Orange has a long track record of using content promotions and extra services to attract and retain subscribers in the UK. Its two-for-one Orange Wednesdays cinema deal has been popular for a number of years and more recently (August 2011) it launched a free weekly iTunes movie download service. While those two examples form part of Orange's UK marketing play, the Swapables represent a significant step in the operator's content and smartphone strategy.  Orange has offered similar rich-media content bundles in its home market France under the "Origami" packages (equivalent to "Panther" in the UK) since 2008. The fact that Orange is bringing its French style all you can eat mobile content buffet to the UK market indicates that: 1) it has managed to monetize the offer in its home market; 2) its UK operations are mature enough in terms of network capacity and smartphone penetration to accommodate it and 3) content costs are low enough (which is not surprising given its particular relationship with Deezer).   

The variety of content on offer, the range of devices that are addressed and the simple pricing (i.e. no additional or hidden cost) and subscribers' freedom to change the content they access should, if communicated to consumers effectively, see the service prove successful in gaining and retaining high-end subscribers. Because the price of Panther packages are remaining the same, no incremental revenues will be directly generated from "Swapables". Monetisation will instead come from the sale of data add-ons, additional content purchases and, eventually, advertising. IHS Screen Digest suspects that this offering will also boost Orange's ARPU via the transition of part of its mid-tier subscriber base to the high-end Panther packages.  

The deal is a major plus for Deezer as it launches UK services. With little to differentiate it from its more established on-demand music competitor Spotify, the "free" bundled Orange service will help Deezer gain significant traction in a market where it lacks brand awareness.

Partnering network operators has been vital to Deezer's rapid growth in its domestic French market. IHS Screen Digest research indicates that 1.3m of Deezer's paid subscribers access via bundled services with just 100,000 standalone premium subscribers.

In the UK, the network operator 3 first offered bundled Spotify access in 2009. More recently, UK pay-TV operator and ISP Virgin Media partnered Spotify to offer various levels of bundled music access to its pay-TV subscribers. Bundled UK services have yet to see the levels of success seen in France, but Orange's offer looks well placed to succeed.

Offering mobile TV access could provide a boost to the UK mobile TV market which has contracted in recent years as smartphone users have opted for free video content and over-the top services via mobile applications outside network operators' control.

Of the other content on offer, games and navigation services will likely be popular choices. IHS Screen Digest research indicates that games will account for more than half of all smartphone application downloads to 2015 and navigation apps are consistently high in the top grossing applications charts.

However the other content will likely prove less appealing to consumers who may feel that puzzles, horoscopes and sport alerts do not offer the same value as premium music, TV, games and navigation services.

Orange's Swapables will be a significant differentiator in the content-thirsty mobile market that is the UK and will push other operators to reconsider their mobile content strategy.