Phones and TV Are Disappearing

Peter : On Rad's Radar?
Peter
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

Phones and TV Are Disappearing

During a CEO Exchange at the FISPA Live event last week, the discussion among the CEOs turned to TV service. Many in the room were primarily residential ISPs or CLECs, all of whom offered Internet. The discussion was about the cord-cutting's effect on the TV model.

As I have explained before, cablecos have it the best - they went from TV service, which is the least profitable to Internet and voice, which are the most profitable services to offer consumers. Meanwhile, telcos went from the most profitable - Internet and voice - to the least profitable, TV. And they had a serious investment to make to provide TV. (Head-ends don't come cheap.)

Data from the cablecos suggest that people are cutting the cord to TV for alternatives like Netflix, Hulu and Amazon Prime. HBO, CBS and others are now offering their own content over the top (OTT) for a fee. AT&T is bundling HBO with Amazon Prime and U-Verse. Frontier offers a Tivo that records streaming video. (Why?)

All suggestion is that service providers need to focus on delivering Gigabit broadband. That is what people want.

"The latest data from the Centers for Disease Control paints the picture of a growing mobile first society in the U.S., with nearly half (45.4%) of U.S. households wireless only," reports Channel Vision magazine.

That is lost revenue (ARPU) as well as a chance to be sticky. That is the key component of a bundle - Be Sticky. Now what do ISPs do?

One is to re-package voice that includes voice with mobile tie-in.

Wi-Fi is expected to carry up to 60% of Mobile Data by 2019, according to the CV article. Including wi-fi, femcell or other tie-ins could make for an attractive bundle.

We see AT&T and cablecos offering home security and automation services as the new triple of quad play. That is outside the normal telco service delivery platform, but that is where service providers need to head.

I would start by surveying your current customers to find out how they are using TV, voice services and other data that could help you profile them better for designing a better bundle.

It will be all about the Giga-pipe. Over-subscription, uptime, security, privacy and routes that directly connect with Google/YouTube, Amazon, Netflix, Hulu, etc. The Internet will be the foundation on which customers will or will not buy your service. That said, work on word-of-mouth, referrals and even reviews.

EXTRA

"Consider the alternative, which is choosing to turn the question upside down, to do it backwards, sideways, or in a significantly more generous or risky way." [Seth]



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