Fixed line broadband still sticky service

James Middleton

December 8, 2008

2 Min Read
Fixed line broadband still sticky service

One of the growing concerns of the fixed line operator community in these times of economic slowdown is that consumers are cutting their fixed line broadband in favour of a mobile net connection.

It’s been well noted that mobile broadband subscriptions are growing at an explosive rate, giving rise to a potential double whammy risk, which could see fixed line operators not only lose further fixed voice revenues but valuable broadband revenues as well.

To further investigate this phenomenon, industry analyst Ovum recently commissioned a survey of over 8,000 consumers worldwide to find out their plans.

The researcher discovered that the majority of consumers intend to scale down rather than cancel their fixed line broadband service, and at the top level broadband seems to remain a ‘sticky’ service.

The survey found that only 7 per cent of respondents would ditch their fixed line for both voice and broadband in favour of mobile services, and only 1 per cent said they would be prepared to keep their fixed voice but cut their broadband access.

Those thinking of cutting the mobile subscription stood at 6 per cent, making fixed broadband actually even stickier than mobile to those that are planning on keeping the fixed line.

The majority (65 per cent), said they would simply look to reduce spend in certain areas, rather than cancelling one of their services altogether. As a result, spend will likely be evenly cut across three areas: fixed voice calls, mobile voice calls and pay TV subscriptions.

Unfortunately for pay TV operators, this suggests that consumers are looking to cut back on extras such as pay per view movies, although this should affect one off payments rather than subscription services which are still expected to increase as consumers go out less.

Age and culture play a big part in this decision making process, and perhaps unsurprisingly, people aged between 16 and 25 are more likely to either drop their fixed line altogether (10 per cent) or keep a fixed connection but rely more on their mobile phone for calls (28 per cent).

Older users are less likely to rely on their mobile and more likely revert back to their fixed line, with only 5 per cent of over 55s saying they would cut their fixed line.

As well as age, culture also plays its part. In countries where mobile services and applications are already firmly engrained into the culture, such as Korea, 15 per cent of respondents would cut their fixed line altogether, compared to roughly 5 per cent in most Western European countries – other than Italy, where 11 per cent said they would.

Conversely, in Germany and France, 11 per cent of respondents said they would rather keep their fixed line and cut their mobile service.

Because broadband is now a part of everyday life, even when money becomes tight, for the vast majority of people cutting out web access is just not an option.

About the Author(s)

James Middleton

James Middleton is managing editor of | Follow him @telecomsjames

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