A SIM card used to mean something. Now, for a growing share of subscribers, it is a data pipe that gets Netflix, Disney+, and Spotify onto a phone, and not much else. When that is the whole relationship, a customer comparing two operators side by side has nothing left to weigh except the monthly price, and the operator with the cheaper SIM-only deal wins by default.
That shift is why telecoms loyalty programs matter more now than they did five years ago, and why the ones built around a generic points balance are losing ground to programs built specifically around what OTT competition changes.
OTT platforms do not just compete for revenue; they compete for attention. A subscriber who spends three hours a night on a streaming platform is building a daily habit with that platform, not with their mobile network, and the network becomes infrastructure rather than a brand anyone thinks about.
GSMA Intelligence's 2025 research on mobile churn and retention found that roughly one in seven mobile subscribers across 12 major markets switched provider in the prior year, and that value for money, not network quality, is now the primary reason they leave. That is the OTT effect in practice: when the content people actually value lives outside the network, "value for money" gets measured against a Netflix subscription, not a competitor's tariff.
Operators have not simply ceded that ground. Omdia and Bango's Super Bundling research puts roughly a fifth of all streaming video subscriptions worldwide as sold through a telecoms bundle rather than direct from the platform, with that share projected to keep climbing. Sky's Ultimate TV bundle in the UK is the clearest example of what that looks like done well: it folds Netflix, Disney+, HBO Max, and Hayu into a single subscription, and existing Netflix or Disney+ subscribers can drop their standalone plan and switch in without losing their profile or watch history. Vodafone Ireland's TV Play does the same on a smaller scale, bundling Netflix, Prime Video, and Disney+ apps into its broadband and TV packages. Neither operator is trying to out-content Netflix. Both are making the case that the subscription a customer already wants is easier to keep through the network than around it.
Bundling OTT access into a loyalty tier is not a discount. It is a way of making the operator relationship as valuable as the content the subscriber is actually there for, which a price comparison tool cannot show a customer at all.
Bundling approaches vary in how much retention value they actually create. A subscription simply billed through the operator's account is a convenience feature; a subscription tied to a loyalty tier, with switching-in incentives or exclusive extras, is a retention mechanic.
| Operator | Market | What's bundled | Mechanic |
|---|---|---|---|
| Sky | UK | Netflix, Disney+, HBO Max, Hayu via Ultimate TV | Existing Netflix/Disney+ subscribers switch in and keep their profile and watch history; genuine retention play, not just a discount |
| Vodafone Ireland | Ireland | Netflix, Prime Video, Disney+ via TV Play | OTT apps folded directly into broadband and TV packages from €65/month |
| EE | UK | Apple Music, Apple TV+, Arcade, iCloud+ via Apple One | Available as an add-on for +£5/month on qualifying plans, plus a 3-month free Apple TV+ offer |
| Vodafone | Germany | Up to 40% off all Netflix tiers | Discount tied to an active Vodafone contract rather than a bundled subscription |
Sky's approach sets the bar because it removes friction at the point a subscriber would otherwise churn to a direct streaming subscription: there is no loss of profile, history, or continuity, so switching away from Sky means giving up a genuinely seamless experience, not just a discount. Vodafone's German model, by contrast, is closer to a straightforward retention discount than a loyalty mechanic, since the value is tied to having a contract at all rather than to tenure or engagement.
Price is the most cited reason subscribers give for leaving, but it is rarely the only one. Ofcom's 2025 comparing customer service report found that 14% of UK mobile and broadband customers had a reason to complain in 2024, and that satisfaction with how those complaints were handled, while improving, still sat at only 58–61% across mobile, broadband, and landline. A subscriber whose billing issue gets resolved badly is a subscriber primed to compare prices the next time a competitor's ad appears.
Network quality issues are harder to address through loyalty mechanics directly, but a program can soften how a subscriber weighs a coverage gap or an outage against the rest of the relationship. Customer service is a genuine, underrated churn driver in its own right. A subscriber who has a poor experience resolving a billing or handset issue is more likely to start shopping around within the following weeks. A loyalty program that recognises subscribers during service moments, such as priority queuing or a proactive gesture after a complaint is resolved, addresses that trigger directly rather than hoping the relationship survives it.
The category OTT competition hits hardest is perceived value. A subscriber comparing two operators purely on data allowance and monthly cost has already reduced the relationship to a commodity transaction. The job of a loyalty program is to make that comparison beside the point by adding value a price comparison tool cannot quantify.
Simon-Kucher's 2025 Global Telecommunications Study, based on 15,700 consumers across 31 markets, found that loyalty program members carry 43% higher customer lifetime value than non-members. Yet 80% of operators run a loyalty program and only half of customers are actually enrolled in one, which is the size of the gap most operators are leaving on the table.
The same study found that 95% of telecoms customer lifetime value comes from the 75% of the base who have stayed three years or more. That is a rare case where the maths says the same thing twice: retention is not a secondary lever behind acquisition, it is where almost all of the value already sits.
That tenure concentration lines up with the acquisition side of the ledger, too. STL Partners' telco churn economics research puts the typical postpay payback period at around 17 months before a new subscriber's acquisition cost is recovered. Every month a subscriber stays past that point is closer to pure margin than the acquisition spend was, which is the case for treating loyalty as a margin lever rather than a customer-service nicety.
Three mechanics do the most work for operators competing against OTT specifically, and none of them is a generic points balance.
OTT bundling is the most direct response to the streaming threat. Folding a Netflix, Disney+, or Apple TV+ subscription into a loyalty tier, the way Sky, Vodafone Ireland, and EE already do through Apple One, makes the subscription the customer already wants part of the reason to stay on the network. The subscriber cannot leave without also losing access to content they already rely on, which is a genuinely different proposition to a bill discount a competitor can match within a billing cycle.
Tenure recognition works alongside it by protecting the value Simon-Kucher's data shows is already concentrated in long-tenure subscribers. A reward at a meaningful anniversary, rather than a generic points trickle, gives a three-plus-year subscriber a visible reason to notice that the relationship has been recognised, not just billed.
The third lever, priority service, gets used less often than it should. A loyalty tier that includes faster complaint resolution or a dedicated contact delivers concrete value a price comparison site cannot replicate, and most operators already have the service infrastructure to support it without building anything new.
Partner rewards beyond OTT, such as fuel or grocery discounts, still have a place: they give subscribers a reason to open the loyalty app between billing cycles rather than only at renewal. But for an operator specifically fighting OTT-driven perceived-value erosion, bundling and tenure recognition are the two mechanics that address the actual problem rather than working around it.
Family and multi-line rewards are worth a specific mention because they compound the OTT bundling case. A streaming subscription is naturally a household purchase, watched across several profiles, which makes it a stronger anchor for a multi-line loyalty tier than an individually redeemed discount. A household with three lines on the same account and a shared Netflix profile through the operator has three separate reasons not to switch, not one, and unwinding that arrangement to move to a competitor means every line-holder has to agree to give something up at the same time.
What doesn't translate well: bundling OTT access without also recognising tenure or usage. A subscriber who gets the same Netflix bundle as every other customer on the plan, regardless of how long they've stayed or how much they use, is still being sold a discount, just a more interesting one than cashback. The bundling only becomes a loyalty mechanic, rather than a pricing feature, when it is paired with something that differentiates a three-year subscriber from a three-month one.
A telecoms loyalty program built to address OTT pressure should be measured against the cost of the churn it prevents, not against its own running cost in isolation.
The metrics that matter most: voluntary churn rate and average revenue per user, both compared by loyalty tier against non-members; net promoter score among program members versus non-members; and redemption rate, the share of subscribers actively engaging with the program rather than simply being enrolled in it. Track the ARPU gap between engaged members and everyone else specifically, since Simon-Kucher's 43% lifetime-value gap is the kind of tier-level comparison worth replicating on your own subscriber base rather than taking on faith. That cohort-based measurement discipline, tracked over time rather than as a single churn figure, is the same one we cover in our broader guide to customer loyalty programs and retention.
Track these quarterly at minimum, and pay particular attention to the months immediately following a major OTT platform price rise or a competitor's own bundling announcement. Those are the moments an unprotected subscriber base is most likely to start comparing on price alone, and the moments a bundled, tenure-recognising program earns its keep.
An operator without a loyalty program does not need to build the full Sky-style bundling infrastructure on day one. The practical starting point is narrower: identify the OTT partnership already within reach given existing commercial relationships, then wire it to a loyalty tier rather than offering it to every customer regardless of tenure. Layer in a tenure-recognition trigger next, for the three-year-plus cohort that Simon-Kucher's data shows already carries almost all the lifetime value on the book. Priority service for that same cohort is the next addition, since it is usually the cheapest of the three mechanics to stand up against existing customer service infrastructure.
That sequencing matters because it protects the highest-value subscribers first, rather than spreading a thin layer of reward across the entire base and calling it a loyalty program. An operator that measures the ARPU and churn gap between its three-year-plus cohort and everyone else before building anything has a business case that justifies the OTT bundling spend before a single subscriber redeems anything.
What is a telecoms loyalty program?
A telecoms loyalty program is a structured retention strategy that rewards mobile or broadband subscribers for staying with an operator, spending more, or engaging with more services. Unlike a generic points scheme, it targets the specific churn triggers of telecoms customers, including the pull of OTT platforms like Netflix, Disney+, and Spotify on subscriber attention and spend.
Why is OTT competition a threat to telecoms operators specifically?
OTT platforms compete for a subscriber's attention and discretionary spend, not just their connectivity budget. When the SIM or broadband line becomes a data pipe for someone else's content, the operator has less of a relationship to protect, which pushes the comparison down to price. Around a fifth of streaming subscriptions globally are now sold through a telecoms bundle rather than direct, which shows operators can capture some of that value rather than losing it outright.
What rewards work best for telecoms subscribers?
Rewards with daily or weekly utility outperform static cashback. OTT bundling, tenure recognition at renewal-relevant milestones, and priority service for account or billing issues all address a specific churn trigger rather than offering a generic discount.
Can a loyalty program work for SIM-only or low-ARPU subscribers?
Yes, and it is worth prioritising. SIM-only subscribers are typically the highest-churn cohort because they have the least invested in the relationship, but they respond to exclusive value that a price comparison site cannot show them, such as an OTT credit or a service perk tied to tenure.
How do you measure whether a telecoms loyalty program is working?
Track voluntary churn and average revenue per user by loyalty tier against non-members, net promoter score among members versus non-members, and redemption rate. Simon-Kucher's 2025 telecoms study found loyalty members carry 43% higher lifetime value than non-members, which is the kind of tier-level comparison worth replicating on your own base.
Brandfire has designed and managed loyalty programs for telecoms and utility brands since 2012, across the Irish and international markets. If you're scoping a program built to hold up against OTT-driven churn specifically, our loyalty programs page covers the strategy side, and rewards platform covers the technical build. Get in touch to talk through your subscriber base and retention objectives.
We can help you design and deliver a solution tailored to your customers and commercial goals.
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