TCI - Network Services Retainer Agreement Q&A

TCI Systems, Inc.

Network Services Retainer Agreement

Questions & Answers

What is the purpose of the Retainer Agreement?

The Retainer Agreement basically entitles a customer to discounted rates and priority response over non-retainer customers and to the "benefits" listed on the TCI_Info web page.

To get really technical, we have long undervalued our services and we have been reluctant to adjust rates on a customer-by-customer basis. The retainer formalizes most of our current business relationships and serves to offset the overhead that is required to support customers, but which is difficult to quantify to each customer.

For example, when we discover an issue - we then try to determine if the issue will impact any of our existing customers. We hope to begin to add this information to a "private" website and to proactively notify "retainer" customers by e-mail.

Why the change in the way TCI Systems, Inc. does business?

In the past, part of the margin that we made on the sale of equipment and software subsidized our technical support function. Well, the "products" part of the business has changed so radically that the resources are just not available to support other departments. The lack of these resources has truly exacerbated everything and has made it almost impossible for us to recruit additional staff and remain profitable.

Basically, we are now looking at things on more of a "cost center" basis. And every cost center must stand on its own from a profitability point of view.

Does this mean that my costs will continue to rise?

Each year, about 45 days before the "automatic renewal" of the Agreement, we will determine whether rates need to be adjusted and provide each customer with updated "schedules" to the Agreement.

A lot of agonizing thought and effort has gone into this process. We have attempted to be fair with every one of our customers as every customer is an important customer.

I have additional questions. What should I do?

E-Mail your questions to tom@tcisystems.com and you will receive an answer within two days. If appropriate, your question will be added to this web page.

Return to the TCI Info page.