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Voice Obsession Disarms Telco Triple Play

For most telcos, traditional voice is a key obstacle facing triple play uptake and subscriber RGUs (Revenue Generation Units), states a Pyramid Research report. Many incumbent telco triple-play bundles are built to prop up voice revenues, rather than build adoption of other applications -- the result; customers are uninterested.

"Telco's own destructive obsession to protect their legacy voice services has been detrimental to the development of attractive triple-play services," comments Research Director Guy Zibi. "Their reluctance to push VoIP is neutering the potential of their triple play offering."

Fixed operators and cable MSOs that have previously offered fixed line telephony are setting VoIP pricing closer to PSTN prices and substantially higher than third-party VoIP equivalents, a symptom of the reluctance to speed up the inevitable demise of PSTN services. "This is an industry-wide conundrum; fixed operators must tread a fine line between cannibalizing fixed line services with overcompelling VoIP pricing and offering unattractive VoIP services," adds Zibi.

In the context of accelerating VoIP adoption, supporting PSTN with triple play is out of step with market dynamics. Some telcos (e.g. KPN) have understood as much, most (e.g. Verizon, France Telecom, BT) have moved slowly for a variety of reasons.

Indeed, competitors are sensing vulnerability on this front, with many emphasizing the VoIP element of their packages to create obvious differentiation to accelerate incumbent telco churn. "Many incumbent telcos are fiddling while Rome is burning" concludes Zibi.

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