IBM Deutschland GmbH
ommunications companies are facing “hypercompetition:” traditional local and long-distance telecommunication companies have invaded each other’s markets, and wireless, cable, and Internet service provider (ISP) options have proliferated. This environment has created more choice for consumers and has naturally resulted in high customer churn. Telecommunications companies are also experiencing an emerging trend of displacement—the movement from wireline products to wireless—which can significantly impact churn given that wireless customers are traditionally less loyal to any one provider. Contributing to this trend is the fact that most products are undifferentiated, leaving price as the main factor in deciding which provider to choose.