Quad Play Giving Way to Dumb Pipe
According to a Stratecast | Frost & Sullivan survey of 2,035 consumers from North America, the market is evolving toward a new dynamic in which services are simply applications delivered via an IP-based connection, whether wired or wireless. The survey also indicates that consumers find broadband connections sufficient for voice telephone and subscription TV, in addition to a preference for bundled services. However, the new bundle evolving is unlikely to be a quad play (voice, video, Internet access, and wireless), but is increasingly a dual play of wired and wireless broadband. Services, therefore, may one day look more like applications, downloadable via an app store.
According to the survey, residential consumers rate Internet service the highest in importance, followed by wireless, subscription video and then voice. Statistics related to the services consumed concurred with these rankings, with 97.3% of respondents subscribing to an Internet service and 78.9% subscribing to landline telephone service. Finally, among other results, the survey indicates that Internet usage now exceeds conventional TV viewing for more consumers with a data connection.
Other findings indicate:
- While landline telephone service shows year-over-year annual erosion approaching 3%, the survey found that nearly 79% of respondents still maintain a landline telephone service. However, more than 25% indicated they had dropped a landline service in their lifetime.
- Subscription TV service also shows slow to negative growth. Conventional cable subscriptions show a decline of 12% in the third quarter (Q3) 2013 from Q3 2007.
- Broadband Internet access is showing year-over-year growth at 3.7% from 2012 to 2013. Internet access technologies that deliver higher throughput than older copper-based technologies (like DSL) are growing in popularity. Stratecast predicts DSL will see a significant dive in subscriptions in the years to come.
- Wireless subscribership, especially in the prepaid space, is increasing, although at a slower pace than in the past.