Academic journal article Journal of Competitiveness Studies

Customer Satisfaction with Mobile Services in Telecommunication Companies

Academic journal article Journal of Competitiveness Studies

Customer Satisfaction with Mobile Services in Telecommunication Companies

Article excerpt


With the rapid development of technology, the world has quickly become an information society built upon a foundation of telecommunication networks. Through the innovation of information technologies, such as mobile communication, internet, and multimedia, time and space have become compressed as well. Telecommunication services are the integration of computer and communication, which deeply influence the increase of quality of life and information dissemination.

The Saudi mobile market observed the arrival of competition in 2005. Up to that period, the Saudi Telecom Company (STC) had enjoyed a market monopoly. Following the launch of mobile services by Mobily (owned by the UAE's Etisalat), in mid-2005, and Zain, in late 2008, the Saudi mobile market developed into a three-way contest between Zain, Mobily and the Saudi incumbent operator (STC). Recent research by Informa Telecoms & Media, shows that STC had the majority of customers by 43.2%, followed by Mobily with 40% and Zain 16.8% market share by the end of the second quarter in 2010. According to statistics collated by the Communication and Information Technology Commission (CITC), the total number of mobile subscriptions was around 50 million by the first quarter (2014). Mobile service penetration in Saudi Arabia is about 165% as shown in Figure 1.

The continued decrease in the number of subscriptions, since 2012, seen here, is due to the adoption of CITC's decision to link the sale and activation of pre-paid SIM cards with the national ID systems. As companies deactivated a large number of unidentified SIM cards, this impacted the total number of subscriptions and penetration rates (CITC, 2014).

In the last decade, a number of national indicators have reflected that consumer satisfaction across a wide range of organizations has risen (e.g., USA-ACSI; Fornell et al., 1996; Europe-ECSI Technical Committee, 1998; Denmark-Martensen et al., 2000). Moreover, organizations of all types have increasingly acknowledged the importance of customer satisfaction and loyalty (Bayraktar et al., 2012).

A standardized measure of satisfaction provides the means for accurate regulatory objectives that capture both consumer interest and overcome vagueness. Regulators can adapt this standard measure for national benchmarking, competitive country assessment and longitudinal studies of regulation implications. The ACSI model is a general cross-industry model that provides market-based performance measures for firms, industries, sectors and nations. It measures the quality of goods and services as experienced by consumers (Fornell et al., 1996) and gauges their actual and anticipated consumption experiences (Anderson & Fornell, 2000).

A standard measure is of primary importance to both mobile operators and regulators. First, mobile operators can utilize a standardized satisfaction measure for strategic benchmarking with other telecommunications service providers. Second, they may self-assess their performance through the application of longitudinal satisfaction studies. Third, the use of such a measure may help regulators better achieve their objectives by overcoming the flaws of extant service-level regulations. To ensure acceptable service levels, regulators typically enforce a maximum number of disconnections, coverage constraints and technical standards (Wigglesworth, 1997). These regulations, however, are applied mainly because they are easy to measure, even though they are believed to only partially explain the public need. The improvement of service quality is the focus of telecommunication regulations for both social and economic reasons. From a social perspective, services should be available on reasonable terms. From an economic viewpoint, services should satisfy a full range of consumer demand (Melody, 1997). Overall, it is believed that satisfaction better captures the range of services, prices and quality than any other single measure. …

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