Orange rebrand a declaration of quadruple play war

Europe's single players in jeopardy

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Meanwhile, once Virgin Mobile has been acquired in the UK by NTL, it will form a digital cable based quadruple play, and it too can start offering innovative service bundles, including free broadband to mobile customers in the same way as Orange.

UK IPTV service HomeChoice is up for grabs, having placed itself on the market some months ago. This is an exceptional IPTV service, complete with internet access and VoIP, but not access to mobile bundling. So this might be another way into the UK for a BT rival. Acquired by DT or Telecom Italia it would make a perfect introduction into the UK market, but there's a better acquisition to be made.

DT could move to buy British Telecom itself. Many think that this is only a matter of time and price and that the price will only go down as BT spends aggressively on its switch to an entirely IP based network, and as it loses market share to encroaching VoIP services.

The excellent Europe wide enterprise services that BT has could be floated off, and DT might end up with a cut price acquisition, at the same time bypassing the effort of competing in the market against BT. Rumours appeared yet again in the UK press this week pointing at private equity involvement in this process.

In Spain, the virulently strong Telefonica bolstered by South American mobile and broadband revenues, is likely to yield little joy to anyone trying to enter its market in a quadruple play. It has IPTV growing at breakneck pace, it has huge broadband market share and it is the second largest mobile carrier in the world. Telefonica might be the next company to begin quadruple play bundling of its own, and a natural target would be the UK, because it owns local mobile operator O2.

So all of these major quadruple plays can be carried out in the UK, where the incumbent is weakened with no true IPTV service (it plans a VoD hybrid) and no mobile ownership, and in smaller European markets such as the nine new members of the European Union, mostly to the East, many of them neighboring the borders of either Germany or Italy.

To the north in Scandinavia where IPTV was invented, with playersv like Teliasonera and Telenor, the telecoms environment is less rewarding because of the smaller total market size and because there are so many operators making it more competitive.

With increasing recognition of how a quadruple play works, and with at least three, perhaps four major European telcos pushing it, where does this leave anyone that offers just a single service - whether that is single VoIP, pay TV or mobile?

In Germany, the Netherlands and Belgium, where does it leave the multiple regional cable operators which have no access to mobile services, specially if KPN and Belgacom, newly started in IPTV complete their own quadruple play service bundles?

Where does it leave IPTV founding father Fastweb in Italy, strong in triple play but with no friend in the mobile world? Obviously strong triple plays can do what NTL has done, and buy a mobile company, or start their own MVNO, but they don’t have much time to make their move before price squeezes begin to appear all over Europe.

What about independents in the ISP world like the Italian Tiscali which although it has 4.5m customers in Italy, Germany, Netherlands, UK and the Czech Republic, most of them are dial up, with only 1.9m on ADSL?

Which is why the fact that France Telecom and Orange, finally getting their act together puts all the single players in greater jeopardy and seems to us like a declaration of war.

Copyright © 2006, Faultline

Faultline is published by Rethink Research, a London-based publishing and consulting firm. This weekly newsletter is an assessment of the impact of the week's events in the world of digital media. Faultline is where media meets technology. Subscription details here.

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