Broadband bundles of Joy.

Bundled services are not new, but consumers are becoming increasingly attracted to the cost savings and potential customer service benefits that can accrue from bundling their Internet access with TV, phone or cellphone services.

A new report from Telephia suggests that as of mid-2006, over 31 million online households in the US were buying two or more services from one provider. This equates to nearly 43% of online households.

The Internet/TV combination is the most popular bundle at the moment, according to Telephia, with approximately 13 million households taking that double play, compared with 10 million households taking the double play of Internet/phone. Triple-play households only numbered five million and the quad play, which includes mobile phone service, is still a rarity.

Research firm IDC forecasts 84 million bundled communications subscribers in the US in 2010, which will likely be nearly every broadband household in the country at that time.

For its recent Broadband Prices & Bundles report, eMarketer surveyed a selection of the leading broadband access providers in the US to assess their multi-play offers. While Verizon does offer multichannel TV services over its fiber-to-the-home Fios network in select areas of the country, telecom operators have partnered with satellite TV providers in order to include digital TV services to their bundles.

The data show that a basic triple-play bundle is currently available for approximately $100 per month. It is worth pointing out that, typically, cable providers offer significantly greater amounts of Internet bandwidth to their customers than telecom operators, so value is in the eye of the beholder. Furthermore, different phone and digital TV services mean that it is not always an apples-to-apples comparison. Nevertheless, the data below provide a useful snapshot of multi-play prices as of June 2006.

Cost savings are the primary driver for consumers to bundle their communications services, particularly when a consumer looks at triple- and quad-play offers, according to the Telephia data presented below. Convenience and customer service, however, are other important drivers that should not be underestimated by service providers.