This project is funded by the European Union

Consumer aspects in telecoms

Peter Lundy MSc DIC BSc(Eng) Information and Communications Technology consultant

November 2008

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This project is funded by the European Union

Agenda1. How customers are served2. How customers choose a telecoms service3. How are consumers informed?4. The role of consumer/ business associations

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This project is funded by the European Union

How customers are servedTypes of telecoms services

– Fixed services– Mobile services– Broadband

Types of customers– Consumers– Small and Medium Businesses– Large Businesses

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This project is funded by the European Union

Consumer services• Broadband• Vision• Home phone• Call plans• Mobile• Shop• Phone bill

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This project is funded by the European Union

Small and medium business services

• Broadband internet• Phone services• Mobile• Networking• Equipment• IT services • “Peace of mind”

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Large businesses and public sector services

• Conferencing• Contact centres and telemarketing• Internet and online• Lines and call services• Mobile• Network infrastructure• Phones and faxes• Telephony systems and hosted voice networks

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This project is funded by the European Union

How are customers informed?

• TV advertising• Newspapers/ magazines• Consumer surveys• Business journals• Over-the-phone selling• Websites (e.g.) TelecomsAdvicehttp://www.telecomsadvice.org.uk/infosheets/

service_availability_isdn_adsl_cable_broadband_mobile.html

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This project is funded by the European Union

Service packaging:(“double-play”, “triple-play” and

“quad-play”)

• VIRGIN/ NTL– 9.5m customers– fixed line, broadband,

digital TV, mobile– available on one bill

from 2007• SKY/EASYNET

– 8.1m customers– digital TV, broadband,

fixed calls

• ORANGE– 17m customers– broadband, mobile, fixed line calls– digital TV

• BT– 16m customers (retail)– fixed line calls, mobile, broadband, television, internet– priced separately

This project is funded by the European Union

Basic requirements of customers• Basic voice…. plus mobile…. plus internet…. plus

TV…..plus ??• To get what they want as easily as possible:

– to enquire what is available:• prices and package deals• delivery dates

– to place an order quickly and easily– to report a problem– receiving a bill and making payment– to change to another tariff plan– complaining– changing to a new provider

This project is funded by the European Union

Flexible tariff plans• The old “meter pulse” method of charging is now

a dinosaur• To bring “packaged services” to the market,

billing systems are now re-configurable in real time

• The service provider can guarantee to the subscriber that they will always be on the best available tariff plan

• Tariff plans;– Services that are separately priced– Service packages - “bundled”– “all you can eat” – flat rate with unlimited usage

This project is funded by the European Union

Example tariff and billing plans• Example tariff plan (a business with 100

employees):– each employee has a company-provided mobile phone– the company pays under a contract plan during working

hours– each employee pays (using pre-paid or a package deal)

outside working hours• The company specifies how it wants its bill

presented (e.g. by department, by call type, by employee usage)

• Each employee can incorporate personal package deals including home (fixed) line, internet and TV, “family & friends” etc, all on one personalised bill

This project is funded by the European Union

Does service matter?

“Yes, because if something does go wrong or you have a query, you do not want to be left with no service or a high bill because you cannot get through to customer services”

“And it is not just about giving you a helping hand. It is about looking after existing customers, making sure you are on the best plan for you and treating you as a customer, not a bill.

“Does your supplier do this?”

This project is funded by the European Union

Who is giving the best satisfaction?

Survey of 8,000 adults carried out in March 2006 for “YouGov” in the UK

Overall Customer

Satisfaction

Value for money

Customer Support Service

TalkTalk 89% 88% 63%Tascali 88% 82% 52%SkyTalk 87% 83% 62%Telewest 83% 74% 75%Homecall 82% 80% 59%

BT 75% 59% 62%ntl 72% 66% 50%

Source: [www.uswitch.com]

This project is funded by the European Union

Finding out what is available• “U-Switch”, “Up my Street” and “Magenta

Systems” are examples of commercial web-based services that will inform consumers of the best deals for telecoms, and other competitive services (e.g. gas, electricity, insurance, mortgages)– www.uswitch.com– www.upmystreet.com– www.magsys.co.uk/telecom

• These are very sophisticated and up to date• This is free information, provided completely

independently from service providers• Magenta Systems has details of 127

telecommunications operators and resellers in the UK

This project is funded by the European Union

Investment in customer service• New entrants and incumbents have invested

heavily in modern systems to support better customer service

• Customer relationship management (CRM) and billing

• “Self-help” for customers to deal electronically• Call centres for “over-the-phone” service• “Walk-in” centres, retail shops, franchises• Mail order

This project is funded by the European Union

Providing responses to customers• Products and services information• Tariffs and availability dates• On-line ordering and order tracking• “View my bill” and on-line payment options• Help desks• Feedback & complaints

Examples: see www.bt.com/contactus

This project is funded by the European Union

“Self-help” service to customers• Web-based:

– on-line services browsing– on-line ordering– on-line billing, bill checking and payment– on-line tracking of orders and fault restoration– on-line reconfiguration of billing and payment options

This project is funded by the European Union

The customer can check availability……

This project is funded by the European Union

The customer can place an order…..

This project is funded by the European Union

The customer can confirm and pay……

This project is funded by the European Union

Regulator’s role in encouraging competitive comparison websites

• The UK regulator Ofcom has promoted price transparency for consumers through its “Ofcom Price Assurance Standard” (Ofcom PASS)

• PASS is designed to ensure independent, accurate and up-to-date price information

• Any public website providing price comparisons which displays the Ofcom PASS logo certifies its compliance with a code of practice

This project is funded by the European Union

Summary• The market is changing as competition matures• Incumbents are establishing their position as

profitable wholesalers as well as retailers• Next generation networks• Heavy investment in customer service• The customer is benefiting from a wide choice of

single and “packaged” market offerings• Challenging regulatory implications

This project is funded by the European Union

César Alierta Chairman of Telefόnica (May 2006)

“We have all transformed ourselves. This is a new sector. Broadband over fixed and wireless phones is the future”

“By 2009, Telefonica expects to be earning 85 per cent of its income from content downloads, data transmission and mobile services”

This project is funded by the European Union

Broadband

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Broadband access penetration EU EBRD countries