Cablevision's Bundle Is Working

from the make-it-cheap-enough... dept

While Cablevision’s attempt at satellite TV never fully made any sense and is now in the process of going away, some other recent decisions seem to be paying off. Last June we were surprised, but impressed, that Cablevision had basically decided to give away VoIP for free in a bundle with cable TV and broadband. While, technically, they were offering all three services at $30/service (total bundle: $90/month), if you just got TV and broadband, the total was still $90/month. While many disagreed, we felt that this made a ton of sense. The cable companies are fighting the telcos when it comes to triple play offerings, and they have an advantage in that they already can offer voice, video and data today — while the telcos still can’t reasonably offer a truly integrated video package (yet…). The thing that makes the most sense, then, for the cable companies is to beat up on the telcos on their home turf. The Baby Bells still look at voice calls as their cash cow and have been slow to adopt VoIP for the most part. So, by attacking them where the telcos think they’re strongest, and where they’ve refused to make any real advancements, the cable companies have the best chance to have an impact right now. While some analysts thought Cablevision should go down the old route of squeezing every penny out of users for new services, Cablevision actually realized that this isn’t about how many pennies you can squeeze now, but it really is a marketshare war for bundled customers (who are much less likely to leave). The strategy is working. Broadband Reports points us to an article saying that Cablevision is thrilled with the success of the program, allowing them to add new bundled customers at a much greater rate than the rest of the industry while also decreasing their churn rate noticeably. Expect other cable providers to begin to wake up to this, just as they start embracing mobile phone service as well — and expect the telcos to push their fiber deployment efforts up a notch in certain areas to get some sort of integrated video on the market as fast as possible.

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