TenTel says it will offer a unique “move-in, turn-on” service with no enforced tie-ins or hidden extras, aimed principally at customers in rented accommodation.
It aims to work in partnership with landlords and letting agents, offering them a commission for each line of data they supply and for each of their tenants who signs-up, with deals that could increase their profitability by up to 40%, according to Tentel.
The Selkirk-based company boasts the most competitive prices in the market with only a 30-day notice period for customers who want to cancel their service or switch providers.
For those who want to sign-up to a longer term deal, The Advance bundle will give them 12 months telephone and broadband for as little as £250. According to data published by Ofcom, the average household in the UK pays £451.44p a year for those services.
TenTel anticipates signing 20,000 customers in its first year of trading, generating a turnover of £9million, rising to 100,000 customers within five years. It will, initially, employ 18 people at its Borders HQ.
The same business model has worked successfully in the energy market, with landlords agreeing similar deals with suppliers of gas and electricity, and TenTel is confident it can be replicated in the telecoms market.
Letting agents that manage 1,000 properties would generate commission of £25,000-a-year, significantly increasing yields, according to the company.
“This would be the equivalent to them managing an extra 250 properties without incurring any additional workload or expense,” says Robert McKechnie, the company’s managing director.
“This approach has worked successfully in the energy market, where the onus is on customers to opt-out, whereas ours is an opt-in model which assumes nothing and gives customers the choice to switch.
He added: “This is a brand new approach in the telecoms market that offers customers a less expensive and more convenient service, while also providing a new income stream for landlords.
“Because we don’t spend large sums on marketing campaigns or sales commissions to switching sites, we can pass on those savings in the form of cheaper deals to our customers and commission to our partners. It’s a win-win.”
According to Tentel, there are 9million tenants in rented accommodation in the UK, 67% of whom will move within 12 months, giving the company a potential market of 6million people per year.
Four out of five customers expect to be connected within five days of ordering telephone and broadband but the minimum wait from the ‘Big Four’ providers (BT, Sky, Virgin and Talk Talk) is 15 days, according to their terms and conditions.
“It’s a business opportunity that is currently being missed and we can help landlords and letting agents take advantage of it by partnering with us. They can find out how much additional revenue they could be generating by using the calculator on our website,” says McKechnie.