As the number of new mobile users slows so the telecoms companies must look to new audiences to increase sales. This new customer base, says The Yankee Group, may include the youth market, ethnic minorities and the ‘credit-challenged’.
According to a new report
Can US Carriers Become Profitable in Wireless Prepaid?, the Yankee Group believes that prepaid wireless services will better enable carriers to reach out to these alternative subscriber bases and make wireless phone usage a more appealing option to a larger percentage of the population.
According to forecasts, at the end of 2001 approximately 12% of all wireless subscribers were prepaid subscribers. By the end of 2006, the Yankee Group believes that this figure will grow to exceed 30%.
“In order for carriers to make prepaid a successful product offering, some of the dynamics of prepaid wireless must be adjusted,” said Knox Bricken, senior analyst at the Yankee Group.
“In most existing prepaid relationships, carriers do not have regular contact with their customers. In fact, carriers do not even know who approximately 50% of their prepaid subscribers are. This makes it difficult to develop long-lasting relationships with subscribers and work to continually increase ARPU and reduce churn,” he concluded.
