Broadband Communities

MAR-APR 2018

BROADBAND COMMUNITIES is the leading source of information on digital and broadband technologies for buildings and communities. Our editorial aims to accelerate the deployment of Fiber-To-The-Home and Fiber-To-The-Premises.

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SERVICE PROVIDER STRATEGIES 6 0 | B R O A D B A N D C O M M U N I T I E S | w w w. b r o a d b a n d c o m m u n i t i e s . c o m | M A R C H / A P R I L 2 0 1 8 The Middle Ground for Video Even though traditional pay-TV services are declining, operators can still grow revenue and monetize new services through video. By Joel Tyus / Evolution Digital E very network operator in the United States is keeping a watchful eye on broadband-only and cord-cutting households. SNL Kagan projects that by 2021, the percentage of broadband-only homes will have grown to 22 percent. Operators, programmers and content makers all feel the pressure. However, operators are in a unique position because U.S. households are still in need of high-speed, high-quality internet connections to consume not only the over-the-top content that they like, but also live content such as sports, local news and events programming, which are not typically available from popular OTT services such as Netflix. Consumers are instead turning to virtual MVPD services, including DIRECTV NOW and Sling TV, to get specific live content. But turning to these services often means paying multiple subscription fees, which may result in a higher overall cost for those who want to cut the cord. As reported by Morgan Stanley, cable companies are hiking up broadband pricing as video revenue growth is increasingly pressured. Will this make consumers happy? No. Does it pain operators to raise prices on a single product because of industry pressures? Yes. As an alternative strategy, operators can position themselves to grow and retain broadband and video subscribers by offering a revenue-rich solution with all the features and functionalities consumers crave, such as simplified navigation screens with graphic-rich program tiles and sorted content – and most important, access to live and local content from the broadcast networks. BUNDLING HIGH-SPEED INTERNET WITH VIDEO SERVICES Operators and consumers can find a middle ground in video content. Instead of losing video subscribers to third-party V-MVPD services, even small operators can offer similar services of their own (through white-label, managed video platforms) that they can bundle with high-speed internet, thus increasing their bottom lines without incurring massive capex or gouging customers at ridiculous price points. To watch high-value content, consumers rely on access to high-speed connections. However, not all consumers who are considering cutting the cord subscribe to high-speed tiers. So why can't operators offer an incentive for those willing to bump up their broadband speeds – albeit at a higher cost – and throw in high- quality video at a huge discount? is strategy can lure subscribers into opting for a more expensive internet service and still give them the video they want at an enticing cost. Operators can take advantage of customers' discontent with traditional pay-TV services.

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