Thursday, October 04, 2012

Tired Data Plans Not Affecting App Downloads

The recent transition from unlimited to tiered data plans for mobile devices by carriers such as AT&T, T-Mobile and Verizon Wireless has not impacted downloads of apps by consumers, according to new research from Parks Associates.

Smartphone owners on tiered data plans have downloaded an average of 17 apps since purchasing their phones and use seven apps on average per month. By comparison, smartphone owners on unlimited data plans have downloaded an average of 16 apps since purchase and use six apps on a monthly basis.

With the proliferation of portable devices carriers have done away with unlimited data plans and instituted tiered pricing as a means of generating incremental revenue, while at the same time reducing monthly costs for infrequent users. Verizon last year began offering monthly plans of $30 for 2GB of data, $50 for 5GB and $80 for 10GB. It also rolled out a $10 monthly option for 75MB of data earmarked for consumers with phones featuring limited Web functionality.

Jennifer Kent, research analyst with Parks, said proliferation of Wi-Fi zones and wireless connectivity has attributed to almost 40% of users on tiered data plans using Wi-Fi for mobile Internet access whenever possible, compared with only 22% of consumers on unlimited data plans.

“Carriers are moving subscribers away from unlimited data plans at the same time phones are increasing their capabilities," Kent said. "The iPhone 5, with its larger screen and LTE upgrade, will encourage people to use more data, but consumers are finding ways to compensate for data limits.”

Notably, research shows that tablet owners use fewer apps on a regular basis than smartphone owners but are more likely to pay for them. Two-thirds of tablet owners have at least one paid app on their device, compared with 59% of smartphone users, and more tablet app users make in-app purchases, according to Park.

“App developers who are proactive with their tablet strategy may see a big payoff,” Kent said.

Dallas-based Parks said subscribers in tiered data plans track their usage more closely, which could reduce usage of data-intensive apps, such as music streaming and video apps.

“App developers are worried tiered data plans will inhibit app usage, so developers of data-intensive apps may want to explore toll-free arrangements with carriers,” she said. “The developers would pick

From the article, "Parks: Tired Data Plans Not Affecting App Downloads" by Erik Gruenwedel.

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