In brief
A yearly subscription with a "free SMS" bundle, or a perpetual licence with pay-as-you-go SMS? One year's price misleads. Here is how to work out the five-year total.
Stretch the question over five years
When you collect guest Wi-Fi quotes you meet two models. The first is a yearly subscription, usually with a "free SMS" bundle inside. The second is a perpetual licence, with SMS paid as you use it. Deciding on the first year's price is misleading. This device will run in your business for at least five years, so the cost has to be spread over five years too.
This article gives no other vendor's prices. It gives a method. You drop the quote in front of you into the formula and get your own number.
The purchase side: our figures
Box + Software: 45,000 TL + VAT. Perpetual licence, 250 concurrent users. There is no licence fee that must be renewed each year. If you would rather run the same software on your own virtualisation platform, there is the Virtual Appliance.
SMS goes one of two ways:
- Credit packs: 1,000, 2,000 and 10,000 messages. When credit runs low the box warns you in the panel and raises an alarm below 100.
- Your own provider account: The box sends SMS straight to the provider. If you already have an SMS account, you keep using it.
The five-year total is built like this:
Purchase (5 years) = 45,000 TL + 5 × (yearly SMS count × SMS unit price) + one-off items
One-off items: installation, a site survey if needed, extra hardware such as APs or switches. These exist in both models, so they do not tilt the comparison, but do not forget them.
In this model the only line that changes from year to year is SMS. More guests, more SMS cost; fewer guests, less. The licence is paid once and never comes up again.
The subscription side: two different things
Our SaaS model: A monthly or yearly subscription; no device on site, your existing router or AP controller redirects guests to the portal in the cloud. There is no login quota and no per-user fee; it keeps no Law 5651 records, so for legal records you need the Box or the Virtual Appliance. You will find the current price on the SaaS page; we leave the number out here because the method does not depend on it.
Generic subscription offers: For any "yearly plan, SMS included" offer, pin down three things:
- How many SMS does the bundle include?
- What is the overage price when the bundle runs out?
- Do unused messages roll over, or expire at year end?
There is no "free" SMS; its cost sits inside the bundle. That is not a bad thing, but the sum has to treat it that way.
The formula: define the variables
| Variable | Meaning |
|---|---|
| A | Yearly subscription fee |
| K | Yearly SMS included in the bundle |
| P | SMS unit price beyond the bundle |
| S | Your yearly SMS need (count) |
| s | SMS unit price in the pay-as-you-go model |
Subscription (5 years) = 5 × [ A + max(0, S − K) × P ]
Purchase (5 years) = 45,000 TL + 5 × S × s
Write the two lines side by side. The difference is the financial part of your decision. If you expect yearly price increases, write A separately for each year; a perpetual licence has no such line.
How do you estimate S?
SMS demand comes from the number of new guests per day. With device memory on, a returning guest does not receive a new code within the memory window. You set it short in a café, for the length of the stay in a hotel, for the term in a dormitory. MAC randomisation on phones can shorten that window, so leave a small margin.
Example scenario (assumption): a café sends codes to 40 new guests a day on average.
40 × 365 ≈ 14,600 SMS / year
Under pay-as-you-go that is close to one 10,000 pack and two 2,000 packs a year. Under a subscription, if K is below that figure, the overage price enters the sum.
Voucher and e-mail logins consume no SMS. In accommodation, issuing a voucher valid for the length of the stay cuts the SMS count noticeably. It is the simplest way to shrink S. At events and trade fairs, bulk-generated printed vouchers bring SMS close to zero and are practical for foreign attendees too.
Differences the spreadsheet does not show
- What happens when the subscription ends? With a perpetual licence the software keeps running. For a subscription, read the contract on what happens to the portal and to access to the log archive.
- Where are the records? In all three of our products the Law 5651 records stay on the box, in your business; they do not go to a cloud or to us. Ask this explicitly about other offers.
- Capital or operating expense? A purchase is a one-off investment; a subscription is a monthly expense. Talk to your accountant about which suits you.
- Scale: For a single site, purchase is simple. For many sites or a changing number of locations, a subscription can give flexibility.
Which one fits you?
Purchase stands out when the business will stay in the same place for a long time, a one-off budget exists, and SMS volume is high enough that packs bring the unit cost down.
Subscription stands out when cash flow is planned monthly, the business is seasonal or has a fixed term, or you want to try a few months first.
Both models start with a 7-day trial. Whichever you pick, spread the sum over five years and keep SMS on its own line. If you would like to run the numbers together, contact us.