TORONTO: 8 May 2014 — On average, monthly bills for wireless service have dropped by $7 for customers in Canada, helping to improve overall satisfaction. The recent implementation of the Canadian Radio-television and Telecommunications Commission’s (CRTC) Wireless Code in December 2013, as well as early measures taken by some wireless carriers to be in compliance, has been highly influential in this outcome. However, these changes have presented potential revenue stream challenges for carriers, according to the J.D. Power 2014 Canadian Wireless Total Ownership Experience StudySM released today.
The Wireless Code establishes new standards that all wireless carriers must follow. Among the key mandates are no cancellation fees after two years; limits on data and roaming charges; ability to more easily unlock phones; trial periods without penalty; and clear language in documents.
“While the Wireless Code appears to have benefited wireless customers with a reduction in monthly fees, it may put increased financial strain on carriers over time,” said Adrian Chung, account director at J.D. Power. “Carriers will need to look for other products and services to make up the losses and generate new revenue streams. Tablets with data packages are starting to take hold, and the average additional spend is $34 dollars per month among those with a connected tablet on their plan, compared to those without one. This is a great opportunity for carriers to leverage.”
The study examines wireless customer perceptions of their service, mobile devices and retail experiences. Satisfaction is measured in seven factors: cost of service; network quality; account management; offerings and promotions; customer service; handset; and purchase process. Carriers are ranked in two segments, full-service and stand-alone, which are differentiated by the range of products and services offered as well as the ability of customers to bundle wireless services with other offerings.
Overall satisfaction improves by 14 points to 705 (on a 1,000-point scale) in 2014 from 691 in 2013. In the full-service carrier segment, overall satisfaction in 2014 averages 694, compared with 680 in 2013. In the stand-alone segment, satisfaction averages 744, compared with 730 in 2013.
- Nearly one-third (32%) of customers have two-year contracts, compared with 57 percent who have three-year contracts. Satisfaction is much higher among customers with two-year contracts than among those with three-year contracts (723 vs. 688, respectively), and customers with two-year contracts pay less per month ($76 vs. $81, respectively).
- Sixteen percent of full-service customers indicate they were unexpectedly charged for overages in the past three months. Eleven percent say their bill is typically not consistent with their expectations.
- Data network quality, measured in problems per 100 connections (PP100), has improved due to 4G rollouts. Year over year, overall problems in network quality have remained stable at 10 PP100; however, data problems among full-service carriers have dropped to 14 PP100 in 2014 from 16 PP100 in 2013. In particular, the number of problems with slow mobile Web loading has declined among full-service customers to 15 PP100 from 18 PP100 in 2013.
- Smartphone penetration has grown to 73 percent in 2014 from 63 percent in 2013. Customers are replacing traditional feature phones across all carriers regardless of plan type.
- Penetration of connected tablets has reached 7 percent. Wireless customers with connected tablets spend an average of $101 per month vs. $67 among those who do not have one—a difference of $34.
Wireless Carrier Rankings
For a third consecutive year, SaskTel ranks highest in customer satisfaction among full-service carriers, with a score of 727, which is a 15-point improvement from 2013. SaskTel performs particularly well in the network quality; account management; offerings and promotions; customer service; and handset factors. TELUS Mobility (717) follows SaskTel in the full-service segment rankings.
Among stand-alone carriers, Koodo Mobile ranks highest in customer satisfaction for a third consecutive year, with a score of 778, improving by 13 points from 2013. Koodo Mobile performs particularly well in network quality; account management; offerings and promotions; handset; and purchase process. Virgin Mobile (753) follows Koodo Mobile in the stand-alone segment rankings.
The 2014 Canadian Wireless Total Ownership Experience Study is based on responses from 12,474 mobile service customers. The study was fielded in October 2013 (Wave 1) and March 2014 (Wave 2).
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