Mobile Broadband Poses Threat to Traditional Internet Service Providers
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19th August , 2008

UK : Approximately one in eight mobile broadband users have either replaced their fixed line ISP or
chosen a mobile broadband service in preference to a fixed ISP service. With increasing numbers of households dispensing with their landlines (13% according to Ofcom) accessing the Internet through the mobile phone network is a viable option especially for the young and mobile.

This is one of the major findings from YouGov’s “DongleTrack” report that interviewed users and
potential users of mobile broadband services. Mobile Broadband is defined as where a dongle or
data-card attached to a PC or laptop accesses the Internet via a mobile phone network. It is NOT the use of the Internet on mobile phones (known as Mobile Internet).

In addition a further 5% of people that are currently running both mobile broadband and a fixed ISP
service intend to cancel their ISP service in the next 12 months.

Not all mobile broadband users are satisfied with the service they receive. More than a quarter of
existing mobile broadband customers can be considered unlikely to renew their mobile broadband contracts or to continue to use mobile broadband on a pre-paid basis.

Three main groups of reasons have been identified as driving dissatisfaction, with connection speed and expense heading staying connected as the main factors.

Commenting on the results, Marek Vaygelt, Head of Technology and Telecommunications Consulting at YouGov said “Customers find Mobile Broadband easy to use and install but transmission speeds and to a lesser extent network coverage reduce the initial enjoyment of getting up and running. It is in these areas that fixed ISPs have a distinct advantage and need to concentrate their marketing effort to minimise customer loss.”

He continued, “For Mobile Operators the challenge is to improve network coverage to a level where
customers’ satisfaction levels rise and churn is reduced. The goldrush is coming to an end. Now the operators need to consolidate by improving their networks and tackling the fear and uncertainty that some potential new customers have about price”.

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