Global Information Inc. would like to present a new market research report, "Bundling & selling services with access: New supply-side strategies" by IDATE.
"Smart access services are the services associated with ISPs core solutions, such as rich communication, digital home and secure access. They all represent high-margin opportunities for vendors and involve services related to their core business, along with vital assets when going head to head with internet giants. Operators can draw on their existing customer base and network functionalities", says IDATE consultant, Sophie Lubrano, the Project Manager for this report.
Value-added services bundled with operators core solutions
The smart access category of services includes those that create value-added for operators core solutions: landline telephony, mobile services and internet access. They are relatively close to operators core business and cover various arenas:
- "Rich communication": all services tied to telephony, mail/messaging and instant messaging on wireline and wireless networks, along with location-based services.
- "Digital home": all services that enable the various devices in the home (phone, PC, TV, etc.) to access wireline and wireless networks and customers content. The digital home also includes home network and remote management systems.
- "Secure access": services tied to security and storage, along with insurance and payment, on both wireline and wireless networks.
Opportunities in services adjacent to their core business, with prospects for healthy margins and the ability to leverage assets when sparring with internet giants
"Smart access" services represent an opportunity for added income and solid margins for operators, and offer several advantages:
- Unlike content, they do not require partnerships with market leaders, except for payment systems. This means that operators can enjoy a sizeable margin.
- The margin can be relatively high on storage and security services, for instance, whose running costs are low.
- Smart access services are a natural progression for an operators business and do not require any major upgrade of sales/marketing teams.
- The billing tie is a crucial element: of all the major internet companies, only Apple and Amazon have managed to create a lasting billing relationship with users. The ability to invoice subscribers and have a relationship of trust with them is a vital part of operators business.
Ultimately, then, operators have major assets when it comes to these services and can leverage the existing trust-based relationship they have with internet users, deliver solutions that are close to their core business and generate healthy margins. But they are having to compete with top internet players who are working hard to occupy these positions, especially when it comes to communication services, cloud computing and home network solutions.