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Wednesday, April 25, 2012
Two-thirds of U.S. Mobile Consumers Won’t Pay more than $50/Month for Mobile Data
New Research “Mobile Data and Applications” Shows Consumer Trends and Challenges as Mobile Operators Monetize Data Usage
Parks Associates research finds two-thirds of U.S. consumers planning to purchase a smartphone are unwilling to pay more than $50 per month for mobile data plans while almost 50% of smartphone users do not know how much mobile data they use each month. The firm's analysts say these findings, from the report Mobile Data and Applications: Market Update, highlight the risks to mobile operators as they try to shift from unlimited to usage-based mobile data plans.
"Operators need to create new value propositions for their data services," said Harry Wang, Director, Mobile Research, Parks Associates. “U.S. consumers are accustomed to unlimited data use for one fixed price. They are reluctantly embracing the capped data plan tiers, but they have high price sensitivity and will rebel against byte-tracking. Operators need to shift consumers’ perception away from raw data to the experience created by their data services.”
Parks Associates finds over 90% of U.S. smartphone owners have downloaded apps since product purchase, at an average of two apps per month. Worldwide, consumers will spend over $14 billion on smartphone app downloads in 2012. To maximize their revenues, operators need to tie their offerings to popular apps and services, including TV, music, books, newspapers, games, location-based services, and social activities, rather than charging consumers per megabyte.
"Moving mobile users to usage-based plans will be difficult and painful, but changes are necessary for operators to maintain revenues," Wang said. "Operators would benefit by recasting mobile data services as experience-driven—like many of their OTT competitors—in order to reduce consumers’ price sensitivity, fend off competition, and keep their mobile data revenue engine humming for the long run."
Parks Associates will discuss operator strategies to monetize mobile data and redefine consumers’ 4G experience at CONNECTIONS™: The Digital Living Conference and Showcase, June 5-7, co-located with TIA 2012 in Dallas, Texas.
In Mobile Data and Applications: Market Update, Parks Associates analyzes mobile data usage trends, consumer preferences, and operators’ competitive position relative to over-the-top (OTT) players and concludes that usage-based pricing should be only an interim solution for operators.
About Parks Associates: Parks Associates is an internationally recognized market research and consulting company specializing in emerging consumer technology products and services. Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start-ups through market reports, primary studies, consumer research, custom research, workshops, executive conferences, and annual service subscriptions.
The company's expertise includes digital media and platforms, entertainment and gaming, home networks, Internet and television services, digital health, mobile applications and services, support services, consumer apps, advanced advertising, consumer electronics, energy management, and home control systems and security.
Each year, Parks Associates hosts industry webcasts, the CONNECTIONS™ Conference Series, and Smart Energy Summit: Engaging the Consumer.
Next: Parks Associates: Mobile value-added services (VAS) generated revenues of $14.5 billion worldwide for mobile operators in 2011
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