: Silicon Insights: The Death of Ricochet

Mike Masnick
Thu, 23 Aug 2001 16:08:28 -0700

I would, did, and would continue to pay for it (I'd even pay more for it,
if it would help).  I started using Ricochet back when they only offered it
at 28k and loved it then.  At 128k (I usually was getting closer to 150k)
it was absolutely worth every penny and more.

Metricom made a ton of mistakes (some of which I told to people there, but
they weren't going to listen to me).

Among the mistakes that they made (in my mind) not discussed in the article:

1.  Wrong target market.  What they had was really a very good competitor
to DSL or cable - with certain benefits.  They had solved the last mile
problem.  In places where you could get ricochet they just send you a
modem, you plugged it in, and you were ready to go.  No installation to
deal with.  The speeds were a little slower (depending on where you were)
but certainly good enough for a lot of people.  I used to use my ricochet
on my desktop machine for fast access as well.  Instead, they thought they
were targeting "mobile professionals".  The mobile part, to me (and to many
other ricochet users I know) was a nice side effect - but not the main
reason we used it.  It was our high speed access - and it was good and
reliable (unlike my two month adventure with DSL which was painful and it
never worked).  Since ricochet died, I'm back to using dialup in my house.
I'm right in the center of the Bay Area and I can't get any high speed
access.  Lovely.

2.  Wrong price.  As such, they should have priced it $20 to $30 lower.  If
they saw it as a competing product to DSL or cable they should have priced
it between $40 and $50 a month.  They finally started doing this in the
month or so before they shut down, and a lot more people subscribed.  I
know a bunch of people who had made it clear they would certainly buy in at
$50/month.  While the amount made per customer might go down - the overall
revenue brought in would increase significantly - and there's no reason to
think with that many more customers they couldn't drive down there costs
and regain the margins anyway.

3.  Horrible marketing.  Did you see their commercials?  They seemed to
think their target market was the James Bond wannabe as opposed to the
every day user who wanted high speed access.

4.  Reseller confusion.  Instead of selling directly (as they did with the
28.8k version) they went with resellers.  The only reseller who actually
cared about offering ricochet was tiny WWC.  No one else promoted it at
all.  Worldcom, who invested a ton of money into Metricom never even
bothered to try to offer it to customers.

5.  Brand confusion.  Metricom?  Ricochet?  WWC?  What am I getting here
and who is it from?

6.  Bad segmentation.  Rather, no segmentation until the very end.  There
was one price, one plan - and most people didn't like it.  It wouldn't have
been hard to charge more for "roaming", or to charge different rates for
different speeds (they did try this, again, when they only had one month of
cash left).

7.  Terrible market research.  To the end they never looked at what people
were using it for.  They still assumed that the mobile part was the main
reason people bought the ricochet.  The mobile part was nice (in the past 8
months alone I used it all over the Bay Area, in Phoenix, in San Diego, and
in LA - I'd be using it in NY when I go there in November, but now it's
dead).  They never realized what their actual customers thought the value
proposition was - and continued to insist it had to be something else.

I'm still waiting for the results of last Thursday's auction.  Apparently
fewer than expected companies showed up, and chances are my two ricochet
modems are paper weights now.  However, I'm still hoping that someone
realizes there's a really useful wireless network out there.

Despite what the article says about people not wanting to sit in their
cars, or coffee shops and boot up (and I did all those things), what they
forget is that people also could use the ricochet while sitting in their
office or sitting in someone else's office or sitting in their home, or
sitting at a hotel, or at an airport.  And it was all included in the
monthly fee.

As for the "instant on" thing, that's a laptop problem - and not a ricochet
problem.  The ricochet was pretty much instant on.  You clicked "connect"
and you were on.  When I travel with my laptop, I usually put it into sleep
mode, so, as far as I was concerned it was pretty much instant on, always
connected for me.

Of all the tech company deaths, Metricom's has hit me the hardest.  There
simply is no subsitute that is anywhere near as useful as it was to me, and
I haven't seen anything that looks like it will be showing up in the near
future either.


At 03:01 PM 8/23/01 -0700, Gregory Alan Bolcer wrote:
>I wouldn't pay for it either. Looked really cool, they just
>needed more operations.  34,000 to 52,000 x $80/month should have been
more than
>enough to keep them floating. That's $2,720,000 to $4,160,000 monsconies.  
>I also agree, instant on is a key factor. 
>Matt Bolcer wrote:
>> Greg, lessons to be learned from Ricochet's failure.
>> Dad
>Gregory Alan Bolcer        |  | work: 949.833.2800
>Chief Technology Officer   |   | cell: 714.928.5476
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