By targeting smaller ISPs and keeping its own operations small and customer-focused, Flexpop works to distance itself from the stereotypical image of the large and inaccessible wholesale dialup provider.

by Jeff Goldman [September 18, 2002]

Flexpop was founded in October 2000 by Jim Dawson and Mike Grady, both veterans of the small Internet service provider arena since the early 1990's. According to Dawson, now the company's President and Chief Executive Officer, the essential idea was to offer wholesale dialup service at a reasonable price. "We were seeing a lot of these mom-and-pop operations around the country struggling to make ends meet," he said.

Value added services can only take a small ISP so far, Dawson explains, and affordable pricing is crucial for smaller companies. "People think that there's a huge amount of margin in this business, but there's not," he said. "You've got to shave the pennies where you can, and when these smaller operations are competing with the EarthLinks of the world, it's very difficult to do so."

Flexpop, Inc. 618 NW Glisan St. Suite 101 Portland, OR 97209 Voice: (877) 562-5128

Significantly, just as the company was launching services two years ago, a number of free ISPs closed shop, taking some wholesale dialup providers with them. An article in ISP-Planet at the time quoted Grady as saying, "No free ISPs need apply," and Dawson says the resulting publicity boosted Flexpop enormously during its initial launch.

"One of the things we had decided early on was that we weren't going to be working with free ISPs," Dawson said. "If our customers don't have an income stream, how are we supposed to have an income stream? That generated a lot of interest, so we got off to a fairly decent start in terms of industry awareness as to who we were. That was a very good thing."

Dawson acknowledges, however, that the ride hasn't always been smooth. Some network arrangements, he says, have caused problems in the past—and last spring, Grady left the company and moved on. "We made a lot of missteps along the way," Dawson said. "We got involved with a couple of networks that turned out not to work for us at all, and we've made some changes to the business model."

Fewer headaches
Flexpop's nationwide coverage employs a number of different agreements with some national, carrier-class networks and smaller, regional networks, including ICG, Level 3, 01, Universal Telecom, and Imbris. "One of our strengths is the fact that we've got several networks, so in the heavily populated areas of the country, we've got pretty good depth," Dawson said.

Dawson says Imbris is a good example of the ideal Flexpop partner. "They're not a huge conglomerate, but they've got a bunch of coverage that people have been asking us for, and so we can get into the areas that nobody else has," he said. "We've found it's much easier to work with regional operations, because they're smaller and we can actually talk to people. If things go wrong, they get fixed quickly."

By aggregating a range of networks under a single pricing plan, Dawson suggests, Flexpop saves customers the headache of managing who's logging in to which network. "This way, they have a single flat price to deal with," he said. "They don't have to worry about the additional management and administrative headaches. That was part of our original business plan, and it's still one of our strengths."

Crucially, customers are also guaranteed that there won't be any surprises in their invoices. "Because we only buy ports from the networks, we don't have any 200-hour or 150-hour limits," Dawson said. "That doesn't mean we're unlimited, though. If end users go over 300 hours, then we just charge our customer for that port for the month—as opposed to an hourly fee, which can get pretty horrendous."

An online demo shows the features of Flexpop's Web-based Customer Account Manager. "Customers can make changes: they can add realms or turn them on and off," Dawson said. "If they have a RADIUS server go down at 3am on a Sunday morning and they need a new IP address up, they can do it themselves. They have total control over what's going on."

Pricing starts with a $750 activation fee. Per-user fees vary, depending on whether the customer signs up for an annual contract (Table 1) or on a month-to-month basis (Table 2).

New customers are able to handle most of the setup themselves, thanks to the Customer Account Manager interface: once the contract is signed, everything else can be handled online. "We can get people turned up in as long as it takes for them to fax a signed contract over to us, because of the interface," Dawson said. "From there, they can get set up at their own speed."

Weekend warriors
In the long run, Dawson says, the real focus of the company is on customer service. The fact that Flexpop is small and accessible guarantees that its customers get the attention they need. "These smaller operations want to know that they're dealing with real people," he said. "They can't spend time dealing with issues. If they have a problem, they want it fixed, and that's what we try to do."

Doug Palin is CEO of Pacifier Online, an ISP based in Vancouver, Wash., with approximately 60,000 customers. Of those customers, Palin says, about 1,000 or so use Pacifier's national dialup offering. While nationwide access isn't crucial to Pacifier, Palin does see it as a competitive differentiator for the ISP.

After founding Pacifier in 1987, Palin sold the company to US Net of St. Louis in 2000. In May of this year, he bought it back. At the time of the re-acquisition, Pacifier was using Broadwing for nationwide access, but Palin says he wasn't happy with the company's services. He shopped around, and he was impressed with Flexpop's responsiveness to his requests.

Palin agrees that customer service is Flexpop's greatest asset. After working with Broadwing, he says, it was wonderful to go from "call back Monday morning" to the kind of personalized service that Flexpop provides. In choosing a new provider, he says, that was the real differentiator: the other companies he considered all had relatively similar pricing and coverage.

"They really were ultra-responsive," Palin said. "I emailed Jim on a Friday night—he's like all of us die-hards: he reads his email over the weekend. He emailed me back, and by Saturday afternoon, they had us up. I was surprised to see it happen as fast as it did, and I really do feel that dealing with a smaller company was better."

— End

Online resources:
	Wholesale Dialup Directory
	Wholesale Dialup Quick Reference Chart

Related articles:
	[Nov. 27, 2000]	How to Pick A Wholesale Access Provider
	[Nov. 17, 2000]	ZipLink Closes Door, WorldCom Opens It
	[June 14, 2000]	ISP Profile: Broadwing