Belgacom Brandishes Free TV as Triple Play Sign Up Incentive

| Jul 14, 2009 | Consumer Broadband Services - Europe | Competitive Intelligence Report

| Analyst: Ben Tudor

Current Perspective: Positive
Vendor Importance: High
Market Impact: High

Event Summary

July 10, 2009 – Belgacom launches new triple play packs incorporating digital television with either fixed voice and Internet access or mobile voice and Internet access, for no additional fee. Seven variations of the new packs are available and can be ordered by the first 25,000 new subscribers to a 12 month fixed voice and Internet package and the first 5,000 subscribers to a 12 month mobile voice and Internet package.

Analytical Summary

• Current Perspective: Positive on Belgacom's new range of triple play packs, because they enrich and expand the incumbent's consumer portfolio with numerous fixed and mobile voice, broadband Internet and digital television service choices. The limited time offer of 'free' digital television also provides a compelling incentive for undecided customers to subscribe to Belgacom sooner rather than later, and encourages uptake of three bundled services rather than one or two.

• Vendor Importance: High to Belgacom, because the company needed to bring triple play bundles to market to complement and expand on its existing standalone, dual and quad play offers. Belgacom needs to continue to grow its digital television customer base to generate economies of scale and maintain market leadership, and offering triple play packages incorporating either a fixed or mobile element alongside a strong sign-up incentive will help to drive up bundled customer numbers.

• Market Impact: High on the Belgian triple play market, because the new offers from Belgacom represent a clear competitive threat to other consumer players. The company can now provide a multiplicity of bundled options spanning both fixed and mobile voice alongside DSL and multimedia content, and in response alternative operators will need to re-evaluate their own options and capabilities with regard to product and technology development, pricing and promotion.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

| Client access - Full report in Consumer Broadband Services - Europe | More information

Recommended Competitor Actions

• Where possible Telenet reps should point out that this limited time offer incorporating 'free' digital television underscores that Belgacom's regularly-priced bundled packages are actually more costly when compared to Telenet's. The cable provider can emphasise that it came to market with reasonably priced bundled packages well ahead of the incumbent, and will continue to offer cost-effective products after Belgacom's short-term incentive offers have expired.

• One area where Belgacom has a decisive edge over Telenet is mobile, and with these new offers, alongside its quad play pack, the incumbent is doing a good job in exploiting its ability to offer mobile services alongside fixed voice, Internet and television to provide compelling product bundles. With a mobile capability now in place via an MVNO agreement, Telenet needs to consider ways in which it can bundle mobile service options into its 'Shakes' range of bundled packages.

• All cable and DSL providers that already offer digital television as part of a bundled service, and those that are considering doing so, must be aware that Belgium is a comparatively mature broadband market largely controlled by Belgacom and Telenet. In order to achieve significant growth or market share outside of specific niche locations, competitors would need to poach customers from these incumbent operators, a difficult, expensive and time-intensive undertaking.

Recommended Competitor Actions

• Consumers interested in receiving a bundled fixed or mobile voice, broadband Internet and digital television offer should examine Belgacom's new packs given the range of choice and the short-term sign-up incentives currently available. Existing Belgacom customers should query the provider very closely on their eligibility for the new limited time offers and whether penalties or hidden, extra charges would be involved in changing, upgrading or opting for bundled services.

• Aside from Belgacom, the other major candidate for consideration is Telenet, which offers packages that are competitive with Belgacom's on price, speed and features. Consumers should be aware that Telenet can now also provide some mobile voice options alongside its bundled triple play packages. In any case, customers considering switching providers need to inquire carefully as to penalties for early contract cancellation and the likely time it will actually take to migrate to the new service.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

| Client access - Full report in Consumer Broadband Services - Europe | More information

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