Internet access key to £8bn bundle market

Half of UK households will be using a communications bundle by the end of the year, pushing the bundle market value to £8bn, says market researcher Mintel.

Half of UK households will be using a communications bundle by the end of the year, pushing the bundle market value to £8bn, says market researcher Mintel.

 The triple-play (phone, TV & broadband services) market had risen six-fold in five years. Worth £490m in 2005, it would reach £3.3bn this year and £5.9bn by 2015, Mintel said.

According to Mintel simplified supply and cost savings offered by bundles were driving growth. "The triple-play business has been gaining more from dual-play buyers trading up in the recession than from newcomers buying in at that level straight away," it said.

Mintel senior leisure analyst, Matt King said the recession had helped take-up rates as consumer sought to cut household bills and admin."The sector has also been driven by the recession-related rise of in-home leisure, which has increased consumers' attachment to essential internet and pay-TV services," he said. "Bundling has proved a way of retaining these core entertainment technologies on a more economic basis."

Mintel found that price is the most important market driver. Nearly half (49%) of bundle users said they opted for the cheapest deal offered. The convenience of having bills in one payment (41%) and trust in the provider's brand (40%) were also important decision factors.

The fixed line internet connection was by far the most important element of the home communications services bundle, a priority for almost half (46%) of consumers, Mintel said."Anticipated developments in the reach of broadband technology, both geographically and in enabled device numbers, are likely to entrench the dominance of the web," King said.

He said new technologies like IPTV and high speed broadband would allow suppliers to reposition bundles from utility packages to value-added packages. "Suppliers should shift from quantity to quality, from how many services our bundles can buy to what sort of services they can bring us," King said.

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