Vendor locking

I worked 11 years for a dealer who stressed that if his manufacturer’s unique trunking protocol were sold, it would essentially lock out other vendors from future purchases. What a great marketing idea, right?

Sell a unique protocol upfront (but don’t tell the customer) and throw future equipment purchase discounts out the window. At first I agreed because like most young hungry salespeople, I could equate that into more money in my bank account.

But wait a minute, whose best interest was I thinking of, myself or the customer? Was that my conscience talking to me? Since when did my conscience interfere with my sales philosophy? Well, since about three years ago when my own city installed a state-of-the-art unique digital trunking system.

Here in the Midwest, public safety departments are slowly upgrading old VHF repeaters to modern trunked radio systems to maximize frequency spectrum and system flexibility. Unique protocol systems have been popping up in city and countywide applications over the past few years.

Some of these customers are just now figuring out that they are locked into their current and only vendor as they seek out competitive bids. Some public officials are starting to ask, “Why did we purchase a unique radio system anyway?”

I guess if you are the dealer who sold one of these unique protocol systems, then you would say vendor locking is good, but if you are a tax-paying citizen or a smart business owner you might strongly disagree.

Turnabout

In my case, the manufacturer sold the digital trunking system direct and contracted the (other) local manufacturer dealer in our city to maintain the system. The ironic thing is that the philosophy being taught within my own company was being used by our own equipment manufacturer — against us. This unique system equipment could only be sold directly by the manufacturer, in essence cutting their own dealers’ throats.

Not only was this one of the most expensive infrastructure bids, it also cost my city $2,300 per every hand-held and more than $3,000 per every mobile unit sold.

I’m sorry, but no $2,300 or $3,000 unit is going to save my life any better than any top-of-the-line radio from any other manufacturer on a common protocol selling for one-third to half the price. Any properly designed system with quality radios and encryption can perform to the same level and equally provide security to this unique protocol system. What a waste of tax dollars.

What’s even worse is that entire counties are going with unique ESMR 800 MHz where equipment costs are between $2,000 and $3,500, and then they are being charged a monthly fee of upwards of $30 per radio for monthly service. It appears the big selling point of this particular system is that they can communicate with other radios outside of their county on a statewide system.

From talking with people within these communities, my guess would be that less than 5 to 10 percent would actually use this feature on a consistent basis. Most of these people already had cell phones that could be used instead.

Now, does it make sense as a public department to invest in a system that charges for monthly services that 90 to 95 percent will not use?

Both examples still have entities within the city and counties that need to maintain the old VHF equipment and system to communicate with surrounding counties in addition to the 800 MHz radios. In the county ESMR 800 MHz example, smaller volunteer fire departments have a difficult time purchasing actual firefighting apparatus, let alone multiple $3,000 radios.

Business decision

How does it make any sense to commit to one vendor as a government entity when you have no possible back-up and equipment costs are monopolized as long as that system is in place? Would that be a good decision for any business?

Vendor locking is bad. I see absolutely no realistic (worth spending the taxpayer’s money) advantages. I am happy to say I work for a company who believes in taking care of the customer’s best interest, not ours. I have been on both sides of the (dealer’s) fence and prefer the view from this side. What side of the fence are you on?

Kovarik is sales manager at Graybill Electronics, Hiawatha, Iowa.