Oftel residential survey – January 2003

Contents

Chapter 1 Introduction

Chapter 2 Summary findings

Main findings

Chapter 3 Use of fixed telecoms in homes

Chapter 4 Awareness and use of alternative suppliers

Chapter 5 Impact of mobile on the use of fixed phones

Chapter 6 Internet use at home

Chapter 7 Connection methods, ISPs, and packages used

Chapter 8 Use of broadband 

Annex A Questionnaire

Chapter 1

Introduction

1.1 This report provides an overview of the key findings of consumer behaviour in the fixed telecoms services and Internet market in the Hull Area (see note one below) (‘Hull’). Results from previous waves of Oftel’s quarterly UK residential surveys are used for comparison purposes where appropriate and referred to throughout this report.

1.2 Telecommunications in Hull is unique within the United Kingdom. Kingston Communications (Hull) plc (‘Kingston’) is the incumbent local operator and provides local, national and international telecommunications services within Hull. Initially Hull was excluded from the area in which BT was licensed to run systems. After the 1998 review it was decided that this restriction on BT could be lifted, however BT did not pursue an amendment to its PTO licence.

1.3 The survey was conducted for Oftel by ICM Research amongst 500 adults (see note two below) with a fixed line phone during November 2002. The report has been prepared by Oftel (see note three below), based on the results provided by ICM Research.

1.4 A copy of the questions is attached in annex A. Topics to be researched were requested by Oftel project teams and results feed into current investigations and reviews in individual market areas.

Notes:

1.The Hull Area is the area defined as the 'Licensed Area' in the licence granted on 30 November 1987 by the Secretary of State under section 7 of the Telecommunications Act 1984 to Kingston upon Hull City Council and Kingston Communications (Hull) plc.

2. This survey was conducted amongst a representative sample of adults, reflecting the regional profile of sex, age, social grade, tenure and employment status. Data has also been weighted to ensure the sample is representative of the adult population of the region.

3. Because the surveys were 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 the total sample of 500 consumers is about 3-4%, but higher amongst smaller subgroups. 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. 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. 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 ICM Research or any decisions taken by any person in reliance on the report.

Chapter 2

Summary findings

Headline figures for the Hull Area

• £68 was the average quarterly spend on fixed telecoms (inc. calls, rental, VAT);
• 97% of adults were satisfied with their fixed telecoms service overall;
• 49% of homes with a fixed line telephone are connected to the Internet;
• 64% Internet homes using unmetered packages;
• 7% Internet homes claim to be using broadband; and
• 9 hours is the average weekly household time spent online.

Fixed market

Kingston Communications is the only supplier of full service fixed line telephony in Hull. This does not appear to have an adverse affect on average consumer spend or satisfaction levels.

2.1 Consumers in Hull spend an average of £68 per quarter on fixed phone services – slightly lower than the UK average spend of £79.

2.2 Overall satisfaction in the fixed market in Hull is 97%, on a par with UK satisfaction level. Satisfaction in Hull is higher than UK levels with reliability of fixed line (99%) and value for money (95%), compared to the UK levels of 97% and 81% respectively.

Nearly half of consumers in Hull are aware of suppliers that they can access by dialling a freephone or local rate number from their home phone before they call.

2.3 Standard indirect access and carrier pre selection suppliers are not available to consumers in Hull, however 8% of consumers are making use of indirect suppliers that are accessed by freephone or local rate numbers. Awareness of suppliers that can be accessed by dialling a freephone or local rate number from a home phone stands at 45%.

A third of those with fixed line telephones in Hull are aware of indirect access or carrier pre selection suppliers.

2.4 Awareness of IA and CPS stands at 34% - lower than UK awareness of 69%. This is unsurprising as these operators are not currently available to consumers in Hull. 1 in 5 (18%) of all fixed line customers said that they would be interested in using these types of suppliers 

83% of those with a fixed line and a mobile phone use their mobile rather than their fixed line in a variety of circumstances.

2.5 Over 8 in 10 (83%) use their mobile rather than fixed line in a variety of circumstances – this is higher than the 3 in 5 UK consumers who claimed to be doing this in August ‘02. This can partly be explained by Hull’s population profile consisting of higher proportions of groups who have a higher propensity to this behaviour.

Internet market

Half of homes with a fixed line phone in Hull have Internet access – ordinary dial-up is the most commonly used method to connect.

2.6 Broadband and fully unmetered narrowband Internet access are only available to consumers from one ISP (Karoo (see note four below)), however this does not appear to have affected levels of Internet use or satisfaction. Internet penetration stands at 49% in Hull amongst those with a fixed line phone – in line with the UK penetration figure.

2.7 9 in 10 of those with Internet access in Hull use an ordinary phone line dial-up connection. This is a significantly higher proportion than found in Oftel’s most recent UK survey (80%).

2.8 Use of unmetered packages in Hull stands at 64% - similar to the UK. A third (34%) of those currently using narrowband metered access are interested in getting unmetered access.

2.9 Satisfaction with overall Internet service in Hull is the same as satisfaction in the rest of the UK (90%).

Similarly to the UK, most of Hull’s Internet customers have never used another connection method

2.10 As found in the UK survey the vast majority (89%) of consumers in Hull with home Internet access have never used anything other than their current method to connect to the Internet.

2.11 Unsurprisingly, since Karoo are the only supplier currently offering fully unmetered Internet access and broadband connections, half of homes in Hull with Internet access use Karoo/Kingston as their ISP. 7 in 10 (71%) are aware of other ISPs offering any Internet service in their area.

Half of those using Kingston/ Karoo’s fully unmetered package said that they were likely to consider switching if other suppliers offered similar packages and 16% said that they would have preferred to use another ISP if another had offered an identical package at the time of purchase.

2.12 Half of those using Karoo/ Kingston’s fully unmetered package say they would have preferred to use Karoo/ Kingston even if another ISP had offered an identical package at the time of purchase. A third expressed no preference and 16% said they would have preferred to use another ISP.

2.13 When asked about future intentions half of those currently using Karoo/ Kingston’s fully unmetered package said that they were likely to consider switching suppliers if others started offering similar packages.

A quarter of Internet customers in Hull not currently using broadband claim to be likely to upgrade to broadband in the next 12 months

2.14 27% of Internet customers in Hull claim to be likely to upgrade to broadband Internet in the next 12 months.

2.15 A third of Internet users not currently using broadband mentioned cost (too expensive, waiting for prices to fall, benefit wouldn’t justify cost) as a reason why they don’t currently have broadband or are unlikely to get it in the next 12 months.

3 in 10 broadband users claim they would switch to narrowband if charges rose by 10%

2.16 If broadband charges were to rise by 10% about 6 in 10 broadband users said they would continue to use broadband. Around 3 in 10 claimed that they would switch to narrowband.

Note:

4. Karoo is the brand name for Kingston Communications' ISP. Throughout the report Karoo are referred to as Karoo/Kingston. This includes all of those who claimed to use Kingston or Karoo as their ISP.

Main findings

Chapter 3

Use of fixed telecoms in homes

Average spend on fixed telecoms services

3.1 Consumers in Hull spend on average £68 per quarter on their home fixed phone services – this is slightly lower than the average spend of £79 in November ’02 in the UK as a whole.

3.2 The difference in average spend between Hull and the UK can be partly explained by differences in population profiles. Average income in Hull is lower than the UK average and C2DE social groups are more prevalent. These are groups that Oftel’s previous research has shown to spend less on fixed telephony, however fixed spend does appear to be lower in Hull across all social groupings.

Figure 3a: Average quarterly fixed telecoms spend, including rental, calls, metered Internet usage & VAT
Base: Hull residential fixed phone customers aged 15+, Jan ‘03 (Base: 500, ‘don’t knows’ have been excluded)

Consumers’ use of fixed telecoms operators

3.3 Kingston Communications are currently the only supplier offering standard fixed telephony services to residential consumers in Hull.

3.4 98% of consumers claim to use Kingston Communications for their fixed line telephone service. A small minority (2%) claim to use BT, possibly indicating confusion amongst some consumers. 1% claim to be using another operator – which includes customers who use a supplier that they can access by dialling a freephone or local rate number from their fixed line phone.

Satisfaction with fixed telecoms

3.5 Overall satisfaction with fixed telecoms services in Hull is at a similar level to the UK, standing at 97%. Satisfaction with value for money is significantly higher in Hull at 95% than the rest of the UK at 81%. Kingston’s prices are broadly in line with BT’s. Satisfaction levels are slightly lower with the price of International calls.

Figure 3b: Satisfaction with aspects of home fixed phone service
Base: Hull residential fixed phone customers aged 15+, Jan ‘03 (Base: 500, ‘don’t knows’ have been excluded)

Chapter 4

Awareness and use of alternative suppliers

4.1 Since 1998 a number of carrier pre selection (CPS) operators (see note five below) approached Kingston to consider offering services in Hull however none have commenced operation. Additionally since 1998 a number of indirect access (IA) operators (see note six below) approached Kingston to enter the market. Only First Telecom commenced operations in the Hull area however following the collapse of its parent company Atlantic Telecom plc this operation was ceased. Accordingly there are currently no CPS and no IA operators within the Hull area. However there is no restriction on access to national IA operators that offer access to their services via a freephone or lo-call number (such as One.Tel and AlphaTelecom).

4.2 45% of consumers with a fixed line phone in Hull are aware of suppliers that they can access by dialling a freephone or local rate number from their fixed line phone before each call. 8% claim that their household uses this type of supplier. Awareness is higher amongst those aged 35+, AB social grades and higher income groups.

4.3 A third (34%) of those with a fixed line telephone in Hull are aware of indirect access (IA) or carrier pre selection (CPS) suppliers. Awareness is lower in Hull compared to UK awareness (69%). This is unsurprising as these types of operators are not currently available to residential consumers in Hull.

4.4 verall satisfaction is slightly lower (95%) among those who were unaware that they can get telephone services from other suppliers using their existing line. Suggesting that dissatisfaction among some consumers may be caused by perceived lack of choice.

Figure 4a: Awareness and use of suppliers offering indirect access via a freephone or local rate number
Base: Hull residential fixed phone customers aged 15+, Jan ‘03 (Base: 500)

4.5 Figure 4b shows the types of calls made over indirect access suppliers. About 1 in 5 customers who use IA use this method for all types of calls. 6 in 10 do so for more than one call type.

Figure 4b: Types of calls customers make using IA via a freephone or local rate number
Base: Hull residential fixed phone customers aged 15+ using suppliers offering indirect access to their services via a freephone or local rate number (Base: 41*), Jan ’03

* Small base size, apply caution and treat results as indicative only

4.6 About a fifth of these consumers claim to use their alternate supplier for all of their calls, as shown in figure 4c. This equates to 2% of all fixed line customers. Almost half of those using this supplier type claim to do so for half their calls or more.

Figure 4c: Proportion of all fixed line calls from home using IA suppliers via a freephone or local rate number
Base: Hull residential fixed phone customers aged 15+ using suppliers offering indirect access to their services via a freephone or local rate number (Base: 41*), Jan ’03

* Small base size, apply caution and treat results as indicative only

Interest in using alternative suppliers

4.7 1 in 5 (18%) fixed line customers in Hull said that they would be interested in using IA or CPS suppliers (13% were fairly interested and 5% were very interested). Interest is higher amongst younger consumers, higher spenders and higher social groups.

4.8 Satisfaction with existing service is the most common reason for lack of interest in using IA or CPS, as shown below. 63% of those not interested said that this was because of satisfaction with existing service or supplier costs. Barriers for a minority include insufficient information/ knowledge about these services, how to get them and their trustworthiness. UK qualitative research on branding carried out in November 2001 highlights the importance of brand image in the telecoms market. Whilst some consumers believed it was worth switching suppliers for a reduced price, few were prepared to switch to an unknown supplier, and few indirect access suppliers were considered to have yet established sufficiently reputable or well-known brands. The full report can be found at http://www.oftel.gov.uk/publications/research/2001/bran1101.htm. 

Figure 4d: Reasons not interested in using IA/CPS
Base: Those not interested in using (Base: 409), Jan ’03

Notes:

5. Operators that consumers can access via their home fixed line by telling the supplier in advance which types of calls they want to use them for. These calls will then automatically go through this supplier.

6. Operators that consumer can access via their home fixed line, usually by entering a short code before dialling the number they wish to call. Alternatively, consumers may have a box attached to their phone which does this for them.

Chapter 5

Impact of mobiles on the use of fixed phones

5.1 68% of those with a fixed line telephone in Hull also own a mobile phone, in line with the level of penetration found in Oftel’s most recent UK survey.

5.2 Consumers in Hull are more likely than the average UK consumer to use their mobile rather than their fixed line - 83% of those with both a fixed line and a mobile use their mobile instead of their fixed line in a variety of circumstances, compared to about 3 in 5 in the UK. This difference can be partly attributed to Hull’s population profile. Lower income groups have a greater propensity to use their mobile in place of their fixed line for ‘cost saving’ reasons (to call mobiles on same or different network because cheaper; for certain numbers because cheaper; at certain times because cheaper; or to use up ‘free minutes’). These groups make up a greater proportion of the population in Hull compared to the UK.

5.3 Convenience is the main reason for selecting mobiles rather than fixed phones, and nearly half (46%) said that they use their mobile to make calls to other mobiles on the same network because it is cheaper. In all the listed circumstances, those in Hull are significantly more likely then the average UK consumer to use their mobile in place of their fixed line.

5.4 Oftel’s research has found that mobile customers with Internet access at home tend to spend more on their monthly mobile bill as their Internet usage increases. Although this may reflect heavier telecoms usage in general, nearly half (47%) of mobile customers with Internet in Hull said they used their mobile to make calls when the fixed phone was connected to the Internet – this compares to about a fifth of mobile customers with Internet in the UK. 

Figure 5a Examples of consumer preference for mobile over fixed phone usage
Base: Hull residential consumers aged 15+ with both fixed and mobile phone, Jan ’03 (Base: 341)

Chapter 6

Internet use at home

6.1 Half (49%) of homes with a fixed line phone in Hull have Internet access which is in line with the UK at 46%.

6.2 Similarly to UK findings Internet penetration is lowest among older consumers (55+), lower income groups and DE social grades.

Figure 6a: % fixed phone customers with Internet at home
Base: Hull residential consumers aged 15+, Jan ‘03 (Base: 500) 

6.3 Figure 6b shows that the main reasons given for not having Internet access at home are no interest or not having a PC at home.

Figure 6b Reasons why don’t have Internet access at home
Base: Hull residential consumers aged 15+ without Internet access at home, Jan ’03 (Base: 260)

Weekly time spent online

6.4 The average amount of time consumers are spending online at home in Hull is equal to the national average at nine hours.

6.5 Broadband users in Hull are currently the heaviest users spending an average of 15 hours per week online, compared to 11 hours per week by narrowband unmetered customers and an average 5 hours for those using a metered package. This is consistent with usage in the rest of the UK.

Figure 6c: Average weekly household time spent online
Base: Hull homes connected to the Internet, Jan ‘03 (Base: 239)

Satisfaction with Internet service

6.6 Satisfaction with overall Internet services in Hull is consistent with the UK at 90%. Satisfaction with value for money and quality and reliability in Hull are also similar to satisfaction levels in the UK.

6.7 Internet customers in Hull are least satisfied with the speed of access, although the satisfaction level of 80% is significantly higher than the UK satisfaction level of 70%.

Figure 6d: Satisfaction with aspects of home Internet service
Base: Hull homes with Internet, Jan ‘03 (Base: 239, ‘don’t knows have been excluded)

*base size less than 100 so apply caution
** extremely small base size so apply caution and treat as indicative only

Chapter 7

Connection methods, ISPs, and packages used

Access method

7.1 9 in 10 homes with Internet access in Hull use ordinary phone line/dial up access. This is a significantly higher proportion than use this method in the UK as a whole (80%). Younger Internet customers and those from higher social and income groups are especially more likely to use dial up access in Hull than in the UK.

Figure 7a: Penetration of methods used by consumers to access the Internet at home
Base: Hull homes with Internet access, Jan ‘03 (Base: 239, 6% ‘don’t knows’ have been excluded)

* this equates to around 10 consumers and seems a somewhat high proportion

7.2 Figure 7a shows that the use of broadband appears lower in Hull than the UK. Subscriber figures from November ’02 suggest that approximately 9% of UK homes with Internet currently use ADSL (3%) or cable modem (6%). These figures are slightly lower than those reported in the consumer survey (which are subject to error margins of about +/- 2-3%). A third of those who claim to be using ADSL in Hull claim to be using an ISP other than Karoo/ Kingston. This indicates some confusion amongst consumers as Karoo are the only supplier currently offering broadband services in Hull, indicating that as with UK figures that claimed use of broadband is marginally overstated compared with current supplier figures.

Type of Internet package used

7.3 Use of unmetered packages in Hull is similar to that found in Oftel’s UK survey at just over 6 in 10 homes (64%) with Internet using either a fully or partially unmetered package. This comprises 7% using a broadband package, the remainder using a narrowband unmetered package (including ISDN), similar to levels in the UK as shown in figure 7b. Just over a third use metered packages, again consistent with the UK. 

Figure 7b: Main type of Internet package used at home
Base: Hull homes with Internet access – all access methods, Jan ‘03 (Base: 239, 32% ‘don’t knows’ have been excluded)

Switching access method and package

7.4 The vast majority (89%) of consumers in Hull with home Internet access have never used an alternative method than currently, to connect to the Internet. The level of switching (9%) is broadly similar to the rest of the UK. Those currently using PSTN are most likely to have connected straight to the Internet (94%) while broadband users are more likely to have upgraded from an alternative type of connection (44%), mainly PSTN unmetered access as shown in figure 7c.

Figure 7c: Previous connection method/package used
Base: Hull Internet homes using DSL, Jan ’03

* small base sizes so treat results with caution 

7.5 In line with findings from the UK survey, three quarters of narrowband unmetered users connected straight to the Internet via this type of package, whilst the remainder upgraded from metered packages – either pay as you go or subscription and calls packages. Switching away from unmetered is less evident – 20% of those currently using a narrowband metered package previously used unmetered – again these findings for Hull are similar to the rest of the UK.

* small base sizes so treat results with caution 

ISPs used and awareness of alternatives

7.6 ISP’s used in Hull are quite different to the UK as a whole, due to limitations in package types offered by many ISPs to consumers in Hull. Karoo (Kingston Communications’ ISP) are currently the only ISP to offer broadband and fully unmetered narrowband Internet access. AOL offer a partially unmetered narrowband package with a time limit. The proportion of Internet homes using unmetered access was no different to the rest of the UK as reported in figure 7b.

7.7 Half of homes in Hull with Internet access use Karoo/ Kingston as their ISP, as shown in figure 7f. Two-thirds of those using narrowband unmetered packages claim to use Kingston/Karoo as their ISP.

Figure 7f: ISP share of Hull residential homes with Internet access (based on all ISPs consumer use)
Base: All ISPs used in Hull homes with Internet access Jan ‘03 (Base: 239, 13% ‘don’t knows’ have been excluded)

( – Shares of less than 2%, included in the ‘Other’ category) 

7.8 Of those using Internet at home in Hull 7 in 10 (71%) are aware of other ISPs offering service in their area, as shown in figure 7g. Awareness is higher amongst those aged 35+, and higher income groups. 78% of those using Kingston/ Karoo as their ISP are aware of alternatives.

7.9 Of those aware of other ISPs, half (51%) claim to be aware of an ISP, other than Karoo/Kingston, offering unmetered Internet access in their area – equating to 36% of Internet customers. 55% of those using Karoo/Kingston’s fully unmetered narrowband package claim to be aware of an alternative unmetered supplier.

Figure 7g: Awareness of other ISPs in Hull
Base: Hull Internet customers aged 15+, Jan ‘03 (Base: 239)

Interest in upgrading to unmetered Internet access

7.10 A third (34%) of those currently using metered Internet access in Hull are interested in getting unmetered Internet access, as shown in figure 7f. Of these, half also claimed that they are likely to upgrade to broadband in the next 12 months. Those that were interested in getting unmetered were split over which ISP they would prefer to use – about a third stated Kingston/Karoo, a third would use another ISP and a further third had no preference. 

Figure 7h: Interest in getting unmetered Internet access
Base: Hull homes with Internet currently using metered Internet access, Jan ’03 (Base: 59*)

* small base size so treat results with caution

7.11 The main reason given for not currently having unmetered Internet access by those interested was that it was too expensive. This reason was mainly given by light Internet users. Lack of choice (my supplier doesn’t offer it, not available in my area, insufficient choice of suppliers offering this) was mentioned by around 1 in 5 of this group.

Interest in using alternative ISPs

7.12 Customers using Karoo’s fully unmetered service were asked whether they would have preferred to use a different ISP if identical services had been available when they made their choice.

7.13 Half (48%) of those using Karoo/ Kingston for fully unmetered access say they would have preferred to use Karoo/ Kingston even if another ISP had offered an identical package at their time of purchase. 16% said they would have preferred to use another ISP, and a third expressed no preference.

7.14 Familiarity, trusted brand and the convenience of using the supplier they already use for their home telephony were the main reasons for preferring to use Karoo over another supplier, mentioned by just over half. Other reasons included perception of most reliable service or best cost. 

Figure 7i: Preference for Karoo/ Kingston or another ISP
Base: Hull Internet customers using Karoo/ Kingston as their ISP for fully unmetered Internet access aged 15+ (Base: 66*), Jan ’03

*Base size less than 100 so apply caution

7.15 When asked about future switching intentions, half (49%) of those currently using Karoo/ Kingston fully unmetered Internet access said that they were likely to consider switching supplier if other suppliers started offering similar packages. Younger consumers and those from higher income groups were more likely to consider switching in these circumstances.

Figure 7j: Likelihood to consider switching supplier if other ISPs started offering similar packages
Base: Hull Internet customers using Karoo/ Kingston as their ISP for fully unmetered Internet access aged 15+ (Base: 66*), Jan ’03

* base size less than 100 so apply caution

Chapter 8

Use of broadband

Likelihood of upgrading to broadband

8.1 A quarter (27%) of narrowband Internet consumers in Hull claim to be likely to upgrade to broadband Internet access in the next 12 months. Likelihood of upgrading is highest amongst younger to middle age groups and higher income groups. There were no significant differences according to current ISP used.

8.2 Likelihood to upgrade to broadband unsurprisingly increases with usage, ranging from 19% amongst light users (less than 5 hours per week) to 38% amongst heavier Internet users (more than 16 hours per week).

8.3 Figure 8a shows reasons given for not currently having broadband by those who are likely to get broadband in the next 12 months. ‘Haven’t got round to it’ was the most common reason given. Cost reasons (too expensive, waiting for prices to fall, benefit wouldn’t justify cost) were mentioned by a third (34%).

Figure 8a: Reasons why don’t currently have broadband Internet access
Base: Hull residential consumers aged 15+ likely to switch to broadband in next 12 months, Jan ’03 (Base: 60*)

* small base size so treat results with caution

8.4 Figure 8b shows the reasons for not getting broadband. Not using the Internet enough is the main reason – mentioned by a third (34%). Cost reasons (too expensive, waiting for prices to fall, benefit wouldn’t justify cost) were mentioned by a third (32%). In total these cost reasons were mentioned by a third (33%) of all Internet users who do not have broadband as a reason why they don’t currently have broadband or are unlikely to get it in the next 12 months. Lack of supplier choice or availability of preferred ISP do not appear to be major factors affecting broadband take up for the majority of Internet customers.

Figure 8b: Reasons why not likely to get broadband in next 12 months
Base: Hull residential consumers aged 15+ not likely to switch to broadband in next 12 months, Jan ’03 (Base: 151)

Combined Pay TV and broadband package use

8.5 39% of consumers in Hull with fixed line telephones have pay TV as shown in figure 8c. This rises to 51% in homes with Internet access. The majority of these are Sky subscribers.

Figure 8c: Use of Pay TV
Base: Hull residential fixed phone customers aged 15+ (Base: 500), Jan ’03

* NB Total adds up to more than 100% as 3% consumers had more than one pay TV package

8.6 Kingston Communications currently offer a combined broadband and cable TV package. Of those subscribing to Kingston Interactive pay TV services 1 in 10 also have a broadband Internet connection – this equates to less than 1% consumers in Hull. Of these 3 consumers, 2 said that a supplier offering joint broadband and pay TV packages would be important to them in future broadband decisions.

8.7 About 1 in 6 customers using Kingston pay TV expressed interest in getting broadband. About 2 in 5 of these said that a supplier offering joint broadband and pay TV packages would be important to them in future broadband decisions. 3 in 5 said that it wouldn’t be an important factor in the choice of supplier.

8.8 All consumers who already had or were likely to get broadband were asked what they would do if a joint TV and broadband Internet package were not available from their preferred supplier, as shown in figure 8d. Half said they would get broadband and pay TV services from separate suppliers, 16% would select a supplier that offered a joint package even if it was not their preferred supplier, and a quarter would not consider pay TV in their decision as they are not interested in getting it.

Figure 8d: Actions consumers would take if joint TV and broadband Internet package were not available from preferred supplier
Base: Hull residential fixed phone customers aged 15+ with broadband or interested in getting broadband (Base: 75*), Jan ’03

*Base size less than 100 so apply caution

Reaction to broadband price increases

8.9 Figure 8e shows what action broadband users claimed they would take in the event of charges rising. Around 6 in 10 broadband customers claim they would tolerate a 10% price increase and continue to use broadband. However this falls to around 1 in 10 if charges rose by 50%. 4 in 10 claim they would switch to narrowband and 3 in 10 would stop using the Internet at a 50% price rise.

Figure 8e Actions broadband users would take in the event of price rises
Base: Hull broadband customers aged 15+ , Jan ’03 (Base: 15**)

** extremely small base size so apply caution and treat as indicative only

Annex A

Residential questionnaire

Q1 Which companies does your household use for your home fixed line telephone services? Please include local, national and international calls. Please do not count mobile phone companies.

Kingston Communications
Other (specify)

Q2 You can get telephone services from other suppliers using the line already in your home. To use one type of supplier you dial a freephone or local rate number before each call. Before now were you aware of this type of telephone supplier?

Q3 And do you or members of your household currently use any suppliers where you dial a freephone or local rate number first, for any of your calls from home?

Q4 Which of the following call types do you or members of your household use this type of supplier for?

All calls
International
National
Local
Mobile calls
Internet calls/usage
Business/ work related calls
Premium rate phone calls
Other call types

Q5 What proportion of ALL your fixed line calls from home would you or members of your household say you use this method of calling for?

All calls
At least three-quarters
Less than three quarters, more than half
Half
Less than half, more than a quarter
A quarter or less

Q6 There are other suppliers which provide services using the lines already in your home. You enter a short code before you dial the number you wish to call or you have a box attached to you phone which automatically does this for you OR you tell them in advance which calls you want to use them for and these calls will automatically go through these type of suppliers.

Before now were you aware of any of these types of suppliers?

Q7 How interested are you in using any of these types of suppliers? Would you say…?

Very interested
Fairly interested
Not very interested
Not at all interested

Q8 Why are you not interested in using any of these suppliers?

Q9 How satisfied are you with each of the following?

Would you say you are…?

Your fixed line telephone service overall
Reliability of your fixed line telephone service
Price of UK calls from your fixed line telephone service
Price of International calls from your fixed line telephone service
Overall value for money from your fixed line telephone service
Very satisfied
Fairly Satisfied
Not very satisfied
Not at all satisfied

Q10 Approximately how much would you estimate your TOTAL household spend per quarter on telecoms services is for all telecoms suppliers used (including line rental, any other charges and VAT) but EXCLUDING mobile phone costs?

Up to £30
£31-£50
£51-£70
£71-£100
£101-£200
£201-£300
More than £300

Q11 Do you personally have or use a mobile phone?

Q12 Thinking about when you use your mobile phone rather than your fixed line phone at home, which if any, of the following statements apply?

Use mobile instead of fixed to use up free mobile minutes/ vouchers before expires
Use mobile instead of fixed at certain times of the day because cheaper
Use mobile instead of fixed for certain numbers because cheaper
Use mobile instead of fixed to call mobiles on same network because cheaper
Use mobile instead of fixed to call mobiles on different networks because cheaper
Use mobile even when more expensive than fixed because the convenience is more important than the cost
Use mobile when home phone is being used by someone else
Use mobile when home phone line is connected to the Internet

Q13 Do you or does anyone in your household have access to the Internet or World Wide Web AT HOME (via any device, e.g. PC, TV, mobile phone, etc)?

Q14 Why do you not have access to the Internet at home?

Q15 Which of these types of connection does your household use to connect to the Internet at home?

Ordinary phone line – dial up access using a modem
ISDN line – mid speed access/faster than an ordinary phone – You can make voice calls at the same time as using the Internet
DSL/ ADSL – high speed broadband access/ much faster than ordinary phone – is always on and unmetered access. You can make voice calls at the same time as using the Internet
High speed access via another method e.g. satellite, fibre optic, fixed, wireless or leased line
Other

Q16 Have you or members of your household ever used a different method of connecting to the Internet at home?

Q17 What type of connection did you or your household previously use?

Ordinary phone line – dial up access using a modem
ISDN line – mid speed access/faster than an ordinary phone – You can make voice calls at the same time as using the Internet
DSL/ ADSL – high speed broadband access/ much faster than ordinary phone – is always on and unmetered access. You can make voice calls at the same time as using the Internet
High speed access via another method e.g. satellite, fibre optic, fixed, wireless or leased line

Q18a Which of the following do you think you would do if current broadband charges were to rise by 10%? Would you …

Q18b And if they rose by 50%? Would you …

Continue to use broadband
Switch to unmetered narrowband - Ordinary phone line, dial-up access using a modem
Switch to metered narrowband - Ordinary phone line, dial-up access using a modem
Stop using Internet

Q19 Broadband Internet services such as DSL or cable modem allow you to be permanently connected to the Internet for a set fee and offer much faster Internet access than an ordinary phone line. You do not have to pay call charges for the time you spend online, and you can use the same line to make voice calls while you are using the Internet.

How likely are you to switch to broadband Internet access at home in the next 12 months? Would you say…?

Very likely
Fairly likely
Not very likely
Not at all likely

Q20a Why do you not currently have broadband Internet access?