Tuesday, February 16, 2016

Liberty Global, Vodafone Combine Operations in Netherlands

Liberty Global and Vodafone will merge their operating businesses in the Netherlands to form a 50:50 joint venture creating a national communications provider in the Netherlands with video, broadband, mobile and business segment service capabilities.

The business will operate under both the Vodafone and Ziggo brands and will have over 15 million revenue generating units, of which 5.3 million are mobile, 4.2 million are video, 3.2 million are high-speed broadband and 2.6 million are fixed-line telephony.

The new venture will allow the partners to measure customer demand for quadruple-play packages combining fixed network video, high speed access and voice with mobile service, all as part of a single offer.

Compared to European operators, U.S. service providers have been much less convinced that most consumers want to buy all four services from a single provider.

Among other things, marketing challenges are an issue, since mobile service tends to be available nationwide, while the fixed services sold by any single provider are available, if at all, to less than a third of all U.S. homes. That complicates national advertising and marketing operations.

But U.S. cable TV operators are likely to test that assumption, as they tend to market locally, meaning national offers are not a practical issue.

Also, many tier-one European service providers do already operate nationally, for both fixed and mobile services. U.S. regulations are not likely to change, in that regard, in one respect. Though mobile operators can lawfully sell their services nationwide, regulatory authorities still have acted to keep any single provider’s installed base below about 33 percent.

source: Strategy Analytics

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