Wireless industry at annual convention bemoans lack of consumer trust

May 9, 2012

The wireless industry is one of the least trusted businesses among U.S. consumers ,and network operators need to improve their reputations as they look to provide sensitive services like mobile payments or health monitoring, according to the chief executive of the No. 3 U.S. mobile provider Sprint Nextel.

Sprint CEO Dan Hesse cited statistics regarding the wireless industry from the Reputation Institute Pulse Index annual survey during his keynote at the CTIA — The Wireless Association annual U.S. wireless convention in New Orleans.

“Even cable and oil industries rate higher with consumers than we do,” Hesse said. “Its very troubling.”

Hesse, who himself is facing a push by some shareholders to vote him off the board at Sprint’s shareholder meeting next week, said he did not know why mobile has such a bad reputation. But, he said, it urgently needs to improve as it offerings tap further into people’s lives in areas such as financial services, health and home security.

“Trust is important. There has never been a device as personal as a smartphone,” said Hesse who participated in a panel of the top executives from the top four U.S. mobile providers.

In his presentation, Philipp Humm, chief executive of No. 4 U.S. operator T-Mobile USA, showed a video advertisement that portrayed his company’s network as being substantially faster than the Apple Inc iPhone on the network of bigger rival AT&T Inc . AT&T’s mobile chief Ralph de la Vega pointed to the advertisement for a suggestion as to why customers might feel they cannot believe U.S. operators.

“That’s why this industry has a bad rap. We take the truth and we stretch it. We each try to put our best foot forward and in doing so it’s confused the customer,” de la Vega said.

His company is hoping that customers will put more trust in AT&T as the operator is planning to offer a home security and monitoring service aimed at fending off everything from burglaries to floods.

Sprint’s Hesse promised a new mobile advertising policy to reassure customers that they have control over whether or not they receive ads on their cellphone.

The new mobile policy would educate people on their options and give them “multiple choices for how to opt out or opt in,” Hesse said, adding that the company is hiring an outside firm to verify that it lives up to its promises.

Asked about what big advancements might come occur in the wireless industry in the next year, AT&T’s de la Vega focused on mobile payments services, which would allow consumers to wave their phone to pay at store check-outs instead of using a credit card.   The industry has talked for years about mobile payments, but according to de la Vega, it will have to wait a bit longer for this area to flourish.

“I think the next big break will be mobile payments, probably toward the end of next year … mobile payments and mobile commerce is going to flourish next year”  he said.

Verizon Wireless CEO Dan Mead used the keynote to complain about a shortage of spectrum in the U.S. wireless industry. The head of the biggest U.S. mobile operator argued that the shortage should work in Verizon’s favor as U.S. regulators review its plan to buy unused spectrum from cable operators.

That deal is being hotly contested by T-Mobile USA, which has made no secret of the fact that it would like a chance to buy that spectrum itself.

2 comments

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“We take the truth and we stretch it”

Hold on there, Turbo.

Isn’t that the definition of LYING?

Posted by bryanX | Report as abusive

You bet I do not trust them what with there pre payment penalties, took them years to agree to shout use of stolen or lost phones, data plan prices increase, and charge every one else more so that they can subsidize i phones.

Posted by wallynm | Report as abusive