[IP] Cellphone Disconnect: Carriers Offer More, Customers Want Less
Begin forwarded message:
From: Dewayne Hendricks <dewayne@xxxxxxxxxxxxx>
Date: September 29, 2004 11:59:43 PM EDT
To: Dewayne-Net Technology List <dewayne-net@xxxxxxxxxxxxx>
Subject: [Dewayne-Net] Cellphone Disconnect: Carriers Offer More,
Customers Want Less
Reply-To: dewayne@xxxxxxxxxxxxx
Cellphone Disconnect: Carriers Offer More, Customers Want Less
By CHRISTOPHER RHOADS
Staff Reporter of THE WALL STREET JOURNAL
September 29, 2004; Page D5
Carriers have loaded up mobile phones with new features, from instant
messaging to music players, but for many consumers a phone is still a
phone -- and they would just as soon keep it that way.
Having video and camera features ranked last among priorities for
cellphone users, according to a recent study by Forrester Research
Inc., a technology research firm based in Cambridge, Mass. Just 8% said
such features were important when deciding which phone to purchase.
Some smaller companies are focusing on cellphone consumers looking for
simpler service plans. MetroPCS, a wireless carrier in Dallas, is
targeting users who don't leave town much, probably haven't used a
cellphone before and want a simple pricing plan.
For $35 a month, MetroPCS customers can make unlimited local calls. For
$5 more a month, they get unlimited long-distance service within the
continental U.S. The company has just begun to offer what the larger
operators have long considered the basics, such as voice mail, for
another $5. The 2½-year-old company now has 1.2 million customers, says
J. Lyle Patrick, chief financial officer.
Kevin Hill, a 21-year-old student at the University of New Mexico in
Albuquerque, uses a cellphone service with a similar fixed-price
approach called Cricket, offered by Leap Wireless International Inc. in
San Diego. He pays about $50 a month for unlimited local and
long-distance calling, along with a few features like caller
identification. His phone doesn't have a music player or text
messaging. It does, however, have a camera. "I took couple of pictures
with it, but then it got old."
Cameras -- a rarity on phones just 18 months ago -- are now built-in
for more than 80% of Motorola Inc.'s new handsets. Another increasingly
common feature: cellphones that receive data such as the latest
headlines or sports scores.
But while the number of consumers using the data service is growing, it
remains small. Just 13% of the customers of Deutsche Telekom AG's
T-Mobile use its data service, called t-zones, at least once a week,
according to the Forrester study -- and that was the highest figure
among all the main carriers.
"There is a big gap between what operators think adds value and what
customers really value," says Ari Iso-Rautio, a consultant in the
telecom, media and entertainment group of Capgemini, the technology
research and advisory firm based in Paris.
A six-month study conducted by Capgemini and INSEAD, the business
school in Fontainebleau, France, showed that 77% of the respondents
from 27 wireless carriers surveyed in Europe believed that advanced
data services were a "key factor" in remaining competitive.
Cellphone users felt just the opposite. Such services were the least
important factor of all for consumers, with 73% of those questioned
considering them "unimportant. A similar study on the U.S. market due
out in the coming weeks shows a similar mismatch, says Mr. Iso-Rautio.
What is important for users is price, network coverage, simplicity of
offers and ease of paying, the study showed.
But with cellphone growth world-wide slowing as developed countries
become saturated and new competitors emerge, the major carriers contend
that offering everything that a customer may want is crucial to
remaining competitive.
Levi Laine, of Denver, typifies the view of many consumers. He oversees
his 100-person cable-installation company mostly while on the road in
his van and says he uses his cellphone for one thing: phoning. He
estimates he has spent more than 6,600 minutes on his cellphone since
July alone. "I don't need all these bells and whistles," says Mr.
Laine, 42 years old. "Those are toys. People don't need toys. What I
need is to be in touch."
Write to Christopher Rhoads at christopher.rhoads@xxxxxxxx
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