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The Consumer Experience - Research Report 06

16|11|06

Introduction

Background

Ofcom has only one principal duty afforded to it under the Communications Act 2003 , which is to further the interests of citizens in relation to communications matters; and to further the interests of consumers in relevant markets , where appropriate by promoting competition. As a result , everything that Ofcom does is ultimately geared towards securing better experiences for consumers and citizens.

Since inception Ofcom has worked to create a sustainable competitive framework for regulation. Sustainability and regulatory certainty are particularly significant in communications markets , as they depend heavily on the development and application of new technologies and this in turn relies on the ability of the UK to attract investment capital. Effective competitive markets ensure that providers have the incentive to deliver good services to customers at a low price and to innovate in service delivery so that new products are geared towards consumers’ needs.

We want to make sure that customers can engage with the market , by being able to make informed choices regarding provider and service and by having processes that enable them to switch supplier easily when they choose to do so.

We also strive to ensure that consumers can shop around and consume services with confidence, are protected from scams and unfair practices, and can complain and seek redress when things do go wrong.

Finally , we have a role in seeking to ensure that particular communications services are delivered in a manner that is fair. We work to ensure that those services of social importance are provided in a way which allows all our citizens to benefit from the services we value the most and that the particular interests of all parts of society , including disabled , rural and low income users , are acknowledged and addressed.

The reports

Given this mission, we need to make sure we have mechanisms to evaluate the experience of consumers and citizens in relation to telecoms , digital broadcasting and the internet. That is the purpose of this document – our annual report of the consumer experience. This volume lists the full results of a major research exercise aimed at measuring how well consumers are faring in respect of these services. Where we have data available , we track the research results over time and look to benchmark them against other sectors and other countries. We do not cover TV or radio content issues here as these are subject to separate reporting by Ofcom.

The accompanying volume of this publication – A Policy Evaluation – examines the data presented in this research report and uses it to assess the impact of regulation and the priorities we have set ourselves. We want to understand , where possible , whether our existing priorities are having the desired consequences. Where we find consumer experiences that are not as positive as we would like , or where we think that further Ofcom action may lead to improvement , we want to make sure that Ofcom’s priorities are set appropriately.

In order to evaluate our progress and guide consumer policy changes to meet our mission the Consumer Policy Consultation document was published in February 2006 and proposed that Ofcom produce an annual publication containing a set of metrics. The metrics consulted on covered three areas

  • consumer choices and range in the market place
  • consumer empowerment; and
  • consumer protection and concerns

During the consultation, stakeholders commented on which metrics they felt were useful, which should be added and which should be removed. Following the consultation amendments were made to the metrics and a fourth section, consumer access, was added.

The purpose of this document is to report the full results of an extensive research exercise aimed at measuring how well consumers are faring in our sector using these metrics. Where we have data available , we have tracked the research results over time and where possible, benchmarked them against other sectors and other countries.

The metrics in this report are the first set to be published and we plan to update these on a regular basis. In addition, future reports will have more comparable data, as we continue tracking the metrics.

Equally, if we find that a particular regulatory approach is not having the impact we would like, we will re-evaluate our approach to see how positive consumer outcomes might be achieved. Likewise , if we see data that shows major new concerns, we will use it to reassess our priorities to see if a shift of resource towards new issues would allow us to improve the consumer experience.

This report draws on data from a number of sources, including Ofcom’s own research and external sources. The most relevant and robust data sources have been selected for each individual metric. In some cases, comparable metrics from different sources have been included and in these cases the source notes will identify how the research has been used.

The majority of data used in this report is drawn from surveys conducted in the first half of 2006.

Full details of each of the key Ofcom research initiatives used in this report are available in Annex 1. The following is a brief outline of each of the research initiatives referenced in this report.

Ofcom’s Residential Communications Tracking Survey

The Residential Communications Survey takes place monthly and provides Ofcom with continued understanding of consumer behaviour in the UK communications markets. It helps to monitor change and assess the degree and success of competition.

Consumer Panel Tracking Survey

The Consumer Panel Tracking Survey is conducted once a year, and measures the level of consumer knowledge of what is going on in the communications market and the choices and alternatives consumers have now and will have in the future.

Consumer Panel Qualitative Survey

The Consumer Panel Qualitative Survey was carried out in May 2006. In-depth interviews and focus groups were conducted with older consumers (55+ years) to provide profiles and characteristics of older people, and to understand the reasons why some have purchased internet and DTV services and others have not.

Ofcom Decision-making Survey

Ofcom’s Decision-making survey was carried out in June 2006. This study involved 500 interviews with consumers in each of the fixed line, mobile and internet markets. The main objective was to understand switching behaviour in each of the markets, including how consumers make switching decisions, and why a significant proportion do not even consider changing supplier.

Ofcom Consumer Concerns Survey

Two studies were conducted in June and August 2006. The objectives of the research were to assess what issues concern consumers in the communications market, and the extent to which consumers are concerned about specific issues.

Ofcom Accuracy of Consumer Usage Estimates

In this research carried out in August 2006, an initial qualitative phase was followed by quantitative online interviews. The objective of both phases was to assess the effectiveness of price comparison websites in capturing accurate information on consumers’ usage and providing accurate advice on potential savings.

Ofcom Tracking General Awareness of Consumers

This study was a face-to-face survey of 2000 respondents. The objective was to determine the level of brand awareness that Ofcom has and compare this broadly to the Financial Services Authority and Ofgem (the regulator for gas and electricity markets).

Scope of this report

This report analyses the overall experience consumers have of the communications market, covering three areas:

  • telecoms (fixed line and mobile);
  • internet (including broadband); and
  • digital broadcasting (television and radio).

The report presents data on each of the markets under four main section headings:

  • consumer access - the availability and take-up of communications services (including non-ownership – both voluntary and involuntary)
  • consumer choices and range – trends in prices of communications services, awareness and use of suppliers, and satisfaction;
  • consumer empowerment – the level of participation in communications markets in terms of switching and shopping, use of consumer information; and
  • consumer protection and concerns – complaints, concerns and awareness of complaint procedures

This report covers the UK adult population, and compares findings in three ways

  • across various demographic groups, where relevant;
  • over time, where the data is available;
  • across countries, where robust data is available;
  • across other relevant markets, where comparable data is available.

This report does not look at minority ethnic groups; this will be covered in a separate Ofcom study due to be published in March 2007.

Findings have not been analysed at a national or regional level across the UK as this will be covered by Ofcom’s annual Communications Market report on nations and regions to be published in 2007.

Statistical reliability

For reporting purposes, sub-group differences are noted in the report only when they are significantly different from the total sample. We have reported differences at the 95% confident level which means that if you asked 100 people from the population, 95 of them would give you a similar response to the finding reported.

The full document is available below

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