2010 ITU-T SG3 RG-AO.Beijing.China
Session 10
Research on the Design Strategy for
Integrated Full-Service Package
ZhaoYuanyuan
China Unicom. National Engineering Lab
2010.04
0
Abstract
 Under the full-service operating environment, the integrated package exhibiting more and
more development potential. Whether operators’ package strategies is reasonable and
meets users’ expectations is the main factor for their acceptance and usages of full-service
integrated package. Based on the research of the demands of home users and relevant
domestic and foreign package strategies, this paper proposes a model for telecom operators
to design full-service integrated package.
The full-service integrated package is a kind of service
model designed in accordance with different levels and
contents and combines month calls fee, preferential data
value-added services as well as diversified use terminals
based on home users’ different needs.
1
Home users’ demands and Affecting factors for fullservice integrated package
Full-service integrated package strategies of
telecom operators
2
Home users’ demands and Affecting factors for fullservice integrated package

Until the end of 2008, China has 424 million households, 45.2% of whom have installed fixed phone, and
about 60% of them have installed mobile phones at the same time. It is predicted that in 2011, the number
of households is expected to reach 439 million and the number of households using telephones and mobile
phones simultaneously is expected to reach 119 million all over China.

A domestic regional integration business survey data of home users in 2009 reflects that, under the
condition of fixed phone numbers, the average acceptance of the family integrated service is 85.3%; while
in the opposite case, the average acceptance of family integrated service reached 51.4%.
Average acceptance : The fixed phone
numbers
95%
90%
Average acceptance: The changed phone
numbers
56%
92.2%
54%
86.3%
86.0%
84.8%
83.2%
85%
85.3%
84.6%
53.5%
54.3%
53.4%
51.4%
52%
80%
49.6%
49.5%
50%
80.0%
52.9%
48.4%
48%
75%
46%
70%
44%
A
B
C
D
E

F
G
Total
A
B
C
D
E
F
G
Total
The average acceptance of various kinds of service (A-G)
3
Home users’ demands and Affecting factors for fullservice integrated package
fixed phone + mobile phone+ broadband

the package of fixed phone + mobile phone+
broadband is universally recognized and proved
47.50%
35.90%
to be the first choice for 53.88% clients.
16.60%

fixed phone + mobile
fixed phone + 2mobile
fixed phone + n mobile
phone+ broadband
phones+ broadband
phones+ broadband
As for the service of bundling terminal numbers,
when clients are facing of choosing fixed phone+
mobile phone+ broadband and fixed phone +
fixed phone + mobile phone
mobile phone the proportion of bundling two
mobile phones were the highest 47.5% and 45.9%
45.90%
27.00%
fixed phone+ mobile
phone
27.00%
fixed phone+ 2
mobile phones
fixed phone+ n
mobile phones
respectively.

According to market research about a variety of
integrated services, the acceptance rate of family
VPN service reaches as high as 91.33%, 60.92%
A variety of integrated services
of FNS (Familiarity Number Service) and 22.25%
91.33%
60.92%
of family unification account, while 57% of the full-
57.00%
22.25%
family VPN service
FNS
the full-service bundle
package
service bundle package.
family unification
account
4
Home users’ demands and Affecting factors for fullservice integrated package

Tariff price ranges
26.8%
19.2%
15.2%
is an arch shape: when the tariff decreases
by 10% -20%, there are 20% clients who will
21.3%
certainly use full-service integrated package;
when the tariff drops to 30%, this proportion
8.8%
4.6%
-10%

3.8%
-20%
-30%
-40%
the users’ sensitivity degree of price changes
-50% -60% Not to purchase
rises to 27%; and when the tariff drops by
more than 40%, the proportion decreases.
Compared with the 3G mobile services, the primary factor whether users choose full-service
integrated package lies in the “degree of access to services convenient" and “tariff price ranges.”

For users sensitive to price changes, operators should focus on exploring their other demands to
prevent them roller among different networks.

for the price-insensitive users, operators should strive for the users’ joining in the network by
upgrading service quality and convenience of packages as well as attracting family members to
choose the packages.
5
Home users’ demands and Affecting factors for fullservice integrated package
Full-service integrated package strategies of
telecom operators
6
1.Tariff integration strategy based on service bundling

The tariff standard of full-service integrated packages with the bundling of voice, broadband, TV
and wireless services.
Case Study
Tariff strategy


Operators A


Operators B

Divided fixed phones, 3G mobile, broadband, and digital TV and designed specific tariff
packages
Provided a package of solutions with “multi-business portfolio bundling” and “typical
combination of bundled packages”
Introducing 3G to enhance its attractiveness. 3G users could choose all domestic packages
and family packages, including national long-distance calls and roaming, voice mail,
unlimited calls between cell phones, call waiting, three-parties calling etc.
Basic services package +Value-added services package, more differentiated value-added
services /products and day / week cycle billing services are offered to clients.
The contract duration of value-added services package + basic services is at least one year.
Fees are deducted directly from bank accounts and different rates, call duration and valueadded services data packages are offered according to different contract duration and
packages.
7
1.Tariff integration strategy based on service bundling


Operators tend to flexibly combine the basic voice services with value-added services portfolio
and to design flexible tariff strategies and pricing cycle (daily/weekly).
The high-end users can have more value-added data services (for example, e-mail, SMS,
MMS and other services) to reflect users’ differentiation.

The greater the amount of full-service package, the lower the rate is, and the bridge between
cheap packages is narrow, the gap between expensive packages is broad. This is designed on
the basis of different users’ sensitivity towards price: the low-end users are more sensitive to
expenditure, which means it is necessary to further divide into smaller packages from
according to the different habits of users, while the high-end users are less sensitive, so
packages can be simplified.
8
2. Integrated tariff strategies based on integrated terminals

Integrated tariff strategies based on integrated terminals adapted a pre-paid + monthly fee +
stratified bundling design pattern.
Case Study
Tariff strategy

Operators C


Operators D

Application-oriented Home Gateway + simplified family Internet + 3P integrated services with
voice, broadband and TV. Established a business web site to provide users with multimedia
download services.
Adapted the pre-paid purchase / lease + monthly fees model. In different area market
adapted the different home gateways + Dect handles + music box, bundle the two/ triple-play
(1M/4M/8M) broadband service model.
Through the 3G network to get fixed-line services such as fixed-line telephone, DECT
phones, computers and fax, etc.; providing data services on 3G networks; linking set-top
boxes and PC through the WLAN; domestic users can order services in the network when
necessary.
Fixing the virtual operator (FVNO), the fixed-line operators wholesale broadband services to
implement the "mobile + fixed + broadband" business strategy of bundling. Different grades
of family package plans are introduced guided by network package tariff and users’ habits
and needs.
9
2. Integrated tariff strategies based on integrated terminals


In the integrated strategy based on integrated terminals, users’ costs are increased when
integrated home gateways are promoted. As for telecom operators, gateway-related pay for
additional services and new business investment and additional management costs are also
increased.
At the same time, the direct influence of promoting home gateway or set-top box is the
increase of operating revenues. Whether users directly buy or lease terminals or terminal
operators make all or part of subsidies, higher one-time purchase cost or deposit will be
received, which is calculated through pricing model.

In addition, because bundling integrated home gateway, operators can charge more monthly
rent than previously. Its indirect impacts include the provision of differentiated and competitive
products; customers’ high degree of loyalty and more digital home users’ value-added services.
10
Thank You!