Will dissatisfied subscribers let their fingers do the walking? – MetaFacts TUPdate

Churn Intention by Major Carrier-MetaFacts

Will dissatisfied subscribers let their fingers do the walking?

A MetaFacts TUPdate by Dan Ness, Principal Analyst

An old western movie featured a cowboy who sold his horse several times throughout the film. After each sale, the cowboy would wander off and whistle and the horse would run back to the cowboy. The various new owners were upset, yet the cowboy claimed his horse had his own mind.

With the prospective merger of AT&T and T-Mobile, the biggest question is whether the customers will approve of the transaction and stay with the combined unit. Or, will they stray, perhaps back to Verizon or to one of the prepaid MVNOs?

One measure of a subscriber’s mindset is their intention to switch carriers upon the expiration of their contracts.

In our most recent wave of Technology User Profile, we found that both AT&T Wireless and T-Mobile contract subscribers report the highest churn intention rate of any of the major carriers. Close to one in four (23%) of T-Mobile’s online subscribers agree or strongly agree that they plan to switch carriers when their contract expires. Among AT&T subscriber base, this rate is nearly one-fifth at 19%. For comparison, Sprint’s rate is 18% and Verizon’s is 13%. These findings are based on responses from 5,054 online adults who use a mobile phone with a contract agreement, a subset of the entire Technology User Profile survey.

Also, churn intention rates were highest among both carrier’s Smartphone as well as Basic Mobile Phone subscribers.

If the merger were complete today, the combined customer base would have the highest churn intention rate. This is not fully comparable to independent rates, because some subscribers planning to switch likely considered switching from AT&T to T-Mobile or the other way around.

In other findings in our survey results, we’re seeing that the segments of customers AT&T has attracted are different enough from T-Mobile’s subscribers that it’s likely that both companies will need to create an assortment of campaigns to address the wide span of segments. Furthermore, this will rattle the positions of handset manfacturers from Motorola to Apple and RIM.

Of course, wireless carriers do all they can to sway subscriber’s churn intentions, and we’re likely to see creative efforts from both companies to entice subscribers to stay, just as competitors Verizon, Sprint, and others will do their best to welcome them into their fold.

So, we’ll all be keeping our ears open for the whistle which might draw subscribers back to Verizon, although some might instead follow the growing herd to prepaid alternatives.


The results in this TUPdate are drawn from the MetaFacts Technology User Profile Survey. Results specific to this topic can be obtained through a customized report and analysis. Or contact MetaFacts for the MetaFacts Technology User Profile Overview Edition report, which covers the broader range of key trends. View findings in 25 pages of executive summary analysis, 200+ pages of charts and graphs, all supported by 95+ pages of detailed tables. The complete, 300+ page report is delivered to you electronically. This edition is for the U.S. based on the 2010 wave of Technology User Profile gathered among a scrupulously selected set of representative respondents, surveyed both online and offline.

To see other research coverage of Internet products and activities – from smartphones to feature phones, desktops to notebooks, social networking, demographics, and attitudes – see the many other Internet-oriented questions TUP covers on www.technologyuser.com.

About TUPdates

MetaFacts releases ongoing research on the market shifts and profiles for Smartphones, Netbooks, Mobile PCs, Workplace PCs, Home PCs, Moms and Dads, Web Creators, Broadband, and many other technology industry trends and facts. These TUPdates are short analytical articles in a series of specific topics utilizing the Technology User Profile Annual Edition study, which reveals the changing patterns of technology adoption around the world. Interested technology professionals can sign up at https://metafacts.com/contact-metafacts/ for complimentary TUPdates – periodic snapshots of technology markets.

About MetaFacts

MetaFacts, Inc. is a market research firm focusing exclusively on the technology industries. MetaFacts’ Technology User Profile (TUP) survey is the longest-running, large-scale comprehensive study of its kind, conducted continuously since 1983, the year before Apple released the Apple Macintosh. The detailed results are a primary market sizing and segmentation resource for leading companies providing consumer-oriented technology products and services, such as PCs, printers, software applications, peripherals, consumer electronics, mobile computing, and related services and products. TUP analyzes key trends and the data-rich source can be dived into more deeply for custom analysis. For more information about the syndicated research service, analysis tools, publications and datasets, contact MetaFacts at 1-760-635-4300.

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Filed under Consumer research, Market Research, Mobile Phones, Technology User Overview Report, TUP 2010, TUPdate

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