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Subscriber churn in the Australian ISP market

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

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://www.sciencedirect.com/science/article/B6V8J-3X11072-4/2/b5c9ebf7f1dadb05061424a67c297688
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Article provided by Elsevier in its journal Information Economics and Policy.

Volume (Year): 11 (1999)
Issue (Month): 2 (July)
Pages: 195-207

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Handle: RePEc:eee:iepoli:v:11:y:1999:i:2:p:195-207
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505549

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  1. 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.
  2. 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.
  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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