Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines

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Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines

                 Connected Consumer Survey
                 2019: fixed broadband
                 retention and satisfaction in
                 Malaysia and the Philippines

                 Stephen Wilson
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines                                                               2

About this report

This report focuses on aspects of Analysys Mason’s Connected                                                        GEOGRAPHICAL COVERAGE
Consumer Survey that relate to the behaviour, preferences and
                                                                                                ▪ Malaysia
plans of broadband users in Malaysia and the Philippines.
                                                                                                ▪ Philippines
The survey was conducted in association with Dynata in August
2019. The survey groups were chosen to be representative of the
broader online consumer population in Malaysia and the
Philippines. We set quotas on age, gender and geographical
spread to that effect. There were a minimum of 1000
respondents per country.

             KEY QUESTIONS ANSWERED IN THIS REPORT                                                              WHO SHOULD READ THIS REPORT

 ▪ What are the most significant factors that affect Net Promoter Scores                        ▪ Product managers and strategy teams working for fixed operators that
   (NPSs) for fixed broadband operators? Which operators score highly and                         are launching new broadband products aimed at the retail market, or
   why?                                                                                           are designing their response to those of their competitors.
 ▪ What are the most significant drivers of fixed broadband churn and how                       ▪ Marketing executives and product managers for operators that are
   can operators most-effectively approach customer retention?                                    making decisions about service design and its impact on customers’
 ▪ Which value-added services have a measurable effect on customer                                retention of broadband bundles.
   satisfaction and churn intention?
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines                                                     7

Converge ICT has a much higher NPS than other Philippine operators; Malaysian
operators all have similar NPSs
The spread of NPSs between operators in the Philippines is very                               Figure 2: NPS by operator, Malaysia and the Philippines, 20191
wide. FTTP player Converge ICT is far ahead of its competitors
with an NPS of 48. Incumbent PLDT has an NPS of 9, but this is
below its largest competitor, Globe Telecom, which has an NPS of                              Malaysia
15.
Converge ICT’s customers are much more satisfied with speeds,
reliability and prices than other operators’ customers are. The
greatest difference in satisfaction scores between Converge ICT                               Philippines
and incumbent PLDT is for price. This is interesting because
Converge ICT has a listed entry-level fibre price of PHP1500
(USD29.6); this is higher than that of the other operators.
Globe Telecom also outperforms the incumbent across all aspects
of satisfaction. This reflects the fact that Globe Telecom’s capped
fixed-wireless plans are capable of competing with PLDT’s low-                                Telekom Malaysia has a slightly higher NPS than the other
speed DSL offers. However, Globe Telecom’s fixed-wireless                                     operators in Malaysia, driven by its superior performance in terms
subscribers are less satisfied overall than PLDT’s fibre                                      of speed satisfaction. This is probably because the operator
subscribers.                                                                                  began significantly increasing the speed of its offers for no
                                                                                              additional monthly fee for existing customers in 2H 2018. For
The gap between NPSs for Malaysian operators is much smaller                                  example, the operator’s entry-level fibre speed was increased
than that for Philippine operators. Maxis, the second-largest fixed                           from 10Mbit/s to 100Mbit/s and the speeds of existing
broadband provider in Malaysia, is very reliant on Telekom                                    subscribers on 100Mbit/s plans increased to a new maximum of
Malaysia’s fibre access network. As a result, the difference in                               800Mbit/s. It must be noted that there is a significant difference
satisfaction with speed and reliability for customers taking fibre                            in NPS between Telekom Malaysia’s DSL subscribers (5.9) and its
from either Maxis or Telekom Malaysia is limited.                                             fibre subscribers (18.3).

1   Please refer to the appendix for sample sizes and relevant survey questions.
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines                                                   13

The intention to churn of DSL and fixed-wireless subscribers in the Philippines is
particularly high
The intention to churn of DSL and fixed-wireless subscribers in                               Figure 8: Intention to churn, by access technology, Malaysia
the Philippines is very high, and much higher than that of fibre                              and the Philippines, 20191
subscribers. This is a very positive sign for Converge ICT because
it is currently significantly increasing the size of its FTTP
deployment. As its FTTP coverage increases, Converge ICT is likely
to benefit from a ready-made base of customers that are
prepared to churn from PLDT and Globe Telecom.
The intention to churn figures raise question marks over the
extent to which the two market leaders, PLDT and Globe Telecom,
should increase their fibre investments. PLDT appears to
recognise the challenges and stated in February 2018 that it
intended to cover virtually all of its ADSL subscribers with fibre by
the end of 2019.
Intention to churn varies much less with technology in Malaysia
than in the Philippines. Intention to churn levels are also lower in
Malaysia than in the Philippines, particularly for DSL and fixed-
wireless subscribers. This may be a result of the limited
competition from fibre access networks in areas with DSL and
fixed-wireless subscribers. Moreover, the difference in perceived
quality between DSL and fixed-wireless offers is likely to be low.
DSL offers an unlimited data allowance, but suffers from having
maximum speeds of just 8Mbit/s. Fixed-wireless speeds are likely
to be higher (although are not advertised), but data caps are
prevalent.

1   Please refer to the appendix for sample sizes and relevant survey questions.
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines

               Contents                              Executive summary

                                                     Satisfaction and willingness to recommend

                                                     Churn

                                                     Value added services

                                                     Methodology and panel information

                                                     About the author and Analysys Mason
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines                                                           28

About the author

                        Stephen Wilson (Principal Analyst) is the lead analyst for Analysys Mason’s Fixed Broadband Services and Asia–Pacific research programmes.
                        He leads Analysys Mason’s annual FTTx coverage, capex and conversion forecasts, and other recent areas of focus include examining fixed
                        broadband operators’ home Wi-Fi strategies. Stephen has more than 10 years of experience in the telecoms sector and is a graduate in
                        Philosophy, Politics and Economics from St Catherine's College, Oxford University.
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines                                                         29

Analysys Mason’s consulting and research are uniquely positioned

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                                                                                                    and service and content providers.
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                                                                                              facing clients, in addition to the wider effects of global forces.
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                                                                                              and opportunities that new technology brings.
                                                                                              RESEARCH
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                                                                                              technology delivering those services.
                                                                                              Clients benefit from regular and timely intelligence, and direct
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Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines   30

Research from Analysys Mason
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines   31

Consulting from Analysys Mason
Connected Consumer Survey 2019: fixed broadband retention and satisfaction in Malaysia and the Philippines

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