Consumers Confused, Long Tail Reigns

Consumers are confused and overwhelmed by the vast array of services telcos now offer, say analysts at Ofcom, the U.K. telecom regulatory agency. 

A "significant minority" of consumers have trouble working out which company offers the best value or quality of service on particular packages, Ofcom says. As it turns out, the huge range of services available, from phone line and broadband to cable television and mobile phone, confuses consumers. 

 Twenty-seven per cent of people find it hard to make cost comparisons for fixed-line phone services, Ofcom research reveals, while 34 per cent find it difficult to choose internet suppliers based on quality of service. 

 All of which points out why the "long tail" of telecom will continue to operate. Which is to say that cable company and telco basic packages will continue to maintain dominant market share. In an effort to reduce complexity, many consumers are simply going to choose from a small subset of relatively complete packages offered by the dominant providers in a market. That doesn't all buyers will do so, though. 

A significant percentage are going to go with some sort of "best of breed" approach that shifts demand "out on the tail of demand." And more customers will ultimately find they buy both a "package" of some sort from the dominant providers, as well as tailored services provided by others "out on the tail." 

 There are niches within the broader distribution of market segments as well. Looking just at today's use of mobile data apps, the same "long tail" already is apparent. SMS gets wide use by just about everybody. After that, usage trails off.