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24th June 2004 - While consumer research from
In-Stat/MDR clearly shows that consumers that
use wireless phones have significantly decreased
their wireline phone usage for both local and
long distance service, the high-tech market research
firm finds that most consumers are not interested
in "cutting the cord" and replacing their landline
altogether.
In-Stat/MDR believes that there are a myriad
of factors that go into the decision to become
totally mobile and that if offered the option
to have both wireline and wireless services as
part of one rate plan, consumers might take it
- particularly those older than 25. While the
number of people subscribing to wireless services
is growing, it does not provide the same type
of experience, or more importantly, the same quality
of service, as wireline local phone service. Furthermore,
among those that do subscribe to wireless service,
a relatively small percent are willing to give
up their wireline, residential phone service.
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Consumers still value the capabilities and reliability
of a traditional landline phone. However, traditional
wireline providers must not lie on their laurels. As
consumers are faced with real dollar decisions, the
economics of paying for what is perceived as two similar
services may cause some to convert to wireless.
A recent In-Stat/MDR survey has also found that:
- There are clear distinctions of behavior depending
on the age of respondents, the younger the respondent,
the more likely to "cut the cord." However,
customers that "cut the cord" today, may
reconnect to the landline services later in life as
their priorities change.
- Convenience was the number one stated reason, on
average, for considering canceling wireline services,
suggesting the cutting the cord is really about mobility
- not necessarily just price.
- While both wireline and wireless calls tended to
be more local than long distance, the proportion of
long distance calls was higher among wireless calls.
- Verizon/Verizon Wireless was the only provider to
consistently be ranked among the top three providers,
in terms of respondents subscribing to their service
for local, long distance, and wireless phone service.
Verizon was the most frequently selected provider
for local and wireless phone service, and the third
most frequently selected provider for long distance.
This Market Alert is drawn from the In-Stat/MDR report,
"Into
Thin Air: Residential Wireline Erosion from Wireless
and Other Access Alternatives", which explores
the potential for wireline to wireless conversion. The
report is based on US consumer primary research. Results
are segmented by region, income level, and age of respondent.
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