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Half of UK adults would immediately cancel their telecoms and broadband contracts in the event of a personal data leak at their communications service provider (CSP), even if they faced financial penalties as a result, according to a recent report.
The study, compiled by consultants at KPMG, found that security breaches – such as the one that struck TalkTalk in the autumn of 2015 – were now the biggest threat to customer loyalty for CSPs, outweighing poor customer service.
A security breach was twice as likely to prompt customers to switch providers as being subjected to rude or unhelpful staff, it found.
KPMG suggested that moving to position themselves as a more trustworthy partner to their customers should be a priority for CSPs, but added that this needed to be coupled with investment to strengthen quality of service and network reliability.
“By focusing on building trust with their customers, there is a clear opportunity for telcos to increase revenues and become the trusted gateway for tomorrow’s connected consumer,” said KPMG UK head of telecoms, media and technology, Alex Holt.
KPMG’s statisticians estimated that by improving customer service and taking action to eliminate dropped calls, CSPs could increase mobile revenues by £900m per annum collectively.
Addressing issues relating to reliable broadband connectivity could account for £550m in additional income every year, boosting CSP average revenues per user by 10%.
“Consumers love their connected lives, so their tolerance is extremely low for anything that prevents connections with the devices or services they want. Before telcos can get a licence to up- and cross-sell, they’ve got to get the basics right and deliver a great connected experience,” said Holt.
The survey showed there was some potential for CSPs to make headway by bundling services, with a third of respondents saying they would consider a single quad-play contract, although many still remained nervous about being reliant on one provider.
The survey also showed CSPs could make headway by offering more connected devices, with 47% of respondents saying they would be willing to buy a smart watch from their mobile provider, and 22% would consider buying connected home security products from a telco.