Security breach biggest threat to telecomms providers | KPMG | UK
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Half of UK consumers would leave their telecomms provider in the event of a personal data breach

Security breach biggest threat to telecomms providers

KPMG report reveals £1.45bn revenue opportunity for telcos able to master trust, customer experience and reliability.


Also on

  • Security breaches outweigh poor service as the biggest threat to customer loyalty
  • Improved customer service and no dropped calls could increase mobile revenues by £900 million per year
  • Providing consistently reliable broadband connectivity could potentially account for £550 million in additional income per year

Improved customer service and reliable connectivity could net telcos an extra £1.45 billion in annual revenues, but security breaches represent a serious threat to customer loyalty in the sector, according to a new report from KPMG. 

According to the survey of 2,000 UK adults, 50 per cent said a personal data leak would lead them to immediately cancel their contract, even if that resulted in a financial penalty. A security breach is also twice as likely to prompt consumers to switch providers as being subjected to rude or unhelpful staff, the research found.

However, the findings reveal consumers would pay more for reliable connectivity and faultless customer service. Based on the average amount consumers would add to their monthly bills, improving customer service and eliminating dropped calls could deliver a £900 million increase in annual mobile revenues, with reliable broadband connectivity accounting for an extra £550 million. This would boost telco’s average revenue per user by 10 per cent, according to the research.  

Alex Holt, Partner and Head of Telco, Media and Technology, KPMG in the UK, commented: “Today’s consumers love their connected lives, so their tolerance is extremely low for anything that prevents connections with the devices or services they want. Before Telcos can get a licence to up and cross sell, they’ve got to get the basics right and deliver a great connected experience.

“By focusing on building trust with their customers, there is a clear opportunity for telcos to increase revenues and become the trusted gateway for tomorrow’s connected consumer.”

The survey reveals the growing demand for a new generation of connected devices offers a significant new revenue opportunity for telcos. Of those surveyed, 47 per cent would be willing to buy a smart watch from their mobile provider, 50 per cent would be willing to buy a connected kitchen appliance from their broadband provider and 22 per cent would consider buying connected household security from their telco.   

There is also a huge potential for bundling with a third of respondents stating they would definitely consider a single contract for television, broadband internet, landline phone, and mobile – or ‘quad-play’. However, consumers remain nervous about being over-reliant on one provider and fearful of onerous contracts.

There is also a huge potential for bundling with a third of .In order to effect change, the report is calling for telco companies to take more radical action. Positioning themselves as the logical and trustworthy partner to the customer must be a priority, but this must also be coupled with investment to strengthen the quality of service and reliability of their networks. 

Alex Holt concluded, “We believe that telcos have a great opportunity to define the connected world. They need to take action now, invest in great infrastructure and position themselves as the logical and trustworthy digital curator to the consumers exciting, but daunting journey into the connected world. In short - get the basics right today to realise the opportunity of the connected world tomorrow.”

The report entitled ‘The digital telco: gateway to the connected world’ is available here


For media enquiries, please contact:

Peter Lappin, Citypress (on behalf of KPMG)


T: 0161 235 0328

David Bertram, Citypress (on behalf of KPMG)


T: 0161 235 0316

KPMG press office: +44 (0)207 694 8773

About KPMG

KPMG in the United Kingdom, is member of a global network of professional firms providing Audit, Tax and Advisory services. KPMG operates in 155 countries and has more than 162,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

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