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Mobile Network Providers - UK - February 2016

OVERVIEW
What you need to know
Covered in this report
EXECUTIVE SUMMARY
Mobile network providers’ market continues to show relative stability
Figure 1: Forecast value of retail mobile network connections in the UK, 2010-20
Big Four lose market share to virtual network operators
Figure 2: Consumers’ mobile network provider, December 2015
Two thirds of UK consumers are on contract
Figure 3: Connection type, December 2015
Consumers shifting to shorter contracts
Figure 4: Contract length, December 2015
Contract customers significantly more profitable than PAYG users
Figure 5: Monthly spend, by connection type, December 2015
Quad-play deals the most sought after by consumers
Figure 6: Interest in using and payment preferences for additional services, December 2015
More data the biggest motivator to switch
Figure 7: Factors that would encourage consumers to switch provider, December 2015
What we think
ISSUES & INSIGHTS
How big a threat are quad-play deals?
The importance of attracting PAYG customers
THE MARKET
What you need to know
Mobile network providers’ market continues to show relative stability
Mobile connections continue to grow in the UK
BT’s acquisition of EE speeds up consolidation of quad-play market
Adoption of smart devices drives appetite for mobile connections
Mobile viewing boosts demand for greater data allowances
Fast-growing Internet of Things speeds up 5G developments
Market size, segmentation and forecast
Mobile network providers’ market continues to show relative stability
Figure 8: Forecast value of retail mobile network connections in the UK, 2010-20
Figure 9: Forecast value of retail mobile network connections in the UK, 2010-20
Figure 10: Average monthly revenue per user, by contract type, 2010-14
Mobile bundles drive change in revenues breakdown
Figure 11: Mobile retail revenue, by service (£ billions), 2010-14
Mobile connections continue to grow in the UK
Figure 12: Forecast volume of mobile network connections in the UK, 2010-20
Figure 13: Forecast volume of mobile network connections in the UK, 2010-20
Market drivers
BT’s acquisition of EE speeds up consolidation of quad-play market
Adoption of smart devices drives appetite for mobile connections
Figure 14: Ownership of smartphones and tablets, January 2013-December 2015
Mobile viewing boosts demand for greater data allowances
Figure 15: Attitudes towards mobile viewing, July 2015
Fast-growing Internet of Things speeds up 5G developments
KEY PLAYERS
What you need to know
Innovation a common lack among the Big Four
EE and O2 looking into network-level ad blocking
Vodafone brings next-generation calls to the UK with Call+
Apple and Samsung rumoured to be working on e-SIM standards
Anywhere SIM lets you choose to not choose
EE and O2 focus on connectivity
Brand research
Brand map
Figure 16: Attitudes towards and usage of selected brands, October 2015
Key brand metrics
Figure 17: Key metrics for selected brands, October 2015
Figure 18: Attitudes, by brand, October 2015
Figure 19: Brand personality – Macro image, October 2015
Figure 20: Brand personality – Micro image, October 2015
Brand analysis
Figure 21: User profile of O2, October 2015
Figure 22: User profile of EE, October 2015
Figure 23: User profile of Three, October 2015
Figure 24: User profile of Vodafone, October 2015
Launch activity and innovation
EE and O2 looking into network-level ad blocking
Vodafone brings next-generation calls to the UK with Call+
Figure 25: Vodafone Call+ app interface
Apple and Samsung rumoured to be working on e-SIM standards
Anywhere SIM lets you choose to not choose
EE and O2 focus on connectivity
Figure 26: EE’s 4GEE Capture Cam, November 2015
THE CONSUMER
What you need to know
Big Four lose market share to virtual network operators
Two thirds of UK consumers are on contract
Consumers shifting to shorter contracts
Contract customers significantly more profitable than PAYG users
Quad-play deals the most sought after by consumers
More data the biggest motivator to switch
Network operator and type of connection
Big Four lose market share to virtual network operators
Figure 27: Consumers’ mobile network provider, December 2015
Two thirds of UK consumers are on contract
Figure 28: Connection type, December 2015
Industry positioning impacts customer base
Figure 29: Connection type, by consumers’ mobile network providers, December 2015
Contract length
Consumers shifting to shorter contracts
Figure 30: Contract length, December 2015
Smartphones attract parents and 16-44s to two-year contracts
Figure 31: Connection type, by contract length, December 2015
Connection cost
Contract customers significantly more profitable than PAYG users
Figure 32: Monthly spend, by connection type, December 2015
Can PAYG customers be shifted to contract?
Figure 33: Additional products and services paid in monthly bill, December 2015
The Big Four attract the most profitable customers
Figure 34: Monthly contract spend, by consumers’ mobile network providers, December 2015
Payment preferences for additional services
Quad-play deals the most sought after by consumers
Figure 35: Interest in using and payment preferences for additional services, December 2015
The potential of the non-quad-play counter-offer
Figure 36: Payment preferences for quad-play services, by payment preferences for additional services (Nets), December 2015
Incentives to switch provider
More data the biggest motivator to switch
Figure 37: Factors that would encourage consumers to switch provider, December 2015
Most UK consumers are loyal to their provider
Figure 38: Repertoire of factors that would encourage consumers to switch provider, December 2015
Young consumers are easier to influence
Figure 39: Factors that would encourage consumers to switch provider, by age, December 2015
APPENDIX
Data sources, abbreviations and supporting information
Data sources
Abbreviations
Market size and forecast
Figure 40: Best- and worst-case forecast for the value of the UK mobile network providers’ market, 2015-20
Figure 41: Best- and worst-case forecast for the volume of the UK mobile network providers’ market, 2015-20
Brand research
RESEARCH METHODOLOGY
UK Research Methodology
Sampling and weighting
Face to Face Surveys
Definitions
Brand & Social Media Research
Trade research
Desk research
Statistical Forecasting
The Mintel fan chart

Mobile Network Providers - UK - February 2016

“The convenience of managing quad-play subscriptions in a single bill is not always a big enough decision driver for high-spending consumers (including young consumers, the highest spending), as their mobile usage behaviours probably lead them to favour a mobile provider based on other factors, such as data allowance and deals on a specific phone.”

– Sara Ballaben, Technology Analyst

This report discusses the following key topics:

How big a threat are quad-play deals?
The importance of attracting PAYG customers


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