[3GScottishUser]

Funny how things work out sometimes.

That bit of copper that attaches your phone to the exchange is the same bit of copper that has been there for years for voice calls now it can carry data at high speed and for the privilage BT has milked it with customers paying up to £30 a month for what is essentially the same bit of cable!! OK there will have been some infrastructue investment but I doubt if that could justify the monthly charges that existied originally when broadband appeared. Reality has now bitten and as prices tumbled, connections rocketed and we are now at a stage where LLU broadband is so cheap that it can be used as a freebie to gain access to the line rental revenue or another associated product or service.

Free broadband is now a reality. First Carphone Warehouse used it to promote Talk Talk, then Sky jumped on the bandwagon to fend off the arrival of TV distibution by broadband technology. Now the mobile operators are moving fast to protect their core business. Orange was first with a deal with Energis (a division of Cable and Wireless), next up will be 02 who have their own ISP which they recently paid £50m for and now it reported Vodafone will partner with BT to provide IPstream to their customers.

Convergence is happening fast and with 3 major mobile companies now actively pursuing fixed line broadband it'll be interesting to see how this development affects market shares. 02/Telefonica are well placed to make revenues from taking over landlines through LLU rollout. Vodafone appear to have done a clever deal with BT where their user base will bring BT basic broadband customers who can then buy additional services like VOD and VoIP for which Vodafone will no doubt get a commission from, without a single penny of investment! Orange appear happy to provide C&W's broadband simply to protect their core mobile business but their Livebox has expansion facilities which could also be used to deliver new enetertainment services which would be rewarded with a share of revenue from when marketed to their own customers.

Meanwhile over at NTL/Virgin they have launched the first quad play product. TV, Landline, Internet and mobile for a single monthly cost. The major problem for NTL is that they dont have the geographic coverage that the BT network offers and they may have to come to some arrangement to make broadband available for customers who live in non-cabled areas.

So who is left out?

Well T-Mobile seems to have ignored consolodation to date. They will be watching the market carefully and may just pounce and make a big acquisition if they think convergence threatens their long term plan of being up there with Vodafone, 02 + Orange. They could buy Cable and Wireless easily but are also big enough to swallow BT and that move (already rumoured) has the potential to be the most significant maket shaker to date with profound implications for Vodafone who may have to get into a bidding war for BT to prevent the German giant becoming the UK's most dominant telco.

Hutchison have taken a long time to embrace the Mobile Internet in the UK but have recently been reported as looking at the possibilty of a tie-up with an ISP to offer converged services. AOL looks too big a meal to swallow with the company struggling to maintain the small market share they have but a deal with a smaller player might bode well for them. Perhaps some arrangement with CPW could be benefitial for both parties, perhaps CPW might even go the whole hog and agree a merger or takeover to become a real multi-platform compeditor to what looks like becoming common, the converged landline, Internet, VOD and Mobile companies.

I have posted a poll re convergence at the top of this page. Feel free to leave your vote and any comments below.

[Ben]

Oh while I love the thought of one bill, one point of contact, cheaper prices etc, converged services lack a crucial element that we've become so used to in the UK, especially in broadband. Flexibility.

NTL Telewest's over-the-wire services may well be the best implementation of a multi-play service in this country and, with the Virgin brand in their hands, they have a real chance to be revolutionary. 'Landline' companies offering mobile services is something that makes sense to me, yet it's the mobile players that have all the money and are therefore making all the big moves.

I think the winners in this race will be those who keep their options open and remain agile and flexible. BT will likely succeed in offering Mobile TV and VOD, and with Sky now in the broadband market there's a good chance they'll clean up too. Both will probably offer mobile services, either through partnerships of MVNO's of their own and with varying degrees of success, or they might wait for the Next Best Thing, just like T-Mobile might do...

T-Mobile is furiously building out its network. They recently struck a deal with Sony Vaio to incorporate their HSDPA broadband into laptops. The keen Web n Walk pricing means we could see the first consumer-orientated online laptop deals becoming available. Through it's WiFi offering and, perhaps, even WiMAX, T-Mobile could resist being tied down and keep to mobile and broadband offerings over-the-air.

So, I intend to keep my services separate for now. Or should I say, I intend to keep my mobile services separate from my fixed line ones. Being connected to Vodafone HSDPA at 1.8mbps right now is case-enough for me to declare HSDPA as a success. Pricing and integration into the massive and expanding laptop market really could be a big hit.

[3GScottishUser]

I agree HSDPA will make a difference but it'll be restricted to a very small proportion of the market until costs allow casual domestic users to browse the Internet. Even then it's not going to be everyone who wants to carry a laptop about, so perhaps the pricing reflects and wiill continue to reflect the busisness benefit of proper full scale Mobile Internet use.

As for the free broadband that now appears to be the tool of choice to stimulate line migration and mobile retention I think it will be very appealing for those who don't have specialist needs. A basic free broadband account will be more than good enough for most and the prospect of a free wireless router and free VoIP calls makes the offer a pretty cool option for the domestic user saving them up to £30 a month.

Broadband could be the surprise key to customer acquisition and retention by mobile telcos. It will be more complex changing network if you have to make arrangements for broadband transfer as well as making all the usual PAC arrangements to port out a number. Perhaps an upgrade might offer the simplicity most customers desire and many might be quite happy to get a little less of a deal when they consider they now get something additional that they used to have to pay for.

In an ideal world it would be best to buy all services separately but the buying power of the mobile networks appears to have produced an opportunity for substantial savings to be made for the average user who wants broadband too. Sadly once a service has been 'given away' its very hard to reintroduce a charge for it and free broadband whether via your cable, landline, mobile or TV supplier looks like becoming the norm in the future.

[Hands0n]

Convergence is an irrelevance for me. I am simply not interested in losing all leverage possible [to me] and at Churn time I want the freedom to move my pieces around the board as I see fit. Convergence takes all of that away from me and I want no part of it. One-bill holds no appeal for me, I can manage multiple bits of paper (we have to anyway .....).

Will I have to pay more for non-convergence? It would be a very brave player indeed that jacked their prices up in the face of competition in the UK. So the answer is No, I won't have to pay more.

What about environmentally? I have a "converged" offering from my ISP and Telephone supplier, there is a completely wasted unused cable TV box in my stack. It was drawing power for ages before I decided to turn it off as we never used it (we use Sky for all our TV - the cable offering is a poor second in terms of meeting our needs and wants). They won't take it away as "it comes with the package!". Ridiculous.

It may well be that in time I will not have a choice, and that I will have to purchase converged offerings. But that would mean a major trauma for me - disruption during the change-over and leverage over me by the supplier rather than the other way round. My freedom of choice will become eroded. I will be less likely to change supplier unless they really mess up wholesale - and surely that is the single most appeal to the suppliers of engaging in this Convergence activity. Not for our benefit at all. No surprises there then.

I do have doubts that OFCOM and the other regulators will be able to keep up in the face of this convergence. And so we will see the industry, at least for a time, performing self regulation - something that history tells us it is abysmally poor at. Witness Reverse-billed SMS, grossly abused by the industry until that lumbering ICSTIS got its act together. No, if I were the regulators I'd call a halt to all of this convergence until suitable consumer protection regulation [of the providers] was in place.

These are not the rantings of a Luddite - convergence needs not be an inevitability. But if it is to be, then we need to avoid the repeat of history and ensure that these offerings are done so in a properly regulated, open and transparent manner. Protection of choice by the consumer must be paramount. I see no evidence of that at present.

[3GScottishUser]

The big problem facing all of the networks is the value factor.

I used to pay £25 a month for broadband, now it's free and I don't think I'll be rushing to pay an ISP in the future. The whole notion seems absurd.

The landscape is definately changing and whilst I agree about proper controls to protect customers I suspect current convergence moves will be welcomed by regulators as what appears to be happening is that more services are becoming cheaper and more accessable to more customers.

There has been considerable shake-up in the mobile market since 4 networks became 5 in the UK. Sky and NTL have had the pay TV market sewn up for years and that stranglehold looks soon to be challenged by ADSL VOD. Landline subscribers now have more choice and all of sudden who controls and charges for that copper connection to the local exchange becomes the gategeeper for a whole range of other services, some of which can be used to promote mobile products and others can be added on to create additional value. The times really are a changing and the day when telco products can be viewed in isolation are over in the UK I suspect.

[Hands0n]

As 3GSU points out, the financial case for convergence is compelling. Early adopters beware! What you may not see behind the glossy branding is the assembly of a number of different and disparate organisations with their own supply and support processes and procedures. It will take a strong management team and some time to bring the whole into a coherent supply train. Anyone who has been involved in mergers and acquisitions from the inside will have a good idea of what is involved and how long it takes for coherence to set in, if ever.

For example, lets take the recent Virgin branding of NTL. Almost everyone knows that Virgin has a solid offering in the mobile world. Good supply, and good Customer support. NTL on the other hand has spawned an entire industry of "disaffected" bringing into being the now legendary NTL:Hell (http://forums.ntlhell.co.uk/) website. The fact that NTL:Hell continues to exist is not only embarrassing for NTL but should be of great concern to Virgin (you ignore the buying public at your peril). What will the site be named next, if NTL cannot pull it together and match the Virgin delivery/support? Will the Virgin brand become afflicted by its new parent? Life in the fast lane is not all spin and no-substance, the Customer knows what they want, and what they are not being given.

So, imagine the near-future scenario - a deleriously happy Virgin Mobile customer decides to go for the Four Play. All goes well until the NTL syndrome begins to bite - and now we have a customer who begins to feel disaffected to the Virgin brand. After the usual bout of Customer Service wars the customer walks away disgusted with the all new Virgin, vowing never to return! Not something Sir Richard would have wanted at all, NTL becoming a wrecking ball to the Virgin reputation.

Okay, so this is perhaps a gloomy scenario - but what, if anything, has changed at NTL to make NTL:Hell redundant? If the answer is "Nothing...." then it is inevitable that Virgin's branding will suffer as a consequence of this marriage.

But more importantly than any of that, the Customer choice will have been spoiled. And that cannot be for the good of the Customer.

I remain open to being swayed towards convergence, as I really can see its many benefits, but these I feel are outweighed by the negatives in the current state of the art.