Since its founding in 2001, MailGuard has been proud to provide a premium service with a focus on customer support and exceptional spam filtering. Andrew Froehitch comments on the flawed ideology that as competition rises, pricing becomes the number one concern for businesses - a trait which MailGuard has vehemently avoided. He explains that this concept can lead to a 'race to the bottom' which will hurt the quality of cloud-based services.
Whenever competition heats up in certain markets, an interesting phenomenon can occur that’s often referred to as a “race to the bottom.” I fear that the race to the bottom is currently infecting the cloud computing market.
A race to the bottom happens when companies compete with one another solely based on price. Customers end up going with the vendor that ultimately is the cheapest. While this tactic can work for a while, ultimately it alienates customers who would rather choose to pay a bit more for better quality and service.
“They don’t make them like they used to.” How often has this remark been repeated often over the past few decades?
Price competition has created a race to the bottom that has given us inferior automobiles, clothing and appliances, amongst other goods and services. Forget about the fact that your dishwasher will die and you’ll have to buy a new one every few years. Consumers are focused on the price of goods today, not thinking about replacement costs in the future.
The same can be said for many service industries. Gas stations are a great example. Are you old enough to remember when gas stations used to have attendants who filled your tank for few cents extra at full-service stations? These attendants ultimately became viewed by station owners as unnecessary overhead. To cut costs, gas station attendants were eliminated in nearly every U.S. state, except where required by law. These jobs became extinct because customers were shopping around for the lowest price — regardless of whether or not they had to pump the gas themselves. Most of us are fine with pumping our own gas, in spite of the vast elimination of jobs as a result of this trend.
