The issue is you can't use the "I'll give you a deeper discount for a 3 year contract" line anymore.
It'll potentially create a situation where customers in the US pay a lot less because they still have that incentive.
It'll potentially create a situation where customers in the US pay a lot less because they still have that incentive.
I don't see why not. You can still offer a low price right? You can still promise it won't go up for 3 years. But the customer can now cancel at any time.
I'm sorry to the investors but I'll still prioritize users experience in the saas lifecycle.
Also there is prepayment in a lot of commitment. When you commit on the cloud such contract your PREPAY compute unit and this is not new.
I think that's how it's generally been. I don't see how this changes things.
What's customary is forfeiting any discount, then a partial refund with eventual early termination processing fees.
So if you had an annual subscription with a 10% discount which you stop after 3 months, your refund would be what you have paid minus three months at full price plus a token processing fee. It's a very common setup for mobile phone and internet subscriptions here. You generally end up paying roughly the equivalent of one additional month when you cancel which competing providers often actually refund when you switch.
An alternative would be to ask the customer to pay in advance for 3 years. This way both the customer and the producer have an incentive to keep this deal going (if the producer reneges on the deal the consumer can take the producer to court. My reading implies only the consumer can walk away with 2 months notice). But in the world of 6% interest rates who would want to front that much money?