Aggressive discounts from telcos seeking to oust BT will cut no ice with business users.
Users are more concerned with expertise, reputation and network coverage, according to a survey of 400 UK business telecomms buyers by Morgan Stanley Dean Witter. Market leadership came bottom in the list of 12 criteria for choosing a telco, while a whacking 93 per cent said specialist expertise was the most important, followed by reputation (88 per cent), and national reach (84 per cent). Aggressive pricing came sixth with 83 per cent.
However, at a certain level pricing does come into play. Single-digit discounts will fail to win new hearts, but cuts of between 11 and 25 per cent will help sway the choice of over three-quarters of buyers. Around 45 per cent of prospective users said they would be attracted to cuts of 21-25 per cent, while one-third would respond to discounts of between 11 and 20 per cent.
Curiously, alternative suppliers to BT that are claiming to halve telecomms costs only attracted one per cent of respondents - perhaps because of quality fears.
The figures are significantly different, however, among businesses in London, which proved more price sensitive. Discounts of up to 25 per cent would attract only 50 per cent of buyers, but prices slashed by half would interest 75 per cent of London respondents.
In terms of overall customer satisfaction, European telco Colt and cable operator NTL/Cabletel each scored the highest ratings, each gaining 7.6 points out of 10. The lowest score, 6.2, was for BT?s international arm, Concert, which consistently ranked behind arch rival, Global One.
According to the survey: ?Users seem particularly distressed about Concert?s abilities in network quality, complaint handling, and billing clarity and accuracy.?
BT itself came just outside the top five in overall satisfaction, but ahead of Cable & Wireless Communications and Energis. The incumbent operator scored the highest in network quality but lagged behind on its pricing structure.
Cable operators received a boost in the survey as 25 per cent of respondents said they would ?seriously? consider them as suppliers. Although only 23 per cent were currently using cable services, a relatively small percentage (16 per cent) believed they were not competitive.
However, cable operators need to focus on pricing and discounts, overall network quality and network coverage. ?For certain users with relatively unsophisticated requirements, cable operators could be adequate,? said Paul Marsch, prinicipal telecomms analyst at Morgan Stanley.
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