Cheap mobile subscriptions the bait as Euro operators become more aggressive

The latest example is British operator BT, which now offers 500MB of data, texts and voice for less than $10 to its broadband subscribers

Consumers seem to be coming out on top as a growing number of European telecom and cable operators offer discounted mobile subscriptions as a bonus for choosing other services.

Bundles with broadband, telephony and TV across fixed and mobile networks are becoming increasingly important for operators across the continent. The latest example is British operator BT, which on Wednesday announced its return to the consumer mobile market.

The expressed goal is to offer the best-value, 4G SIM-only mobile deals as a reward for its broadband customers. The cheapest plan costs £5 (US$7.40) per month and includes 500MB of data, unlimited texts and 200 voice minutes. BT's broadband subscribers can also choose a plan with 2GB of data, unlimited texts and 500 voice minutes for £12 per month, the operator said.

It's also including unlimited access to millions of Wi-Fi hotspots and its BT Sport App to help its offerings stand out. The hotspots consist of users sharing their broadband access with each other.

In France, SFR is readying new tariffs that will offer mobile customers who also subscribe to the company's fixed line services more features or a larger data allowance, newspaper Les Echos wrote earlier this week.

Offering discounts on mobile or fixed plans isn't a new tactic in Europe. SFR already offers discounts on its fixed-line tariffs of €5 (US$5.50) or €10 per month for each associated mobile contract, and rival Free has long offered a discount of €4 per month to mobile customers who also buy its fixed-line services.

It's a trend that will become increasingly common, according to Paolo Pescatore, director of multiplay and media at market research company CCS Insight. For example, in the U.K., Vodafone is getting ready to add fixed broadband services and pay TV for consumers to go along with its mobile offerings.

The timing isn't a coincidence; a raft of acquisitions are redrawing the telecom map in Europe. Operators are convinced that bundles are the best weapon to stay relevant as many of their traditional revenue sources are under pressure from Web-based services.

Mobile operators are competing with the the likes of WhatsApp and Skype. At the same time, fixed-line operators have lost some of their luster as users get rid of their phones and cable and broadband TV operators battle for viewers with newcomers such as Netflix and Amazon.

To make this possible, BT is in the process of buying EE, which was formed from the merger of the U.K. networks of Orange and T-Mobile. With a mobile network of its own, BT will be able to offer more advanced services that go beyond simple connectivity, Pescatore said.

In France, cable operator Numericable has already acquired SFR. Vodafone, historically a mobile operator, has acquired cable operators in Spain and Germany. It has also acquired Greek broadband provider Hellas Online.

We have not seen the end of it, according to Pescatore, who expects a few more big announcements later this year.

For example, Pescatore thinks that Vodafone should acquire U.K. TV and broadband provider Sky. Also, for Hutchison Whampoa, the parent company of U.K. mobile operator Three, it makes sense to set its sights on a TV and broadband provider after it has acquired O2.

What all of these deals mean for consumers remains to be seen. So far, there are few signs they would result in price hikes. BT's plans show there is a willingness to compete aggressively on pricing. However, a multitude of different triple and quad play offerings likely won't make it any easier for consumers to find the best deals.

Send news tips and comments to mikael_ricknas@idg.com

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Mikael Ricknäs

IDG News Service
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