Does Service Bundling Reduce Churn?
54 Pages Posted: 30 Nov 2011 Last revised: 13 May 2014
There are 2 versions of this paper
Does Service Bundling Reduce Churn?
Does Service Bundling Reduce Churn?
Date Written: April 2013
Abstract
We examine whether bundling in telecommunications services reduces churn using a series of large, independent cross sections of household decisions. To identify the effect of bundling, we construct a pseudo-panel dataset and utilize a linear, dynamic panel-data model, supplemented by nearest-neighbor matching. We find bundling does reduce churn for all three “triple-play” services. The effect is only “visible” during times of turbulent demand. We also find evidence that broadband was substituting for pay television in 2009. This analysis highlights that bundling helps with customer retention in service industries, and may play an important role in preserving contracting markets.
Keywords: Bundle, Service, Churn, Triple Play, Telecommunications, Cable, Broadband, Telephone, Screen
JEL Classification: D12, L96
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Household Demand for Broadband Internet Service
By Gregory L. Rosston, Scott Savage, ...
-
Fighting City Hall: Entry Deterrence and New Technology Deployment in Local Cable TV Markets
-
Mixed Oligopoly Equilibria When Firms' Objectives are Endogenous
By Philippe De Donder and John E. Roemer
-
Mixed Oligopoly Equilibria When Firms' Objectives are Endogenous
By Philippe De Donder and John E. Roemer
-
Generics and New Goods in Pharmaceutical Price Indexes
By Zvi Griliches and Iain M. Cockburn
-
Forecast Models of Broadband Diffusion and Other Information Technologies