T-Mobile Leads for Customer Value While Verizon Scores High Marks for Network Quality, ACSI Data Show

Samsung Galaxy Note 9 Is America’s Favorite Smartphone

ANN ARBOR, Mich.–(BUSINESS WIRE)–As wireless telephone service readies for a major transformation,
customer satisfaction with the industry climbs 1.4% to a score of 75 (on
a scale of 0 to 100), according to the American
Customer Satisfaction Index’s (ACSI^®) Wireless Service and
Cellular Telephone Report 2018-2019.

This inaugural report covers three new categories of wireless telephone
service providers—mobile network operators (MNOs), full-service mobile
virtual network operators (MVNOs), and value MVNOs—as well as cellular
telephone manufacturers and smartphone brands. The ACSI also introduces
new metrics for network quality as well as customer satisfaction by
spending level.

Smartphone sales are levelling off as more customers wait to upgrade
devices. Longer phone lifecycles play a role, but there’s also an
increasing desire to wait for innovations like 5G technology.

“To cope with the rapid growth of wireless data traffic, carriers are
investing in modernizing infrastructure, including 5G networks,” said
David VanAmburg, Managing Director at the ACSI. “Samsung’s newest Galaxy
S10 smartphone is a major step toward enhanced 5G connectivity. This may
help build a foundation for future 5G devices, as it will be the first
time a phone can access 5G without an attachment in the United States.”

T-Mobile tops customer satisfaction among MNOs

The lowest-scoring category in the wireless telephone service industry
is MNOs with an ACSI score of 73. Growth of network devices slows, while
wireless revenue declines for the second straight year, falling 5% in
2018.

T-Mobile, which reported its best three months ever, leads all MNOs in
customer satisfaction with a score of 76, as it bests the competition in
value and ease of billing. The carrier also outpaces the others in
subscriber growth.

Although T-Mobile is seeking to merge with Sprint—the lowest-scoring
network operator—to compete with the likes of Verizon and AT&T, ACSI
data show mergers typically stifle customer satisfaction, at least in
the short term.

Verizon Wireless and U.S. Cellular tie for second place at 74. AT&T
matches the category average with an ACSI score of 73.

While Sprint finishes last at 65, it exceeds new subscriber expectations
thanks to promotions and giveaways. However, Sprint lost 189,000 monthly
phone subscribers during its fiscal fourth quarter—the carrier’s most
valuable customers—and its mobile app rates last in the category in both
quality and reliability.

Verizon stands out for network quality

The ACSI introduces a new rating of network quality based on customer
evaluations of call quality (clarity and strength), call reliability
(dropped calls), network coverage, and data speed. Verizon Wireless
leads this category with a score of 80. AT&T is next at 78. T-Mobile and
U.S. Cellular score 77, respectively. Sprint again brings up the rear
with a network quality score of 72.

MNOs thrive at in-person customer service: Staff courtesy and
helpfulness is the highest-scoring aspect of the customer experience at
81.

MNOs succeed with mobile apps as well. While scores vary widely among
companies, the category comes in at 80 for both quality and reliability.
Customers prefer mobile apps to websites, with website satisfaction
scoring slightly lower at 79.

Customers admit the worst aspects of network service are data speed and
call centers, which score 76 and 71, respectively.

Cricket Wireless ranks best among full-service MVNOs

With an ACSI score of 77, customer satisfaction with full-service MVNOs
is dramatically higher than the rating for MNOs.

Cricket Wireless—part of AT&T’s prepaid portfolio—leads the category at
79 and just passed the 10 million subscriber mark. Customers feel
Cricket Wireless offers the best range of wireless plans among
full-service MVNOs.

Metro by T-Mobile and Virgin Mobile (a subsidiary of Sprint) tie for
second place at 76, while Sprint’s Boost Mobile comes in last with score
of 74. Boost Mobile’s issues may lie in device compatibility; services
will only work on Boost Mobile devices and some certified Sprint
devices. ACSI data show Boost ranks lowest in the category in terms of
dropped call frequency.

Full-service MVNOs do well in most aspects of the customer experience.
Straightforward payments are vital for prepaid customers and ease of
billing holds the top mark of 85. Mobile apps score well in terms of
quality (81) and reliability (80). In-person customer service is also a
plus for the category, with staff courtesy and helpfulness at 82 and
service speed at 80.

According to customers, call centers are the poorest aspect of
full-service MVNOs, with a score of 72.

Consumer Cellular leads value MVNOs – and all carriers

Customer satisfaction with value MVNOs is the highest among the wireless
categories at 81. Consumer Cellular, which leads the category with an
ACSI score of 85, also tops all carriers across the board. Its customers
appreciate the ease of billing that comes with offering no-contract,
postpaid service and discounts to AARP members.

Straight Talk Wireless comes in second at 80. TracFone Wireless finishes
last with an ACSI score of 77 and lags behind for data speed and
reliability.

Value MVNOs score an industry-best 89 in billing. In general, these
customers have a higher regard for all aspects of the customer
experience compared to customers of both full-service MVNOs and MNOs.

All elements of the value MVNO customer experience score in the 80s,
save for call centers, which score 74.

Introducing new measure of customer spending

The ACSI also asked respondents how much they spend each month for their
wireless service. The Customer Value Segment Model allows
differentiation among customer groups based on how much each spends on
their wireless service, along with variation in satisfaction and
loyalty. The model then targets those segments where the financial
return from investing in better customer satisfaction is strongest.

For instance, while almost 70% of customers note a spending level
between $1 and $100 on their wireless bill, these customers account for
no more than 35% of carriers’ revenue. Meanwhile, customers that spend
$101-$150 and $250-$500 make up only 18% of the customer base but more
than 36% of total revenue. However, because the latter higher-spend
groups are less loyal and have lower customer satisfaction, they account
for nearly 40% of the revenue lost to customer churn across the wireless
service industry each year.

Samsung pulls even with Apple among cell phones

For the fourth consecutive year, customer satisfaction with cell phones
is stagnant at 79. The market is saturated, and customer satisfaction
with mobile devices remains unchanged because of a combination of high
expectations and a lack of industry innovation.

Following a 1% jump, Samsung moves into a first-place tie with Apple at
81 despite smartphone sales dropping for both companies. Apple iPhone
sales are down 17% for the first quarter, a potential issue for Apple as
ACSI data show the company’s value is lacking compared to other
manufacturers.

Among brands, Samsung’s Galaxy Note 9 is now America’s favorite
smartphone with an ACSI score of 86. Customers like the powerful Android
model, with its large screen and broad capabilities.

Apple’s iPhone X, iPhone 8 Plus, and iPhone SE all score 83. Three more
models cluster at 83: Samsung’s Galaxy J7 Prime and Galaxy S8+, as well
as Motorola’s Moto G. The lowest-rated model now belongs to Samsung with
its Galaxy J3 (77).

“As Samsung’s newly released Galaxy S10 5G smartphone hits the market,
it will be interesting to see how this first step and the bigger 5G
rollout impacts both customer perceptions and the ACSI rankings next
year,” said VanAmburg.

Customer experience shows little improvement over the last year. Cell
phones are generally easy to use, with text messaging earning the top
score at 85. Despite being the only area to improve year over year,
battery life (78) finishes last among customer experience benchmarks.

The ACSI Wireless Service and Cellular Telephone Report 2018-2019 on
MNOs, full-service MVNOs, value MVNOs, cellular telephones, and
smartphone brands is based on interviews with 19,658 customers, chosen
at random and contacted via email between April 5, 2018, and March 27,
2019. Download the full Wireless
Service and Cellular Telephone Report.

Follow the ACSI on LinkedIn
and Twitter at @theACSI.

No advertising or other promotional use can be made of the data and
information in this release without the express prior written consent of
ACSI LLC.

About ACSI

The American
Customer Satisfaction Index (ACSI^®) has been a
national economic indicator for 25 years. It measures and analyzes
customer satisfaction with more than 400 companies in 46 industries and
10 economic sectors, including various services of federal and local
government agencies. Reported on a scale of 0 to 100, ACSI scores are
based on data from interviews with roughly 300,000 customers annually.
For more information, visit www.theacsi.org.

ACSI and its logo are Registered Marks of the University of Michigan,
licensed worldwide exclusively to American Customer Satisfaction Index
LLC with the right to sublicense.

Contacts

Katie Johnston, 610-228-2248
katiej@gregoryfca.com