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Introduction

1.1 Background to the research

This report supports Ofcom’s work to monitor and understand large businesses and their use of and experience of telecoms services.

Latest figures from the Office for National Statistics show that there are 7,700 large businesses in the UK^(-1-) defined as businesses with 250 employees or more.

These businesses form an important part of the UK economy. Telecommunications plays a vital role in supporting and enabling these businesses to function and develop.

Ofcom has a statutory duty to further the interests of UK businesses and aims to provide best-in-class research to which stakeholders have regular access.

This research aims to show how the large business community in the UK uses fixed line telecoms, mobile telecoms and advanced data services. The report also provides evidence of their experiences of these services.

In particular the research focuses upon:

• actual switching behaviour and views on the ease/difficulties of switching,
• satisfaction with overall service, value for money, customer service/account management and the range of services and suppliers available,
• views on how easy or difficult it is to make comparisons between suppliers when making purchasing decisions, and
• opinions on whether or not particular aspects of the markets have improved or deteriorated over the past year.

1.2 Methodological approach

Research amongst large business users presents certain practical challenges:

Firstly, there is a relatively small universe of large businesses available for interviewing. In total in the UK there are only 7,700 large businesses.

Additionally, many different organisations are interested in the views and experiences of this important but relatively small group of large businesses. This results in a high demand of requests to participate in research; especially in the area of communications technologies.

To address this Ofcom established a panel of large business representatives in 2005^(-2-). Maintaining this panel allows Ofcom to contact representatives within large businesses who are willing to take part in research.

This research was carried out using Ofcom’s large business panel via an on-line survey. Interviews were carried out in May and June 2006 and a total of 147 interviews were completed with people who had responsibility for telecoms decision making within large businesses.

In research 147 respondents may not constitute a large sample, however, given that there are 7,700 large businesses in the UK, 147 respondents equates to 2 percent of the total large business population. Ofcom therefore considers this a suitable sample for research with large businesses. With this number of respondents Ofcom calculates the margin for possible error to be 7.5 percent: That is to say that if 50% of the sample say they are satisfied with a service, the actual figure may lie anywhere between 42 percent and 58 percent.

Responses were weighted by company size based on data supplied by the Office for National Statistics^(-3-).

1.3 Summary of key findings

Switching

Just over half of large businesses say they have switched suppliers in the last 3 years across fixed line, mobile services and advanced data services, but the process of switching is not always straightforward, particularly for advanced data services:

• 53% claimed to have switched supplier for fixed line phone services and the same proportion have switched mobile services in the last 3 years. Some 55% say they have switched advanced data services in the same time period.
• 60% of those who switched fixed line phone services said they found the process easy, compared to 30% who found it difficult. When switching mobile services, 43% found this easy and 33% had some difficulty. Around 32% found switching advanced services easy and 37% found this difficult.

Satisfaction

Large businesses are generally satisfied with fixed line and mobile services, but satisfaction with advanced data services was shown to be less:

• 73% of companies were satisfied with fixed line services overall. The same number were overall satisfied with their mobile services. This is compared to 44% of companies who were overall satisfied with advanced data services.
• 60% of companies were satisfied with the quality of customer service or account management with their fixed line services, 68% were satisfied with this on their mobile services compared to 43% of companies who were satisfied with this on their advanced data services.
• 64% of companies were satisfied with value for money on fixed line services, 61% were satisfied with this aspect of their mobile services compared to 38% of companies who were satisfied with this for their advanced data services.
• 62% of companies were satisfied with the range of relevant or appropriate services and suppliers for fixed line services, 71% were satisfied with this for mobile services, whilst 41% of companies were satisfied with this aspect of advanced data services.

Comparisons between suppliers

The research indicates that large businesses do not necessarily find it easy to compare the costs of different suppliers:

• 44% found it easy and 38% found it difficult to compare the costs of fixed line suppliers, whilst for mobile services 44% found it easy and 40% found it difficult. For advanced data services 29% found it easy and 26% found it difficult.

Large businesses also reported some difficulties comparing the overall quality of suppliers:

• For fixed line 28% said they found it easy whilst a higher proportion (53%) found it difficult to make this comparison. When thinking about mobile services 29% found it easy and 48% found it difficult. With advanced data services 22% found it easy and 41% found it difficult to compare the overall quality of different suppliers.

Changes over the last year

When considering any changes that have taken place over the last year, large businesses generally reported that choice of suppliers had improved across fixed line, mobiles and advanced data services. Around a third of respondents felt there had been an improvement compared to around one in ten who felt that choice had got worse.

Large businesses gave the most positive feedback on changes in the overall quality of service on mobile services; 40% said they thought this had improved whilst 7% said this had become worse. In comparison 23% of businesses felt that quality of service overall of fixed line services had improved, with 10% of the view it had got worse. The figures were very similar for advanced data services; 22% indicated improvements whilst 10% suggested that this had become worse.

There was little indication that quality of customer service or account management had improved for both fixed lines and advanced data services with roughly equal numbers saying it had improved and worsened. However, 33% of those with mobile services saw this aspect of the services as having improved compared to 16% who commented that this had got worse.

Footnotes:

1.- Data supplied by ONS Data Analysis Service on 2005 figures for VAT based enterprises

2.- This panel has since been up-dated and refreshed in 2006.

3.- Data supplied by ONS Data Analysis Service on 2005 figures for VAT based enterprises

The full document is available below:

• Large Business Use of Telecoms Services: Research Report 2006 [pdf]
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