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Subscriber churn in the Australian ISP market

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Author Info

  • Madden, Gary G
  • Savage, Scott J
  • Coble-Neal, Grant

Abstract

Rapid growth in Internet use, combined with easy market entry by Internet service providers (ISPs), has resulted in a highly competitive supply of Internet services. Australian ISPs range in size from a few large national operators to niche ISPs focused on specialised service. With many ISPs currently not profitable, subscriber retention is an important aspect of survival. This study develops a model which relates the probability of subscriber churn to various service attributes and subscriber characteristics. Estimation results show that churn probability is positively associated with monthly ISP expenditure, but inversely related to household income. Pricing also matters with subscribers preferring ISPs which offer flat-rate pricing arrangements.

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File URL: http://mpra.ub.uni-muenchen.de/11450/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 11450.

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Date of creation: 1999
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Handle: RePEc:pra:mprapa:11450

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Related research

Keywords: Internet; customer churn; pricing;

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References

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  1. Gary Madden & Michael Simpson, 1997. "Residential broadband subscription demand: an econometric analysis of Australian choice experiment data," Applied Economics, Taylor & Francis Journals, vol. 29(8), pages 1073-1078.
  2. Shane Greenstein, 1998. "Universal Service in the Digital Age: The Commercialization and Geography of U.S. Internet Access," NBER Working Papers 6453, National Bureau of Economic Research, Inc.
  3. Katz, James E & Aspden, Philip, 1998. "Internet dropouts in the USA: The invisible group," Telecommunications Policy, Elsevier, vol. 22(4-5), pages 327-339, May.
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Cited by:
  1. Keesookpun, Chutipong & Mitomo, Hitoshi, 2013. "The determinants of mobile operator switching and policy implications in developing countries: A case study of Thailand," 24th European Regional ITS Conference, Florence 2013 88472, International Telecommunications Society (ITS).
  2. Gans, Joshua S., 2000. "Network competition and consumer churn," Information Economics and Policy, Elsevier, vol. 12(2), pages 97-109, June.
  3. Pereira, Pedro & Ribeiro, Tiago, 2011. "The impact on broadband access to the Internet of the dual ownership of telephone and cable networks," International Journal of Industrial Organization, Elsevier, vol. 29(2), pages 283-293, March.
  4. Filippo Belloc & Antonio Nicita & Maria Alessandra Rossi, 2009. "Whither Broadband Policy? In Search of Selective Intervention," Department of Economics University of Siena 567, Department of Economics, University of Siena.
  5. Baranes, Edmond & Bourreau, Marc, 2005. "An Economist's Guide to Local Loop Unbundling," MPRA Paper 2510, University Library of Munich, Germany.
  6. Nakamura, A., 2011. "Estimating switching costs after introducing Fixed-Mobile Convergence in Japan," Information Economics and Policy, Elsevier, vol. 23(1), pages 59-71, March.
  7. Filippo Belloc & Antonio Nicita & Maria Alessandra Rossi, 2011. "The Nature, Timing and Impact of Broadband Policies: a Panel Analysis of 30 OECD Countries," Department of Economics University of Siena 615, Department of Economics, University of Siena.

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