Australian operators have long understood the impact of their own network investments on churn. But their visibility into how competitors’ network investments affect customer switching is limited. The challenges are becoming more complex due to Vodafone’s increased national coverage and Aussie Broadband’s increased focus on the mobile market through its partnership with Optus. Meanwhile, Telstra has purchased the MVNO Boost Mobile, which will enable the operator to better deliver on its multi-brand strategy.
In this new study, we leverage our proprietary data to assess the impact that poor mobile network experience has on Australian mobile users’ propensity to switch operators. We compared monthly churn rates between Opensignal users with the worst and best mobile network experiences, based on key Opensignal metrics, to see which indicators would show the highest propensity for switching operators.
Key findings:
- Consistent quality and reliability matter for users. Australian users with the least consistent services on their networks are 19% more likely to switch operators than customers experiencing highly consistent services. Meanwhile, those with the least reliable services are 13% more likely to move to another provider than those with a highly reliable network experience.
- High time with no signal drives users away. Opensignal users in Australia who struggle with some of the highest time with no signal on their networks are 11% more likely to switch operators than those who enjoy some of the lowest time with no signal.
- Regional gaps in experience render potential prospects for operators. The regional analysis reveals major disparities in Opensignal metrics between the statistical areas within Australian states. This opens the opportunity for the more localized “defend and attack” strategy for mobile operators to prevent churn and gain new customers.
Our analysis demonstrates that users in the worst Excellent Consistent Quality (ECQ) segment (20th percentile of scores) are 19% more likely to switch mobile operators than those with the best ECQ scores. Opensignal’s Excellent Consistent Quality (ECQ) measures how consistently mobile networks support demanding applications such as video streaming, video calls, and gaming, ensuring a seamless user experience.
Reliability Experience reflects the ability of users to connect to and successfully complete basic tasks on mobile networks. Our Australian users who struggle with the least reliable mobile services are 13% more likely to change operators than those who experienced the most reliable services on their networks.
Elevated time with no signal and poor download speed also can also lead to higher churn. We have previously analysed the impact of low signal availability on churn in Australia before. Lack of signal availability may lead to a bigger impact on churn soon due to the recent shutdown of Telstra’s and Optus’s 3G networks, which led to customers complaining about lack of signal in rural areas.
Analyzing regional gaps in experience could lead to commercial wins
There are substantial differences in network quality across Australian regions, which could amplify churn tendencies for local customers. We’ve included maps depicting average mobile network experience across Australian Statistical Area Level 2 (SA2) regions, for all four metrics analyzed above. Operators could turn these regional disparities into competitive advantages via targeted localized go-to-market strategies.
For Excellent Consistent Quality and Reliability Experience, a large portion of regional Australia, (i.e. Western Australia, the Northern Territory, and central parts of Queensland and South Australia) show inferior scores for both metrics. Higher-performing clusters are concentrated around urban and coastal areas, such as New South Wales, Victoria or southeast Queensland. These zones have denser, more mature infrastructure — as network investment is mainly focused on densely populated urban areas. But even within the same state, performance can vary significantly, like in the case of Queensland and New South Wales, where high-performing and underperforming areas are close to each other.
While Australia as a market ranks highly for signal availability in Opensignal's Global Network Excellence — which can be partly attributed to the introduction of the Mobile Black Spot Program — there are still areas with limited signal availability across the country. Opensignal users in substantial parts of Western Australia, South Australia or the Northern Territory spend more than 5% of the time with no signal, while in some areas of Queensland, they spend more than 10% of their time without a signal.
Looking at Download Speed Experience, some areas with lower Excellent Consistent Quality and Reliability Experience often have decent average download speeds exceeding 50Mbps. This is likely due to cell sites covering few users per cell site than urban areas but far greater coverage areas. Users may enjoy impressive speeds within a few kilometers of the cell site, but when they travel to the edge of cell coverage areas, or to hilly areas, their overall consistency of experience declines dramatically.
Opensignal's visibility into correlations between network quality and user switching behavior allows operators to optimize their capex and marketing investment decisions. The variability of user experience across Australia suggests big differences in churn propensity for individual operators at the localized level. Marrying Opensignal’s insight into churn propensity with its highly granular network data enables Australian operators to more effectively navigate Australia’s increasingly competitive mobile market.
While our analysis focuses on the national level, Opensignal has operator-level views of all these metrics in a number of markets, which can help operators with their acquisition and retention strategies, along with network investment decisions. If you are interested in learning more about our network drivers of churn capabilities and methodology, please contact us. Subscribe to our newsletter to stay up to date!
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