LIVE FROM WEDO WORLDWIDE USER GROUP, PORTO: The convergence of fixed and mobile services into a single, integrated proposition is key to the growth strategy of Portuguese operator Zon Optimus, said CEO Miguel Almeida (pictured).

“When you have the combination of assets that we have, convergence is the way forward,” the executive continued. “We can protect our pay TV customer base by upselling mobile, and we can grow our mobile customer base by doing this because we have a much larger market share in pay TV.”

Almeida said that growth from the operator’s quadplay bundle has been “very, very fast”. But bundling is only the first stage, he continued. “Today we are bundling the services and giving a discount to the customer, which is good news for the customer, but not such good news for the operator. What we are trying to do for the future is to bring to this convergence a value proposition, things like making sure customers use all the services across all the different devices.”

An example where the company is “well down the road” is in making its content available across fixed and mobile devices.

logo_nosAlmeida’s comments come shortly after the company adopted a new brand, Nos (pictured), which will be used across all its propositions, replacing the separate identities used by its predecessor companies, Zon and Optimus, prior to their merger.

“Basically, as our value proposition converged, we could not keep working the market with two brands”, he said. Nos is being positioned as a new operator, “and a new operator that is born with a fully integrated offering”.

The executive said that Portugal has faced the same challenges as other countries worldwide, such as economic weakness and regulatory changes which have impacted inter-operator revenue.

But, he continued, “the key reason is not the economy, is not regulation, the key reason is competition” – which has led to price cuts.

In addition, prior to the merger of Zon and Optimus, and with the exception of incumbent operator Portugal Telecom, no company had a significant market share across pay TV, fixed and mobile services.

Zon, for example, was strong in fixed and pay TV services, but not in mobile. Optimus and Vodafone Portugal were strong in mobile, but less so in other markets.

What followed was the merger between Zon and Optimus, while Vodafone has invested in its fibre-to-the-home network.

While post-merger Zon and Optimus is still behind PT, “it gives us enough size to compete head-to-head with the incumbent,” Almeida said.

And the CEO was also bullish on its prospects for the future, mooting international growth as one option.

“Our objective and our strategy for the coming years is focused on Portugal, but someday if we deliver on this strategy well in Portugal, we will be in a position to seek international growth opportunities, with all this experience in convergent markets,” he concluded.