Family or peer groups as well as customer service are increasingly affecting U.S. consumers’ selection of their wireless service providers and driving customer churn, according to initial results from the Yankee Group’s 2005 Wireless User Surveys.
The survey found that nearly half of all new postpaid customer additions were through family plan offerings, which allow multiple users to share a bucket of minutes, and in most cases, receive free calling between plan members.
Family plans have proven a strong catalyst in driving growth and reducing churn as plan members appear more likely to stay with plans or carriers if family or friend are sharing their accounts. However, family plans have had a negative impact on average revenue per user, as most offerings allow customers to be added for less than $20 per month, which is less than half the $40 to $50 in monthly ARPU generated by a single subscriber.
The survey also noted that mobile data and other advanced services continue to have a minimal impact on service provider selection. Consumers are becoming more aware of the advanced services being offered by carriers-with picture messaging singled out in the survey as a bright spot-but penetration levels for more mature mobile data services have begun to plateau.
The Yankee Group added that the 25-and-younger crowd continues to lead in adoption and regular use of most mobile data services with increasing interest in music-based applications.
By comparison, a survey of European consumers found that most wireless subscribers were dissatisfied with the value they receive from their service providers and in general posted poor customer service ratings. European wireless use has continued to grow, though most users still maintain their wireline phones for broadband and cheaper incoming calls.
The survey also found that U.S. businesses spent an average of $5.7 million on wireless voice and data services last year, and 40 percent of employees at firms with more than 500 employees were considered mobile. European businesses spent an average of $35.5 million toward wireless voice, video, data and wireless local area network services last year with 37 percent of all workers in businesses with more than 500 employees considered mobile.
The United States was also singled out as a leader in the adoption of wireless wide-area data services with 35 percent of companies having deployed or trialing wide-area wireless data services. The Yankee Group found that 27 percent of large European companies have deployed or are trialing wide-area wireless data services compared with 56 percent of small- and mid-sized businesses.
