Commentary

Is the Mobile Data Gambit Finally Paying Off For Carriers?

According to a new study by Forrester Research, not really. Only 44% of wireless subscribers are using some type of data service. While this shows that mobile data usage is becoming more commonplace, the bad news is that the bulk of it comes from text messaging rather than ring tone downloads or mobile Internet surfing. In fact, a majority of consumers fail to see the value of mobile data services.

According to a new study by Forrester Research, not really. Only 44% of wireless subscribers are using some type of data service. While this shows that mobile data usage is becoming more commonplace, the bad news is that the bulk of it comes from text messaging rather than ring tone downloads or mobile Internet surfing. In fact, a majority of consumers fail to see the value of mobile data services.I can see the wireless company CEOs pulling their hair out over that one. The Forrester study goes on to say that most people think wireless data services are "nice to have" but certainly not necessary. Combined, the major wireless carriers in the U.S. have spent tens of billions of dollars installing and upgrading 3G wireless data networks. Has it all been for naught?

What's disconcerting here is that wireless data is not new. Text messaging and even the most rudimentary forms of the mobile Internet have been around for years and years. Even so, only 35% of consumers use text messaging, only 18% send or receive picture messages, and an abysmal 11% surf the mobile Web. The percentage of subscribers who've downloaded music or videos to their phones is even lower.


More Mobility Insights

White Papers

More >>

Reports

More >>

Webcasts

More >>

I am the first to admit that the mobile Web can be frustrating at times and certainly doesn't compare to the desktop experience. But I think a shift in thinking is necessary. We can't think of the mobile Web in the same way that we think about the standard Web. They are two different animals. Approaching the mobile Web with the expectation that it will be like browsing on a regular PC will only lead to disappointment.

So, how do we change peoples' thinking about the mobile Web and data usage?

Innovative companies, like Google, are working on it. As more and more offerings are designed specifically for mobile phones (and provide good services/experiences), general adoption will follow. But it's slow going.

In the mean time, wireless carriers have to worry about recouping their massive investments. Carriers hoped that mobile data usage would lead to an increase in ARPU. While there has been growth (e.g., Verizon Wireless's data revenue jumped 16% in 2006), the increases haven't offset the loss of voice revenue.


Related Reading




Currently we allow the following HTML tags in comments:

Single tags

These tags can be used alone and don't need an ending tag.

<br> Defines a single line break

<hr> Defines a horizontal line

Matching tags

These require an ending tag - e.g. <i>italic text</i>

<a> Defines an anchor

<b> Defines bold text

<big> Defines big text

<blockquote> Defines a long quotation

<caption> Defines a table caption

<cite> Defines a citation

<code> Defines computer code text

<em> Defines emphasized text

<fieldset> Defines a border around elements in a form

<h1> This is heading 1

<h2> This is heading 2

<h3> This is heading 3

<h4> This is heading 4

<h5> This is heading 5

<h6> This is heading 6

<i> Defines italic text

<p> Defines a paragraph

<pre> Defines preformatted text

<q> Defines a short quotation

<samp> Defines sample computer code text

<small> Defines small text

<span> Defines a section in a document

<s> Defines strikethrough text

<strike> Defines strikethrough text

<strong> Defines strong text

<sub> Defines subscripted text

<sup> Defines superscripted text

<u> Defines underlined text

InformationWeek encourages readers to engage in spirited, healthy debate, including taking us to task. However, InformationWeek moderates all comments posted to our site, and reserves the right to modify or remove any content that it determines to be derogatory, offensive, inflammatory, vulgar, irrelevant/off-topic, racist or obvious marketing/SPAM. InformationWeek further reserves the right to disable the profile of any commenter participating in said activities.

Disqus Tips To upload an avatar photo, first complete your Disqus profile. | View the list of supported HTML tags you can use to style comments. | Please read our commenting policy.
T-Shirt Giveaway T-Shirt Giveaway: Each week we're selecting one great comment from our readers. The author of the comment will receive an InformaitonWeek Community t-shirt. So get posting!
Subscribe to RSS

Resource Links