Competition brings out the best

A new report from Opensignal indicates that Canada’s mobile customers put a value on quality, and will migrate between service providers based on their mobile network experience.

The report, “Mobile experience explains why urban and rural Canadian users change mobile operators”, found that on average, users who changed their mobile carrier – termed “Leavers” – had a worse mobile experience before they switched, than they typically experienced on their original network.

Opensignal found that users who switched operators had a below average mobile network experience. As might be expected, the data suggests that those users who experienced pain with their former mobile service were more likely to change their mobile service provider. On the former network, mobile users who switched were found to have spent less time on either a 3G or 4G mobile connection, and they experienced lower 4G Availability. “Canada has some of the fastest 4G download speeds globally, which benefits both urban and rural users, but these fast speeds are meaningless when users spend time either without a mobile signal or without at least being able to connect to 4G.”

The report shows that mobile users are willing to switch to get a better mobile experience, indicating they value quality. It confirms the value of investment in infrastructure, upgrading to faster speeds, extending network coverage and reach, and improving network experience. Opensignal found “mobile experience matters to subscribers and that it is a critical driver of churn in Canada.”

In an interview at the Canadian Club last week, CRTC Chair Ian Scott explained why he supports facilities-based competition as the most sustainable model for Canada. “We’re focused, as best as we can, on eliminating obstacles to the rapid deployment of the latest technology whether it be in the broadband space or in the wireless space.” While acknowledging services-based competition as a means to enter the market to discipline pricing, he said that such a business model becomes fragile as prices approach competitive levels. “So, in general, I would say facilities-based competition is more robust and sustained.”

Opensignal found that the mobile experience of Canadian customers (both urban and rural) who switch is, on average, significantly higher than in many other countries globally. It also observed that some Canadian users will have a worse mobile experience than others.

Our data shows that Canada’s Leavers had a worse mobile experience before they switched to another carrier, compared to the typical experience of users on their original network. This shows that mobile experience matters to subscribers and that it is a critical driver of churn in Canada.

If customers will switch service providers to get a better quality mobile experience, it confirms the need for continued network investment, consistent with Canadian policy favouring facilities-based competition.

Canada’s future depends on connectivity.

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