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Better to focus on late adopters of 3G - report
July 16, 2004
According to new research from Strategy Analytics, Technophiles and Business Pragmatists generate $88 billion in cellular service revenues in the US and Western Europe, even though these early adopters have their allegiances firmly in the device camp. According to, "Operators Trail Handset Vendors in Mindshare & Loyalty among Technophile & Business Pragmatist 3G Visionaries," operators will ultimately extract better lifetime value from mass-market and late adopters of new mobile technologies.
This latest research from the Strategy Analytics Wireless Network Strategies
service provides a detailed profile of seven segments with distinct
behavioral traits and motivations in the cellular market, emphasizing
the challenge operators face in building a strong 3G business. The
two early adopter segments account for 24 percent of users in both
regions, 23 percent of lifetime value to operators, but 38 percent
of handset market retail value.
"Tech-savvy early-adopters just don't have the customer loyalty
profiles on which operators can build long term 3G business models,"
comments David Kerr, Vice President of the Global Wireless Practice
at Strategy Analytics. "Technophiles and Business Pragmatists will
be the first to adopt 3G services, however operators will need to
lean heavily on handset partners to keep these segments happy, and
offer frequent subsidies to meet their vicious handset replacement
cycles."
"It is ultimately the mass market where greater operator value exists," adds Phil Kendall, Director, Wireless Network Strategies. "Digital Youth and Messengers in Western Europe, and Voice Planners in the US, offer greater lifetime value to operators than early adopters. Profitability will ultimately be driven by meeting the more modest needs of these users for location services, m-payments and photo messaging rather than chasing mobile video applications."
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