Sprint, Cable Companies Make It Official

from the creating-the-mecha-telco dept

Cable TV companies have been talking about offering mobile phone service for some time now, the rumors that a deal with Sprint would finally be announced gathered pace over the last couple weeks, finally culminating in the announcement that Sprint, Comcast, Time Warner Cable, Cox Communications and Advance/Newhouse are forming a joint venture to meld the companies’ wired and wireless services. Much of the talk has been about how cable companies want to offer the “quadruple play” — cable TV, internet, voice and mobile phone — and expectations were that they’d just enter an MVNO arrangement with Sprint, and resell its service. While bundling has been a successful strategy for the cable companies, we’ve wondered just how valuable combining everything into one big bill really is. But today’s announcement goes beyond bundling or the quadruple play, and is really about taking the triple play mobile that Mike’s been talking about for more than a year. It’s not just about bundling, it’s about offering users anywhere, anytime access to all their services, whether it’s at home through a cable pipe, or outside it on Sprint’s mobile network. Customers will buy the bundled services from one company and have just a single point of contact, but the JV says it will give users access to all their services — even DVR content — from the mobile device. It’s that kind of integration, not just bundling, that makes things far more exciting than just having everything on a single bill for consumers.

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Comments on “Sprint, Cable Companies Make It Official”

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lar3ry says:

Depend on the mobile to f*** it up

The wireless operators still don’t get it. Offering the same services as the cable companies but charging a premium won’t last. People are going to balk at paying $2.50 for the same song they can get on iTunes for $0.99, just because it’s on their phone.

The real trick is to figure out how to get to the cable companies’ pricing: one price for the service, with a premium for additional “layered” services. That is, one price for all calls local, mobile-to-mobile, and out-of-network… basic service. Then layer additional services, but at single prices:

  • text messaging
  • audio (playback of songs, “radio,” etc.)
  • “Pull” media (auto weather, headlines, RSS-type stuff)
  • video (playback of TV shows, short videos)
  • content sharing (eg, watch HBO or OnDemand content)
  • Internet (web) access

The trick is to figure out the price point where consumers will be willing to purchase the various services, and no more “per unit” charges. Of course, the media companies (RIAA/MPAA) won’t like this model, but they already put up with it with OnDemand type digital cable… why not mobile?

But as I said, the mobile operators aren’t used to this model, and figure they can nickel and dime their customers for every song/video/block of internet activity. That’s when somebody with brains comes along with a better pricing scenario and eats their lunch…!

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