Aerohive, a leading enterprise-class WLAN vendor, announced changes to its product and services pricing that is intended to get its foot in the door of more customers. Here is what it has done:
- Announced a new WLAN Access Point, the AP122, an 802.11ac device, for $229. This includes a cloud-management service for no cost. The version of cloud management, called “Connect” that comes with this product has fewer features than its current cloud-manged service, which will be called “Select.” The AP122 will still have BLE Beacon and USB support, making it suitable for both retail and hospitality vertical markets.
- Announced it is changing pricing across its total product portfolio, with the approximate net effect being a lower customer price for hardware plus its services of about 1/4 off the prices just a week ago.
- Changed pricing of its exiting AP130 to $299, which, like the AP122, includes “Connect” cloud-managed service. the previous price of the AP130 was $599.
Taken as a whole, it appears that Aerohive has seen that there has been stronger growth with more aggressively priced products from competitors, such as Ubiquiti Networks, and the company wants a piece of this faster growth.
In our interview with management about the new product (AP122) and new service (Connect) announcement, we learned that the company expects many of its prospective customers will opt to chose the “Select” service level over time because there are more features than those available from Connect. Additionally, we learned that the company will be charging somewhat more for its services and software and somewhat less for its hardware, taken as a measure across its entire product line. We see this change as being consistent with its price-aggressiveness it just announced for its low end” of its product line, namely the AP122 and AP 130.
We expect that Aerohive’s pricing moves will have an impact on the industry. Certainly, other well-featured products with aggressive price points have done well in the marketplace in recent years.