Bear Stearns Finds Consumers View Services As Commodities By Linda Moss -- Multichannel News, 3/6/2008 2:53:00 PM
Price is the key factor driving demand for video, broadband and voice services, according to consumer research conducted by Bear Stearns.
“Our survey finds that users continue to view these services as ‘commodity-like’ with price the primary driver of demand,” the Wall Street firm said in a report by analyst Spencer Wang.
For its 2008 Communications Survey, Bear Stearns surveyed nearly 1,000 consumers.
“Consistent with our prior work, our survey finds that across all three products categories, price is the top factor affecting demand,” Wang wrote. “This implies that consumers view communication services as fairly ‘commodity-like,’ and that as competition rises, pricing power may wane. However, we still expect rational pricing given the oligopoly structure of the industry, although average revenue per user growth will likely slow going forward with more competition.”
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