Clients are willing to abandon fixed-line, converged services grow popular
2007-06-01
KPMG insists that the telecommunications companies should build their offers of converged services on the basis of mobile telephony and, especially, internet access. These two kinds of telecoms services also give clients more satisfaction than fixed-line telephony or pay TV.
According to a survey carried out by KPMG, consumers indicated fixed-line telephony as the kind of telecommunications services that they would give up as their first choice, with as much as 60% of them saying so. By way of comparison, only 6% declared that they would give up having a mobile phone as their first choice. However, half of the subscribers (51%) rule out the possibility of replacing a fixed-line phone at home with a mobile. The main reason for that is the higher cost of using a mobile phone, as compared to that of a fixed-line. Around a third (31%) declare that they would consider fixed-to-mobile substitution.
As for the converged services, over 20% of the respondents said that the most attractive bundle offer would consist of internet access and fixed-line phone or a television service. As much as 16% would choose duo-play consisting of internet access and a mobile phone, an offer that is not present in the Polish market. KPMG emphasised that this might be a market niche that the operators should look into. Few users expressed their interest in duo-play integrating fixed and mobile telephony.
The triple-play offer bundling fixed-line, internet access and TV has been chosen as the most attractive offer. Of those respondents who do not use triple-play, 14% declared that they prefer three services provided together rather than two. There is also a market niche with regard to triple-play, as the second-most attractive choice for the respondents would be integration of fixed-line, mobile and TV. This kind of offer is at the moment not available in Poland.
Around half of the existing users of triple-play offers said that an upgrade from triple-play (fixed-line, internet access and TV) to quadruple-play by adding the mobile phone would be an improvement in comparison with the existing offer.
Those consumers who are interested in triple-play most often pointed at a cable TV operator as the preferred provider of converged services. The CaTV operators are also considered as better prepared to provide quadruple-play than the mobile operators.
Price is the key factor that influences decision on choosing converged offers. The users indicate that the subscription for such offer is sensible only if it permits the reduction of costs of the telecommunications services. The respondents have also noted that service integration offers greater convenience in paying for the services. KPMG emphasised that the consumers are not receiving sufficient information on the advantages offered by converged services, as the respondents did not point at them spontaneously.
According to the survey, clients most often take into account the price when looking for a new telecommunications services provider but they also consider quality and guaranteed permanent access to the service as important. They do not, however, tend to limit the range of services that they are using in order to save money.
Triple-play users say that this kind of offer is satisfactory and this indicator is even higher than that observed for mobile networks. Converged offers are better evaluated by the customers as a whole, as well as the particular services that they consist of. This is particularly visible in the case of fixed-line telephony; triple-play users rated it at 4.2 points (in a five-grade scale), while people signed up for a fixed-line telephone only rated it at just 3.7 points. Therefore, only 4% of triple-play subscribers declared that they wanted to change the operator, while this figure for fixed-line subscribers stood at 15%.
KPMG concluded that the consumer’s bad opinion regarding fixed-line telephony is very important to the incumbent operator and so is the high number of those considering giving it up in favour of a mobile phone. Triple-play, suggest the authors of the survey, should be developed on the basis of the internet access service and wireless devices that permit the set up of a network within the household. Mobile operators should feel the positive impact of being seen as potential ISPs and companies that could offer mobile and fixed telephony combined with the internet access. CaTV operators could profit from the fact that they are considered as “natural” providers of quadruple-play but their position might be threatened by the development of IP TV offers. According to KPMG, companies that want to embark on the telecommunications market should focus on the provision of internet services, as the users are willing to consider new offers and to change the providers.
Mateusz Malicki IT & Telecoms Analyst PMR Publications mateusz.malicki@pmrpublications.com
Methodology note: The KPMG survey canvassed 500 users of fixed-line and mobile telephony, internet access services and pay TV. It was carried out in the form of individual interviews with the respondents.
PMRis a British-American company providing market information, advice and services to international businesses interested in Central and Eastern Europe as well as other emerging markets. PMR key areas of operation include business publications (through PMR Publications), consultancy (through PMR Consulting) and market research (through PMR Research). With over fourteen years of experience, high international standards in projects and publications, highly skilled multilingual staff and a wide network of co-operating research companies and market experts, PMR is one of the largest companies of its type in the region.
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