Lamassu has announced it will begin charging monthly subscription fees to pay for tech support and software upgrades.
While the service is not mandatory, Lamassu said that it will no longer offer free support to customers after the start date.
The actual fees required depend on the number of machines owned by an operator. For those who own between one and four machines, the monthly cost will be $100 per unit while charges for those who own between five and nine machines will be $90 per unit. Operators who run more than 10 ATMs will pay $80 per unit.
In interview, Lamassu CEO and co-founder Zach Harvey characterized the existing support framework as unsustainable, indicating that such a move has been in the works for some time.
Harvey told CoinDesk:
“Up until this point, we were just giving out support for free, and it’s something that’s just not sustainable. We can’t give full support for free, and it was something that was never included in the price of the machine.”
Harvey stressed that the company did not want to pursue an approach by which a percentage of transaction fees or profits would be taken out for support. According to the company, operators will still be able to access the Lamassu support desk for information, and that existing warranties will remain in place.
The move follows an operational shift at the company, during which time Lamassu reduced the size of its team and cut travel and conference expenses. The changes, according to Harvey, took place last year and were necessary in order to eliminate what had become consistent cash flow problems.
Shift to paid support model
An email sent to operators outlined the parameters of the support subscription plan, stating that a formal service level agreement will be put in place when the service goes live in June.
Harvey explained that operators will have the option to pay the fees in bitcoin, but said that the Lamassu team is still developing how that will work operationally.
He told CoinDesk that Lamassu had been looking to begin charging for technical support for some time, but held off as the ATM software was being developed and improved upon. The company, he said, was also establishing how much its support services would cost it in the long-term.
“It was just a matter of when we thought we could implement it, and we’re at the point now where we have a pretty good idea of what the support entails, and a good idea of what it will cost,” he said.
Harvey suggested that operator sentiment toward the support fee structure was divided, with larger-scale operators generally in favor of the change while less business-focused operators are “not as happy about it”.
“It’s kind of what we expected,” Harvey said of the response.
He added that resources will still be available for operators that opt out of the support subscription.
However, he stated that “there’s no way we can offer free lifetime support for everyone” owing to the long-term costs, adding that he does not believe Lamassu had previously committed to doing so.
Tightening the belt
According to Harvey, Lamassu previously moved to reduce its internal headcount last year, which included firing several freelancers that were working for the company.
When asked why the company decided to consolidate, Harvey said that the company was seeing month-over-month losses, explaining:
“We were spending more money than was coming in. Which is fine for a short period of time, but when it happened for four-to-five months we had to pull back before it ate up our prior profits.”
Since then, he explained, the company has seen improving financials as of the last quarter of 2014.
“We all work harder now, but we’re also a healthier business,” he added.
Pete Rizzo contributed reporting.
Image via Lamassu