of multiple SIM cards in mobile phones, by consumers in Italy, Finland
& Portugal - Summary of Oftel Research,
April-May 2001, published July 2001
Chapter 1 - Introduction
Chapter 2 - Key findings & conclusions
Chapter 3 - Main findings
Appendix 1 - Questionnaire on International SIM locking
1.1 Mobile phone handsets contain a smart card 'subscriber identity module' (SIM) which is used to identify which network the handset is connected to, for billing and service access purposes. SIM locking is a feature which restricts a mobile phone so that it will operate only with a pre-defined set of SIM cards. This has the effect of restricting customers’ ability to change networks, tying them in to a particular operator for a certain minimum period of time. In order to change network and keep their existing handset, consumers must change their SIM card.
1.2 In Italy, Finland and Portugal, SIM locking does not exist, enabling customers to switch SIM cards in order to get the cheapest deal, depending on the network they are calling or type of call they are making. The two primary ways of doing this are (i) using a mobile phone which has space for only one SIM card at a time, which consumers manually change as required (ii) using a mobile phone which has space for more than one SIM card at a time, which consumers can then ‘toggle’ between without having to manually change the SIM card.
1.3 Oftel has not been able to obtain comprehensive information on the mechanics of what customers have to do to use more than one SIM card in the three countries surveyed. For Italy at least, Oftel understands that handsets and subscriptions (with SIM cards) can be bought separately, and that customers need to buy separate vouchers/call credits for each network they use. Oftel has examined price information which indicates that the relative difference between on and off-net prices, and between peak and off-peak rates is typically greater in the UK than in the three countries surveyed.
1.4 This research examined consumer behaviour in these three countries in terms of:
(a) the proportion
of mobile customers using multiple SIM cards and manually switching
them in single-SIM card phones,
1.5 The purpose of this research was to examine whether consumers’ make greater use of the choices available (in terms of their switching behaviour or ability to use more than one SIM card) in countries where there is no SIM locking. If this is the case, it might be concluded that SIM locking in the UK is a significant barrier to taking advantage of the choices available and getting the best deal. This research will contribute to Oftel’s review of state of competition in the mobile market.
1.6 The survey was conducted for Oftel by Ipsos-RSL during April 2001, and uses comparative data from Oftel’s Q5 UK residential survey, conducted for Oftel by MORI during May 2001. This report has been prepared by Oftel (see note one below), based on the results provided by Ipsos-RSL and MORI.
1.7 In-home, face to face surveys were conducted – details for the individual countries are as follows:
1.8 Each survey was conducted among a sample of adults (aged 15+), representative of the profile of adults in that particular country. Data has also been weighted to ensure the sample is representative of the adult population in each of the three countries. 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.
1.9 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 these surveys of c.1000 consumers is about 2-3%, but is higher amongst smaller subgroups. In particular, caution should be applied to the results of multiple SIM users of whom less than 100 were surveyed in each country.
1.10 A copy of the questionnaire can be found in Appendix 1.
1. 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 Ipsos-RSL and MORI, or any decisions taken by any person in reliance on the report.
2.1 The proportions of mobile customers using more than one SIM card were - 13% of mobile customers in Italy, 7% in Finland, and 4% in Portugal. This equates to 5.8 million, 272,000, and 288,000 customers respectively. Multiple SIM use was most popular among younger consumers and to a lesser extent those without a fixed phone at home.
2.2 Overall, about two-thirds of multiple SIM card customers said they used one card the most and the others only occasionally. This is not particularly surprising given that the majority of those using more than one SIM card did so by changing it manually as their phone held only one card at a time. Phones which held more than one SIM card at a time were less widely used – 27% in Italy, 18% in Portugal, and 16% in Finland, but tended to result in slightly greater use of alternative SIM cards.
2.3 The most popular circumstances which influenced which SIM card consumers decided to use included whether they were calling a fixed or mobile phone, which mobile network they were calling, and whether they had inclusive minutes or credit available. On average, consumers said they actively considered which SIM to use for about half to three-quarters of these different types of calls. This perhaps indicates the types of calls where they perceive the greatest price or quality differences between networks.
2.4 The majority of mobile customers in each of the three countries used only one SIM card with their mobile phone. Satisfaction with current costs was the main reason for this, along with perceptions that they didn’t use their phone enough to justify having more than one SIM card. 3 in 10 Portuguese customers were not aware that they could use multiple SIM cards, although this was lower in Italy and Finland at less than 10%.
2.5 Absence of SIM locking did not seem to result in greater overall switching between networks and packages to get a better deal, as might have been expected. The proportion of mobile customers who had previously used a different network than the one they currently use, was only slightly higher in Italy than in the UK, and indeed the UK was in line with Finland and slightly higher than Portugal. A similar picture was seen in terms of the proportion of consumers who had switched package.
2.6 Switching networks, packages, and tariffs (previously used a different one than the one(s) used currently) was significantly higher among multi than single SIM users. The levels of switching among multi-SIM customers exceeded the highest levels of switching by any individual group of UK residential consumers.
2.7 One of the advantages of absence of SIM locking is that consumers can keep the same handset and simply change the SIM without paying a fee for unlocking. However, handset switching was higher in all three countries than in the UK. This may be partly a result of being able to change handset without having to change SIM card. Data collected by Oftel has indicated that handset prices are higher in all three countries than in the UK. It is interesting to note the higher levels of handset switching compared with the UK, despite the higher handset prices in these countries.
2.8 Switching behaviour was highest in Finland, particularly for handsets, which 65% of mobile customers had changed after a period of about 18 months. This compares with 38% in the UK. Handset switching was highest amongst younger consumers. Previous Oftel research identified that a significant proportion of those who had changed their handset did so because they wanted a new phone/the latest model. SIM locking may not have been an issue for these customers, depending on their ability to combine their chosen handset with their preferred network/package.
2.9 The three key findings:
2.10 Previous Oftel research found that SIM locking was an issue for 23% of consumers who had changed their mobile handset, but who had wanted to keep their original phone but were told they were unable to, or who were reluctant to pay a fee to have their phone unlocked. However, there was no conclusive evidence from the three countries researched to indicate that removal of SIM locking in the UK would necessarily result in more customers taking advantages of better deals by using more than one SIM or switching supplier or package.
3.1 Mobile penetration (in terms of the number of mobile phone subscriptions per 100 inhabitants) in the UK, Italy, Finland and Portugal is shown in figure 3a below. The data shown includes both business and residential subscribers.
Figure 3a Number
of mobile phones per 100 inhabitants, April ’01
3.2 As in the UK, pay as you go mobile packages were most popular in Italy and Portugal, used by 84% of adults with mobiles. In Finland monthly contract packages were most popular, used by 97% of adult mobile customers. This is shown in figure 3b.
Figure 3b Profile
of mobile package usage
Multiple SIM card usage
3.3 Multi SIM usage was highest in Italy where 13% of mobile customers said they use more than one SIM card with their mobile phone. This compares with 7% in Finland and 4% in Portugal, and can be seen in figure 3c.
Figure 3c % mobile
customers using one / more than one SIM card
3.4 In all three countries use of more than one SIM card was most popular among younger customers (aged 15-24), and in Italy in particular, those without a fixed phone at home, about a fifth of whom were using more than one SIM card.
3.5 One of the benefits of using more than one SIM card would be to take advantage of cheaper ‘on-net’ call charges to more than one network. In all three countries, mobile customers said on average between half and three-quarters of their mobile to mobile calls were to people using the same network as them (ie on-net calls). In both Finland and Portugal, the proportion of on-net calls was slightly lower among multiple SIM users, compared with those using only one SIM card (see note two below).
Type of mobile phone accommodating multi-SIM usage
3.6 Caution should be applied to results in this and the next section, as sample sizes (in terms of the number of multi-SIM users) are less than 100 in each country, and hence should be treated qualitatively.
3.7 In all three countries, the majority of mobile customers who were using more than one SIM card, had a mobile which held only one SIM card at a time which they changed manually as and when required. Just over a quarter of Italian customers (27%) said their phone held more than one SIM at once, and just over half of these said they also had other SIM cards which they changed manually as and when required. Phones which held more than one SIM card were less popular in Portugal (18%) and Finland (16%) – figure 3d.
Figure 3d Type
of phone used to accommodate multi-SIM usage
Distribution of SIM card usage
3.8 The amount of use multiple SIM mobile customers make of their additional SIM cards is shown in figure 3e. On the whole, about two-thirds of customers said they used one most and the other(s) occasionally. At most, a fifth of multi-SIM users (Portugal) said they use all or most of their SIM cards in fairly equal amounts. This was slightly higher among customers who did not have a fixed phone at home, and those with a phone that accommodated more than one SIM card at once.
Figure 3e Frequency
of use of multiple SIM cards
Factors which influence choice of SIM card
3.9 Mobile customers using more than one SIM card were asked what factors influenced which SIM they decided to use. They were then asked what proportion of their calls they consciously selected one SIM over another in each of the circumstances which influenced their choice of SIM.
3.10 Circumstances that were consistently influential on choice of SIM card across all three countries included whether they were calling a fixed or mobile phone, which mobile network they were calling, and availability of inclusive minutes or credit. On average, customers who took the various factors into account, said they did so for between half and three-quarters of their calls. There were small variations between countries on both the proportion of customers taking these factors into account and the amount of times they did so. This perhaps indicates the areas where consumers think there are greatest differences between networks.
3.11 In all three countries, customers with mobile phones which held only one SIM which they have to change SIM card manually, were less likely to take the various factors Into account than those phones which held multiple SIM cards. This is not unexpected given the greater effort required to manually change SIM cards than to toggle between two or three already in a phone.
Figure 3f Factors
influencing which SIM card to use
Reasons for not using more than one SIM card
3.12 The vast majority of mobile customers in all three countries said they use one SIM card in their mobile phone (see figure 3c). Reasons for not using more than one SIM card are shown in figure 3g.
3.13 The overwhelming reason was that customers were satisfied with the costs of their current network/package (more so in Italy than in Portugal and Finland). Significant minorities in each of the countries said they don’t use their phone enough to need more than one SIM. Only small numbers in Italy and Finland said that they were unaware or unable to use more than one SIM with their mobile. This was higher in Portugal where 3 in 10 single SIM users were unaware of the possibility of multiple SIM use.
Figure 3g Reasons
for not using more than one SIM card in mobile phone
Consumer switching behaviour in the mobile market
3.14 One potential advantage of not locking SIM cards to phones, is the opportunity to change more readily between providers and packages when prices change. If this is the case, we might expect countries where there is no locking to have more customers who have switched than in the UK. The proportion of mobile customers who have previously used a different network than the one they use now, a different payment package (ie prepay or contract), tariff package, or handset is shown in figure 3h. Data is shown for UK customers for comparison purposes (UK data from May 2001) to assess whether there is any difference in switching behaviour between countries with and without SIM locking.
Figure 3h % mobile
customers who have switched
3.15 Apart from Finland, mobile customers in countries with no SIM locking were no more likely to have previously used either a different network or package to the one they use now, than those in the UK where SIM cards are locked. All three countries offer both monthly contract and pay as you go packages (Finland has only two pre-pay offerings), and have a comparable number of networks to the UK (4 in Italy and Finland, and 3 in Portugal).
3.16 Although it should be borne in mind that these switching levels may reflect less choice or price difference in these countries, the results would seem to suggest that absence of SIM locking does not necessarily result in significantly higher proportions of customers switching suppliers to get better deals. Although the additional figures in brackets in figure 3h show the proportion of mobile customers who have not previously used a different network/tariff to the ones they use now, but who currently use more than one SIM card. This proportion of customers may or may not have switched completely if they had not otherwise chosen to use multiple SIM cards.
3.17 Single SIM users in Finland were previously seen to be least likely to say that their single SIM usage was driven by satisfaction with current costs (figure 3g). This might explain the slightly higher incidence of switching in Finland (which also has four mobile networks).
3.18 Switching behaviour in all three countries was considerably higher among customers using multi-SIMs that those using one SIM card in their phone. The levels of switching observed among multi-SIM users in all three countries, exceed the highest levels of switching of any particular group of UK residential consumers. This perhaps indicates that switching is driven more by personal attitude (ie those customers who are keen to ensure they are getting the best deal) rather than the ability to keep an existing handset.
3.19 Furthermore, the most popular switching activity was handsets, with previous phones being used for about 18 months on average. For the majority there is no need to change their handset as their SIM card could be changed to enable them to use a different network. However, some customers may have changed their handsets more readily because of the greater independence of handsets and subscriptions. Handset switching was highest amongst younger customers who kept their phones for a year on average (slightly longer in Finland) compared with older customers who kept their handsets for double this time. This most likely reflects younger consumers wanting the most up to date or fashionable handsets which is in line with previous Oftel research.
3.20 Recent Oftel research indicated that although 4 in 5 mobile customers got a new phone when they switched network, most popular reason was that they wanted a new phone. SIM locking in the UK was found to be a barrier for a 23% of customers who changed their handset but had wanted to keep their original phone but were told they were unable to, or were deterred by the fee to unlock the phone.
3.21 There is no conclusive evidence from the three countries studied to indicate that removal of SIM locking in the UK would necessarily result in more customers taking advantages of better deals by using more than one SIM or switching supplier or package. Multi-SIM users were most likely to have switched network/tariff previously (ie used suppliers other than those they currently use). However, studying consumer behaviour in isolation cannot predict what would happen in the UK in the absence of SIM locking.
2. The benefits to be gained by effectively turning off-net calls into on-net calls, by using more than one SIM card, may be limited given Oftel's earlier findings that the difference between on and off-net call costs in these countries is smaller than in the UK.
ASK ALL ADULTS
ASK ALL ADULTS WHO
OWN OR USE A MOBILE PHONE
ASK All adults who
use only one SIM card
ASK ALL ADULTS WHO
OWN OR USE A MOBILE PHONE
ASK ALL ADULTS WHO
OWN OR USE A MOBILE PHONE