The future of converged services – will it be triple-play or quad-play that comes out on top?

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Converged services are not new in the telecommunications world. For the last decade many providers have bundled their fixed line telephony and broadband services into one, with great success. In the UK, 46% of households purchase a so called ‘double-play’ package of this kind.  More recently, triple-play packages have entered the market place, combining fixed line telephony, broadband and paid TV. This type of package has also seen early success. France is leading the way in Europe, with 30% of households now opting for triple-play packages.

Quad-play is the latest offering to hit the market place, combining fixed line telephony, broadband, paid TV and mobile services. Over the past 18 months quad-play services have seen a rise, with the likes of Virgin Media in the UK and Deutsche Telekom in Germany to name but a few. But will this next level of convergence take of, or do consumers prefer to keep things separate?

What do customers really want?

With already high uptake rates, it’s clear to see that triple-play has proven its place within the market. As the next logical step, quad-pay packages offer a number of benefits to subscribers:

  • Potential cost savings of buying a fully bundled package
  • Access to new content such as new exclusive TV channels
  • Access to new services such as free internet conferencing

For many, this type of package is ideal, and is seen as just one less bill to handle. However there has been a notable trend of some subscribers moving away from quad-play after only short contract periods. This has been attributed primarily to poor billing clarity, with everything being lumped into one. Some reports have also suggested that younger subscribers prefer a ‘pick and mix’ approach, opting for OTT providers for their TV needs such as Netflix and Amazon Prime, and leaving their mobile contracts as stand-alone.

The added complexities of bundling for CSP’s

Fixed line, broadband and TV contracts are usually purchased on a ‘one per household’ basis, however throwing mobile into the mix adds a new dimension. In the US for example, just under half of households have 5 or more mobile devices in the home. This gives rise to a new challenge with regards to packaging, pricing and management of the total offering, with an infinite number of options on the table.

CSPs need an intelligent system which can segment and monitor subscriber behaviours, enabling them to offer the best suited packages at various touchpoints throughout the customer lifecycle. A level of automation is also needed to make the process actually manageable with the available resources. Specific subscriber trend thresholds should be set which then automate bundle recommendations. For example, probe data can be used to identify two mobile phones which are used daily in the same household. Usage KPI’s can then be automatically analysed and matched to the best ‘multi-play’ package for the household.

Future predictions for converged services

Converged services have had traction, and there is no doubt that they are here to stay. Triple-play has already proven its place, with Ofcom demonstrating that in 2013 the standard price of a triple-play bundle was £32.12 pcm compared to a whopping £56.16 pcm for the standalone equivalent.

However with multiple mobile devices in each household, there are a much wider range of packages and bundles available with quad-play. This variation makes it a little trickier to measure whether subscribers are achieving good value for money compared with stand-alone options.

For quad-play to be a true success, CSPs must ensure, and demonstrate that subscribers are reaping the benefits of a quad-play package. Detailed billing breakdowns are also a must to enable CSP’s to effectively show subscribes the true value of their bundle. If CSPs can do this, then the future looks promising for quad-play.

One final thought, if all TV heads over the internet, and VoIP delivers consistent quality, will we finally reach a point in which fixed line telephony and traditional TV services are made redundant?  And when we reach it, what will be the next big thing?

What are your thoughts about the future of converged services? Let us know in the comments.

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