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Consumers’ use of mobile telephony - Summary of Oftel residential survey |
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Q2 August 2000 4. Which consumers are using mobile phones? 5. Customer satisfaction with mobile service 6. Satisfaction with information sources available to assist mobile selection 7. Switching in the mobile market 9. Impact of mobile phones on use of fixed line home phones Appendix A - Mobile phone usage in Northern Ireland 1.1 This report provides an overview of the key findings in the mobile market, taken from second quarter 2000/01 of Oftel’s quarterly residential consumer survey conducted in August 2000. Results from the first quarter (conducted in May 2000) are used for comparison purposes and referred to throughout this report. 1.2 The report provides a base for trend information on 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 2092 UK adults during August 2000, of whom 54% claimed to personally have a mobile phone. A further 14% who do not personally use a mobile, claim to live in a home with at least one mobile. 1.4 An additional survey was conducted for Oftel by Ipsos-RSL and Ulster Marketing Surveys during September, amongst 997 UK mobile users examining their usage in more detail. The results of both surveys are incorporated in this report, which has been prepared by Oftel, based on the results provided by MORI, Ipsos-RSL and Ulster Marketing Surveys. 1.5 This report covers:
The report addresses the following issues:
(Footnote 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. 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 2000 consumers is about 1-2%, but is higher amongst smaller subgroups. (Footnote 2) The report should not be seen as recommended best buys and should not therefore be relied upon when making purchase decisions. Oftel accepts no liability in respect of any of the results provided to it by MORI, Ipsos-RSL or Ulster Marketing Surveys, or any decisions taken by any person in reliance on the report. (Footnote 3) Results from the Northern Ireland survey are detailed separately in Appendix A.
Mobile usage 2.1 Mobile ownership continues to rise. During August 54% of UK adults claimed to have a mobile, up from 50% in May. Furthermore, mobile penetration amongst the UK population (adults and children) has risen by 3 million since May, to approximately 31.8 million subscribers by August 2000. 2.2 6% of UK homes claimed to use mobiles instead of fixed phones, mainly a result of the flexibility and ability to control costs offered by pre-pay mobiles. These homes are spending as much each month on their mobile usage as other mobile owners, and almost as much as the average fixed phone monthly spend. Additionally, 8% of homes with both mobiles and fixed phones considered their mobile to be their main phone. 2.3 Pre-pay packages remain most popular, preferred by almost 2 in 3 residential customers. Use of choice in the mobile market 2.4 21% of mobile customers claim to have switched network, and 16% claim to have changed the type of package they use (ie pre-pay / post-pay). The majority (4 in 5) of those who switched network changed their mobile number, but most of those who kept their original number were able to do so at no extra cost. Satisfaction with mobiles 2.5 Customer satisfaction with mobile services remains high at 93%, although there was some variation between customers on the different networks. Despite these high levels of satisfaction however, less than half of customers felt their package was the best value for their needs, and fewer than a third felt their supplier offered the best value, geographic coverage, quality of service or customer service. This is most likely an indication of consumer awareness of the rapidly growing and developing mobile market. 2.6 Further evidence indicated that consumers differentiate between mobile networks, with the cost of calls and the range of tariffs and packages being the most marked areas where differences were thought to exist. Satisfaction with information to assist mobile selection 2.7 Although the majority of mobile customers said they were satisfied with the range and quality of advice and information available to assist them select their mobile, the most popular source of advice and information was ‘word of mouth’ from family and friends.A third of mobile customers said they made their choice without the assistance of any comparative information. 2.8 2 in 3 customers who bought their mobile in a shop were offered advice by sales staff, primarily focusing on advice on tariffs and packages to suit needs, and advice on the coverage and quality of different networks. The amount and type of advice varied between outlets, and was most forthcoming in mobile specialist outlets. 2.9 18% customers considered what networks they were most likely to be calling before making their selection and the price of calls to mobiles was not a significant consideration when selecting a mobile. However, about half of fixed line customers said they tend to keep the call shorter if they’re calling a mobile, than if it were another fixed line phone. Satisfaction with mobile usage abroad 2.10 Of the 17% customers using their mobile overseas, almost half said that the coverage and quality of service was good, but satisfaction with price of calls when abroad was considerably lower, with only 13% rating the call charges as ‘good’. 2.11 Price and inability to use phone abroad are potential barriers to greater mobile usage for a small proportion of customers (about 1 in 10 of those who don’t use their mobile abroad). Impact of mobiles on fixed phone usage 2.12 In addition to significant use of mobiles amongst homes without a fixed phone, 7 in 10 consumers with both fixed and mobiles phones claim to be actively choosing mobile rather than fixed phones (in situations, typically at home, where they could use either) for at least some of their calls. The most popular circumstances where this occurred included when the home fixed phone was already being used, to use up free call minutes, or call savings on specific numbers or at certain times of the day. 2.13 20% of consumers with fixed and mobile phones claimed that people now call them more on their mobile and less on their fixed phone than they used to. From the caller’s point of view however, half of consumers said if they know it’s a mobile number they’re calling they tend to keep the call shorter than if they were calling a fixed phone. Some consumers remain confused over identification of mobile numbers and call charges.
3.1 Mobile ownership continues to rise and has doubled since January 99 (figure 3a). 54% of adults surveyed claimed to have a mobile phone, up from 50% in May. This equates to almost 25 million adult users. However, when asked about other mobile subscribers in their household (adults and children), mobile penetration rose to a conservative 31.8 million, a rise of 3 million in the last three months. This is in line with industry subscriber estimates for the same period (Fintec August 2000 estimate 31.8 million subscribers).
3.2 68% of UK homes claimed to have at least one mobile phone. (This includes both adult and child users, but we are unable to accurately establish from this survey the split between the two). The vast majority of mobiles were personally owned rather than provided through work. 3.3 8% of UK homes claim to be without fixed phones. The proportion of these using mobiles instead remains high at 3 in 4, which equates to about 6% mobile-only homes in the UK. This can be seen in figure 3b below. It is too early to predict whether fixed penetration has started to drop, as was the case in Finland (attributable to both economic recession in the early 1990s, but more recently due to mobile uptake) but we shall be monitoring the UK position in subsequent surveys.
How many consumers use each network? 3.4 A comparison of the MORI and Ipsos-RSL surveys with published sources of mobile market share information (in terms of numbers of subscribers using each of the four networks), confirms that the surveys are broadly reflective of the current mobile market in terms of the proportion of consumers using each network. Figure 3c shows industry subscriber figures for the residential market published by Fintec Communications for September 2000.
What mobile packages are consumers using? 3.5 Overall, pre-paid packages are still most popular, preferred by 64% of mobile users. The profile of mobile package usage is shown in figure 3d, and is consistent with the findings of other recent Oftel surveys. There has been no significant changes in these figures since May.
3.6 Pre-pay packages were most popular amongst DE social grades / low income groups, three-quarters of whom used pre-pay packages. They also remain most popular amongst homes without a fixed phone. 3.7 Monthly subscription packages were most popular amongst AB social grades / high income groups. 3.8 There were fewer distinct features of consumers using all in one packages (ie where phone and line rental is paid in advance and calls are either billed monthly or paid by call vouchers), but were again slightly more popular than average amongst higher income groups. How much are consumers spending on their mobile service? 3.9 Average monthly mobile spend was about £21, although this has been inflated by a small number of high spenders and in fact two-thirds of mobile users spend less than £20 each month. This is illustrated in figure 3e.
3.10 Spend varies quite considerably by the type of mobile package used (figure 3f), with those using monthly subscription packages spending twice as much as those using pre-pay. Aside from differences by type of package used, heavy spenders were typically high income groups, heavy fixed line spenders, but equally, homes without a fixed phone. The lowest spenders were over the age of 55.
(Footnote 4) Homes with more than 4 mobiles were counted as 4 subscribers
4. Which consumers are using mobile phones? 4.1 Figure 4a shows mobile ownership levels amongst various demographic groups of the population. Mobile ownership is still largely dependent on income, age, and to a lesser extent social grade. 4.2 Ownership remains highest amongst the high income groups (More than £30,000 annual household income) of whom 69% claimed to have a mobile, falling to 42% amongst low income groups (less than £17,500 annual household income). It was also highest amongst younger consumers (15-24), of whom 75% claimed to have a mobile, compared with only 5% amongst those over the age of 75. 4.3 Mobile users were more likely than those without mobiles to have other technologies at home including pay TV, PC, and home Internet. 4.4 Figure 4b shows combined data from both the May and August surveys for geographic regions, to provide more robust sample sizes (minimum of 200 in each area) on which to base conclusions.
4.5 Between January ’99 and May ’00 there was a slight shift in the profile mobile phone users. This is illustrated in figure 4c. Although still prevalent amongst the younger and middle age groups, and higher social classes, distribution had experienced a slight shift towards the lower social grades and to a lesser extent older users. Since May however, there has been little change in the profile of mobile users.
Mobile-only homes 4.6 74% of homes without a fixed phone (which equates to 6% of all UK homes) currently use mobiles instead of fixed phones. 4 in 5 of these mobile-only consumers use pre-pay packages, higher than the average 64%. Preference for the flexibility and convenience that mobiles offer, particularly pre-pay in relation to managing costs, are the main drivers behind this trend. 4.7 27% of these mobile-only users said they used to have a fixed line, and only 16% said they would consider getting a fixed line if prices were reduced. This is possibly related to the fact that most of these mobile-only users live in rented accommodation. 4.8 Spending an average £25 each month on their mobile bill (little change since May), they spend no less than mobile users generally (average mobile monthly spend £21). Equating to about £75 per quarter, these mobile-only users are spending almost as much as the average fixed line customer (who spends about £80 per quarter). This suggests that these consumers are either not familiar with fixed line charges and perhaps overestimate them, or that the greater control and convenience of mobiles is more significant than cost alone. This might be an area to further investigate in future surveys. (Footnote 5) Includes phones provided by employers
5. Customer satisfaction with mobile service 5.1 Overall customer satisfaction with mobile phone service remains high at 93% and has seen little change since May (94%). Differences between customers of different networks and mobile packages are shown in figure 5a.
5.2 There was some variation in satisfaction levels between customers of different networks and using different mobile packages, but there was little other difference in satisfaction levels between consumer groups. More notable, was the impact of coverage and quality problems which resulted in lower satisfaction levels, reported in the May survey. Coverage and quality of service experiences 5.3 Mobile users were asked how often they experienced problems with the mobile coverage and quality of service including
5.4 On average 1 in 3 mobile owners said they experience these problems at least sometimes, but the majority said they rarely or never have any problems. This is shown in figure 5b. 5.5 There has been little change in these figures since May. Inability to make and receive calls is still the most common problem, experienced by 37% of mobile users at least sometimes. Consistent with May, higher spending customers experienced these problems more often than low spenders, which is unsurprising given that higher spend is likely to reflect greater usage in most instances.
5.6 Generally, there was little difference between the four networks in terms of the frequency with which their customers said they experienced quality or coverage problems. This is broadly in line with the industry-published quality of service indicators which can be found at www.oftel.gov.uk/cmu/initiatives/mobilcpi.htm. One2One customers and consumers using monthly subscription packages were most likely to report these problems. Do mobile customers think they’re getting the best deal from their chosen supplier? 5.7 Despite high levels of overall satisfaction, fewer than half of mobile users felt that the package/tariff they currently used was the best value/cheapest one for their needs. Just less than a third of users thought that their supplier offered the best value for money and fewer still said their supplier offered the best geographic coverage, quality of service, or customer service (figure 5c). 5.8 One in five mobile users did not feel that their supplier/network was the best on any of value for money, a package to suit their needs, coverage or customer service. This is interesting since the May survey reported that cost was the primary driver behind choice of network, followed by coverage and quality of service. 5.9 These findings may reflect the rapidly growing and changing mobile market – customers may have felt they were signing up to the best deal at the time of their purchase, but may now feel that subsequent deals offer better value. This would not explain perception of coverage or customer service however, but may support the May survey findings which indicated that price rather than coverage was the most important driver in network selection. 5.10 These findings might also suggest that whilst cost and quality are important features in mobile selection, consumers might be finding it difficult to compare networks and packages and hence don’t necessarily think they’re getting the best deal. Section 6 provides further detail on consumers’ satisfaction with the range and quality of information sources available to assist their selection.
5.11 Low spending mobile customers (less than £10 per month) were more likely to agree their package/tariff was the best value/cheapest for their needs compared with higher spending customers (53% and 34% respectively). Higher spend customers however, were more likely to say their supplier offered the best coverage and quality of service. 5.12 Mobile users who experienced poor line and sound quality frequently or sometimes, were less likely to say their network offered the best coverage or quality of service than those who rarely or never experienced these problems. 5.13 The apparent contradictions in overall satisfaction, choice of mobile service, and opinion on individual network features are perhaps indicative of the fast changing nature of the mobile market. A range of better deals and packages may have come onto the market since the customer initially chose their mobile, and hence whilst they remain satisfied with their service, it may no longer be the cheapest or best deal for them. Do mobile customers differentiate between networks? 5.14 It is interesting to examine the extent to which consumers think that networks differ in terms of the deals and service they offer. Initial evidence above suggests that consumers make some distinction between networks, although the extent to which this distinction is based on factual information is uncertain. 5.15 Further evidence that consumers differentiate between networks and suppliers is shown in figure 5d. Overall, more than half of mobile customers thought that mobile networks differed at least ‘a little’ on all the features listed. Cost was the area on which they felt that mobile networks differed most. On average, three-quarters of customers said that networks differed at least a little (including over a third who felt they varied ‘a lot’) on overall value for money, price of calls, and range of packages and tariffs offered. 5.16 Over a third of customers felt that networks differ a lot on coverage and quality of service. Range of services and customer service were the two areas where differences between networks were considered to be least marked. 5.17 A significant minority of customers were unsure of the extent to which networks differed, perhaps indicating a need for improving awareness of comparative information to assist consumers make these comparisons and ensure they’re getting the best deal.
5.18 In addition to asking consumers whether or not they feel they are getting the best deal, a further way of assessing whether or not they are using the package most appropriate to their needs is to examine their actual usage compared to what the package offers them. This has been done for customers on monthly subscription packages, examining whether they use the free minutes provided with their package each month, and is shown in figure 5e. 5.19 Just over 8 in 10 customers using monthly subscription packages said they receive free call minutes with their package. A quarter of these customers said that the free minutes they receive usually provides them with sufficient call time for their needs. A further 40% said that they use all their free minutes and usually buy additional minutes. A third of customers said they don’t usually use all the free minutes provided with their package, over half of whom (almost 1 in 5 monthly subs users) said they don’t use at least half of the free minutes they receive. This might suggest that these customers are not necessarily on the best package for their needs.
Do mobile customers consider the price of calls to mobiles when selecting their mobile network? 5.20 The May survey reported that cost was the primary driver behind choice of network, followed by coverage and quality of service. Price of calls, rental, connection and handsets were all areas of cost consumers considered when selecting their mobile. 5.21 Oftel’s Market Information publication reported an 87% growth in the number of call minutes to mobiles over the 12 month period to March 2000. Given the generally higher costs of calling mobiles than fixed lines, and increasing number of call minutes to mobiles, it is worth examining whether mobile customers consider the cost to others of calling their mobile when selecting their service. 5.22 Figure 5f indicates that cost of calls to mobiles was not a significant factor for the majority of customers when selecting their mobile phone. Almost 1 in 5 customers said their mobile selection took into consideration the mobile networks they were likely to be calling. The relevance of this is the provision of cheaper calls by mobile suppliers to callers on their own network (on-net) than other networks. Younger customers appeared to be taking greater advantage of this ‘on-net’ benefit than older customers, who were less likely to consider the networks they would be calling. 5.23 The majority of mobile customers however, said they did not find our how much it would cost people to call them and this cost was not a significant factor in their choice of network.
(Footnote 6) This equates to just less than 100 mobile users. Caution should therefore be applied to these results due to the relatively small sample sizes.
6. Satisfaction with information sources available to assist mobile selection 6.1 Consumers have a wide choice of outlets where they can purchase a mobile phone, from specialist mobile retailers on the high street to supermarkets, mail order catalogue and via the Internet. Consumers currently have a choice of four mobile networks and a considerably larger range of packages and tariffs from which to choose. It is important to examine whether there is sufficient information and advice to assist consumers choose the network and package best suited to their needs. Where do consumers buy their mobiles? 6.2 High street mobile network shops (Orange, BTCellnet, Vodafone and One2One) were the most popular location for mobile phone purchases, followed closely by specialist mobile retailers (such as Carphone Warehouse, DX Communications). This is shown in figure 6a. 6.3 High street retailers (such as Dixons, Currys, Boots) were most popular amongst DE / low income groups and homes without a fixed phone.
6.4 There was little difference across networks as to where consumers had bought their phone. One2One customers appeared to be more likely to have bought their phone in a specialist mobile outlet or general high street retailer. Similarly, there was little difference by type of package, although monthly subscription packages appeared to be more widely available via mail order, compared to pre-pay packages which tended to be more shop based purchases. What information sources do consumers use to assist them select a mobile? 6.5 Two-thirds of mobile customers who bought their mobile phone (as opposed to being given it as a gift etc) said they used information sources to assist them in their selection, shown in figure 6b. The most popular source of information was word of mouth in the form of recommendations and advice from family and friends. This is similar to supplier selection in the fixed telecoms market, where recommendations from family and friends were the most popular source of advice. 6.6 Other popular sources of advice were information from retail outlets, magazines and other literature. 2% of mobile users spontaneously mentioned the industry published mobile quality of service comparison website and a further 3% mentioned quality of service information more generally.
6.7 A third of mobile customers said they did not use any information sources to assist them select their mobile. DE social grades, consumers who left full time education by the age of 15, and tabloid rather than broadsheet readers, were least likely to have used any information to assist their mobile selection. There was little difference across network or package in the type or amount of information used to assist the purchase. What advice, if any, do sales staff offer customers? 6.8 Mobile users were asked whether they received any advice from the sales staff when they bought their mobile. Again, almost 2 in 3 customers said were given advice by the sales staff. 6.9 Figure 6c shows the type of advice offered to customers by sales staff. The most frequent advice provided in sales outlets related to the type of tariff package that would best suit the customer’s needs. 1 in 3 mobile buyers said they were advised on tariff packages. Over a quarter of buyers were given advice on current offers and deals, the quality and coverage of different networks, and advice on running costs including rental, call charges and inclusive call minutes.
6.10 Assistance was most forthcoming in mobile network shops and specialist mobile outlets where 4 in 5 customers said they received advice. Advice was less forthcoming in supermarkets and other high street retailers or via mail order purchasing. Advice on the best tariff package to suit needs and information on offers and cheap deals appeared to be most widely available in specialist mobile outlets. 6.11 There was little or no difference across networks, although customers who bought pre-pay packages were less likely to have said they had been offered any advice, than those buying monthly subscription packages. Are consumers satisfied with the range of information sources available? 6.12 Three-quarters of mobile customers (78%) said they were satisfied with the range and quality of advice and information available to assist them choose a mobile network and package best suited to their needs. 6.13 Older customers, particularly those over the age of 55, were least satisfied with the range of quality of information available. There was little or no difference by social grade or terminal education age. 6.14 Satisfaction with advice and information sources was highest amongst customers who bought their phone in one of the mobile network shops, followed closely by specialist mobile outlets. Satisfaction levels were lower amongst those who had purchased their mobile in other high street retailers. Customers who had received information and advice the quality and coverage of different networks, and on the best tariff package to suit their needs were more satisfied than average. 6.15 Apart from One2One customers who were less satisfied with the information sources than average, there was little difference between customers of different networks. Lower satisfaction amongst One2One customers is possibly related to slightly different purchase locations than customers using the other networks, although they said they received as much advice as customers buying from other networks. 6.16 There was little difference in satisfaction levels between customers using different mobile packages, suggesting that despite claims by pre-pay customer that they receive less advice from sales staff, the availability and quality of other information for different types of mobile packages is satisfactory for most consumers. However, Oftel is examining the type of information and advice available to consumers in greater detail to determine whether consumers are receiving appropriate and impartial advice to assist them get the best deal. (Footnote 7) Consumer switching behaviour in the telecoms market (Conducted for Oftel by NOP, March 2000)
7. Switching in the mobile market 7.1 Just over a third (37%) of mobile customers claim to have made use of the choices available to them in the mobile market, in terms of their switching behaviour. One in five (21%) mobile customers claimed to have switched from one mobile network to another (which is consistent with other recent Oftel surveys and a recent study from the Department of Trade and Industry), and 16% said they had switched from one package to another (ie pre-pay / post-pay). Almost 3 in 4 network changes were in the last 12 months. 7.2 Consistent with the April survey, consumers making most use of mobile competition, in terms of their propensity to switch, were younger (25-34), AB social groups, and to a lesser extent homes with Internet access, about half of whom had switched either network and/or package. 7.3 Older consumers, aged 55+, and C2DE social grades were least likely to have switched mobile package or network. These groups are more likely to have acquired their mobile more recently however, which may explain their lower propensity to switch. 7.4 Just over 1 in 5 (22%) mobile customers who had switched network said that they kept their original phone number. Almost 3 in 5 of these customers said they incurred no cost in porting their original number, and further quarter were unsure. Of the small handful remaining, charges of up to £20 were mentioned. 7.5 A similar proportion (19%) said they kept their existing handset when switched network while the vast majority bought a new handset. 2 in 5 said they wanted a new phone or their old one was broken, while 1 in 5 said that they were told they were unable to use their existing handset / or were unaware that they could keep it. A small proportion said they didn’t want to pay a fee to keep their handset. (Footnote 8) Mobiles - Barriers to switching, and quality of service issues (conducted for Oftel by Ipsos-RSL, April 2000) (Footnote 9) Caution should be exercised as these figures are based on a small sample size of just less than 100.
8.1 17% of mobile phone customers surveyed claimed to have used their mobile phone when abroad (13% frequently/sometimes, 4% used abroad only once). Frequency of use abroad was highest amongst the AB social grades and higher income groups. 8.2 Despite small base sizes mobile usage abroad ratings from customers who had used their mobile overseas at least once are shown in figure 8a. Coverage and quality of service received the highest ratings – almost half of users said it was good, and a further third said it was fair. Price of calls received the lowest ratings with only 13% of users saying this was good, and more than twice this number considering it poor. 8.3 Ratings for overall value for money was somewhere in between quality and price, which perhaps indicates that poor call costs are to some extent counterbalanced by relatively good perceptions of quality and coverage.
8.3 No significant barriers to mobile usage abroad were identified for the majority of mobile customers. Reasons for not using mobiles when abroad are shown in figure 8b. They focused mainly on lack of need and not wanting to be contactable. 8.4 However, potential barriers to greater mobile usage for a small proportion of customers included cost and inability to use phone abroad.
(Footnote 10) The 17% of mobile users surveyed had their phone abroad equates to fewer than 100 people. Caution should be therefore be applied to the degree of reliance placed on individual figures.
9. Impact of mobile phones on use of fixed line home phones 9.1 About half 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 9a. Only 3 in 10 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. 9.2 Almost 1 in 10 (8%) of these dual-users consider their mobile rather than their fixed line to be their main phone. 9.3 1 in 5 consumers with both fixed and mobile phones said that people call them more on their mobile and less on their fixed phone than they used to. This was higher still amongst younger consumers and high spending mobile customers. 9.4 Just over a fifth of dual-users said they used their mobile when their home fixed phone was being used by someone else. This practice was more popular amongst younger rather older consumers, high rather than low income groups and larger rather than smaller households. 9.5 Other circumstances in which mobile phones are replacing fixed line usage included use of free mobile call minutes, and for cost savings where use of mobile was considered cheaper for calling other mobiles, specific numbers, or at certain times of the day.
9.6 In addition to the obvious substitution of fixed phone usage with mobile amongst homes who do not have a fixed phone, these results indicate an increasing proportion of consumers and range of circumstances in which certain groups of consumers are actively choosing to use their mobile rather than fixed line phone. Apparent reasons for this substitution include greater convenience and perceived cost savings on a range of call types. 9.7 Despite indications of increasing fixed and mobile call substitution there is some evidence of consumer confusion over identification of mobile numbers, awareness of call costs and some concern over price of calls to mobiles. 9.8 Just over half (55%) of those with fixed phones said they usually know whether or not it’s a mobile number they’re calling, although this was lower amongst consumers who do not own mobiles. This situation should improve with the national code and number change which will mean as of end April 2001 all mobile numbers will begin 077, 078 or 079. 9.9 A similar proportion of consumers (51%) said that if they know they’re calling a mobile number they tend to keep the call shorter than if they had been calling a fixed phone. 9.10 About a quarter of consumers (27%) said they know roughly how much it costs to call a mobile number from their fixed phone, and only 15% said that the cost of calling a mobile number doesn’t really matter to them. 9.11 Ability to identify mobile numbers and awareness of approximate costs of calling mobiles was lowest amongst older consumers and to a lesser extent the lower social grades.
Do consumers think that mobile networks are all broadly the same, or do they differentiate between them in terms of price, quality and range of service? And are they getting the best deal? 10.1 Mobile customers appear to differentiate between networks, particularly in terms of price, quality and coverage, and the range of tariffs and packages on offer. The majority of customers were satisfied with their own network, but fewer than half felt they were getting the cheapest deal or best coverage. 10.2 It is not surprisingly therefore that over a third of mobile customers claim to have changed network or the type of package they use. In addition, a significant minority of customers using monthly subscription packages claim they usually use less than half of their inclusive free monthly call time, indicating perhaps that they are not necessarily on the most appropriate for their particular usage pattern. 10.3 These findings may reflect the rapidly growing and changing mobile market but may also indicate consumer difficulty in comparing networks and packages and hence they don’t necessarily know if they’re getting the best deal. However, evidence to the contrary (see below) indicates that most consumers are satisfied with the range and quality of information sources available to assist them select a supplier. Is there sufficient information to assist consumers select their mobile? 10.4 As noted above, the majority of mobile customers said they were satisfied with the range and quality of information to assist them select their mobile service. The most popular sources of information included advice from family and friends, and literature from retail outlets and magazines etc. Additionally, about 2 in 3 mobile customers who bought their own mobile were offered advice by sales staff, which included information on tariffs and packages, running costs, and network quality and coverage. 10.5 The amount and type of advice was variable however depending on where the customer bought their mobile, and a third of customers said they made the decision without the assistance of any advice or information. 10.6 So whilst the majority were satisfied with the both the service they receive and the availability of information sources to assist their selection, it is unsurprising that a significant proportion of customers don’t know whether they’re getting the best deal. Oftel is currently examining this area in more detail. 10.7 Improving awareness and usage of impartial information sources such as the industry published comparable performance indicators is a challenge for the mobile industry and consumer groups, which should assist in ensuring more consumers have the information they need to enable them to get the best deal. What impact is mobile usage having on the fixed line market? 10.8 Results from this and other recent Oftel surveys indicate that an increasing proportion of residential consumers are actively choosing mobiles rather than fixed phones for at least some of their calls. 10.9 The most obvious example of this substitution is amongst the 6% of UK homes without a fixed line phone who use mobiles instead. 10.10 Mobile penetration is highest amongst younger consumers (aged 15-24, of whom 75% claimed to have mobiles). As these consumers (forming 15% of the population) become home-owners, it will be interesting to see whether they move to fixed phones or whether they will have a greater propensity to use mobiles as their main form of communication. 10.11 Even amongst homes with fixed phones however, mobiles are replacing a certain proportion of fixed calls for reasons of convenience eg when fixed phone is already in use, and for cost savings eg cheaper calls to other mobiles, at certain times of the day, or to use up free call minutes. Almost 1 in 10 consumers with both fixed and mobile phones consider their mobile rather than fixed line to be their main phone. 10.12 Concern over cost of calls to mobiles amongst some consumers may be obstructing this trend to a certain extent, as they claim they tend to keep calls to mobiles shorter than they would calls to fixed line phones. 10.13 Recent Oftel Market Information publications (eg May and July 2000) further indicate the impact of mobiles, highlighting growth in mobile call minutes and a decline in fixed local and national call minutes during the period 1999-2000. We will continue to track these trends in subsequent waves of the Oftel residential survey. 10.14 Oftel is considering the findings from this and other surveys, particularly in relation to its effective competition reviews (as outlined in the Oftel’s 2000/01 Management Plan) of the mobile market and price of calls to mobiles. These results will also contribute to Oftel’s Well Informed Consumers projects. (Footnote 11) Mobiles - Barriers to switching, and quality of service issues, April 2000
Appendix A - Mobile phone usage in Northern Ireland During September 2000, a survey was conducted for Oftel by Ulster Marketing Surveys amongst 1100 adults in Northern Ireland, of whom 47% (522) claimed to have a mobile phone. The questionnaire used by Ulster Marketing Surveys was the same as the one administered by Ipsos-RSL across England, Scotland and Wales. The survey is representative of Northern Ireland adults in terms of age, gender, social class, and geographic area. Apart from customers’ use of mobile networks, overall there were little or no statistically significant differences between the results of surveys conducted in Northern Ireland and Great Britain. The key area where differences emerged was the proportion of mobile customers using each of the different networks. According to their website, One2One is currently developing its network in Northern Ireland and hence until recently, the vast majority of consumers had a choice of three networks. Main findings Mobile usage 47% of adults in Northern Ireland claimed to have a mobile phone. The profile of mobile customers in Northern Ireland was broadly similar to the profile of customers across the rest of the UK. Supplier and packages used The profile of mobile usage in Northern Ireland in terms of networks used differs to the rest of the UK. This reflects the later roll out of networks in Northern Ireland the last of which, One2One, is currently under development according to their website. Consumers’ use of mobile networks in Northern Ireland BTCellnet 43% Type of mobile package used The types of mobile packages used in Northern Ireland were broadly similar to those used elsewhere across the UK, with pre-pay most popular used by 73% of mobile customers. Similar proportions of customers on monthly subscriptions to the main GB survey reported not using all their free inclusive call minutes each monthly (just over a quarter). Customer satisfaction with mobile service Overall satisfaction with mobiles was the same amongst customers in Northern Ireland to those elsewhere in the UK at 93%. Similarly, there was little or no difference in customer opinion on variation between mobile networks in terms of price, quality and range of services – price of calls and range of packages and tariffs were the two areas where the greatest differences between networks were thought to exist. Switching in the mobile market The proportion of mobile customers in Northern Ireland who had switched either network and/or the type of package they use was lower than the rest of the UK (18% and 37% respectively). This difference is most likely a reflection of the more recent use of mobiles in Northern Ireland, and the more recent development of competition in terms of choice of networks available. 16% claimed to have switched network and/or service provider compared with 21% in GB, and only 2% had changed the type of package they use compared with 16% elsewhere. In line with elsewhere in the UK, switching was most common amongst younger rather than older customers. 12% of customers in Northern Ireland who had changed their mobile supplier said they had been able to keep their original number. This compares with 22% in the rest of the UK, although these differences are not statistically significant due to the small base sizes. 24% of NI customers who had switched said they kept their original handset, again similar the elsewhere in the UK. Satisfaction with information sources available to assist mobile selection There was little difference between mobile buying patterns between Northern Ireland and the rest of the UK. Mobile network shops and specialist mobile retailers were the most popular locations. Mobile customers in Northern Ireland were more likely than those in GB to seek advice and information to assist their mobile selection (91% vs 67% respectively). Personal recommendations and advice from family and friends was almost twice as popular than elsewhere in the UK. There was little difference between the two groups in the other types and amounts of information used or in the amount and type of information and advice offered by sales staff. Equally, there was no difference in the proportion of customers satisfied with the range and quality of advice and information available to assist their mobile selection at 79% in Northern Ireland and 78% in GB. Use of mobiles abroad 20% of mobile customers in Northern Ireland claim to have used their mobile abroad (similar the GB level of 17%). Ratings for price of calls, coverage and quality of service, and overall value for money were similar to those shown in the main report. Similar barriers to greater use abroad were identified for a significant minority of customers, and included cost of calls and phone not working abroad. (Footnote
12) The main reason for this separate survey is that market research
companies in Great Britain generally tend not to include Northern Ireland
on their regular omnibus surveys. It was therefore necessary to administer
the same questionnaire used in the GB omnibus conducted by Ipsos-RSL
on behalf of Oftel, via a separate omnibus survey in Northern Ireland
in order to obtain a sufficiently robust sample size with which results
from the GB survey could be compared. (Footnote 13) Because the survey was conducted amongst a sample of 522 adults rather than the whole population, results may be subject to a margin of error of between 2-4%, but is higher amongst smaller sub-groups.
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