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In Brief: Understanding Consumer Concerns About the Quality of Wireless Telephone Service

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Over the past decade, the number of cellular or wireless1 telephone subscribers in the United States has grown substantially from roughly 16 million in 1994 to 97 million in 2000, producing a nationwide penetration rate of 45 percent.2 In 2002, the number of cell phone subscribers was estimated at about 145 million.3 The large and growing number of subscribers, many of whom are age 50 and older, clearly suggests that the public finds value in having a wireless phone. What is less clear, however, is the value and quality of the actual service that subscribers receive.

Cell Phone Use by Age

  • For many older Americans, cellular or wireless telephone service has become an essential tool of life. Respondents age 50 to 64 are almost as likely as those age 18 to 49 to report having cell phone service. Respondents age 65 and older are less likely to say they have cell phone service (Figure 1).

  • When asked why they have cell phone service, cell phone users age 50 to 64 and age 18 to 49 are most likely to say it offers the convenience of being able to make calls from anywhere. For older cell phone users age 65 and older, however, security in case of an emergency is the most common reason for having a cell phone (Figure 2).4

Consumer Observation and Assessments of Cellular Service

  • Consumers who use their wireless service more frequently are generally in a better position to assess their service quality. In this regard, the most frequent users of cell phone service are less likely to report being very satisfied with their service and more likely to say they have experienced difficulties in making or receiving calls (Figure 3). 5

  • Cell phone users currently must change their cell phone number if they want to switch service providers, a fact that probably discourages them from switching. Nearly half of all cell phone users report that keeping their cell phone number when they change cell phone service is "very important." Another 20 percent says that number portability is "somewhat important."
  • Unlike users of other telecommunications services, few cell phone users have ever willingly switched their service provider. Among cell phone users who gave their current provider less than the highest rating, more than half have never used another service provider. When asked why they remain with their current provider, more than half of the most frequent users of cell phone service in this group said either that they wanted to avoid paying an early termination fee or they did not want to give up their current cell phone number.
  • Filing a complaint might be an option for less satisfied users except that many users do not know whom to contact if they cannot resolve a problem with their service provider. In fact, very few cell phone users said they would contact the Federal Communications Commissions (FCC), the federal agency that tracks cell phone service complaints (Figure 4).

 

 

 

Footnotes

1  For purpose of this report, the term wireless telephone is used interchangeably with cell phone or mobile phone, and includes services by cellular, broadband personal communications service (PCS), and digital specialized mobile radio carriers (SMR).
2  Federal Communications Commission (July 3, 2002). Annual Report and Analysis of Competitive Market Conditions With Respect to Commercial Mobile Services: 7th Report. Retrieved May 1st, 2003 from http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-02-179A2.pdf.
3  See the Cellular Telecommunications & Internet Association's website at http://www.wow-com.com/.
4  Since respondents were allowed to provide multiple responses, the sum of percentages shown exceeds 100.
5  Based on a series of statistical analyses of survey data, average monthly spending on cell phone service is determined to be a measure of frequency of cell phone usage. Therefore, the most frequent users of cell phones are those who reported the highest average monthly spending on cell phone services. For details, see Understanding Consumer Concerns about the Quality of Wireless Telephone Service, AARP PPI Data Digest 89.

 

Written by Christopher A. Baker and Kellie K. Kim-Sung, AARP Public Policy Institute
July 2003
©2003 AARP
All rights are reserved and content may be reproduced, downloaded, disseminated, or transferred, for single use, or by nonprofit organizations for educational purposes, if correct attribution is made to AARP.
Public Policy Institute, AARP, 601 E Street, NW, Washington, DC 20049

The authors thank Jeffrey Love and Helen W. Brown from AARP's Knowledge Management for their assistance in developing the survey questionnaire and comments on this report.

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