Telecoms Suffering From Innovation Perception Gap

The U.S. wireless industry is suffering from an innovation perception gap, which could hurt it as consumers’ worlds become increasingly more connected. 

According to a survey of consumers by Market Strategies International, fewer than half would consider their current wireless carrier as an option to provide high-speed Internet access or home-security or automation systems. Of the big four carriers, only AT&T was able to consistently receive consideration for these services, says Greg Mishkin, vice president of research and consulting at Market Strategies. 

“With telecoms, people are used to them providing services; they’re not seen as innovative movers,” Mishkin tells Marketing Daily. "There’s plenty of innovation there, but the problem is that they're not perceived by consumers as driving innovation.”



While few of these companies currently offer high-speed Internet or home automation services (the fact that AT&T does may be one of the reasons for its consideration), the need to broaden offerings could become more acute as consumers begin to view wireless services as more or less equal, Mishkin says. 

“[T-Mobile’s] whole ‘Un-carrier’ positioning has led to a commoditization of mobile services. What ends up happening in commoditized businesses is it becomes a race to the bottom,” Mishkin says. “It’s becoming less differentiated, and as it does, what we’re going to see is carrier loyalty will become less apparent.”

Of the four largest wireless providers, T-Mobile fared the worst when it came to potentially offering high-speed Internet or home security systems. The brand, which has found success with its “Un-carrier” positioning, did not rank among the top three providers considered by its competitors’ customers and was even behind Google among its own customers, Mishkin says. 

Sprint customers, meanwhile, ranked Verizon higher as a potential Internet provider, and only one-third of its customers had it as the top contender for home automation and security provider, Mishkin says. Verizon performed well among its own customers, but fell behind AT&T among other carriers’ customers.

AT&T, however, was the only major carrier to consistently show consideration among competitors’ customers, perhaps because it has been aggressively promoting its U-verse and Digital Life services, Mishkin says. 

“AT&T has had a much broader set of products that its competitors have had,” he says. “Things don’t stay constant in the telecommunications world very often. AT&T is probably very well served to capitalize on this. They should use this as a customer acquisition vehicle."

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