• by Jack Loechner , Staff Writer @mp_research, May 11, 2003

Half of M-Commerce Users Under Age of 24

Ross Rubin, senior Analyst for eMarketer reports that the US has become a leading country in terms of both mobile phone subscribers and penetration. This high installed base is somewhat sabotaged by competing network standards, but overall the US represents a rich base for mobile commerce (m-commerce).

MobilePhone Subscribers in the US (millions)

• 2000 109.5
• 2001 128.4
• 2002 148.6
• 2003 167.8
• 2004 187.7

Source: eMarketer, 2002

Rubin says that two trends are starting to materialize which should improve the cellphone as a platform for e-commerce. First, the wireless networks are getting faster. Second, the devices themselves are getting more sophisticated with text-entry options, larger, color screens, and built-in browsers that can better represent the design of a Web page.

According to eBrain, it appears that significant progress, either in functionality or education, will need to take place before consumers are interested in wireless shopping. Only 19% of consumers surveyed expressed interest in shopping on handheld devices, while the majority were either indifferent or not interested. However, 7% indicated they were very interested in such an ability, which bodes well for generating an early adopter base. One recurring theme in surveys on Internet commerce is convenience. In theory, extending this convenience to wireless and mobile devices should enable consumers to make electronic purchases anytime and anywhere.

US Consumer Interest in the Ability to Shop and Purchse Products Using a PDA, Mobile Phone or Other Handheld Device (% of respondents)

• Very Interested 7%
• Somewhat Interested 13%
• Neither Interested nor Disinterested 24%
• Not Very Interested 22%
• Not At All Interested 34%

Source: eBrain Market Research (CEA)

Yankee Group is somewhat more upbeat about the future of m-commerce, at least paid content. Early indications in the US are that carriers are seeing demand for content that takes advantage of advanced handsets such as ringtones and games. Yankee Group sees premium mobile content as a billion-dollar market in the US by 2006, more than ten times the size as that for remote commerce (such as accessing a Web site), and far in front of using the handset as a point-of-sale tool (as in punching in a code to release a candy bar from a vending machine).

US M-Commerce Transactions (millions)

	2001	2002	2003	2004	2005	2006
Premium Content	1.0	10.7	67.6	155.6	467.4	1,089.6
Point of Sale Purchase	0	0	.7	2.8	11.7	33.5
Remote Purchase	.5	3.2	13.2	24.3	57.7	103.9

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