Internode managing director Simon Hackett has published a lengthy apology to the ISP’s customers for a pricing plan migration “stuffup” that had seen the company inadvertently alienate some of its oldest and most loyal customers.
In mid-July, Internode had revamped its monthly plan structure, with the aim of unifying its disparate product offerings under one simplified structure. At the time, the new plans caused a stir amongst some customers, because it turned out that some were better off on their existing deal. Internode however, claimed the high wholesale prices placed on the company by the likes of Telstra meant pricing had to be adjusted in order to allow the company to remain “financially sustainable.”
Compounding the problem, Internode subsequently confirmed a number of existing out-of-contract customers would have to be moved onto its newer plans because of the so-called wholesale “price squeeze”.
But in a post on Whirlpool published yesterday, Hackett acknowledged that some customers had been notified about these compulsory plan migrations, but revealed his company had inadvertently targeted the wrong customers.
Internode had intended to implement the forced plan migrations in a way that was “incremental”, he said, not in a “big bang” way. In addition, the ISP had intended to exclude customers who had been buying services from it for a long time (for example, longer than five years) from the migration process initially, in order to reward their loyalty.
However, Internode’s actual implementation of the plan went awry. The net effect of what Hackett described as a “stuffup” was that its algorithm for selecting customers “selected that first batch of un-lucky people in the perfectly worst possible way – starting with our oldest applicable out-of-contract customer and working along from there “.
“So we didn’t just fail to be random about it – we’ve hit on exactly our longest term customers first,” added Hackett. “Oops. That explains why the people here on Whirlpool who have been with us the longest all seemed to be disproportionately singled out. That’s because they were. Not intentionally, but that’s what happened.”
“It is a stuffup and its my fault,” said Hackett. “I’m really sorry about it.”
As an immediate first step, Internode is planning to withdraw all of the price change notices which it issued last week, and will be changing its processes so that it rewards its oldest customers in future by leaving them until last in future changes. In addition the customers who received Internode’s first batch of notifications last week will “never” see a price rise as part of the current changes, and may receive a further offer as a goodwill exercise.
Hackett also reiterated that Internode would never have targeted its oldest customers intentionally. “It’s certainly not been intentional – nobody would intentionally target their longest term customers to get it in the neck first,” he wrote. “Gah.”
In general, customers reacted very positively to Hackett’s disclosure, although some had already confirmed plans to migrate to another ISP. “This is what I love about Internode – honesty. Thanks for the post Simon. Sure, not everyone’s going to be happy but at least you’ve done your bit to explain why,” wrote one.
Image credit: Internode