Less than one third of mobile phone users plan to upgrade their phones to third generation (3G) enabled units, throwing further clouds over the supposed new wave of revenue for the telecoms industry (see Insight Analysis: 3G Promises Unfulfilled).
A new report from
A.T. Kearney and Cambridge Business School has found that whilst 61% of mobile users across 15 countries are aware of the services that 3G offers, only 29% plan to upgrade. The survey finds that whilst consumers are being reasonably well educated about 3G services, the benefit versus cost currently leaves them somewhat cold.
“Users clearly want to experience increased value and faster internet access capabilities with existing information and data services before upgrading,” said L. C. Mitchell, A.T. Kearney vice president.
“If users are not adequately enticed to try the service offerings of the mobile internet with current technology, they won’t be compelled to move up to the enriched service offerings delivered using next generation (3G) technology,” he warns.
Early experience in markets such as Japan, where 82% of respondents have access to the web via their mobile phones, highlight the potential market opportunities for consumer offerings, according to the study. However, the business or enterprise markets remain largely untapped worldwide.
A.T. Kearney says that since the launch of its Mobinet survey in 2000, results have consistently indicated an uphill struggle in persuading users that internet-enabled telephony is worthwhile.
“However, awareness of new technology is high and creating the right content and service, at the right price, could boost demand significantly,” claims Paul Collins, who led the research.
Cost is crucial Since the previous Mobinet study, cost has become an increasingly important issue to consumers. More than one third (36%) cited cost as the primary barrier to upgrading to 3G. A further 36% said that they did not need or understand the technology.
Slow Net access was also cited as a significant deterrent to using mobile phones to access the internet more regularly.
Mobile advertising increases The survey also found that the use of mobile advertising continues to increase. Four in ten mobile phone users surveyed have received an ad on their phones. However, only 1% of users across the 15 countries has ever made a purchase based on an ad to their phones.
“Pilot advertising efforts continue with numerous channels in all market areas and early experiments with movie coupons and fast food chains indicate the potential for this channel to reach consumers,” says the report.
