Analysis: Telco customer loyalty is dead
January 6, 2026
By Colin Mann
Teresa Cottam, founder and Chief Analyst at Omnisperience and author of Telecoms Customer 2035, has issued a ruthless wake-up call for the telecoms industry: if telcos want to thrive in 2035, they urgently need to rethink customer relationships.
According to Cottam, the evidence is stark. Hundreds of billions spent on 5G networks, fibre-to-the-home, digital transformation and now machine learning and AI – yet churn rates remain among the highest of any industry. Revenues have flatlined. Customers continue to vote with their feet.
Cottam is blunt: “The telecoms industry has been running the same 1990s playbook while AI has obsoleted everything – including customer expectations. You can’t keep doing the same things and expect different results. 2026 must be the year we finally get real and recentre on the customer.”
In the study, Cottam argues that what telcos long called “loyalty” was never real. It was largely inertia.
“The bottom line is that billions spent on loyalty schemes and customer perks were not a good use of resources,” she suggests. “Customers were never loyal – they were just too lazy to leave.”
With switching easier than ever and AI agents on the rise, telcos face their toughest battle yet. One of the book’s core messages is simple and brutal: stop wasting money on loyalty programmes that deliver almost nothing. With customers switching faster than ever, perks and points won’t hold them.
Trust, not loyalty, is the only sustainable edge left
But hope exists. Surviving means killing your darlings, slaughtering sacred cows and dragging comfortable but outdated assumptions into the daylight.
What keeps customers engaged – especially during the current global trust crisis – is being a trusted company. In commoditised markets, trust is now the rarest commodity and one of the few true differentiators.
The numbers speak for themselves:
• 87 per cent of shoppers have paid more for a trusted brand
• Trusted companies can charge 23 per cent more on average
Cottam’s verdict: “Loyalty programmes are expensive theatre. Trust is the premium feature customers are willing to pay for. Earn it relentlessly. Guard it fiercely. Lose it once – by letting a customer down when they most need you – and they’re gone.”
The analysis exposes wrong-headed and obsolete thinking in the industry while delivering practical ideas to shift the needle.
Cottam concludes: “The telcos that thrive in 2035 will be those that understood one thing in 2026: the customer must come first, last and always.”