The Unbundling Of Operator Multiplay

METISfiles analyst Pim Bilderbeek presented at the inaugural meeting of imellem this week, a new member-based networking platform for executives in the Dutch IT and Telecom sector. The presentation focused on the unique aspects of the Dutch telecoms market and the challenges that operators face to remain relevant in a rapidly changing regulatory, customer, and infrastructure environment.

One of the biggest challenges for operators is to change their current network bundling strategy into an experience bundling strategy. Multiplay is a bundle of telephony, mobile, TV, and Internet services delivered over one or several access networks. KPN, Ziggo and UPC, the three largest multiplay operators here in the Netherlands, all use multiplay as the weapon of choice to acquire new customers and prevent customer churn. In the business market, the same tactics are being deployed combining cloud, unified communications and collaboration (UCC), and FMC aspects into single converged services.

Today, the consumer experience of the multiplay bundle is a reduced bill and increased service provider lock-in, rather than a bundled or integrated communications and entertainment experience. But this is about to change.

The traditional value chain is rapidly being unbundled. Telephony (e.g. Skype), mobile (e.g. MVNO), TV (e.g. YouTube) and Internet access (e.g. unbundled local loop or unlicensed Wi-Fi) are all available as standalone products or services. And the unbundling continues. Communication and collaboration (e.g. Salesforce Chatter), mobile (e.g. Amazon Kindle Whispernet), TV (we predict a Facebook TV feature here) and Internet access (e.g. Skype Wi-Fi) are all available as a product feature rather than a standalone product. And the unbundling continues.  Already VoIP and videoconferencing are being brought to the browser natively through WebRTC and HTML5. No need to share the same network with an app and a user ID, you just join and connect.

The new consumer platform players – Apple, Amazon, Facebook, Google, Microsoft – are taking advantage of the new value chain through offering experience bundling and roaming, either through a device/OS led strategy or through a social suite.

Linking customers and services through these new platforms is the winning formula for acquiring the digital consumer and preventing churn. The new platforms create digital societies where the platform provider determines how consumers communicate, where they buy, how they pay, what books they read, what music they listen to, and so forth. The strength of this ecosystem is the experience roaming and bundling. This means that – for example – the Apple experience is the same wherever you are. And if you buy a new Apple device, and connect it to the Apple platform, you magically have direct access to all the services you already had. This experience is diametrically opposed to the network roaming, bundling and compartmentalization that characterize the traditional value chain.

Operators are fighting back, however. Examples are the UPC and Ziggo mobile internet MVNOs, the UPC Horizon box, Ziggo TV for iPad, and KPN iTV for iPad for instance. But these initiatives remain focused on bringing Internet, mobile or TV on to other devices rather than deliver an integrated and converged communications and entertainment experience that roams wherever you are.

What is your customer experience roaming strategy? Innovative operators are already partnering with or acquiring OTT vendors or busy creating their own offering.

Are you thinking out of the box and beyond the multiplay bundle? Let us know!

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About Pim Bilderbeek