U.K.-based Sky is about to enter the U.K. mobile service provider market, becoming a mobile virtual network operator using the Telefónica UK network in 2016.
The move will make Sky a quadruple-play services provider, as it already sells fixed line high speed access, fixed network voice and video entertainment.
Sky is the second-largest provider of consumer high speed access, with more than five million customers. Sky also sells a triple-play package to 40 percent of all its customers.
Telefónica UK will give Sky wholesale access to 2G, 3G and 4G services over its nationwide network, and should bolster Sky’s ability to compete in the consumer services business.
Telefónica UK also is the wholesale supplier for the largest MVNO, Tesco Mobile. The latest move by Sky simply illustrates the fact that the consumer telecom market now is based on triple-play or quadruple-play offers, not discrete services.
Another big deal involving U.S. satellite TV operator DirecTV, as well as separate deals involving Iusacell and Nextel Mexico would shift AT&T’s customer center of gravity in the other direction, towards business services.
If all deals are approved by U.S. regulators, AT&T’s proposed acquistions of DirecTV, Iusacell and Nextel Mexico would dramatically boost video entertainment and broadband segment revenues and business customer revenues, while dramatically reducing exposure to consumer wireless services.
The moves by Sky and AT&T illustrate the different ways a combination of satellite, fixed and mobile assets can drive company strategies. The move by Sky arguably positions that company as a stronger company in the consumer services business, while AT&T’s three moves will shift it more in the direction of business customer revenues.
For AT&T, as for many other tier-one service providers, the shift into business customer services might make lots of sense, given increasing competition in the consumer services business.
In the U.S. market, for example, cable TV operators already have the largest share of high speed access and collectively have the second-largest share of fixed network voice, as well as the highest share of video subscription customers.
If you think the U.S. mobile marketing war is about to become even more intense, with Google’s entry into the business, the revenue contributor changes might be a very good thing for AT&T.