Swedish consumers are among the happiest in Europe with the performance of telco networks

• According to the latest BearingPoint research, connectivity is one of the most important enablers for digitalization, still we see a high amount of missing education and missing willingness to pay for premium services. The study explores the influence factors across Europe and identifies levers for telcos and other market players alike.
• 54% of Europeans are satisfied with their mobile network performance, although satisfaction drops to 13% in Germany
• While 84% of European respondents are aware of 5G, only 27% claim to use it on their smartphones
• Irish customers seem to be most aware and optimistic about the impact of 5G and are the most willing to pay for premium network services
• Swedish customers are among the happiest in Europe with their current network performance (fixed and mobile) even though their usage of 5G is on par with the average.
  

Stockholm, June 12, 2023 – Management and technology consultancy BearingPoint’s latest study, “The connectivity challenge,” suggests telco operators need to get the basics right while promoting 5G to consumers. Based on 10,850 respondents in eight European countries, the study reveals a mixed perception of network quality, indicating that operators must ensure satisfaction with overall networks (both fixed and mobile) before convincing consumers to pay for a new network technology – most consumers (71%) are currently unwilling to pay a 5G network service premium.

The study outlines that a wide part of Europe’s society is relatively uneducated when it comes to network technologies. In particular the authors see a certain amount of misinformation, especially when it comes to health impacts. Awareness, however, is elementary in driving the right network choice and the willingness to pay for premium services. With connectivity being one of the most important pillars of digitalization, according to the study this lack of education is an issue.

“Little known to a major part of Europe’s population is that 5G offers benefits such as higher network bandwidth, better latency and higher reliability, but also is the network technology with the highest data security and the best energy efficiency among the mobile access technologies”, says Sylvain Chevallier, Global Leader Telecommunications at BearingPoint.

A little-understood network technology

According to the study, dissatisfaction with existing overall networks may explain the cautious approach of consumers toward a new and little-understood network technology. Telco operators can address this lack of satisfaction by better explaining 5G and its benefits for example.

Operators must also adapt their market positioning to respond to the customer perspective, and there are five interconnected points from the survey and analysis that they need to know and act on:

1. Customers expect robust network connectivity – 5G has an important role to play in improving network quality and user experience. More than 4 out of 5 respondents are aware of 5G, but only 1 in 4 claim to use 5G on their smartphone.
2. To drive improved satisfaction, operators need to continue to enhance the perception around network quality. 54% of European respondents overall are satisfied with their mobile network performances versus 13% in Germany, 17% in Austria, and 32% in Switzerland (DACH).
3. The benefits of new technological advances need to be communicated effectively to customers – 5G is no exception. Despite 5G having been launched four years ago, a significant portion of users do not understand how it can really impact their lives.
4. There is a “new network technologies” price premium, but network operators must change their approach to capitalize on it. Respondents in Ireland are willing to pay 67% more than the European average. Two categories in Ireland and Europe that are valued most are video streaming and WIFI/personal hotspot.
5. Network sustainability is important to customers, but it is not yet a key driver for monetization. It is important to 53% of respondents that providers focus on sustainable networks, but only 25% of people are willing to change their usage habits to become more sustainable.

From a Swedish perspective, the share of consumers willing to pay for premium 5G services is low as well, though slightly higher than the other countries in the study in all categories. In contrast, Swedes show lower awareness of 5G than the overall average, scoring 3 to 7 percentage points lower in all categories. This includes both awareness of 5G itself as well as awareness of the potential benefits that 5G might entail.

Per Yhde, BearingPoint Partner in Sweden, says: "It seems that the major fiber push in Sweden that was done in the mid to late 2010s is paying dividends in terms of network satisfaction. When it comes to 5G however, the overarching trend for Sweden is similar to the rest of Europe with awareness actually being even lower. It begs the question, why would a consumer pay a premium for a service when they are not aware of what it is or see the value it adds."

“Our survey shows that network sustainability is becoming a critical factor for the choice of consumers. 53% of respondents consider it to be important for providers to focus on creating sustainable networks. And while customers would prefer an environmentally friendly provider, they are not willing to pay a premium to access sustainable networks”, says Julius Hafer, Partner with focus on network technology consulting at BearingPoint.

Correlation between fiber access and consumer satisfaction

While a clear majority in European countries outside of the DACH region are satisfied with their fixed network performance (69%), the reverse holds for the DACH region itself (only 17%). The variation is in line with access to fiber internet: 23% of respondents in the DACH region said they have access to a fiber network, while it is 52% in the rest of Europe, indicating a correlation between fiber access and consumer satisfaction, according to the study.

Correlation between 5G perception and willingness to pay

According to the study, more than 4 out of 5 respondents know about 5G, but only 1 out of 4 uses 5G on their smartphone: new technological advances must be communicated effectively to customers, and 5G is no exception. For example, even though they are on basically the same networks, 57% of people in Ireland acknowledge a high impact of 5G on network performance, though that drops to only 37% of people in the UK. At the same time, people in Ireland are willing to pay 67% more for a premium network service than the European average.

About the study

For the study, BearingPoint analyzed 10,850 customers to assess their adoption of 5G and satisfaction with 5G, how they perceive mobile versus fixed networks and how they will use them in the future, and their views on network sustainability. The survey respondents, all aged 18 and over, were from Austria, France, Germany, Ireland, the Netherlands, Sweden, Switzerland, and the UK. The participants represent the average demographics of each country’s 18 and older population.