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IPTV may help telcos fight mobile-broadband threat

Informa Telecoms & Media says bundling an IPTV service can help telcos seeking to stem the flow of customers ditching their fixed lines

Bundling an IPTV service is looking like an increasingly savvy strategy for telcos seeking to stem the flow of customers ditching their fixed lines, according to market researcher Informa Telecoms & Media.

According to telecoms watchdog Ofcom's International Communications Market 2008 report, 15 percent of UK homes were mobile-only in 2007 — an increase of two percent on the year before. Ofcom said it expects the worldwide economic downturn, coupled with the rise of mobile broadband, giving people fat-pipe access without the need to have a landline, to further depress landline uptake.

Speaking at the Informa Mobile, Broadband & TV Industry Outlook conference in London on Thursday, Julian Herbert, principal analyst at Informa, said: "Telcos probably are beginning to think they can't live without [IPTV] in the current circumstances."

Herbert cited the Austrian market as an example, where fixed-line access has been in steady decline over the last three years but "bottomed out" towards the end of last year following Telekom Austria's relaunch of an IPTV service.

"IPTV has had a direct effect on the rate of fixed-line decline and has... incrementally increased revenue overall," he said.

"Anecdotally… IPTV reduces churn. It definitely reduces line loss… and the enthusiasm we sense from the telco community for IPTV just is not subsiding," said Herbert.

The analyst said there are more than 100 live IPTV deployments worldwide as of this month, adding: "It's going to continue to be rattling on through 2009. The number of deployments will continue to mushroom."

"The [telecoms] world is now all about triple play," Herbert concluded.

Analyst house Analysys believes the proportion of mobile-only homes in the UK will continue to rise — it recently predicted that around one-quarter of broadband homes will be pulling the plug on fixed-line DSL and connecting over 3G by 2013.