Daily Research News Online no. 3288 - More Customers Use 'Phone Company Web Sites

More Customers Use 'Phone Company Web Sites

July 26 2004

The proportion of US telephone consumers visiting their local telephone service provider's Web site has grown fast in the past six months. 20% of households have done so, up 6% from 2003, according to the J.D. Power and Associates 2004 Residential Local Telephone Customer Satisfaction Study.

The increase is the largest in the past four years. 56% of Web site users report that they have reviewed a bill, and 44% have actually paid their bill online - the latter is 13% up on 2003. Customers with Internet access who visited their local provider's Web site in the past six months have significantly higher overall satisfaction scores than those who have not.

According to Steve Kirkeby, Senior Director of Telecommunication Research at J.D. Power and Associates, 'Customer service is by far the most important component of overall satisfaction in this industry, and improving e-service represents a major opportunity'.

More and more households are 'bundling' at least local and long distance telephone service with one provider - in 2004 the proportion doing so jumped 11% to 51%, representing nearly 10 million households nationally. Moreover, 43% of respondents say they will 'definitely' or 'probably' switch any additional telecommunications services (wireline, Internet, wireless and television) to a multi-service provider.

'Despite continued growth, there has been no loss of appetite nationwide for bundling,' said Kirkeby. 'This underscores our belief that households are most likely to leave their current provider for one key reason - to bundle'.

Customer satisfaction with local telephone service continues to rise from its low point in 2002, and perceived monthly spending also continues to rise as it has every year since the study launched in 1996. Consumers report spending $38.10 per month on local service - up from $34 in 2003.

Overall satisfaction is determined based on six factors of which customer service is the most important, followed by billing, performance and reliability, company image, cost of service, and offerings and promotions, respectively.

In the Northeast, Mid-Atlantic, Southeast and Southwest Regions, AT&T ranks highest overall. In the North Central Region, Talk America ranks highest for the second consecutive year, and in the West Region Cox Communications ranks highest, also repeating last year's result.

More than 10,500 residential users of local telephone service were surveyed throughout the US. Tables showing overall rating scores for each provider in each of the six regions can be found at www.jdpower.com