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Unlimited Data No Longer Gets Mobile Subscribers to Change Plans

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While unlimited data plans were once sought after by mobile subscribers who worried video viewing would use up their data allotment too quickly, those plans no longer get customers to switch carriers. That data comes from the researchers at Parks Associates, who report that only 14 percent of mobile customers in the U.S. switched providers as the most recent change to their mobile subscription.

Parks finds that 39 percent of mobile customers have made a change to their account in the past year, but upgrading their plan or adding a new phone are the more common changes. Also, a third of customers haven't made any changes to their accounts in over 2 years. This is at a time when Sprint, T-Mobile, Verizon, and  AT&T are trying hard to lure new subscribers.

"Unlimited data offerings are no longer effective levers to attract customers from competitors," said Kristen Hanich, a research analyst with Parks Associates. "The challenge now is to find ways to increase ARPU [average revenue per user] without negatively impacting customer satisfaction. Currently, with few exceptions, the top spenders give their mobile carriers a low NPS [net promoter score, a measure of customer loyalty], ten points lower on average than the lowest spenders. Carriers are searching for new ways to upsell without alienating their subscriber base."

What mobile customers want, Parks finds, is simplified billing with prepaid services. Postpaid services are trying to upsell their customers by bundling in entertainment services. Over-the-top (OTT) offerings are becoming the new differentiator.

"AT&T exempted DirecTV from mobile data caps, so its subscribers get video benefits with their mobile services," Hanich adds. "AT&T is looking to offer a wireless-centric video service offering, and, in response, T-Mobile and Verizon are moving to introduce their own OTT TV services this year."

This data comes from the Parks Associates report Mobile Service Churn: Managing Consumer Expectations, available for purchase. 

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