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Callers care most about price, service

In the midst of multimillion-dollar marketing campaigns from telecommunications companies, consumers still care most about price and customer service, says a new study.

In the midst of multimillion-dollar marketing campaigns from telecommunications companies touting new high-tech services, consumers still overwhelmingly care most about price and customer service, a new market research study found.

According to the survey by Insight Research Corporation, a Parsippany, New Jersey-based telecommunications research firm, the majority of consumers said they chose their long distance based on price and their experience with customer service departments.

"Most people are hip enough to really look at price and customer service as the primary considerations," said Robert Rosenberg, president of the research firm. "What we found was that what people are looking at is less brand name and more price, and whether they can get a hold of you to discuss their problems."

Trusted brand name, advanced features, and single-bill services scored well behind the two major concerns for more than 50 percent of consumers surveyed, Rosenberg said.

In what may be more bad news for the big long distance companies' advertising blitzkriegs, the survey found a surprising number of consumers did not know who their long distance provider was, or were unaware that there was a difference between their local and long distance companies.

"We found fully 10 percent of consumers don't have a clue who their long distance provider is," Rosenberg said.

The company's study sketches the outlines of a telecommunications industry that is evolving more quickly--and in different directions--than the consumers it serves.

Most of the big telephone companies are refocusing their attentions quickly on data, Internet and other high-tech traffic. Competition has pushed long distance prices down as much as 50 percent since 1984, and as new companies such as Qwest Communications and Level 3 enter the market with their own networks, prices are dropping even further.

"If you look at the capacity being built into these networks, the cost of a voice telephone call could literally drop to fractions of a cent a minute," Rosenberg said.

While consumers' lack of attention to brand and advanced services could spell bad news for companies like AT&T, which are looking to prop up falling voice service margins with new offerings, it marks opportunity for companies like Qwest.

Although most consumers have never heard of the second tier phone companies, they are still inclined to give them a try if prices are sufficiently low, Rosenberg said.

The company's research was based on a sampling of 1,018 telephone consumers, as well as statistics provided by regulatory agencies and carriers themselves.