Sim-only accounts for one fifth of mobile contracts

Sim-only accounts for one fifth of mobile contracts

Consumers are seeking better deals – with one fifth of all new mobile contracts on Sim-only, industry regulator Ofcom said last week.

Ofcom’s Consumer Experience report, which looks at the overall experience of consumers in the communications market, showed that people are finding new ways to save money on their phone, broadband and pay TV services.

The report said that in 2009, 35% of consumers took a discounted ‘bundle’ compared with 30% in 2008.

The regulator also found that 42% of new mobile contracts were 24 months or longer. GfK research revealed last week that two year deals had reached the 58% mark at the end of October, compared with 6% one year earlier. Ofcom’s figures were for the first three quarters of this year.

Ofcom said: ‘Twenty four month contracts are also becoming increasingly popular as consumers commit to longer periods in return for lower monthly fees and inclusive, or heavily discounted, handsets.’

Meanwhile, Ofcom found that switching was slowing. Those with bundles who moved to another provider fell from 24% to 13%.

The regulator identified that there were ‘obstacles to switching’ and said it would consult on its next steps in 2010. It will also look at broadband and mobile ‘not spots’ in its work programme for the 12 months from 1 April 2010 to 31 March 2011.

The priorities are outlined in Ofcom’s annual plan, which was published alongside the consumer report last week (see box).

Ofcom chief executive Ed Richards said: ‘Take-up of communications services keeps growing and consumers are becoming smarter at finding the cheaper deals available by choosing bundled services or switching from standard annual contracts. 

‘Ofcom will continue to work to make sure there are no unnecessary obstacles to prevent consumers from switching and to promote effective competition in communications markets.’

Key points in Ofcom’s annual plan
• Make progress on broadband and mobile phone ‘not spots’
• Ensure consumers can switch communications providers by removing ‘unnecessary barriers’
• Implement regulation to support effective competition and efficient investment in super-fast broadband
• Start successful clearance of 800MHz spectrum band for
new services
• Implement proposed Government direction to release spectrum for mobile broadband
• Ensure wireless services for 2012 Olympics and Paralympics will be delivered

Written by Mobile Today
Mobile Today

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