The Dutch telecom sector has suffered another blow to its image with the news that regulator Opta has put KPN under surveillance. While there are few details as to why Opta decided to put the incumbent under close supervision, it’s unlikely to prove a positive development for KPN. It’s difficult to remember a time when the sector has been in such a bad light, after the competition regulator already opened an investigation earlier this month into suspected price-fixing among the three mobile operators. Public opinion, driven by reactions from MPs, appears to have already condemned the operators.
While some may say ‘told you so’, one has to wonder why Opta chose to go public. By giving no details of its concerns, it has generated a great deal of speculation. Possibilities include a new episode in the ongoing conflict over the government’s telecom contract, OT2010, which has already changed hands a few times. Opta could also be looking further at the enterprise market, where KPN came under fire following the launch of new subscription terms earlier this year. It may also have to do with the fact that Opta has been turned back several times by court appeals, and is hoping to pre-empt any legal suits. Next year a new round of market analyses and regulations is planned, and the regulator is unlikely to assume KPN will accept these without comment.
Jens Schulte-Bockum
There are more reasons why Opta may be looking closely at KPN, but the regulator is keeping quiet. Opta can stand up for itself, but the telecom sector’s image is suffering. Jens Schulte-Bockum, the outgoing CEO of Vodafone Netherlands, said last week at the Telecom Time conference and this week on the Vodafone blog that he’s concerned about the industry’s public appearance. He noted a number of areas for improvement (network quality, customer service and price perception) and added his own mea culpa. The telecom providers, including Vodafone, were in the past often too vague in their communication to end-users, he said.
Net Promoter Score
The Net Promoter Score (NPS), which measures to what degree customers would recommend a service provider to acquaintances, also shows how low confidence in the Dutch mobile industry has sunk. While a positive NPS suggests sales growth, in the third quarter, the NPS of almost all the operators was negative. Only Ben managed a positive score, of +5, while the market average was -20. Vodafone previously did better than the market, but in Q3 fell back to the average.It’s clear Schulte-Bockum is speaking the truth. While the operators, including Vodafone, have repeatedly said tariffs needs to be more transparent, there is little evidence of this happening. Customer service also regularly comes up as an area for improvement. Its good the Vodafone executive is signaling the problem again, but it will be up to his successor to deal with the thankless task.
Transition to data subscriptions
It is a thankless task, as the tariff structure needs to be completely taken apart. In future subscribers should be able to buy a mobile data package that automatically includes voice services. Currently it’s the opposite. In the fixed market, where triple-play is now the norm, this has happened with little notice - voice is now just a side product. This still needs to happen in the mobile market. With the industry’s current image, and politicians’ willingness to score points by highlighting the problems, some upheaval can be expected. Some may say the public uproar is not always fair, as the operators are still commercial companies trying to sell their products.
But there are reasons enough why the operators – and not just the mobile providers – have themselves to blame for the negative image. However complex the services may be, transparency and fairness in pricing need to be improved. Things like strange rounding schemes and no minutes carryover need to disappear; customers should get what they paid for.
Being free from scrutiny by regulators is not a bad situation either. Whether it’s justified or not.
