Do churning customers keep churning?

A new report from Ovum and highlighted by RCR Wireless says that 50 percent of telecoms customers could churn in the next year. 50 percent churn is a scary number and likely to get the attention of the CEO – and not in a good way. The reason is bad mobile broadband coverage. You would have thought that customers wanting to watch TV would be the ones who are disappointed and wanting to switch but it turns out that those just wanting to access the internet, read the news and listen to some music are feeling as let down. Customers in India and South Korea are more likely to churn than say, Germany and Japan.

Being connected and able to search for something the moment you think of it is now seen as ‘table stakes.’ No wonder then that the focus of telecoms operators remains firmly on getting their network problems fixed and not on billing for new services.

We talk a lot about an array of new services that will replace those lost revenues as text and voice services become commoditised. This was made painfully clear at the recent ETIS Community Gathering in Budapest. The plenary session talked of relationships with Facebook and others. The best way to reduce churn, went the story (not a new one) is to bundle services. Now the services being bundled will include TripAdvisor, Deezer and Sky Sports, to name a few.

Meanwhile, in the Revenue Management stream, the billing departments had universally not been asked whether IoT, M2M, DoB or OTT services could be billed anytime soon. They were still being asked to keep pumping bills out until the legacy systems actually screamed for mercy.

All fall down smallThe problem is that if the congestion on the network is such that 50 percent of customers think it is so bad that they are actively considering switching, then these bundles are meaningless.

The other problem, of course, is that depending where you are, the other network is likely to be as bad. In the UK – as an example (other countries are available) – it is actually impossible to conduct business on any train in the country, or highway. The number of times a call drops or the WiFi on the train hangs, crashes and generally irritates is simply too great.

This is true on any network. So perhaps these statistics should be viewed against a background of ‘musical chairs.’ Every time the music stops, or the irritation reaches combustion point Network Operator A loses 50 percent of his customers but gains 50 percent of Network Operator B’s customers. So the status quo is maintained and irritation levels are reset to zero for a month or two before the cycle repeats.

Even so, it must be time for large companies to stop showing off about their investments in new technology and get the basic stuff right.

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About Alex Leslie 400 Articles
Alex was Founder and CEO of the Global Billing Association (GBA), a trade body focused on the communications sector. He is a sought after speaker and chairman at leading industry conferences, and is widely published in communications magazines around the world. Until it closed, he was Contributing Editor, OSS/BSS for Connected Planet.

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