What mobile users want: Data, directions, payments – at a low price

Oracle recently published results of its report, “Opportunity Calling: The Future of Mobile Communications (PDF).” In it, Oracle surveyed more than 3,000 mobile phone consumers worldwide to gauge their use and perceptions of mobile phones, as well as their willingness to try emerging technologies or services (for example, those revolving around applications and mobile advertising).

Overall, it seemed consumers were generally happy, with 82% of mobile consumers indicating satisfaction with their current service provider. Despite that overall feeling of satisfaction, 77% percent said they’d be willing to churn to another provider if better pricing were available—even if it meant going to non-traditional players.

That last response is interesting as many communications service providers (CSPs) consider themselves to have a leg up as “trusted providers,” whose years of delivering bullet-proof network services will continue to translate into loyalty by consumers. But, that reality seems to be shifting as consumers, increasingly familiar with over-the-top (OTT) brands (Apple, Google, Yahoo, Facebook, Amazon, etc.) increasingly show a willingness to change loyalties according to good old-fashioned pricing factors.

Price vs. Quality of Experience

Will momentum around tiered pricing, however, perhaps make quality of experience and personalization of that experience more important factors than just lower pricing? Once networks start to fumble under increasing demands, will customers currently focused on unlimited data options for a certain price focus more on the quality they can get for certain prices?

In the Oracle report, 61% of respondents said they’d be willing to increase their monthly bill by 7% to maintain unlimited data, and 59% said they’d be willing to increase their monthly bill by 5% for unlimited text. But how much would people be willing to pay to have personalized, niche content prioritized once the “unlimited” data to all is no longer viable? Will significant numbers of mobile consumers be willing to pay a premium for a certain “quality” of experience so that carriers can throttle their bandwidth intelligently enough to operate sustainably?

That important question was a bit outside the scope of this current report, though the Oracle survey does reveal a growing reliance on devices for productivity, entertainment and connections to other people and professional contacts. That could mean consumers will ultimately evolve their expectations to go beyond price.

For instance, in the report, all customers agreed they use their phone today primarily as a communications device, but many indicated they already use it as more—with 35% of respondents saying they use it as an entertainment device, and 28% noting they use it as a mini computer.

If the reliance on devices for more functions and capabilities grows, the opportunities for more creative rating and charging around quality expectations will grow.

For example, 54% of the participants in the report believed that five years from now they would be using their phones as GPS devices, with 31 percent acknowledging they’d use it as a credit card and 24 percent saying they’d use it to start their cars.

Consumers also anticipated using their mobile phones to chat via video, view paid content on multiple screens, scan barcodes to access relevant online information and monitor home electricity usage.

Different Users, Different Size Pocketbooks

The pricing of such services will increasingly depend on the demographics of the consumers. In the report, 64% of customers said they’d be willing to listen to or watch advertisements on their mobile phone in exchange for a 5% credit on their monthly bill, and of that percentage, just 33% said they’d like to receive specific ad content based on their locations (the majority of those who were not interested in this option expressed concern over privacy as the major reason). It was younger consumers in the report that seemed to provide the most potential, as mobile users aged 18-33 were nearly three times as likely to use their phone as an entertainment device and twice as likely to use their phone as a personal computer, compared to their counterparts aged 46-64.

As the bandwidth benefits reaped by network build outs slow, operators will have to do more to measure price and quality as driving factors in how they will target different types of mobile consumers. No matter how stimulating and innovative the services operators support will be, it will be the pricing and billing that will “close the deal” in how consumers regard their operators’ services.