Quote:
Originally Posted by Pierre
Yes, is essentially the answer, you will have an O2 product undercutting VM on the same network footprint.
The rationale is that consumers are leaving VM, going with alt-nets purely for basic inexpensive broadband at decent but modest speeds that work.
So, instead of lessening the VM offer, give them an O2 offer. Better keep the customer at a lower tariff than lose it completely to an alt-net.
It really is brutal in the market at the moment.
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On O2's network O2 and giffgaff offer mobile but no cannibalisation as the services are very different with giffgaff being very much the budget brand with 30-day rolling monthly plans (or pay-as-you-go credit).
On nexfibre's network Virgin Media and giffgaff offer broadband but no cannibalisation as the services are very different, with VM being the premium one with speeds up to 2Gbps whilst giffgaff's is capped at 900Mbps - and giffgaff's rolling monthly contracts are highly visible whilst VM's is hidden away. (After all, VM wants 24-month contracts for broadband, Pay TV and phone.)
For O2 on nexfibre there will be no cannibalisation as O2's broadband will be again different, being a budget offering whose purpose is to help retain O2's mobile customers.
When - and I think it will be when - giffgaff and probably O2 use VM's network, there will again be similar product differentiation with three distinct retail options on the same networks to cater for most punters.