Revenue from so-called quad-play bundles in the UK are set to triple from 2015 to 2020 according to a report from Strategy Analytics, while revenue from all types of multi-play bundles will increase by 34 per cent over the same period.
The report said that quad-play revenue would therefore account for 31 per cent of total multi-play revenue by 2020. Furthermore, quad play would also account for more than 21 per cent of bundled subscriptions in the UK by that point.
Quad-play refers to the practice of bundling together mobile services with home broadband, home TV and fixed voice services and selling them as single packages to subscribers. Multi-service bundles such as these can range from highly integrated plans as seen with Movistar Fusion in Spain through to looser arrangements such as KPN Complete in the Netherlands, with some operators focusing more on discounts rather than full fixed and mobile convergence.
The UK service provider market has been slower to take advantage of such offerings for largely historical reasons; for many years it did not have an incumbent fixed and mobile operator once BT exited the mobile market, for example.
That situation has now changed: BT has bought EE and also sells mobile services via its MVNO BT Mobile; Vodafone UK has launched fixed broadband services; and companies such as Sky, TalkTalk and Virgin Media are also all competing in this market.
Jason Blackwell, director at Strategy Analytics, noted that multi-play bundled services are rapidly gaining ground in the UK as more players have entered this space through expansion and acquisition.
“BT’s acquisition of EE has positioned the company very well, enabling cross-selling of services and giving BT a strong network with fibre and 4G. Based on its strategies in the Netherlands and New Zealand, Vodafone may need to revisit the opportunities for partnerships in the UK,” Blackwell commented.
In terms of pricing, Blackwell added that competition in the UK market is already intense.
“The successful operators will avoid a race to the bottom, and hold overall pricing by upselling customers to faster broadband speeds, premium TV channels and larger mobile broadband buckets,” he said.
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To bundle or not to bundle mobile, that is the question