About 8 in 10 UK households will sign up to a multiplay service bundle by 2019
By the end of 2019, 79% of UK households will have signed up to a multiplay service bundle, buying two or more services such as telephone, broadband, pay-TV and mobile from the same provider. This is according to a new multiplay services forecast by research firm CCS Insight. Thanks to market consolidation and a growing appetite for multiplay services among consumers, 2016 is set to be a pivotal year for the UK’s telecom market.
Demand for service bundles was clearly demonstrated in a recent CCS Insight consumer survey: 61% of those who don’t have a service bundle said they would consider buying one. By the end of 2016, CCS Insight predicts that more than 16 million UK households will have a bundle of three or more services, an increase of 43% from 2014. By the end of 2019, 4.6 million households will have signed up to a package of four services, up from just over 1 million at the end of 2014.
Competitive pressure and significant demand from consumers for multiplay services mean further market consolidation is very likely over the next two years. As providers fill the gaps in the range of services they offer, most major telecom companies — with some notable exceptions — will be able to bundle several services into a variety of attractive packages and sell them to their existing and new customers.
This presents a huge opportunity for the pay-TV market, which CCS Insight believes will see a significant boost in 2016 and 2017 as telecom providers focus heavily on this area. Spending on original content and sports rights will be backed by a great deal of promotional activity to bring in new users from online services; growth in new users will help providers recoup some of the phenomenal sums invested in recent years.
“With a furious battle for customers raging, we expect the amounts paid for exclusive content deals on movies, sports and TV shows to continue to skyrocket” says Paolo Pescatore, Director of Multiplay and Media at CCS Insight. “Sports will be a major weapon in every provider’s arsenal for many years to come.”
BT is a prime example. In recent years, the company has improved its position in the multiplay market thanks to its BT Sport TV channels, which have helped stem broadband subscriber losses. As it strengthens its line-up with exclusive rights to broadcast events like the UEFA Champions League and Europa League it is starting to differentiate its multiplay services from those of its rivals.
But providers will need more than a pay-TV service. “Despite huge investment in rights and content, BT TV has struggled to attract many new viewers”, cautions Pescatore. “The launch of a mobile service for consumers marks 2015 as a critical year for BT. The company will be hoping that the addition of a mobile service will attract new customers and allow it to cross-sell an enhanced bundle of services to its current subscribers, while waiting for the regulatory approval for its acquisition of mobile operator EE.”
Pescatore continued, “Our surveys reveal that consumers find it more convenient and better value to buy broadband, mobile, TV and land-line access from one company, so established providers that can offer all these services are in a strong position. Once multiplay packages are the norm, it’ll be the exclusive content on offer that’ll set providers apart. It’s little wonder we’re seeing a frenzy of acquisitions as leading players scramble to secure assets,” he concluded.
The data above is taken from Market Forecast: Multiplay Services, UK, 2014-2019, which is published as part of CCS Insight’s extensive multiplay strategies research service.
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About CCS Insight
CCS Insight is a global technology analyst company focussing on the mobile, Internet and media industries. It provides comprehensive services that are tailored to meet the needs of individual clients, helping them make sense of the connected world.
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