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As Number Portability Nears, Compete, Inc. Estimates Industry-Wide Revenue Loss From Churn Activity Online Will Reach Nearly $3 Billion

Boston, MA – September 16, 2003 -- According to Compete, Inc., a predictive analytics firm, the volume of competitive consideration facilitated online will result in more than $3 billion in revenue loss industry wide during the next 12 months. The growing complexity of service plans and data features has driven customers online to help manage their accounts and evaluate carriers for future purchases.

"The internet has become an inseparable component of consumer decision-making for wireless products and services," said TJ Mahony, Compete's senior wireless analyst.

Each month approximately 10 million wireless customers use the Internet to manage their accounts (e.g., pay bills and check their minutes used). Of these online customers more than one million exhibit pre-churn behavior. According to Compete, 25% of online customers who exhibit pre-churn behavior will switch carriers in subsequent months. Pre-churn identifies a customer who has not switched carriers yet but has begun the competitive consideration process. With November 24th on the horizon, carriers are on the hook to maximize retention, minimize consumer attrition, and increase customer acquisition from defectors.

"Carriers are watching carefully as number portability nears because of the threat it presents to customer churn and the competitive landscape," added Mahony. "Analysis of timely consumer behavior of in-market wireless subscribers online will serve as the leading industry indicator of who the winners and losers will be."

Compete, Inc. Estimates Industry-Wide Revenue Loss
from Churn Activity Online at $3 Billion

* Based on a 25% churn execution rate, an average customer lifetime of 18 months and each carrier's average revenue per user.