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| Business use of mobile telephony, Oftel small and medium business survey, Q8 February 2002 | |
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2
May 2002 
ContentsChapter 1 – Introduction Chapter 2 – Summary Chapter 3 – Main findings Chapter 4 – Satisfaction with mobile telecoms service Chapter 5 – Use of mobiles abroad Chapter 6 – Reducing the cost of calling mobiles Appendix 1 – Changes to Oftel’s Quarterly Business Survey Appendix 2 – Q8 business questions on mobile telephony 1.1 This report provides an overview of the key findings of business behaviour in the mobile telecoms market, taken from the eighth wave of Oftel’s quarterly business survey, conducted in February 2002 amongst 801 UK businesses. The results are subject to an error margin of about 2-4%, this is slightly higher amongst smaller subgroups. Results referred to as 'significantly' different, have been tested at the 95% level of confidence, please see footnote for further sample details (see note one below). 1.2 The survey sample was changed in wave five, and hence results are not directly comparable with waves previous to that. Details and implications of the changes can be found in Appendix 1. Quotas and weighting were applied to small and medium businesses separately so that the sample was representative of SMEs (Small and Medium Enterprises) in the UK in terms of business size, industry sector and region. 1.3 The survey was conducted on behalf of Oftel by Continental Research during February 2002. This report has been prepared by Oftel (see note two below) based on the results provided by Continental Research. 1.4 The report covers:
1.5 A copy of the questions is attached in Appendix 2. 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. The survey was conducted amongst a representative sample of small and medium enterprises (SMEs) in the UK, reflecting the UK profile in terms of business size, sector and region. As small businesses (1-50 employees) make up around 97% of businesses in the UK, medium businesses (51-250 employees) were over-sampled in the survey to produce a sufficiently robust sample to allow analysis of the results among medium businesses. The combined results were re-weighted to be representative of UK SMEs as a whole (97% small businesses; 3% medium businesses), consequently the results for small businesses closely resemble those for SMEs as a whole. The error margin for this survey of 801 businesses is about 2-4%, but is higher amongst small subgroups. Results referred to as 'significantly' different, have been tested at the 95% level of confidence and hence are outside of the error margins and therefore can be considered real changes. All data shown is weighted data. Unweighted base sizes are shown on charts and tables to show the number of businesses who were asked the question. 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 Continental or any decisions taken by any person in reliance on the report.
Headline figures
Little change in mobile ownership although an increase in average number of mobiles 2.1 Just over 3 in 5 (62%) businesses currently own at least one mobile phone. This figure remains broadly similar to recent quarters. Medium businesses remain more likely to own mobiles (78%) than small businesses (61%). The rise in mobile ownership amongst single employee businesses has been sustained (60% penetration). 2.2 Small businesses currently own an average four mobile phones and medium sized businesses own an average 22. These figures have increased from two and 15 respectively over the last nine months. Satisfaction with overall mobile service recovered to 94% 2.3 Currently 94% of UK SMEs are satisfied with their overall mobile service compared to 88% in November ’01. Medium sized businesses are more satisfied with various cost aspects than they were last quarter, however they remain significantly less satisfied (67%) than small businesses (77%) with regard to the overall cost of making calls from mobiles. Average monthly spend risen slightly this quarter 2.4 Small businesses are spending £138 per month on average for mobile telecoms services, and medium sized businesses are averaging £1,581 per month. These figures have risen slightly since November ’01 and are consistent with the rise in the average number of mobiles owned and rise in average spend per mobile. Currently, UK SMEs average spend on mobile services is £186 compared to £159 in November. Significant improvement in use of mobile number portability but still not working for some 2.5 Around 3 in 10 (29%) businesses have ever switched mobile network/service provider and more than half of these (53%) retained all of their numbers. This figure has risen from 39% in August ’01. The majority (71%) of those businesses that switched within the last 12 months retained all of their numbers and a further 3% retained some of their numbers. Lack of knowledge amongst businesses about the ability to port numbers and the porting process, and incorrect advice from operators were the main reasons given for not porting. Businesses appear to be aware of incoming call charges whilst abroad but are not satisfied with them 2.6 Around three in five (59%) businesses with mobiles claim to use them abroad, 15% frequently. 73% of all businesses with mobiles were aware that they were charged to receive incoming calls whilst abroad, (75% amongst those who have ever used a mobile abroad). However, 27% of businesses which have used mobiles abroad were satisfied with these charges. Many businesses are trying to reduce the costs to customers calling their mobiles 2.7 Almost two thirds (64%) of businesses with mobiles claim they try to reduce the cost to their customers calling the business on its mobile numbers, and others are considering doing so in the future. 2.8 Over half (51%) claim they keep the call short if a customers calls their mobile and a further 10% say they would consider doing this in the future. Over one in 10 (13%) businesses with mobiles claim to have a freephone or local rate number for calls to its mobiles and almost two in 10 (19%) claim to have chosen the mobile network cheapest to call. The least considered option was to encourage customers to call at the cheapest time of day – perhaps as these times may not be within normal working hours. 2.9 22% if businesses claim to have taken steps to reduce the cost of in house calling to their mobiles. These steps include 8% claiming to use private wires, 7% mobile to mobile adaptions and 2% claiming to use leased lines. 2.10 Medium-sized businesses with mobiles are more likely to have taken steps to reduce their in house costs (39%) and the cost to customers of calling their mobiles (72%) than small businesses. 22% of small businesses with mobiles claim to have taken steps to reduce their in house costs and 64% claim to have tried to reduce the costs to customers.
Chapter 3 – Main findingsBusiness use of mobile telephony Ownership of mobiles 3.1 Currently, 62% (see note three below) of all UK businesses own at least one mobile phone, broadly similar to recent quarters. Medium businesses remain more likely to own mobile phones than small businesses – 61% of small businesses have a mobile compared to 78% (see note three below) of medium businesses as shown in figure 3a. Figure 3a:
% UK SME businesses with mobiles
3.2 On average UK small businesses with mobiles currently have on average four mobile phones while medium sized businesses with mobiles claim to have 22, as shown in the table below. While the proportion of businesses with mobiles appears broadly similar across recent quarters, there has been a rise in the average number of mobiles owned. Spend per mobile is covered later in this section. Figure 3b:
Average number of mobile phones amongst UK SME businesses
3.3 The rise in mobile ownership amongst single employee businesses reported in November ’01 has been sustained – currently 60% of these businesses have a mobile phone, up from 56% in August 2001 and 59% November. Mobile ownership in UK SMEs increases with the number of employees, reaching 80% penetration in businesses employing between 101-250 staff. Use of service providers and mobile packages 3.4 Monthly contract (post-pay) packages remain most popular amongst businesses. Currently almost three-quarters (73%) of UK SMEs with mobiles are using a post-pay package. 3.5 Medium sized businesses are more likely to use post-pay packages (86%) than small businesses (73%) who are in turn, increasingly more likely to use pre-pay packages (25%) than medium sized businesses (6%). There has also been a significant rise in usage of post pay monthly contract packages amongst medium-sized businesses (currently 86% compared to 77% in November ’01) bringing usage of this package back in line with previous quarters (82%) shown in figure 3c. Some totals add to more than 100% as some businesses were using more than one type of package. Figure 3c:
Use of mobile packages by UK SME businesses
NB: packages used total more than 100% as some businesses using more than one type of package Business spend on mobile telecoms 3.6 Average monthly spend amongst UK SMEs has risen this quarter to £186 – from £159 in November. The rise is driven mainly by medium sized businesses which are currently spending on average £1,581 per month on mobile services (including subscription and call costs) compared to £1,358 last quarter, see figure 3d. However, current spend amongst UK businesses remains lower than reported in May ’01, an indication that businesses may be benefiting from the introduction of new tariffs since August. Figure 3d:
Average monthly business spend on mobile telecoms services
3.7 Most businesses actually spend less than these averages (62% spend up to £100 per month – shown in figure 3e) as they are inflated by a small number of higher spenders (7% spending more than £500 per month). In comparison, fixed monthly spend is currently £318 (£255 amongst small businesses and £2504 amongst medium sized businesses). 3.8 Spend varies according to the type of package used, those using pre-pay packages spend on average less than half as much per month (£85) as those using monthly contract packages (£216). Figure 3e:
Proportion of monthly spend on mobile services
3.9 Figures 3f compares small and medium businesses’ average spend per phone. Medium businesses are spending around twice as much per phone than small businesses but less per employee. In line with overall average monthly spend, spend per mobile had also increased this quarter and is now broadly similar to those reported in August ’01. Figure 3f:
Average monthly spend on mobile telecoms services per mobile and employee 
Switching mobile networks and number portability 3.10 Almost 3 in 10 (29%) UK businesses with mobile phones have ever switched network, 11% did so within the last 12 months and 18% switched longer ago. These figures are broadly similar to August ’01 (26% had ever switched). Medium sized businesses remain significantly more likely to switch mobile network or service provider than small businesses, 44% and 28% respectively. 3.11 The proportion of UK businesses retaining all their mobile numbers when switching network/service provider has increased significantly since August ‘01. Over half (53%) of businesses that have switched mobile network or service provider claim to have retained all of their mobile phone numbers, compared to 39% in August. This figure is significantly higher amongst those who switched in the last 12 months (71%) than longer ago (42%). Figure 3g:
% UK SME businesses that kept numbers when switching networks
3.12 Nearly three-quarters (71%) of businesses who switched within the last 12 months claim to have retained all of their mobile numbers when doing so, again a significant improvement since August 2001. Small businesses were as likely to have retained all their numbers (52% did so) as medium sized businesses (58%). 3.13 The main reasons given by those not retaining all of their numbers when switching (47% of switchers) were; a lack of awareness about number portability – thinking that they had to have new numbers when changing network or phones, or being given incorrect advice from operators (both new and existing) about the ability to port numbers. Around a quarter (26%) mentioned that to keep mobile numbers would have been too costly. GPRS mobile phones 3.14 GPRS phones are mobiles which offer faster access to mobile Internet services than WAP services. Users are always connected to the Internet rather than having to dial up each time and are billed according to the amount of data downloaded as opposed to the amount of time online. There may be an additional line rental charge for GPRS services. Are UK businesses using GPRS mobiles? 3.15 Currently 4% of all UK SMEs with mobiles use GPRS phones, 4% of small businesses and 6% of medium sized businesses. 3.16 Of those businesses not currently using GPRS mobile phones, 12% said they would be interested in having them in the future (3% very interested, 9% fairly interested). Medium sized businesses were twice as likely to be interested in using these types of mobiles in the future as small businesses (24% and 12% respectively). Interest in GPRS phones increased with the number of employees – ranging from 8% very or fairly interested amongst single employee businesses to 27% amongst businesses with 101-250 employees. Figure 3h:
% interested in having GPRS phones
Note: 3. The apparent drop is not statistically significant but within the error margins for the survey, and therefore may not be a 'real' drop.
Chapter 4 – Satisfaction with mobile telecoms service 4.1 Figure 4a shows businesses’ satisfaction with a range of aspects of mobile service. Overall satisfaction with mobile telecoms services has recovered to 94% from 88% during November ’01. This is driven primarily by small businesses where overall satisfaction has risen from 87% to 94%. The increase in overall satisfaction may also be driven by the general improvement across most of the measures, although no individual measure has experienced a significant rise in satisfaction. 4.2 83% of UK businesses with mobiles are satisfied with value for money and 91% are satisfied with their ability to access the network (ie lack of congestion). Fewer (69%) are satisfied with the incidence of dropped calls (ie being cut off mid-call). The cost of off-net calls remains the least satisfactory cost aspect of mobile usage amongst businesses with mobiles, 49% satisfied. Figure 4a:
% UK SME businesses satisfied with various aspects of their mobile service
4.3 There is little difference in satisfaction levels between small and medium businesses except with regard to the overall call costs from mobiles where small businesses remain significantly more satisfied (77%) than medium-sized businesses (67%), and satisfaction with the proportion of dropped calls. Medium sized businesses are significantly more satisfied (83%) with the number of dropped calls than small businesses (68%). 4.4 The individual measures are not meant to ‘total’ overall satisfaction as there are likely to be many other factors which are not included in this survey which businesses consider important in contributing to their overall satisfaction with their mobile service.
Chapter 5 – Use of mobiles abroad5.1 Currently around 3 in 5 (59%) businesses use their mobile phones abroad for work purposes. The rise in mobile usage abroad amongst UK businesses reported in August ’01 has been sustained (50% in May ’01 and 59% in August ’01). Frequency of use abroad is shown in figure 5a. Figure 5a:
Frequency of mobile use abroad amongst UK SME businesses
5.2 Medium sized businesses remain more likely to use their mobile abroad than small businesses, 79% and 58% respectively have ever used their mobile abroad. 5.3 Of those businesses who have ever used their mobile abroad, three-quarters were aware that they are charged for receiving incoming calls whilst abroad. Just over one in 10 (11%) thought they were not charged for these calls and a further 14% did not know. The total percentage aware is slightly higher than that reported amongst residential consumers (62% GB roaming customers were aware of the incoming call charges – the full report of consumer awareness of mobile roaming can be found at www.oftel.gov.uk/publications/research/2002/odtr0402.htm). There was no difference in awareness of these charges in relation to business size. Satisfaction with various aspects of mobile usage abroad 5.4 Around 3 in 5 (59%) businesses which use their mobiles abroad, are satisfied with the range and quality of information available on call charges for using a mobile abroad. Just over four in five (85%) are satisfied with the quality of coverage and service whilst abroad. Figure 5b:
% UK SME businesses satisfied with aspects of mobile phone use abroad
5.5 Satisfaction with cost aspects are fairly low in comparison to quality issues, with 3 in 10 claiming to be satisfied with the cost of making calls whilst abroad and 27% satisfied with the cost of incoming calls whilst abroad. There is no difference in satisfaction levels for these aspects according to the size of the business.
Chapter 6 – Reducing the cost of calling mobiles6.1 22% of businesses with mobile phones claim to have taken steps to reduce the cost of calling their company’s mobiles by using various methods. 8% claim to use private wires, 7% claim to use mobile to mobile adaptions, 2% claim to use leased lines (see note four below) and 11% claim to use some other method. These total more than 22% as some businesses are claiming to use more than one of these options. Medium-sized businesses are more likely to have taken steps to reduce these costs (39%) than small businesses (22%). Customers calling business’ mobiles 6.2 Two thirds of UK SMEs with mobiles say that it is important for their customers to be able to call them on their mobile phones (44% very important and 22% fairly important). 66% of small businesses say this is important compared to 72% amongst medium sized businesses. 6.3 Figure 6a shows the extent to which businesses with mobile phones would consider or are currently using methods to reduce the cost to customers calling their mobile phones. Currently 64% (see note five below) of businesses with mobiles are using at least one of these methods to reduce the cost to their customers, 72% of medium sized businesses and 64% of small businesses. Figure 6a:
% UK SME businesses using methods to reduce the cost to customers calling
their mobiles
6.4 Over half (51%) of businesses with mobiles claim that if the customers is calling a mobile they keep the call short or perhaps arrange to discuss detail later when not using a mobile. A further 10% claim they would consider doing this in the future. 3 in 10 claim to call the customer back immediately if they receive the call on their mobile phone and a further 12% say they would consider doing this. 6.5 A fifth (19%) of businesses with mobile phones claim to have chosen the network by picking the one which is cheapest for other to call, and a further 21% said they would consider this. However, over half (55%) said they would not consider this option, perhaps valuing other aspects of their mobile service more, for example network coverage, quality of service or overall costs. 6.6 Just over one in 10 (13%) claim to have a freephone or local rate number for calls to their mobile phone. Few businesses (4%) claim to encourage the customer to call them on their mobile at the cheapest time although the vast majority (80%) would not consider doing so, which is perhaps unsurprising as off-peak times are likely to be out of normal working hours. Notes: 4. Private wires connect companies' private exchanges (PBXs) to a mobile network allowing companies to make and receive calls to and from mobiles on that network without paying a fixed line operator to carry that call to/from the mobile network. Mobile to mobile adaptations - giving companies radio links to a mobile network allowing companies to call from fixed phones to mobile phones for the price of a mobile to mobile call which might be cheaper if the mobile phones are on the same network. As with private wires, leased lines connect companies' private exchanges (PBXs) to a mobile network allowing companies to make and receive calls to and from mobiles on that network without paying a fixed line operator to carry that call to/from the mobile network. 5.
In Oftel's February '01 survey, 63% of businesses with mobiles had taken
steps to reduce the cost to their customers when contacting the business
on its mobiles and around 1 in 5 had tried to reduce their in-house
costs of calling their mobiles. Due to sampling differences the results
of these two surveys are not directly comparable - full details of the
changes made to the sample are detailed in appendix 1.
Appendix 1 – Changes to Oftel’s Quarterly Business SurveyBackground A.1 Oftel’s quarterly business surveys began in August 2000. The purpose of these surveys is to provide better information for Oftel decision making and to assist stakeholders in their response to Oftel documents and policy decisions. A.2 The surveys focus on small and medium-sized businesses and exclude large businesses for a number of reasons:
A.3 Oftel’s business surveys are conducted among a representative sample of UK small and medium businesses (with a minimum turnover of £50,000), reflecting the UK profile in terms of number of employees, business sector, and geographic region. As small businesses (with up to 50 employees and over £50,000 annual turnover) account for around 97% of UK businesses, the surveys over-sample medium businesses in order to produce a sufficiently robust sample to allow analysis of results among medium businesses. A.4 Quotas are set for small and medium businesses separately to ensure each sample is representative of businesses of these different sizes, in terms of number of employees, business sector, and geographic region. After interviewing, the results are combined and weighted to be representative of UK small and medium businesses as a whole. This enables us to present representative results for small and medium businesses separately, each based on sufficiently robust samples, and representative results for the combined small and medium business sector. Details of changes to the sample A.5 A review of the first four surveys was conducted in March 2001, and a segmentation study conducted enabling the data to be examined in greater detail than was possible during each separate wave. As a result of this work, three key changes have been made to the surveys between waves four (February 2001) and five (May 2001): a) larger quarterly sample
b) change to definition of ‘medium’ businesses
c) more detailed sampling of small businesses
Implications of changes, for comparison between surveys A.6 The changes to the sampling methodology (employee categories) as described above, mean that the results from wave five onwards are not directly comparable with those from waves one to four. This does not however mean that the results from waves one to four are inaccurate or invalid. Waves one to four are representative of businesses with up to 500 employees, whereas waves five, and onwards, are representative of businesses with up to 250 employees, and provide a greater focus on businesses with up to five employees than waves one to four. A.7 Whilst this unfortunately results in a discontinuity of trend information between waves four and five, the re-focus on smaller businesses following the review of the first four waves of data, was felt to be of greater benefit in assisting Oftel’s policy development and assessment, and other work in respect of small businesses.
Appendix
2 – Q8 business questions on mobile telephony
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