Mobinet 2005 results in line with Singapore trends, with GPRS and MMS traffic growing 50-80% yearly, reports AMIT ROY CHOUDHURY
A GLOBAL study shows mobile phone users are increasingly comfortable with mobile data services and that 56 per cent of them access the Internet at least once a month and 33 per cent download music on their phones.
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Asia-Pacific countries such as China, Korea, Japan and Australia continue to lead the world in terms of penetration of mobile phones, according to the latest Mobinet study of how 4,000 mobile phone users in 21 countries use their handsets.
The study has been conducted eight times since 2000 by management consulting firm AT Kearney and Judge Business School, Cambridge University.
In Singapore, even though the third-generation (3G) mobile telephony user base is still fairly small, data services in the form of GPRS (general packet relay service) and MMS (multimedia messaging service) are growing substantially, according to AT Kearney.
'The results of the Mobinet 2005 study are very much in line with trends in Singapore,' said Chua Soon Ghee, a senior manager with AT Kearney's communications and high-tech practice in Singapore.
'Although the 3G user base in Singapore has been fairly modest so far, we are seeing GPRS and MMS traffic growth of 50-80 per cent,' he said. 'In addition, operators are rushing to offer the latest mobile entertainment service - mobile TV - in anticipation that there will be users willing to pay for it.'
Mr Chua said the study suggests that news and sports programmes are likely to do better than entertainment shows, 'unless operators are targeting the under-25 market for 3G services'.
The study found that more than 50 per cent of handsets worldwide are less than one year old and have robust multimedia capabilities that are increasingly understood by their users.
Fifty-six per cent of multimedia mobile phone users said they use their phones to access the Internet or check e-mail at least once a month - a significant jump from the 36 per cent in last year's Mobinet study.
Almost two-thirds of users said new services and functions are easy to understand and enjoyable to use. And even among older mobile phone users, less than half complained that new functions are difficult to use.
'The increase in multimedia phone penetration is especially rapid in places such as Australia and New Zealand, where growth has been more than 70 per cent over the past year . . . This bodes well for mobile data adoption in Asia-Pacific,' said Mark Page, AT Kearney vice-president and leader of the Mobinet study.
'The growing penetration of new multimedia phones is the catalyst for mobile data adoption and there is a clear relationship between average revenue per user and the age of the phone the customer uses.'
People who have recently replaced their handsets are more likely to be heavier users of data services, Mr Page said. 'Placing new handsets in the palms of the best customers offers the best chances of success (for the telcos).'
The growth of music downloads on phones has been explosive. One-third of multimedia phone users have downloaded music at least once a month on their phone, up from 21 per cent a year ago.
In the Asia-Pacific region, Japan leads the pack with 52 per cent, with China and South Korea behind, on 42 per cent.
Two-thirds of multimedia phone users expressed a desire for time-sensitive TV content such as news and sports rather than entertainment shows, although there is a stronger desire for music TV, movies and soaps/reality shows among users under the age of 25.
The study indicates that mobile operators still face challenges in bringing the price and quality of data services in line with consumer expectations.
'One-third of mobile phone users are concerned about the cost of mobile data, and about half say they are not willing to pay more than $5 per month for it . . . Thirty-five per cent of consumers cited poor content as the reason they don't access multimedia services, a considerable increase from just 8 per cent in 2004,' Mr Page said.
Simon Bell, a professor at Judge Business School, said: 'This is unsettling for operators that have been investing heavily in proprietary portals and content.' Perhaps it suggests they should seek more partnerships with established online portal brands and media companies, he said.
The study recommends that operators shift their marketing focus to encourage repeat use and service loyalty, using pricing along with improved content and customer interfaces. To win new customers, AT Kearney expects operators to do more extensive market testing, implement easier-to-use, content-rich services, and offer low-price alternative packages.
'Indeed, 70 per cent of mobile phone users say price remains the primary factor in choosing an operator,' Mr Page said.
According to AT Kearney's Mr Chua: 'The study suggests that local operators such as StarHub and SingTel will find significant receptivity among users for their commercial i-mode and 3G TV services, which has a strong combination of rich content and easy-to-use interfaces incorporating one-step access to the Internet and mobile TV content.
'The trick, however, is to encourage repeat usage and service continuity after the initial rush of experimentation, he added.
'This will require operators to offer compelling pricing, and content that is continually refreshed. Assuming that operators continue the current 3G services launch momentum and follow through with affordable pricing, we expect 3G uptake and usage to rise significantly in the coming year after a modest start.'
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