The Xfinity Mobile Effect
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1 The Xfinity Mobile Effect Evaluating the success and competitive threat of cable companies offering wireless service ISO Certified Prepared by: Jeffrey T. Johnson 2018 Market Strategies International. All rights reserved.
2 Contents Background and Objectives» Background and Objectives» Xfinity Mobile Awareness and Familiarity» Xfinity Mobile Service Experience» Xfinity Mobile Competitive Threat» Xfinity Mobile Impact on Customer Loyalty» Enrollment Trends» Wireless and Mobile Streaming» Methodology In May 2017, Comcast launched its own wireless service, combining its extensive network of mobile hotspots with the largest 4G/LTE network in the country. This study was conducted to understand how well Xfinity Mobile is performing both as a wireless service within a highly competitive market, but also as a tool that augments Comcast s core Xfinity Internet and TV businesses. We want to understand Xfinity Mobile customers early experience with the service, and how much impact Xfinity Mobile has on consideration, switching behavior, and customer loyalty. 2
3 Xfinity Mobile Awareness and Familiarity Most consumers in the Comcast footprint have at least heard of Xfinity Mobile, but only a quarter are familiar with the service. It is not widely known that Verizon 4G/LTE is the network used by Xfinity Mobile.
4 After exposure to the Xfinity Mobile plan, consumers are somewhat more willing to switch wireless providers especially those with shorter tenure Likelihood to switch by tenure with current wireless service provider Likelihood to switch to Xfinity Mobile by tenure with current wireless service provider Less than More than 5 year years years years (A) (B) (C) (D) Less than More than 5 year years years years (A) (B) (C) (D) Will switch/drop (B2B) Might or might not Might stay 4% 14% ACD 3% 7% 10% 16% 15% 15% 28% 31% 26% 31% Very likely Somewhat likely Might or might not 6% 10% 6% 3% 21% 29% 17% 33% 36% 30% D CD 15% 31% Definitely will stay 58% B 41% 50% 52% Unlikely (B2B) 37% 32% 44% B 52% AB n= n= All Wireless and Internet customers within the Comcast footprint: n = 1044 Q12_1. How long have you had service with <Primary wireless phone service provider from Q1> for wireless phone? Excluding DK WL20. How likely are you to stay with your current wireless phone service provider during the next 6 months, or when your contract expires? All Non-Xfinity Mobile Customers: n=936 WL32. How likely or unlikely are you to switch your wireless service to Xfinity Mobile? A/B/C/D Letters indicate significant differences between groups at 95% CI. 4
5 Different than other carriers combined, most switch to Xfinity Mobile from Quad Play carriers (Verizon or AT&T) due to the better offer from Xfinity Reason for switching by previous carrier Among those who have Xfinity Mobile as their primary wireless carrier Quad Play Carriers All Other Carriers Dissatisfaction with previous provider Both dissatisfaction and a better deal 6% 23% 8% 31% A better offer from Xfinity 66% 49% Another reason 4% 12% n=47 n=49 Wireless customers with Xfinity Mobile as their primary provider: n = 99 WL1. Prior to your service with <primary wireless phone service provider from Q1>, who was your wireless provider? Wireless customers with Xfinity Mobile as their primary provider : n = 96 WL2A. Show if previous provider was pre-listed (WL1=1 16): Was your decision to switch your wireless service from <previous wireless phone service provider from WL1> to <wireless provider from Q1> due to? 5
6 Overall plan costs is the key driver for switching to Xfinity Mobile, and bundling service bills is an important perk for some Reasons for choosing Xfinity Mobile Among those who have Xfinity Mobile as their primary wireless carrier Overall plan costs 50% Able to bundle TV and/or internet with wireless phone service on one bill Better network coverage 12% 8% Primary 28% 25% Total 75% Data costs 7% 38% Promotional or limited time pricing Free talk and text on up to 5 lines Better phone selection Faster network speed Use of Wi-Fi hotspots to save on data usage/costs Ability to easily change data plan based on usage/need Better customer service Another reason No major/primary reasons reason 6% 5% 3% 2% 1% 1% 1% 2% 1% 20% 28% 12% 19% 38% 30% 13% 3% 2% Wireless customers with Xfinity Mobile as their primary provider : n = 99 WL4. What were the major reasons you chose <primary wireless phone service provider from Q1> for your wireless phone service? WL4a. Which one of the following was the primary reason you chose <wireless provider from Q1> for your wireless phone service? 6
7 Only a quarter of Xfinity Mobile customers have experienced an issue with their service; few have experienced speed or coverage issues Issues with Xfinity Mobile Among those who have Xfinity Mobile as their primary wireless carrier Contacted customer service Among those with issues *Caution: Small base Have not experienced any issues 73% Customer service issues Slow data speeds Poor coverage Billing issues Phone issues Some other issue 11% 9% 6% 6% 5% 5% 70% Of customers with issues have contacted Xfinity Mobile customer service Wireless customers with Xfinity Mobile as their primary provider : n = 100 WL9a. Have you experienced any of these issues with your Xfinity Mobile service? Primary Xfinity Mobile customers who have experienced an issues with their service; n = 27* WL9b. Did you contact Xfinity Mobile customer service? Primary Xfinity Mobile customers who contacted Xfinity about an issues with their service; n = 19* too small of base to show WL9c. Did you contact Xfinity Mobile customer service by? Primary Xfinity Mobile customers who has an issues with poor coverage; n = 13* too small of base to show WL9d. When you experienced coverage and/or data speed issues with Xfinity Mobile were you? 7
8 Customers are evenly split between by the gig and unlimited data plans, but unlimited plans tend to meet needs better Plan type Among those who have Xfinity Mobile as their primary wireless carrier Data plan meets needs (Top 2-Box) Among those who have Xfinity Mobile as their primary wireless carrier Unsure 6% 96% 84% Unlimited 45% 49% By the gig Unlimited By the gig n=45 n=49 Wireless customers with Xfinity Mobile as their primary provider : n = 100 WL13. Is your household s wireless data plan? Excludes Don t know WL14. How well does your data plan meet your needs? 8
9 Most consumers believe there are at least some differences between wireless providers, but most are satisfied with their service regardless Between wireless service providers there are Substantial differences Some differences Few differences No differences Overall satisfaction with wireless provider Less than satisfied 25% 50% 17% 9% 11% Overall satisfaction with wireless service by perceived differences (T2B) Substantial No differences Some differences Few differences differences (A) (B) (C) (D) Somewhat satisfied 39% 89% Satisfied with wireless service 50% Very satisfied 90% 90% 87% 85% n= All Wireless and Internet customers within the Comcast footprint: n = 1044 A/B/C/D Letters indicate significant differences between groups at 95% CI. WL18. Do you believe...? WL19. Thinking only about your wireless phone service from <primary wireless phone service provider from Q1>, how satisfied or dissatisfied are you with your...? 9
10 Xfinity Mobile Impacts on Customer Loyalty Longer tenured customers have a lower propensity for switching providers, but at least a quarter of the market has recently switched and would be more apt to switch to Xfinity Mobile. Most Xfinity Mobile subscribers have been with Xfinity Internet and/or TV for several years and indicate that Xfinity Mobile has made them less likely to switch their services in the future.
11 Getting a bundle discount is the primary benefit of having more than one service from a provider Extra benefits of combined services Primary benefit of combined services Among those with more than one service from a provider Among those with more than one service from a provider Lower cost with a bundle discount 57% Lower cost with a bundle discount 50% Combined bill 50% Combined bill 18% Easier to do business with my provider 19% Better performance and reliability 7% Plans that better serve my needs Easier to use the services Better performance and reliability Better customer support More integration; my services work better together Greater functionality, features and/or content More places that I can use my services Something else 17% 17% 16% 15% 13% 13% 7% 1% Better customer support More integration; my services work better together Plans that better serve my needs Easier to do business with my provider Easier to use the services Greater functionality, features and/or content More places that I can use my services Something else No primary reason 4% 4% 4% 3% 3% 2% 2% 1% 3% None, I don't receive any extra value 11% Internet customers with more than one service from provider: n = 842 Q9C. What extra benefit, if any, do you receive by having more than one service from <primary Internet service provider from Q3>? excluding Don t know Q9D. What is the primary benefit you receive by having more than one service from <primary Internet service provider from Q3>? excluding Don t know 11
12 It is likely that Xfinity Mobile customers have premium TV and internet packages How well internet speeds meet needs TV channel package tier Xfinity Mobile Customers Xfinity/ Comcast Customers Non-Xfinity/ Comcast Customers Xfinity Mobile Customers Xfinity/ Comcast Customers Non-Xfinity/ Comcast Customers The highest premium package of channels available 20% 15% 12% Excellent job (%6-7) Average job (%4-5) Poor job (%1-3) 82% 69% 67% 27% 24% 15% 3% 4% 9% A premium, but not the highest channels package An intermediate channels package The lowest package of channels available 44% 26% 36% 35% 34% 39% 10% 15% 14% n= n= All Wireless and Internet customers within the Comcast footprint: n = 1044 INT8. How well do your internet speeds meet your needs? Among those with pay TV, excluding DK: n = 798 TV8. Would you describe your current TV package as having...? 12
13 Even though most consumers are not worried about streaming eating up their data, consideration may increase for providers who offer free data for streaming Likelihood to consider provider if they allow free streaming Much more likely Somewhat more likely Neither more or less likely 17% 41% 40% 58% Of customers are at least somewhat more likely to consider a provider that provides free streaming Impact of streaming on data plan selection I don t worry about streaming video, I don't stream video on my phone I don t worry about streaming video, I don't stream often enough for my streaming data usage to be a consideration I don t worry about streaming video, I already have an unlimited data plan I don t worry about streaming video, my data plan has enough data for my streaming behavior I look for wireless plans that, have enough data to accommodate my streaming behavior 14% 18% 8% 22% 13% Somewhat/much less likely (B2B) 3% I look for wireless plans that, provide streaming without using my data plan 25% All Wireless and Internet customers within the Comcast footprint: n = 1044 Stream9. If a provider wireless or Internet/TV provided a plan that allowed for free streaming that did not count against your data would it make you more or less likely to consider the provider for your service? Stream10. When it comes to selecting and using a wireless data plan, do you? 13
14 As Comcast marks the one-year anniversary of its Xfinity Mobile launch, it s clear that their venture into the coveted Quad Play space is paying off. Whether you re an MSO, wireless provider, RBOC or a tech/media organization, The Xfinity Mobile Effect has far-reaching implications. Contact me to discuss your next move. Have questions? Contact: Jeffrey T. Johnson Director, Tech & Telecom jeffrey.johnson@marketstrategies.com About Market Strategies International Market Strategies International is the research and consulting partner that helps the world s most successful organizations thrive. We have deep expertise in consumer & retail, energy, financial services, health, technology and telecommunications. We blend primary research with data from our syndicated, benchmarking and self-funded studies to provide clients with exceptional research insight that helps solve their challenges. Our research specialties include brand, communications, CX, product development and segmentation. Our syndicated products, known as Cogent Reports, help clients understand the market environment, explore industry trends and monitor their brand within the competitive landscape. Founded in 1989, Market Strategies is one of the largest market research firms in the world. Read Market Strategies blog at FreshMR, and follow us on Facebook, Twitter and LinkedIn.
15 Methodology An online survey was conducted between March 14 th and March 28 th, 2018 among adults in the US who are: years old Decision maker for TV, internet and/or wireless provider Current wireless and home internet customers Within the Comcast footprint Not employed in sensitive industries Interviews were collected from three segments of consumers: 1. Xfinity Mobile customers, n=108; n=100 as primary wireless carrier 2. Xfinity/Comcast customers who do not have Xfinity Mobile, n= Non-Xfinity/Comcast customers, n=453 Data were weighted to reflect current wireless carrier market share.
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