Mobile explores whether the rise of bundled services will be beneficial to the mobile industry
Kezia Joseph says….YES
Bundling services is not a new idea and it’s one that several companies in the UK have already implemented.
TalkTalk recently announced that the demand for quad-play services has fuelled its customer growth, while BT have bundled their consumer mobile proposition with TV and broadband.
The best example of the benefits of multiplay services can be seen in Europe, where France, Spain and Germany are amongst the highly competitive multiplay markets.
Operators in these markets have used a multiplay offering to boost market share and data usage, as well as reduce churn rates.
Offering a number of different services can only be a good thing. Multiplay services enable various revenue streams to enter the industry, which can see the mobile space open up to new areas and ultimately strengthen the competitive proposition of the market.
Many companies are now moving towards offering TV and broadband, with many in the industry clearly seeing the benefit of bundling these services together.
Providing more services means creating more platforms with which to gain and connect to customers. Advancements and investments in the Internet of Things will quickly see the connected home arrive at our doorsteps, and it’s likely that it will be as a multiplay package.
Those who adapt and provide these different platforms will be well placed as the market continues in this trajectory.
Zak Garner-Purkis says…..NO
It usually costs a fair bit of money to steal a customer from a rival; whether it’s the marketing, staff efforts or freebies getting someone to change sides doesn’t come cheap.
When market penetration is high and prices are low, this task becomes harder yet. Add into the equation that you’re entering a new sector and your challenges multiply. This is the struggle facing all companies attempting to sell bundled services.
O2 CEO Ronan Dunne often points out that the markets where quadplay, the most common form of a bundled service, has proved successful is in markets where one or more of the services on offer (TV, broadband, fixed and mobile) have either lacked penetration or competition on price.
Dunne has a vested interest in saying as much but it’s hard to argue against the evidence. Multiplay has failed in many other markets in the UK, from supermarkets to banks the list of companies attempting to sell multiple services to the individual consumer is a long one.
Examples of sustained success in this type of strategy are hard to find. In the cases where success has been achieved it’s noticeable that brands have struggled to gain large numbers of customers for more than two products.
It is an expensive distraction for mobile companies and is largely focused on markets which industry firms don’t need to add to their portfolio such as TV and fixed line.