I belong to that rare breed of human that enjoys commercials. As a social scientist with an interest in the impact of advertisement on consumer behavior, I often find myself, possibly to the chagrin of my wife (though she has not complained), assessing commercials out loud. Are they informative? Are they persuasive or attempt simply to elicit attention to the good in the ad? Might they unintentionally lead to brand confusion? Most importantly, are they funny?
Thus, having also spent some time among wireless regulators, I cannot help but comment on the recent spate of wireless attack ads perpetuated by three of the U.S. nationwide mobile wireless providers. The initial culprit this time around was Verizon Wireless, which determined that balls were a good method to represent relative mobile wireless performance among the nationwide competitors. Shortly thereafter, Sprint aired a commercial using bigger balls while T-Mobile brought in Steve Harvey to demand that Verizon #Ballagize.
There are myriad takeaways that can be had from these commercials. First, at least on the face of it, the nationwide mobile wireless providers appear to be fiercely competitive with one another. It would be interesting to look at advertising to sales ratios for this industry relative to that of other industries in the U.S., though at the time of writing of this blog, I did not have access to such data (Ad Age appears to be a convenient source). Moreover, the content of the commercials suggests that although price continues to be an important factor (Sprint did not veer away from its “half-off” theme in its ball commercial), quality competition that allows competitors to differentiate their product (and in doing so, justify higher prices) remains paramount.
Unfortunately, as a consumer, it is difficult for me to properly assess what these commercials say about wireless quality. There are a number of points at play here.
Alas, how is a consumer supposed to assess wireless providers? An obvious source is Consumer Reports, but my sense, without paying for a subscription, is that these largely depend on expert reviews and not necessarily data analysis (someone correct me if I am wrong). Another if one is not in the habit of paying for information about rival firms is the FCC. The FCC’s Wireless Telecommunications Bureau publishes an “Annual Report and Analysis of Competitive Market Conditions with Respect to Mobile Wireless.” The most recent, Eighteenth Report, contains a lengthy section on industry metrics with a focus on coverage (see Section III) as well as a section on service quality (see Section VI.C). The latter section focuses on nationwide average speed according to FCC Speed Test data as well as on data from private sources Ookla, RootMetrics (yes, the one mentioned in those commercials), and CalSPEED (for California only). If you are interested, be sure to check out the Appendix, which has a wealth of additional data. For those who don’t want to read through a massive pdf file, there is also a set of Quick Facts containing some of the aforementioned data.
However, what I think is lacking is speed data at a granular level. When analyzing transactions or assessing competition, the FCC does so at a level that is far more granular than the state, and rightly so, as consumers do not generally make purchasing decision across an entire state, needless to say, the nation as a whole. This is because service where consumers are likely to be present for the majority of their time is a major concern when deciding on wireless quality. In a previous blog post I mentioned that the FCC releases granular fixed broadband data, but unfortunately, as far as I am aware, this is still not the case for wireless, particularly with regard to individual carrier speed data.
The FCC Speed Test App provides the FCC with such data. The Android version which I have on my phone provides nifty statistics about download and upload speed as well as latency and packet loss, with the option to parse the data according to mobile or WiFi. My monthly mobile only data for the past month showed a download speed above 30 Mbps. Go Verizon! My Wifi average was more than double that. Go SpartenNet! Yet, my observation does not allow me to compare data across providers in East Lansing and my current contract happens to expire in a couple of weeks. The problem is that in a place like East Lansing and particularly so in more rural areas of the United States, not enough people have downloaded the FCC Speed Test App and I doubt that the FCC would be willing to report firm level data at a level deemed not to have statistical validity.
For all I know, the entire East Lansing sample consists of my twice or so daily automatic tests that if aggregated to a quarter of a year make up less than 200 observations for Verizon Wireless. Whether this is sufficient for a statistically significant sample depends on the dispersion in speed observations for a non-parametric measure such as a median speed and also on the assumed distribution for mean speeds. I encourage people to try this app out. The more people who download it, the more likely that the FCC will have sufficient data to be comfortable enough to report it at a level that will make it reliable as a decision making tool. Perhaps then, the FCC will also redesign the app to also report competitor speeds for the relevant geographic area.
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