65% reconsidering mobile contracts over cost of living crisis

Tech

A survey by MVNO Lyca Mobile reckons 65% of customers at the big four mobile network operators in the UK – Vodafone, O2, EE, and Three – are reconsidering their mobile contracts because of the economic climate.

According to Lyca Mobile’s survey, which spoke to a thousand or so customers of the big four UK operators, 73% of those that are thinking about switching providers this year said that getting better value elsewhere is their motive, while 41% thought they are overpaying for their current tariff, and 48% would consider jumping to a new mobile provider in the interests of lowering costs alone.

58% said they would switch to alternative providers such as MVNOs – which is the real talking point the firm really wants to waft around since that’s what Lyca mobile is – however 64% said they feel a sense of loyalty to their mobile provider.

“As households across the UK continue to be squeezed by rising bills and price hikes, consumers are increasingly frustrated and unafraid to ask the all important question: ‘Is this service giving me the best value of money?” said Lyca Mobile chairman, Allirajah Subaskaran. “This is shaking up the mobile services market, and beginning a move away from the big four to alternative providers that offer low value deals to suit changing consumer needs.

“We know how important it is to be able to connect with family and friends – wherever you are, easily and accessibly. Everyone should be able to stay connected, which is why Lyca Mobile is proud to deliver great value offers that give customers one less thing to worry about during these difficult times.”

Obviously the motivation for an MVNO like Lyca to put out this sort of report is to promote the idea that it is one of those cheaper alternatives that consumers might flock next time they look at their monthly bills and wince. However the point stands that for many tough decisions will have to be made the longer the cost of living crisis rolls on, and even Three has hinted it might pick up some customers from the other big three operators for this same reason.

When asked if the cost of living crisis is going to increasingly factor into decisions around mobile and broadband upgrades, and whether that might start hitting telcos revenues, Three’s CFO Darren Purkis said last week: “I think there’s a real risk of that. I think there’s a real risk in not just mobile but across all industries having an impact. You’re hearing about people deciding which shops they go to for food now, and do they buy certain things over other things, so I think there’s a real risk and that’s not going to change in the next 6 to 12 months. I think we are reasonably well positioned, we’ve obviously got a lower contract increase than the other operators.

“So I think whilst it’s going to be a very challenging market, we’re reasonably well placed, reasonably robust in the packages we have to see ourselves through that as well. We’re also pretty well placed to appeal to a new set of consumers, so from other operators where they may be challenged with the pricing, we can appeal to an even wider population.”

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