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Why telco customers switch

12 Apr 2012

Getting a cheaper deal is the main factor driving both mobile and fixed-line telecommunications customers to switch providers, according a study by the Commerce Commission as part of its brief to keep an eye on barriers to switching and thus ensure competition in the market.

In mobile, 13.7% of respondents said they had switched provider in the preceding 12 months. Of those, 46.6% cited obtaining cheaper rates as a reason for switching, followed by better network coverage at 22.4%, being on the same network as friends or family at 20.4%, and not being locked into a fixed-term contract at 13%.

Switchers were overwhelmingly happy to have made the move, with 81.6% reporting a positive experience and just 1.5% reporting a negative experience.

Of those who had thought about switching but hadn’t, the results were split between pre-paid and post-paid customers; the former were more likely to cite being happy with their current provider as a reason to stay, while the latter tended not to switch because it was easier to stay with the same provider.

Having to pay a cancellation fee was cited as a barrier to switching by 14.1% of post-paid customers.

For fixed line customers, 23.9% had either switched service providers or changed their service package.

48.6% of those who had switched providers did so in order to improve their broadband. Of those, 41.1% were looking for a cheaper service, 33.2% were after a higher data cap, 17.1% were unhappy with their ISP’s customer service, and just 4% sought a faster connection.

Both full and summarised versions of the study can be downloaded here.

Have you switched or thought about switching your fixed line or mobile provider recently? If you did, what drove you to switch, and if you didn’t, what made you stay? Post your comments below.

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