Friday, July 28, 2006

From fee to free in the U.K.

Media Life Magazine writes that offering free service is in style in the U.K. such as "when Britain’s Carphone Warehouse, a mobile phone company, began offering free broadband with certain phone packages. Then Orange, another mobile phone company, jumped in at the end of May, also offering free broadband with a particular phone package."

The article notes "the speedy rollout of the package deals, with one element or another being free, speaks volumes about the converging world of the internet, telecoms and entertainment." Ian Fog at JupiterResearch said, “It shows the tremendous pressure on the players in the market.”

Regarding competitively bundling different services, Tom Jowitt at Datamonitor said, “BT is the one potential quad play rival.”

Of course when services go for free, it's hard going back. John Delaney at Ovum said, “Ultimately the outcome is likely to be to erode the value of the service that is being called free. If you call something free for long enough, people will expect it to be free. And then if you start trying to charge for it, you will find that there is a reluctance to pay.”