The Problem With Triple Play
With triple play consumers can get multiple services using only one (internet)connection. The actual concept has in the Netherlands existed for some time. Before the introduction of ADSL, cable companies UPC and Casema have offered Internet connection beside cable television for some years now. However, it has not been before the introduction of other broadband technologies (like ADSL) and the overall adoption of broadband that society is starting to get aware of the possibilities of this concept.
One of the very first companies that came with a concrete triple play Internet subscription based on ADSL2+ was telco (telecom company) Versatel. In December 2004 Versatel bought the exclusive rights for broadcasting soccer matches of the Dutch premier league live over the Internet, in hopes of attracting customers to subscribe to the triple play service. Right now KPN is also busy with actualising the possibility of offering triple play service in one package instead of offering it through the existing separate channels. The expectation is to have the service online by summer 2006.
As telcos are ‘intruding’ the television market, cable companies like Casema, UPC, Essent and Multikabel have responded by offering telephone and internet services in one pack as well. In addition, some local municipalities are building fibreglass networks. This all leads to heavy price competition.
The ‘triple play’ sounds very promising, but will it also indeed become a success? Should telcos and cable companies keep to their core businesses for their own and the customers’ sake? The fact that the customer will have only one supplier for these services can be advantageous, from the perspective of convenience. At the same time, it can get more difficult to compare the services to one another as they are not so easily distinguishable anymore. Also, it might only be the question whether it will be that financially advantageous for the customer when he does not that often use the e.g. TV or the telephone. And even if it will become successful, what companies (telcos or cable companies) will obtain dominance of the (renewed) market?
These are just a number of questions that we will try to answer in the next couple of months. Feel free to leave any comments.
Sources:
http://www.webwereld.nl/articles/31206
http://www.internetten.nl/div/document.asp?id=10011&kleur=blauw
http://www.freeband.nl/uploadedFiles/FreeNovation/Magazine_Nr2/Articles/Article_1120_nl.pdf
maart 11, 2006 at 22:16
Hi there, you have an interesting topic here.
The telcos and internet providers are trying to sell the same concept to the consumer, but to realize it they have to use different technologies. Because the data actually have to come from different sources. E.g. KPN wil have to provide the triple play concept through its own telephone network (ADSL) and cable companiies provide the concept through their cable internet connection.
Now the question arises, which of these possibilities have the best chance of success? I personally think it is hard to tell. It all depends on which of these technologies is capable of providing the biggest datastream. And with the upcoming network of fibreglass, you’ll even have a third party of competitors!
Telecom companies by default providing telephone, cable companies by default providing television and fibreglass, originally intended for just fast internet, all these companies are now doing the same tirple play thing but from different channels. Very interesting! With all these competition, the consumer will decide who will be the winner in the future. Only time will tell.
Maku Maku
maart 13, 2006 at 10:04
Ho-Ying and Ralph,
interesting and currently highly relevant subject you have chosen. I wonder how you are going to deal with the design of a policy for a particular set of technologies of which it isn’t at all certain that they will become a succes. Do you need a policy focussing on the technological aspects, or is competition policy only sufficient as well?
Keep up the good work.
maart 14, 2006 at 14:03
Thanks for your comment Robbert. I think our case is indeed more focussing on competition policy than on technology policy, but it is most certainly not less relevant.
We also will try expand our view to other countries. The Netherlands belong to the worldwide top of broadband penetration, but what about other countries? Booz Allen Hamilton expects that within 4 years, half of all European homes will have purchased triple play.
maart 20, 2006 at 11:59
You speak of a “problem”, but is there really one?
maart 21, 2006 at 17:40
Dear Marc, I have taken your question into consideration. I will try to get back to it as soon as possible.