Amstrad slashes em@iler prices

Mass market play

Amstrad today reduced the list price for the e-m@iler plus to £29.99, down from £49.99.

It says the price cut is intended to take its phone-cum-emailer to mass market status (it was after all, always a mass market, or rather downmarket, play). The price cuts were made possible through lower manufacturing costs and better service revenue potential, it says. In other words, the company is subsidising the hardware to gain a platform for recurring revenues - mostly email and surfing, but also embedded advertising, ringtones and the like.

In a statement, Simon Sugar, commercial director, said: "The revenue per phone has held up well and we continue to add new revenue earning services to the phone. However, increasing the installed base remains a key objective in order to enhance the future long term profitability of the e-m@iler business."

Amstrad launched the em@iler four-ish years ago to much derision. Critics slammed the price of the hardware and the cost of sending and receiving emails. Since, then slowly but surely, Amstrad has clawed a niche market for the product, introducing price cuts and a hardware upgrade.

As of December 31, 2002, the installed base was approximately 201,000 units, generating £13,000 per day in revenues. Post-Christmas last year, Amstrad halved retail prices to £49.99, so one would expect a bigger customer base by now. In its end of year statement published last September, Amstrad said daily revenues had grown to £18,000 a day in June 2003, approximating to an annual take of £6.6m, but it did not release new subscriber numbers.

So the figures are going the right way, even if they still look somewhat puny for a company of Amstrad's ambition. reg;

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