Wireless in the Consumer Telecom Bundle

• There is, indeed, convergence appearing in the telecom bundle; Cable companies and AT&T are both offering services across different networks and devices.
• In-Stat surveys find that cable companies have the majority of the bundle customers with video and broadband packages. However, consumers who have a preference would rather buy bundles from telcos than cable companies.
• Telco and cable company bundles including broadband have very high penetration at near 60%, suggesting that further growth may be limited.

At Last: Convergence but Lack of Discounts

Introduction: The US Telecommunications Market is Changing

AT&T/BellSouth/Cingular

Sprint/Cable Joint Venture

2005 Report Conclusions

Wireless Carriers Not Considered Bundlers

More Bundles Should Include Wireless

Bundled Offerings

Verizon

QWEST

AT&T

Sprint Nextel/Cable Joint Venture

Cox Communications

Time Warner Cable

Comcast

Survey Results

Current and Preferred Bundle Providers

Components of Telco and Cable Bundles

Value of Bundles

Expected Bundle Purchash

Interest in Cable/Wireless Bundle

Forecasts—Cable Joint Venture Wireless Customers

2007 Market

Forecast Assumptions

Assessment

Cable Companies can Stretch Their Leads

Bundled Broadband Market Appears to be Nearing Saturation

Value of Wireless in the Consumer Telecom Bundle

It’s Good to be a Telco and Better to be Verizon

Weak Consumer Interest in Video-to-Wireless Service

Appendix 1—All Bundle Responses and Methodology

All Current Bundles by Carrier Type

Survey Methodology

Appendix 2—Survey Questions

List of Tables

Table 1. Components of AT&T Bundles that Include Wireless

Table 2. Cable Joint Venture Subscribers and US Market Share

Table 3. Cox Mobile Access Multimedia Services Packages (Others Similar)

Table 4. Preferred Telco Bundle Provider

Table 5. Types of Bundles, Individual Bell Companies

Table 6. Willingness to Switch Carriers by Current Bundle Source

Table 7. North America Sprint Cable Joint Venture Wireless Subscribers 2007-2011

Table 8. All Telco Bundle Combinations from Survey

Table 9. All Cable Bundle Combinations from Survey

Table 10. All Wireless Bundle Combinations from Survey

List of Figures

Figure 1. Forecast: US Cable Joint Venture Wireless Subscribers (Subscribers in Thousands)

Figure 2. Actual vs. Intended Bundled Services (2005 Survey)

Figure 3. Cable/Cellular Joint Venture Services—Mobilizing the Triple Play

Figure 4. Current and Preferred Bundle Providers (Base: Those Expressing a Preference)

Figure 5. Components of Telco and Cable Bundles

Figure 6. “Would You Switch Carriers to Purchase Bundled Services?”

Figure 7. Reasons for Adopting Bundled Services

Figure 8. Barriers to Adoption of Bundles (Base: Do Not Purchase Bundles)

Figure 9. Planned vs. Current Bundled Services

Figure 10. Plan to Purchase Bundle within 12 Months: Expected Carrier Type

Figure 11. Interest in Converged Video/Wireless Service (Base: Use a Cell Phone)

Figure 12. Willingness to Change Carriers for Converged Video Wireless Service (Base: Extremely, Very or Somewhat Interested)