Light Reading
Wipro claims a pre-paid model can help cable operators bring a high-margin broadband product to relatively untapped lower-income markets

Pre-Paid Opens New Frontier for US Broadband

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
9/19/2012
50%
50%

The pre-paid model has worked wonders for the mobile market over the years, so why shouldn't it be applied to U.S. broadband?

Wipro Ltd. (NYSE: WIT) is pitching the idea to the nation's cable operators as they think about how to stoke broadband service growth. They'd like to tailor packages to lower-income consumers (or students), but without the associated risks of non-payments and bad debt. (See Comcast: 100K Families Take Internet Essentials Tier.)

"There's sort of a hole out there that's not being addressed," says Stephen Snyder, the global head of business innovation for Wipro's Global Media and Telecom unit. "It could open up a whole new revenue stream."

Wipro's answer is Accelerate, a platform customized to handle the billing, customer care and operational support of a pre-paid service -- basically everything beyond the truck roll and installation of the service itself.

Snyder acknowledges that cable hasn't pursued low-income markets aggressively because they've typically been more trouble than they're worth. Wipro, a Service Provider Information Technology (SPIT) firm and consultancy that also runs an energy management business, claims its ability to optimize the behind-the-scenes processes can make the margins on a pre-paid broadband product consistent with what operators get from their traditional service bundles.

"If we can make that a 40-to-50-percent-margin product, [service providers] should not run away from it," Snyder says, noting that Wipro has been modeling the idea around packages that could be offered for about $9.95 per month.

And Wipro's been at it for a while in other parts of the world, including India, Hungary and in the Middle East, where pre-paid is the first port-of-call for a range of services, including fixed line and wireless.

To provide some separation from an operator's core service packages, MSOs could also create "flanker brands" for a pre-paid offering, Snyder says. Pre-paid broadband could also reach beyond lower-income targets -- to people in vacation rentals, for example.

But Snyder also realizes that that cable operators, particularly the larger ones, like to do things themselves. Wipro is amenable to letting an MSO pilot the idea for two to three months to get a sense of how consumers respond and to test the business case.

Wipro is still in early discussions with U.S. cable operators about this kind of model. Snyder says there's also some potential for pre-paid plans to be applied to video -- something that some operators are already considering as they seek new ways to stem pay-TV subscription losses. (See Pondering Pre-Paid Cable TV.)

(To learn more about the opportunities and challenges of the pre-paid broadband model, tune in Thursday, Sept. 20, at 12:00 noon ET for "Driving Growth Through Pre-Paid Broadband," a Light Reading webinar that will feature a panel with Snyder; Novation Broadband co-founder and former Charter Communications Inc. exec Ted Schremp; and Siber Consulting LLC founder and President Richard Siber.)

— Jeff Baumgartner, Site Editor, Light Reading Cable

(5)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
shygye75
50%
50%
shygye75,
User Rank: Light Beer
12/5/2012 | 5:20:48 PM
re: Pre-Paid Opens New Frontier for US Broadband


We need to get Heavy Reading analysts on Twitter so that they can appear as expert witnesses on LR. But here's a question: How do you get (presumably wireline) prepaid broadband service without a broadband access line?

Jeff Baumgartner
50%
50%
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 5:20:48 PM
re: Pre-Paid Opens New Frontier for US Broadband


This obviously wouldn't apply to areas with no broadband lines... but understand why you'd ask since I stepped in it by bringing up the FCC, which has been more focused on providing access where there is no broadband (but they have also been pushing for more affordable broadband too). JB

Jeff Baumgartner
50%
50%
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 5:20:48 PM
re: Pre-Paid Opens New Frontier for US Broadband


Teresa Mastrangelo at Broadband Trends weighed in on this on Twitter, noting that she sees a very small market in North America for this, though it could play well in some markets.   While the FCC likes to talk about the millions of consumers out there that haven't adopted broadband, but the size of a potential market doesn't mean it's all there for the taking with the waive of a wand, of course. But I'd have to agree that any success in the U.S. will hinge on how and where this sort of pre-paid offering is marketed. A good question to bring up on tomorrow's panel on this topic. JB


 

Jeff Baumgartner
50%
50%
Jeff Baumgartner,
User Rank: Light Beer
12/5/2012 | 5:20:47 PM
re: Pre-Paid Opens New Frontier for US Broadband


Prodigy holding on Line 1; CompuServe on Line 2. AOL...

shygye75
50%
50%
shygye75,
User Rank: Light Beer
12/5/2012 | 5:20:47 PM
re: Pre-Paid Opens New Frontier for US Broadband


So... prepaid dialup?

Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Using Service Quality to Drive WiFi Monetization

10|22|14   |   6:51   |   (0) comments


Live from the SCTE conference: Heavy Reading's Alan Breznick explores the forces shaping the WiFi opportunity in an interview with CableLabs' Justin Colwell and Amdocs' Ken Roulier.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Google: Carriers & Cloud Providers Need to Cooperate
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/16/2014
Could Data Be the New 'Currency'?
Ray Le Maistre, Editor-in-chief, 10/16/2014
iPad Air 2 Lets Users Switch Carriers Any Time
Mitch Wagner, West Coast Bureau Chief, Light Reading, 10/17/2014
Analysts Warn of Major NFV Gaps
Carol Wilson, Editor-at-large, 10/22/2014
CBS Takes OTT Plunge
Mari Silbey, Independent Technology Editor, 10/16/2014
Like Us on Facebook
Twitter Feed