Would you trust your telco to manage all your subscriptions?
![Telecoms Subscriptions](/media/0msktiub/telecoms-subscriptions.png)
Customers want a centralised content hub to help manage and pay for all their subscriptions – and they want their mobile or broadband provider to run it. Would this be a good move for telcos, and would streamers be the bigger winners?
Telcos now do a lot more than just providing connectivity to try and remain competitive, whether it’s reselling mobile handsets and gadgets, selling smart fridges or showering their customers with perks. Could they soon be managing their customers’ other subscriptions too?
Consumers are willing to pay extra for their telecoms provider to act as a hub to manage their subscriptions, according to a survey of 5,000 people across the UK, France, Germany, Italy and Spain.
58% said they wanted a centralised service to manage all their subscriptions and let them pay through a single bill, and of those, most trust their connectivity provider to do it – 46% wanted their mobile provider to, while 36% said their broadband provider. In contrast, only 17% trusted their TV provider to manage this service, while just 6% wanted social media firms.
39% would even go so far as to leave their current provider if another offered such a “super bundle”, and 38% would pay more for their tariff if it came with a package of popular subscription services included.
Many telcos already bundle a few subscription services, most commonly video, sports and music streaming services, while some have tapped into other offerings, such as cloud gaming, antivirus and fitness subscriptions.
What features should this subscription hub have?
- 45% of survey respondents want the option to temporarily pause subscriptions.
- 34% want to be able to change the duration of a given subscription.
- 22% want the ability to switch between tiers of subscription, such as from a cheaper ad-supported tier to a premium tier.
Perhaps most contentiously, 32% also want their content hub to let them compare prices across all platforms, which might lead inevitably to some unfavourable comparisons between providers.
Customers of Optus can already enjoy the benefits of a content hub with SubHub, launched in 2021 for postpaid mobile or broadband users, offering access to several streaming services, as well as Microsoft 365, news service inkl, and education platform MasterClass, among others.
Meanwhile, Seasons is an independent app offering a similar service, letting users manage their streaming subscriptions, but also suggests when is best for them to unsubscribe based on what series they’re currently bingeing.
In fact, consumers are increasingly keen to be vigilant over their subscription spending; research from Citizens Advice has found that in the last 12 months, 13 million people in the UK have accidentally taken out a subscription, and a total of £688 million has been spent on unused services.
The most common reason is auto-renewal without the customer’s knowledge. Others report beginning a free trial but forgetting to cancel, or subscribing to a service under the impression that they were making a one-off purchase. For consumers, a unified service to simplify billing and subscription management to combat these problems can’t come soon enough.
For streaming providers, costs are being forced up across the board, fuelled in part by new protectionist legislation; starting in September, streaming platforms in Canada will have to invest 5% of revenues into local and indigenous content, while France is introducing a tax on music streaming platforms to be reinvested in the local music industry.
Though customers aren’t happy with these new taxes, they aren’t driving them away in significant numbers – 94% of French subscribers have continued to pay for music streaming, despite the tax, according to the survey.
Nevertheless, expanding subscriber counts is becoming more challenging as the market reaches saturation point and customers reach their spend limits – 60% would sign up to more subscriptions if they could afford it, and 42% have been forced to cancel a subscription recently due to price increases.
Subscription providers can only ban password-sharing once to boost their growth, so partnering with a telco gives instant access to a large customer base who may be far less likely to churn if their service is bundled with several other subscriptions at once.
However, subscription companies may choose to remain independent, opting to be a broad church for all consumers instead of getting locked into exclusive or preferential agreements. Furthermore, if a particular telco offers their own competing services, a partnership could give rise to conflicts of interest – any telco is certain to prioritise its own services, potentially impacting service quality and customer satisfaction.
After subsisting on low interest rates and foregoing profitability in favour of rapid subscriber growth, the pressure is now on for digital services providers to start turning a profit for themselves. Price rises and the introduction of ad-supported subscription tiers has gone some way towards this, but retention is the new battleground, and that’s where telcos may be able to help.
Managing payments between telcos and multiple subscription providers would require a robust billing and settlements system tying them together, ensuring a smooth customer experience and more flexible payment options.
TM Forum Open APIs and the Open Digital Architecture (ODA) provide a pathway to standardise this integration, ensuring compatibility between different platforms and technologies. If telcos really want to become more digital and broaden their service offerings, then this is a good place to start.