Data Services Too Expensive For Wireless Subscribers

Data Services Too Expensive For Wireless Subscribers

According to an IDC survey of more than 2,500 American wireless subscribers and customers, 72.5% of respondents did not use any data services outside of messaging in the third quarter of 2006. The report shows that, though Americans are big spenders when it comes to entertainment content and services for consumer electronics such as the Xbox, Apple's iPod, personal computers and high definition TVs, they show less enthusiasm for purchasing entertainment services created for their wireless mobile devices.

According to the survey, 47 percent of respondents in the key demographic age group of 18 to 24 year-olds complained that mobile data services are 'too expensive.' When the survey data was broken down by device type and average revenue per user, this complaint of overpriced data services resonated with respondents who use camera phones and/or spend more than $60 a month for mobile service.

Lewis Ward, research manager for IDC's Mobile Consumer Services, said "The fact that four out of ten survey respondents feel they are overpaying for data services does not bode well for the future of this market. The survey also revealed a small group of U.S. consumers that believes data services are a bad idea, or worse, degrades the calling experience. Education may help this issue, but it's clear from the survey results that many people just want to use their mobile phone to make calls."

In contrast, however, mobile messaging services, especially short message service (SMS), are much more popular among the consumers surveyed by IDC. In fact, close to half of survey respondents indicate that they sent or received at least one SMS message in 3Q06. According to the study, SMS subscription plans have already surpassed the 50% mark, and American consumers spend an average of $3.70 per month for data services.

About one fifth of consumers purchased at least one ringtone in the quarter, and about one in ten bought a graphic/wallpaper or a game. Youths and those with advanced devices exhibited pronounced adoption rates of most forms of wireless entertainment, including full-track music and video/TV services.

For more about the U.S. Wireless Teen and Adult Consumer Entertainment Survey, visit here.

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