Operator churn could rise to 50% in 12 months - report

Ovum has published a report claiming operators could lose almost half of their existing customers within the next year. According to the analyst firm, about a quarter of all users say they will definitely switch to another provider, while another quarter are actively considering changing.

The survey, which included responses from some 15,000 consumers and 2,700 enterprises across 15 major markets, argued the biggest driver for customer churn stems from bad quality mobile broadband. 37% of respondents said they have either left or are planning to leave their current provider because of slow connection speeds.

“Being online is by far the most important thing in consumers’ digital media lives,” Angel Dobardziev, practice leader at Ovum said. “When we asked consumers to rate a range of activities on a scale from ‘essential’ to ‘unimportant’, browsing the web came top, with nearly six out of 10 consumers rating it as essential. By comparison, an old favourite such as watching TV was rated by only three out 10 consumers as essential, scoring as less important than reading the news (50% of consumers), reading a book (45%) and listening to music (42%).”

The survey also found that iPhone users are much more likely to change providers than other handset users, and again the most common reason for churning was slow network speed.

Ovum said operators must gain better understanding of consumers’ inclination of switching to another provider, and they should do so in a wider context than just their own market as global trends tend to pervade through to national-level as well.

“This must be combined with an evaluation of drivers for customer churn across different segments, markets and providers, with a view to gaining insight on the best, and worst, practices – despite differences in local market contexts and levels of competition,” Dobardziev said.

Certainly churn is a pressing issue for most operators – or at least it should be. As a consumer, the writer herself is not unfamiliar with having had active thoughts of switching providers for various reasons, including bad coverage and less than impressive customer service. Although operators can often rectify instances where the customer felt they received bad service with a better deal, bad connectivity is detrimental.