24 January, 2006

The pitfalls of triple play

For several years now "triple play" has been heralded as a goal to be achieved by the telecoms companies.
The term "triple play" has different meanings for different players.
In France it is generally used to signify a combination of broadband Internet, digital TV and fixed telephony. The cable operators had clamoured for years to be allowed to provide a telephony service as the only way they would be able to make a living and continue in existence. Now that they have both the technical and the regulatory ability to do so, it has come too late. There has been a (long expected) complete shake-out of the French cable industry, and the arrival of VOIP telephony has eroded the telephone tariffs.
In the UK, where IPTV is a little slower in coming, I have seen the term "triple play" refer sometimes to a combination of broadband/telephony/wireless (note that Wireless means Wi-Fi access to the Internet and is not the 40s-50s ternm for broadcast radio), and sometimes refer to a combination of broadband/fixed telephony/mobile telephony. I suppose when IPTV becomes more widespread in the UK we will start to see operators talk of "quadruple play".
The advantage of triple play for the telcos is to enable synergy in the activities. They are able to put together attractively priced bundles.
The benefit for the consumer is hence lower prices.

Now, as subscribers to the French ISP "Free" ((Iliad group) are begining to find out, there is also a downside. At the beginning of this month, Free introduced a policy of charging for calls to some of the other telcos. The problem is compounded by the fact that the user does not always know in advance which network is used by the person he is calling, particularly if the number has been "ported".
Whatismore, Free charges more than France Telecom does for calling the same numbers. Too bad for those subscribers who opted for full unbundling (degroupage totale) - they have no option but to use Free to call these nunmbers.

Triple play ties the subscriber into one supplier. All eggs in the same basket. There is frequently a heavy financial or administrative penalty for cancelling.

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