& cplSiteName &

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


So... prepaid dialup?

Educational Resources
sponsor supplied content
Educational Resources Archive
From The Founder
Cisco's Conrad Clemson, recently promoted to head up the company's Service Provider Apps & Platforms developments, talks to Light Reading's Founder and CEO Steve Saunders about how he's bringing cloud video, mobile and virtualization together to empower network operators.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Custom TV
Huawei's Pre-MWC Analyst Briefing 2017 Highlights

2|22|17   |     |   (0) comments


Huawei shares its vision for this year's MWC.
LRTV Interviews
MWC17: 5G, Cloud RAN & More

2|21|17   |   04:35   |   (0) comments


Ovum Senior Analyst Julian Bright talks to Scott Bicheno from Telecoms.com about all things MWC, including Cloud RAN, Huawei's pitch to the industry and the road to 5G.
LRTV Interviews
MWC 2017's Key 2-Letter Terms

2|20|17   |   08:29   |   (1) comment


5G, AI, VR... these are just some of the two-letter terms that will dominate show-floor chat at MWC 2017 in Barcelona, according to these two blow-hards (a.k.a. Scott Bicheno of Telecoms.com and Light Reading's Ray Le Maistre). And then there's PB...
LRTV Interviews
Key Trends for Mobile Operators in Developing Markets

2|20|17   |   06:37   |   (0) comments


Ovum's Matthew Reed talks to Scott Bicheno from Telecoms.com about the challenges and opportunities facing mobile operators in the developing markets of Africa and the Middle East.
LRTV Documentaries
YouTube Takes on Facebook Live-Streaming

2|17|17   |     |   (0) comments


Popular 'YouTubers' will be the first to get the new service on their smartphones. You have been warned.
LRTV Custom TV
Open Source NFV/SDN Automation

2|17|17   |   05:54   |   (0) comments


AT&T ECOMP (Enhanced Control, Orchestration, Management and Policy) code is transitioning into the Linux Foundation for placement into open source. In this video, Carol Wilson provides an update on the maturation of open source ECOMP and meets with industry leaders from AT&T, Bell Canada, Orange, Linux Foundation and Amdocs to discuss what this means for the ...
LRTV Documentaries
Uber & NASA Collaborate on Flying Car Project

2|16|17   |     |   (0) comments


Is Uber for real? Well, it's hired NASA engineer Mark Moore to lead the project, and he wouldn't come cheap.
LRTV Documentaries
Zuckerberg Tries Out the Oculus Rift VR Glove

2|15|17   |     |   (0) comments


Facebook CEO shows off a new way to interact with the Oculus Rift virtual reality headset: an Oculus glove.
LRTV Custom TV
Huawei Digital Transformation Forum 2017

2|10|17   |     |   (0) comments


Here's a preview of the upcoming Huawei Digital Transformation Forum taking place in Barcelona with trending telecom topics like cloud, IoT, 5G and much more!
Telecom Innovators Video Showcase
Dan Sahar of Qwilt on Open Edge Cloud Platform

2|8|17   |   08:38   |   (0) comments


Dan Sahar, Qwilt's co-founder, sits down with Steve Saunders of Light Reading for a conversation about Qwilt's Open Edge Cloud platform and the new role of service providers in application and content delivery.
LRTV Documentaries
ZeroStack's 'Self-Driving Cloud'

2|7|17   |   01:09   |   (0) comments


Its Z-Brain tech automates day-to-day management and long-term planning for hybrid clouds.
Telecom Innovators Video Showcase
Nominum's Craig Sprosts on DNS & Cybersecurity Trends

2|7|17   |     |   (0) comments


Nominum's Craig Sprosts talks about the fast-changing landscape of cybersecurity with Steve Saunders of Light Reading. Sprosts touches on the trend of the rise of ransomwares, rivals of IoT base attacks, and mobile network security. He also discusses the realization of the importance of IoT security after a recent cyber attack that paralyzed several major ...
Upcoming Live Events
March 21-22, 2017, The Curtis Hotel, Denver, CO
March 22, 2017, The Curtis Hotel, Denver, CO
March 22, 2017, The Curtis Hotel, Denver, CO
May 15-17, 2017, Austin Convention Center, Austin, TX
May 15, 2017, Austin Convention Center - Austin, TX
June 6, 2017, The Joule Hotel, Dallas, TX
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Is the Time Right for a Cisco/Ericsson Wedding?
Ray Le Maistre, Editor-in-chief, 2/17/2017
Broadband Has a Problem on the Pole
Mari Silbey, Senior Editor, Cable/Video, 2/21/2017
Verizon to Start Fixed 5G Customer Trials in April
Dan Jones, Mobile Editor, 2/22/2017
Nice to See at Least One CSP Taking My Advice
Mitch Wagner, Editor, Enterprise Cloud, 2/17/2017
Charter Launches 5G Field Trials
Mari Silbey, Senior Editor, Cable/Video, 2/16/2017
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Light Reading founder and CEO Steve Saunders chats with Sportlogiq CEO Craig Buntin about sports data analysis.
Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
Animals with Phones
No One Likes This Click Here
Take a hint!
Live Digital Audio

Playing it safe can only get you so far. Sometimes the biggest bets have the biggest payouts, and that is true in your career as well. For this radio show, Caroline Chan, general manager of the 5G Infrastructure Division of the Network Platform Group at Intel, will share her own personal story of how she successfully took big bets to build a successful career, as well as offer advice on how you can do the same. We’ll cover everything from how to overcome fear and manage risk, how to be prepared for where technology is going in the future and how to structure your career in a way to ensure you keep progressing. Chan, a seasoned telecom veteran and effective risk taker herself, will also leave plenty of time to answer all your questions live on the air.