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January 16, 2018
Cradlepoint, the 4G LTE network solutions provider, has launched a pricing model designed to help partners move to recurring revenue.
The Boise, Idaho-based company on Tuesday announced a subscription-based pricing model and a wireless branch offering. Both are part of Cradlepoint’s “elastic edge” strategy, which aims to move away from a hardware-first mindset to giving customers benefits traditionally associated with software as a service (SaaS). Todd Krautkremer, chief marketing officer, says the elastic edge is “the confluence of LTE and wireless WAN with software-defined and cloud managed infrastructure.”
The subscriptions are tailored for branch, mobile or IoT, come in “essentials” and “advanced” packages, and can last one, three or five years.
Cradlepoint’s Todd Krautkremer
Krautkremer says the subscription model is a major shift for Cradlepoint from being a “classical hardware manufacturer.”
“We now say, ‘Look, we don’t care what our margins are on our hardware. As long as over a long [sic] period of time the total solution we’re selling to our customers delivers compelling margins for our business, we’re good with it,” he told Channel Partners. “And what that’s freed us up to do now is price our products across all the markets we compete in much more aggressively. And that means we’re really cutting off the opening we’ve left for some of these low-end competitors [whose] only value proposition is, ‘We have cheaper hardware.'”
The NetCloud Solution Package features a new “edge” router, access point and console for branch management. Cradlepoint says the AP22 access points and AER2200 router give smaller organizations flexibility and reliability.
“NetCloud Solution Packages simplify how customers buy, deploy, manage and support an entire branch site network,” said Ian Pennell, Cradlepoint’s chief product officer. “Instead of navigating a myriad of separately priced software, hardware and support options, just two or three SKUs deliver a complete wireless branch solution with the cloud management and support customers need to be deployed and operational quickly and easily.”
Krautkremer says the company works with more than 1,500 channel partners, including carriers, MSPs and resellers. He says they are a getting a more simplified way to order and manage products for the clients, in addition to a new way to make money.
“We’re giving them a way that they can grow their recurring revenue more quickly — which we know every partner is concerned about. [It’s] moving from hardware break/fix type of revenue to …
… more software recurring revenue streams,” he said.
Tony Puopolo, vice president of North America channels for Cradlepoint, spoke to our own Lorna Garey last year about the role partners play in the company’s strategy.
Cradlepoint is known for providing 4G LTE solutions that can serve as LTE failover for carriers, primary connectivity, in-vehicle networks and the backbone for M2M/IoT. The company also is making a play in SD-WAN, which Krautkremer says combines wired and wireless wide-area network infrastructure into hybrid WAN connections.
“And increasingly LTE is part of that mix. And what we happen to believe is, if we fast forward over the next couple of years, LTE will become a dominant part of that mix — because of the introduction of gigabit-LTE services, the dramatic cost in delivering these monthly services, and 5G itself. So we think we’re at the turning point in the shift toward wireless WAN. And in much the same way, over the last five years we’ve seen a turning point in building networks in the wireless LAN world, where now nobody asks for an Ethernet connection,” Krautkremer said.
Cradlepoint collected $89 million in new funding early in 2017 and announced plans to enhance its offerings in software-defined networking, IoT, and 4G and 5G connectivity.
Read more about:Agents
Senior News Editor, Channel Futures
James Anderson is a news editor for Channel Futures. He interned with Informa while working toward his degree in journalism from Arizona State University, then joined the company after graduating. He writes about SD-WAN, telecom and cablecos, technology services distributors and carriers. He has served as a moderator for multiple panels at Channel Partners events.
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