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For B2C Marketing Professionals

Service Bundling Isn't The Holy Grail For Telcos

European Telcos Need to Look Beyond Bundling To New Revenue-Generating Services

April 19, 2007


  • By Lars Godell
  • with Thomas Mendel, Ph.D.,
  • Daniel Krauss

Why Read This Report

Contrary to industry hype, most Western European consumers still buy Internet access separately from other services like fixed voice/VoIP, TV, or mobile. Our Consumer Technographics data also shows that very few Europeans get either triple or quadruple play delivered in one integrated package. Forrester isn't very surprised by the low adoption numbers, as these service bundle markets are fairly immature and we don't think most consumers will rush to buy them. An equally worrying sign for the heavy defensive betting on service bundles is that the impact on telco profitability is often forgotten. To make consumers interested in bundles, they need discounts, which hurt profitability. Expensive device subsidies and high subscriber acquisition costs will also be needed in the increasingly competitive consumer markets around Europe. The only sustainable strategy in the medium to long term is to bet on innovation and new revenue-generating services, partnerships with new types of players, innovation around voice, and heavy focus on customer service and experience-based design.

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Table of Contents

  • Most Europeans Still Buy Internet Access Separately From Other Services
  • Service Bundling Is Not The Holy Grail For European Telcos
  • Telcos Need To Look Beyond Service Bundling And Focus On New Services

  • Service Bundling Is The Easy Part — Real Transformation Lies Ahead
  • Related Research Documents