Communication focus: Wireless data usage to rise

WM Circle Logo

By: Wise Marketer Staff |

Posted on June 17, 2002

By the end of next year, over a quarter of US mobile 'phone users may be using their devices extensively - sending and receiving text messages and e-mail, playing Internet games and surfing the web. Penetration of wireless data services is likely to grow fivefold over the coming 18 months, according to a survey by Williams Capital Group (WCG).

A remarkable 84% of current and prospective mobile 'phone owners interviewed for the US Personal Wireless Data Survey are aware of the availability of these services. Some 26% indicated that, within 18 months, they would be using text messaging or e-mail features, and 18% added that they would be web surfing or playing internet games via their mobile devices. Just over 15% said they would be willing to pay an extra US$10 - $15 per month for such services.

The study, conducted in May 2002, measured personal wireless data communications usage among US households, and was based on telephone interviews with people from 400 households, around 300 of whom said they own or plan to acquire a mobile 'phone.

"Clearly US wireless operators have their work cut out for them to increase usage," said Rashad Barajakly, vice president of WCG, who directed the study. "Customers are just now learning about service capabilities and are beginning to realise the value proposition."

He added that he was surprised by the high level of awareness of wireless data services, and that the potential penetration rate for data services was higher than his original estimate.

Slow adoption
According to Barajakly, US wireless operators have been slower to offer data services than their European and Asian counterparts, and they have marketed these services sporadically, often with high prices. Not surprisingly then, US household penetration for data services is low. Current usage of the services among survey participants ranged from 5.3% for text messaging to only 2.5% for internet games and web surfing. By comparison, text messaging usage in some European and Asian markets is around 50%.

Increasing take-up
The report suggests that US wireless operators can increase data penetration through more aggressive marketing efforts, enhanced service offerings and better pricing. Ultimately, operators may need to either include data within monthly service charges, or offer subscribers a "taste of data" for free to entice them.

The survey also found that penetration of cellular voice services is expected to increase to 55% by the end of 2003 (up from 47% at the moment), and that current and projected usage of wireless data services is highest in the 18-24 age group (who were also more willing to pay monthly fees of US$10-$15 than older people.)

More Info: