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Consumers’ use of mobile telephony – Summary of Oftel residential survey, Q6 August 2001 |
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4
November 2001 Chapter
1 – Introduction 1.1 This report provides an overview of the key findings of consumer behaviour in the mobile market, taken from the sixth wave of Oftel’s quarterly residential consumer survey conducted in August 2001. Results from previous waves are used for comparison purposes and referred to throughout this report. 1.2 The report provides trend information to which subsequent quarterly results can be compared, and examines differences between consumers with different social characteristics. 1.3 The survey was conducted for Oftel by MORI, amongst 2063 UK adults (see note one below) during August 2001, of whom 73% claimed to personally own or use a mobile phone. A further 6% who do not personally use a mobile claim to live in a home with at least one mobile. The report has been prepared by Oftel (see note two below), based on the results provided by MORI. 1.4 This report covers:
1.5 A copy of the questions is attached in Appendix 1. Topics to be researched each quarter are requested by Oftel project teams and results feed into current investigations and reviews in individual market areas. Notes: 1. This survey was conducted amongst a representative sample of UK adults, reflecting the UK profile of sex, age, social grade, region and employment status. Data has also been weighted to ensure the sample is representative of the UK adult population. All data shown is weighted data. Unweighted base sizes are shown on charts and tables to show the number of people who were asked the question. Because the survey was conducted amongst a sample of adults, rather than the whole population, the data may be subject to a small margin of error. The error margin for this survey of 1467 consumers with mobiles is about 2-3%, but is higher amongst smaller subgroups. 2. The report should not be seen as recommended best buys and should not therefore be relied upon when making purchase decisions. Oftel has conducted its own checks on the data in this report and whilst we consider it to be correct, Oftel accepts no liability in respect of any of the results provided to it by MORI or any decisions taken by any person in reliance on the report.
Chapter 2 – Summary Findings, Conclusions & Recommendations Mobile ownership continues to rise and pre-pay packages remain most popular amongst mobile owners 2.1 Currently 73% of UK adults claim to own or use a mobile phone. The rate of increase has remained steady (up three percentage points in each of the last two quarters). Mobile phones are becoming more popular with older consumers. The age group into which the majority of owners fall, has risen by ten years. Previously the majority of mobile owners were aged between 15-34, but following significant growth amongst 34-44 year olds, this age group has risen and most mobile owners now fall into the 15-44 age group. 2.2 The slight rise in mobile only homes reported in May 2001 (from 5% to 6%) has been sustained this quarter. These consumers are mainly younger (15-34), lower social grades and those with a lower income. 2.3 Similarly to last quarter 16% (previously 15%) of all UK adults consider their mobile to be their main method of making and receiving calls. Seven in ten of these consumers also have a fixed phone at home. Consumers choosing to use their mobile in preference to their fixed line phone tend to be younger customers and larger households. 90% of UK adults were satisfied with using their mobile as their main method of telephony. 2.4 77% mobile customers use pre-pay packages – these are particularly popular amongst older (55+), DE social grades, and lower income groups. Average monthly mobile spend for ‘pay as you go’ packages is £12 compared to the overall average spend of mobile users at £18 per month (this is inflated by small number of high spenders). Most mobile customers claim to be spending less than £10 per month. Two-thirds of UK mobile customers choose to use their mobile instead of their fixed line phone in a variety of circumstances 2.5 Convenience was the main reason for selecting mobiles rather than fixed phones, and almost a quarter of customers said they use their mobile when the fixed phone is being used by someone else. 2.6 Lower spending fixed and mobile customers, and those over the age of 55 were less likely to be substituting fixed phone usage with mobile in any of the listed circumstances. 2.7 95% of consumers with both fixed and mobile phones are also connected to the Internet at home. 14% of these use their mobile when the phone is ‘hooked up’ to the Internet. Still barriers to mobile number portability 2.8 24% of all mobile customers have switched network at some point. 55% of switchers did so in the last 12 months. Younger consumers and those using monthly contract packages seem more likely to switch. 2.9 11% of consumers who switched in the last year kept their original mobile number. Most customers (65%) who changed their mobile number did so because they were unaware of the ability to port or because they were given wrong information. Consumers are continuing to use their mobiles abroad, but are dissatisfied with charges for receiving calls 2.10 As reported in May there continues to be very little change in the number of consumers using their mobiles abroad. One in five mobile customers have done so. Frequent users tend to be those in higher income groups and AB social grades. Older consumers (55+) are least likely to use their mobile whilst abroad. 2.11 Just over a third (34%) of mobile customers who have used their mobile abroad were satisfied with the range and quality of information available for call charges whilst abroad. A quarter of these consumers, were satisfied with the overall value for and the least satisfactory aspect (12%) was the cost of receiving incoming calls. Satisfaction with mobile services overall remain steady with no real differences across types of package used 2.12 94% UK mobile customers are satisfied with their overall service. Those slightly less satisfied tended to be higher spenders. 88% of consumers claim to be satisfied with the overall value for money provided by their supplier. 2.13 Satisfaction with information for comparing mobile service providers was highest for price of on-net calls, which was twice as satisfactory as for price of off-net calls. The least satisfactory aspect of comparative information included mobile Internet costs and services (6% were satisfied); conditions of contract (16% were satisfied); and the price of off-net calls (18% were satisfied).
Main Findings Chapter 3 – Mobile phone usage 3.1 During August, 73% of UK adults claimed they owned or used a mobile phone. The number of UK residential consumers using mobile phones continues to rise. The speed of growth has remained fairly steady in recent months following the steep increase between August 2000 and February 2001, as shown in figure 3a. Figure 3a
– Mobile growth - % *UK adults who have a mobile phone
Note - Figures up to March 2000 are based on GB population and are taken from MORIs Technology Tracker. Figures from May 2000 onwards include Northern Ireland and therefore represent the UK adult population. 3.2 The number of UK homes with at least one mobile phone remains similar to last quarter (79%), figure 3b. This includes both adult and child users, but it is not possible to accurately establish from this survey the split between the two. Figure 3b
– % UK homes with at least one mobile phone
3.3 Figure 3c shows the proportions of consumers using each method of telephony. The number of UK homes without a fixed line phone remains at 7%. The majority of these homes are claiming to use a mobile instead, leaving only 1% of UK homes with no method of telephony. The slight rise in mobile only homes reported previously has been sustained this quarter (mobile only homes are covered in more detail later in this section.) Figure 3c
– Penetration of mobile telephony in UK homes
Note – rounding of data resulted in occasional months showing totals of more or less than 100% Which consumers use mobile phones? 3.4 Figure 3d and 3e show mobile ownership levels across various demographic groups of the UK population. Mobile ownership is most prominent amongst younger consumers and those with an annual income of more than £17.5K. 3.5 Mobile phone ownership continues to rise across all groups of consumers. Penetration amongst the three youngest groups surveyed (15-24, 25-34, 35-44) is now virtually the same at 87/88% – and at least 10% higher than all other age groups. In the most recent quarter, take-up by 35-44 year olds rose eight percentage points, and take-up amongst those over the age of 75 saw a similar rise of seven percentage points. A quarter (24%) of consumers over the age of 75 now claim to have a mobile. Figure
3d (below left)– % UK adults with mobiles Figure 3e
(below right)– % UK homes with at least one mobile
3.6 Figure 3e shows combined quarterly rolling data from the February and May, and May and August surveys for geographic region. This provides more robust sample sizes (minimum of 200 for each area) on which to base conclusions. Most regions have seen a slight increase in the number of mobile owners. There seems to be very little difference in the number of consumers with mobile phones by region. 3.7 Distribution across social grades remains fairly unchanged over the last year and broadly in line with population distributions. As mentioned above, figure 3f shows the shift in mobile ownership from younger consumers to the 35-54 age bracket since May 2001, although most of this growth is amongst consumers aged 35-44. Figure 3f
– Changing profile of mobile usage
Mobile as main method of calling 3.8 Currently 16% of residential consumers claim to use their mobile phone as their main method of telephony. Similar to last quarter, seven in ten of these consumers also have a fixed phone at home. Consumers using their mobile as their main telephony service tend to be younger (aged between 15-34). 3.9 Customers seem slightly less satisfied using their mobile as their main method of making and receiving calls during August 2001, compared to previous quarters (92% in May 2001 and 91% in February 2001), although it remains relatively high at 90%. Satisfaction with mobiles as a main method of telephony remains lower than both a fixed line at home and a fixed line at work. Figure 3g
– % UK consumers using and satisfied with their main method of telephony
Impact of mobile phones on the calling behaviour from fixed home phones 3.10 Two-thirds of UK adults claimed to personally have both a fixed and mobile phone (dual-users). Some examples of the various ways in which mobile communications are impacting on fixed line usage are shown below in figure 3h. There has been little change in these figures over the last year. 3.11 Convenience was unsurprisingly the main reason for selecting mobiles rather than fixed phones, and almost a quarter of customers said they use their mobile when their fixed phone is being used by someone else. A significant minority of customers were selecting their mobile rather than fixed phone for perceived cost savings on a range of call types. 3.12 A third of dual-users said they were not substituting fixed phone usage with mobile in any of the listed circumstances. These tended to be lower spending fixed and mobile customers, and those over the age of 55. Figure 3h
– Examples of consumer preference for mobile over fixed phone usage
3.13 Despite indications that some consumers are choosing one means of calling over another to get the best deal, previous Oftel research (February 2001) reported evidence of consumer confusion over identification of mobile numbers; awareness of call costs; and some concern over price of calls to mobiles from fixed line phones. 3.14 95% of residential consumers with both a fixed line phone at home and a mobile are also connected to the Internet. 14% use their mobile when the fixed line is connected to the Internet. 3.15 This data is also shown in the August report on ‘Consumers’ use of fixed telecoms services’. Mobile only homes 3.16 Currently 6% of UK homes are using a mobile phone without also having a fixed line. Mobile only customers are predominantly younger (15-34), small households, low income groups and DE social grades. 3.17 Not surprisingly mobile only homes are among the higher mobile spenders. On average mobile only homes are spending £28 per month compared to an average £17 (spent on mobile bill) by those with a fixed line and a mobile. 3.18 Pre-paid packages are most popular amongst this group of consumers, eight in ten claim to be using either ‘pay as you go’ or ‘all in one’ phones.
Chapter 4 – Consumers’ use of mobile packages and suppliersPackages used 4.1 Pre-paid packages remain the most popular package, with 77% of UK mobile users preferring them (figure 4a). For the first time, ‘pay as you go’ packages have experienced a slight drop, and the corresponding rise in monthly subscription packages suggests a movement from prepay to contract packages. We shall monitor whether these changes are sustained in future quarters. The previous shift away from ‘all in one’ packages has been sustained this quarter.
Figure 4a
– Profile of mobile package usage
4.2 ‘Pay as you go’ packages were most popular amongst DE social grades and lower income groups. Users of ‘pay as you go’ spend less than average per month on their mobile bill, £12 compared to an average £18 spent by mobile users as a whole. Full details of mobile spend is reported in Chapter 5. 4.3 Monthly subscription packages continue to be most popular amongst younger mobile users (under 34), AB social grades and higher income groups. They were also favoured by more men than women. 4.4 7% of adult mobile customers currently claim to own a WAP phone, however as reported in this quarter’s Internet survey only 2% named this as a method of accessing the Internet. This does not necessarily mean that they are not using the service, but possibly because when asked about their connection methods consumers did not think about their WAP mobile phone as a means of Internet access. Suppliers used 4.5 Figure 4b shows a comparison between Oftel’s survey and published sources of mobile market share information (in terms of numbers of subscribers using each of the four networks). The results this quarter indicate that the survey remains broadly reflective of the current mobile market in terms of the proportion of customers using each network. It should be noted that industry figures include business subscribers. Figure 4b
– % mobile users using each network
Switching and porting 4.6 During August, 24% of mobile customers claimed to have switched their mobile phone network/service provider at some point since first getting a mobile. Just over half of these consumers (55%) said that they had made this switch within the last 12 months. Figures from a survey last August (2000) saw 21% of mobile customers claiming to have ever switched network, this is a growth of 3% in the last year – however, figures this quarter show 13% of customers having switched in the last year. This variation (in the proportion who have switched in the last 12 months) may be due to repeat switchers – switching network each time their contract ends. 4.7 Younger mobile owners tend to be more likely to switch with just over a third of 15-34 year olds having switched mobile network/service provider at some point. Monthly subscription customers also seem more likely to have switched service provider, possibly customers feel the end of their contract is an ideal time to shop around for a better deal. This idea of trigger points for switching is reflected in other research. 39% of adults using monthly subscription packages have changed their mobile network at some point compared to 21% of those using pre-paid packages. 4.8 Previous Oftel research reported that switching mobile network was driven primarily by cost, but also included dissatisfaction with service, quality, and coverage; and the offer of better deals elsewhere. 4.9 In total just over one in ten (12%) UK residential consumers who have ever changed their mobile network/service provider ported their number. There has been no rise in the proportion of consumers who switched and ported in the last 12 months, compared to more than a year ago (11% and 13% respectively). The vast majority of customers who switched mobile network or service provider actually changed their number (87%), and only 10% did so because they wanted a new number for privacy. 90% identified various barriers to porting. 4.10 Most consumers taking advantage of the ability to port tend to be men, younger and middle aged consumers, higher income groups and social grades (ABC1) and typically those using monthly subscription packages. 4.11 The most popular reason for consumers not keeping their mobile number was that the new company said this was not possible (mentioned by 43%). Similarly a small proportion (7%) claimed that their old company had told them they were not allowed to take their number with them. 4.12 Overall, just over two thirds (65%) of mobile phone owners changed their mobile number when switching network due to a lack of awareness or being wrongly informed, as shown in figure 4c. Oftel recently conducted a mystery shopping exercise. This exercise examined the advice consumers are given by companies when switching mobile network and retaining their number and handset. Results showed that only one in five customers were given the correct advice throughout their enquiry. Figure 4c
– UK mobile owners’ reasons for not porting mobile number when switching
network
Total equals more than 100% as some respondents gave more than one reason 4.13 When comparing the reasons for customers not porting their mobile number, with how long ago they switched – 40% of customers who switched in the last 12 months, were told by their new mobile operator that they must have a new number. In contrast, the majority (65%) of consumers who claim that their old company told them they were not allowed to keep their mobile number, actually switched more than a year ago. 4.14 These results show there are clearly still barriers for customers wishing to port their numbers. Oftel will be repeating the mystery shopping exercise in 2002 to examine the extent to which the industry has improved and will continue to track this information. Oftel has advised the mobile industry that this research will repeated within six-12 months and that we expect to see an improvement, if this proves not to be the case Oftel will not rule out further regulatory intervention.
Chapter 5 – Mobile spend5.1 On average mobile customers are spending £18 per month, (figure 5a). This is down £1 on last quarter. Average monthly mobile spend seems to have reduced slightly over the past year. February 2001 saw a drop in spend from £21 to £18, last quarter’s monthly average rose slightly (£19), but the overall reduction in monthly mobile spend has been sustained this quarter. As reported in previous quarterly results the average spend (£18) is inflated by 15% of UK mobile customers spending more than £30 per month. Currently just over half (52%) say they are spending less than £10 each month on their mobile bill. Figure 5a
– Average monthly mobile spends
5.2 Higher spenders continue to be AB social grades, higher income groups, and younger consumers (15-34), also in this category are those homes with no fixed line phone – (who are spending an average £28 per month on their mobile bill). Men tend to spend more each month than women. Monthly spend increases with age and household income. Amongst the lower spenders are consumers aged 55+ and those with a household annual income of less than £17.5K. 5.3 Mobile spend also differs according to the types of package consumers are using. Users of pre-pay packages are spending least each month (average £12) while those contracted to monthly subscriptions claim to be spending just over three times as much (£37).
Chapter 6 – Use of mobiles abroad6.1 The proportion of UK residential mobile customers claiming to have used their mobiles abroad remains similar to last quarter. Almost one in five adult mobile customers in the UK said they have used their mobile phone when abroad (15% frequently/sometimes, 4% only once). As reported in May 2001 there has been little change in these figures since September 2000. The most frequent users of mobiles whilst abroad tend to be higher income groups and AB social grades. Older consumers (55+), DE social grades and low income groups are least likely to use their mobile abroad. Figure 6a
– % UK mobile customers using their mobile abroad
6.2 During August customers who had made calls from their mobile whilst abroad, were asked whether they were satisfied with certain aspects of the cost of their service (figure 6b). 34% claimed that they satisfied with the range and quality of information available on call charges for using a mobile abroad. The least popular aspect of using mobiles abroad seemed to be the cost of receiving incoming calls (12% satisfied). This is unsurprising as the average cost of receiving calls whilst abroad for pre-pay packages is between 75p-£1.99 per minute and monthly subscription packages average at 73p per minute. Figure 6b
– % satisfied with costs aspects of using mobile whilst abroad
6.3 Consumers were as satisfied with the cost of making calls abroad as they were with the overall value for money whilst abroad. Those satisfied with these aspects tended to be higher income groups and higher social grades.
Chapter 7 – Customer satisfaction with mobile service7.1 Satisfaction with the overall service of mobile phones remains stable with 94% customers claiming to be fairly or very satisfied, as seen in figure 7a. Figure 7a
– % UK mobile customers satisfied with overall mobile phone service
7.2 Mobile only homes and those spending more than £30 a month on their mobile phone bill were slightly less satisfied than average but on the whole satisfaction across most groups remains relatively high. Differences between customers on different networks and mobile packages are shown in figure 7b. There is very little difference in satisfaction levels between packages and networks. 7.3 Overall satisfaction and value for money does not seem to increase amongst those consumers who have switched. This does not necessarily mean that satisfaction does not increase when changing network, but perhaps these consumers have higher expectations of their new operator. Figure 7b
– % UK mobile customers satisfied with overall mobile phone service
7.4 88% mobile customers are satisfied with the overall value for money provided by their supplier. Those least satisfied are high monthly mobile spenders (spending £30+ per month) and customers of monthly subscription packages. 7.5 When thinking about the types of information available to customers for comparing mobile phone networks or service providers, just over half of all UK residential consumers (52%) were satisfied with at least some of the information available. This was slightly higher (66%) amongst mobile phone customers (see figures 7c and 7d). This perhaps indicates that the information to make these comparisons is not widely enough available to assist those consumers looking to purchase a mobile phone. Non-mobile customers are unsurprisingly less likely to be aware of (and therefore less likely to be able to give a satisfaction rating) the sources of information available. 7.6 When comparing satisfaction between all UK adults and those with mobile phones – we see satisfaction levels with most aspects of information rise amongst mobile users/owners. The greatest difference is seen with satisfaction of information of on-net calls, mobile users are probably more aware of these charges than non-mobile users. 7.7 The lowest satisfaction levels were for information on mobile Internet costs and services however, only 7% of mobile customers claim to own a WAP phone and 2% claim to use the services. 7.8 Satisfaction levels for comparing different aspects of information available seems low, compared to previously high results for overall satisfaction with this information. This is explained by consumers tending to be more critical when asked to evaluate particular aspects, rather than overall satisfaction, as asked in previous surveys. 7.9 Mobile owners who are dissatisfied with all comparisons tend to be lower users in terms of mobile spend (spending less than £10 per month), and more generally older consumers, aged 55+. Figure 7c
– % UK adults satisfied with information for comparing mobile networks/service
providers
Figure 7d
– % UK mobile owners/users satisfied with information for comparing
mobile networks/ service providers
7.10 Information on the price of on-net calls (calls to the same mobile network) is almost twice as satisfactory as that for off-net calls (calls to other mobile networks) amongst both groups of consumers, (26% and 14% respectively – all UK adults) (34% and 18% respectively – UK mobile owners/users), as shown in figures 7c and 7d. This is possibly due to more prominent advertising of on-net prices when selling mobile packages.
Appendix 1 – Q6 August 2001 Residential Questionnaire, Mobile questionsHow many mobile phones in total do you and members of your household use? None Which mobile phone supplier do you personally use? BTCellnet Which of these statements best describes the mobile phone package you have? Pre-paid package
(ie after paying a one-off fee for the phone, ‘top up’ is bought as
and when required) Approximately how much would you estimate the monthly cost of your mobile phone to be? Less than £6 How satisfied are you with the following … (a) Your mobile
service overall? Very satisfied Have you ever changed your mobile phone network or service provider? IF YES, ASK: Was this in the last twelve months or more than a year ago? Yes – in the last
12 months When you changed your mobile phone network or service provider, did you change your mobile phone number or did you keep your original number? Changed phone number How often, if ever, have you used your mobile when visiting abroad? Frequently Which, if any, of these aspects of your mobile service are you satisfied with? Range and quality
of information available on call charges for using your mobile phone
abroad Thinking about when you use your mobile rather than your fixed phone, which, if any, of the following statements apply? Please just read out the letters that apply. Use mobile instead
of fixed to use up free mobile minutes/vouchers before expires Please indicate which, if any, of these types of information you are satisfied with for comparing mobile phone networks or service providers? Price of calls to
mobiles on the same network
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