NTL Rolls Out 4-Service Package
The operator is making use of its new asset, Virgin Mobile Telecoms Ltd. , to offer fixed-line telephony, mobile telephony, TV/video on demand, and broadband (up to 2 Mbit/s) for £40 (US$74) per month. (See NTL Takes Virgin.)
And soon after that package becomes available (some time before September 1), customers will be able to pick and mix those four services in any combination they want, with any two of the services for £20 ($37) per month or any three for £30 ($55.50).
The move comes as U.K. consumers face an enviable lineup of telecom, Internet access, and entertainment packages, dominated by the offer of so-called "free" broadband services as part of a wider package. The most recent offer was launched last week by NTL's main TV service rival, Sky . (See Sky's Free Broadband Play, Orange Juices Free Broadband Battle, and Free Broadband Comes to the UK.)
NTL even mentions Sky in its news release, noting that it already has a video-on-demand service up and running, while Sky is still preparing its VOD offer. NTL's "free TV" offer is aimed at bumping up subscriber numbers at the low end of the market. New customers that want a basic fixed-line phone package, costing £11 ($20.36) per month, will get a base-line TV package thrown in free. Notably, the deal does not include any installation or connection charges. It will be available on September 1 or before, says NTL.
Daiwa Securities SMBC Europe Ltd. analyst James Enck reckons this is "a nice defensive kick in the groin for Sky's DSL offering," which offers free broadband, after an activation charge of £40 ($74), of up to 2 Mbit/s for customers that subscribe to Sky's TV service, which starts at £15 ($27.75) per month for the most basic set of channels.
The offer, which is available to existing as well as new customers, will likely be a significant anti-churn tool as well as an attraction for new customers, but NTL will need to prove itself as an organization that can deliver decent post-sale customer service if it is to make the offer count. The company is known for its poor customer relations and contract and billing errors.
NTL is already the U.K.'s second biggest broadband provider after BT Group plc (NYSE: BT; London: BTA). At the end of March this year it had nearly 5 million customers using a variety of services: More than 2.8 million were using the operator's broadband service, 4.3 million were fixed-line telephony users, and 3.3 million subscribed to the TV service.
The closure of the Virgin Mobile acquisition earlier this month added more than 5 million mobile subscribers to the company. (See NTL Completes Virgin Buy.)
While that acquisition brought with it the highly successful Virgin brand, which NTL plans to use across all its services, a spokeswoman says plans for a single brand won't be introduced until at least early 2007.
NTL merged with its major cable rival late last year and has been cutting costs to make itself more competitive and profitable. It also has been busy revamping its network infrastructure and migrating to a less complex architecture in recent years. (See NTL Confirms Job Cuts, NTL & Telewest: Together at Last!, and NTL's NGN Hell.)
— Ray Le Maistre, International News Editor, Light Reading