[Analysys Mason]: Fixed Broadband Consumers Buy on Price; VAS Increases ARPU

A new report by Aris Xylouris, Research Analyst, and Martin Scott [pictured], Practice Head, Consumer Services Research, Analysys Mason analyzes the ".. approaches that fixed operators are taking to promote superfast broadband in their respective markets".

According to the report "Consumers are reluctant to pay a premium for faster speeds [see chart below]. This, combined with the lack of clear applications for high bandwidth services for many users, diminishes potential consumer interest in superfast broadband

Consumers’ expectations of the quality of experience tend to increase along with advertised speeds, which can lead to dissatisfaction with the service for users on top-level speeds."

Criteria consumers intend to use when selecting their next fixed broadband service, by age range

"Operators should supplement superfast broadband offers with value-added services (VAS). They can charge more for such bundles, and this can increase ARPU. Services that benefit from higher access speeds – such as multi-screen TV and video-on-demand (VoD) services – are the best candidates. Services such as these will enable operators to compete with over-the-top (OTT) players, and monetise customers’ online media usage more effectively".

Percentage of tariffs that include value-added services,
 by download speed and service type, Europe, 4Q 2014

See "Multi-play pricing benchmark 4Q 2014: superfast broadband pricing and marketing strategies" - here.