Telecom Expense Management Blog

When negotiating a telecom contract, you should consider including a technology refresh clause. Technology refresh clauses address the risk that the lower-priced future technology could replace the existing higher-priced technology you currently use during the term of the term of the contract. You should negotiate a commitment from your supplier to upgrade you to future technology at no charge and reduce your minimum annual revenue commitment to reflect lower prices.

You should avoid giving your suppliers the right to migrate your services to a different technology at their discretion. As an example, in the recent past, many carriers attempted to commit customers to migrating from their existing Frame Relay networks to MPLS networks. You want to reserve the right to reject technology changes that create possible compatibility issues or impose significant additional costs.

In my next post on the topic of telecom expense management and negotiating a great telecom contract, I will write about including a technology refresh clause in your contract.