Mobile-only consumers arise from heterogeneous valuation of fixed services

Mobile-only users are usually considered as a consequence of fixed-mobile substitution. Via a unique dataset based on a a large European country survey and consumers' invoice data, this study reveals heterogeneous preferences for fixed services among consumers. The data is fitted in a mixed logit model and willingness to pay (WTP) for fixed communications services are estimated. Results show that mobile-only consumers have a WTP for fixed services of 15 € per month, while the WTP of users of both fixed and mobile services is thrice higher. Considering that a typical monthly fee for fixed services is around 30 € the heterogeneous preferences for fixed services constitute an alternative explanation for the existence of mobile-only users, despite the complementarity of fixed and mobile broadband.