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Mobile providers 'at risk of losing customers to Google or Amazon'

Monday, February 27th 2017 by Phil Wilkinson-Jones

Mobile providers are at risk of losing customers should a firm such as Google or Amazon enter the market, a survey has found.

Nearly half (44%) of mobile users would leave their provider if a global digital giant offered a comparable deal, according to Accenture.

The research also looked at the potential impact of the eSIM – otherwise known as the embedded or ‘soft’ SIM – a programmable technology that allows you to switch providers without swapping the physical card in your device.

Programmable SIMs are already used in some tablets and smart watches, and are expected to feature in the next generation of smartphones.

The survey found that 68% of online consumers would be interested in using a device with an eSIM, with 50% saying it is because they will be able to switch providers more easily.

Accenture said eSIMs being embedded in devices at the point of manufacture will help new players enter the market by bypassing network providers and going straight to the consumer.

Francesco Venturini, global industry managing director for media and communications at Accenture, said communications providers have to start moving into new markets as their traditional business is becoming commoditised.

“There are opportunities ripe for the taking if [providers] invest in their core business so it remains healthy, while at the same time pivot to accelerate innovation and expand their reach to provide new digital services, offering real value to their customers.”

He said two such opportunities are in digital video and smart homes.

'The race is on'

Accenture’s survey found that 37% of respondents would turn to their mobile provider for pay TV channels and 34% would go to them for on-demand TV services.

It also found that 71% of consumers planning to buy connected home services would choose a telecoms company if the service was offered.

Communications providers also ranked highly as the preferred providers of education and learning, home monitoring and online security services.

And nearly half of consumers (49%) would choose a communication provider for connected health services.

“The race is on to better serve the evolving and emerging digital ecosystem in the home,” said Mr Venturini.

“But with competition advancing, if [providers] do not make the necessary changes to offer hyper-personalised services quickly, they are at risk of losing market share and becoming organizations that purely offer connectivity with no added value, and that means shrinking revenues.”

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