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Service more important than price for broadband; opposite for mobile

Thursday 12th April 2012

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A Commerce Commission survey on consumer switching behaviour has found the main reason consumers swap internet providers is for better broadband service, while it is cheaper rates that prompt a change in mobile phone provider.

The survey, a first for the commission, was undertaken with Roy Morgan Research, and found about 48 percent of consumers switched providers to improve broadband service. Of the remainder, 41 percent were driven by cost, while 33 percent said data cap restriction was the main reason for not staying with their provider.

“We commissioned this survey of customer experience to find out if there were any significant barriers stopping consumers from switching providers,” Ross Patterson, the Telecommunications Commissioner, said in a statement. “Switching barriers lead to less competition, higher prices, poorer services and less choice.”

On the basis of the survey, the commission concluded there did not appear to be significant barriers to switching broadband or mobile provider.

About 14 percent of mobile customers reported switching providers in the last 12 months, while about 37 percent of New Zealanders had swapped providers at some stage.

The leading reasons given by consumers in all age groups for switching mobile providers was cheaper services, at 46 percent, while better network coverage accounted for 22 percent and being on the same network as family and friends, 20 percent.

For those wanting to be on the same network as family and friends, 79 percent said the main reason was cheaper services.

Of the 12,000 consumers surveyed in New Zealand and the 50,000 in Australia, about 80 percent said they were unlikely to switch mobile providers in the next 12 months. Of the respondents that had switched, 82 percent reported a positive customer experience.

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