Communications and Technology Industry Research

A new Strategy Analytics report, “Wireless Operator Performance Benchmarking, Q1 2007,” says that mobile operators face increasing struggles trying to hold onto their customers.

 

Blaming subscriber volatility in emerging markets for this increase this quarterly report tells that on a global basis, the rate of subscriber churn posted its ninth consecutive quarter of annual growth, reaching 2.5 percent per month in Q1 2007.

 

This report tracks the operational and financial performance of 125 individual operators, accounting for 75 percent of the world’s cellular users. According to the report, churn was relatively stable in Europe and North America, but continued to increase in Asia-Pacific, Central and Latin America, the Middle East and Africa.

 

“Subscriber registration and re-verification procedures have highlighted the challenge of real subscriber growth in a number of emerging markets over the last few quarters,” said Phil Kendall, director, Global Wireless Practice and author of the report in a statement to the press.

 

He continued: “Operators in Malaysia were forced to disconnect nearly 20 percent of their prepaid subscribers at the end of 2006 as part of their drive to register all mobile phone accounts. Additionally, India’s Reliance Infocomm disconnected nearly 6 million of its 30 million customers in Q1.”

 

David Kerr, vice president, Global Wireless Practice points out that this increase in churn highlights the challenge of managing subscriber growth in many prepaid-centric emerging markets.

 

According to Kerr, competitive activity is having an increasingly detrimental impact on subscriber behavior and churn levels in markets where new connections involve simply placing a new SIM card into one’s existing handset.