September 24, 2010

Average wireless bill now $78 a month

The average monthly wireless bill is now $78, compared to $69 in 2007, according to J.D. Power and Associates, which also found that Apple's iPhone continues to rank highest in customer satisfaction among manufacturers of smart phones.

The market research firm said that the increase is monthly fees is mainly because consumers are using additional data-related services, such as Web browsing and e-mail on their phones. Text messaging, too, is up, as are "added fees and taxes."

"It’s clear that there has been an increase in new service offerings during the past several years and that customers are using these services with greater regularity,” said Kirk Parsons, senior director of wireless services at J.D. Power and Associates, in a news release. "The fact remains that in today’s economic climate, wireless providers and device manufacturers need to be sensitive to the mindsets of customers and provide added value where possible in order to drive future business and loyalty."

The findings are from the second volumes of J.D. Power's "2010 U.S. Wireless Smartphone Customer Satisfaction Study" and "2010 U.S. Wireless Traditional Mobile Phone Satisfaction Study."

Apple's top customer satisfaction rating for smart phone manufacturers — a score of 800 on a 1,000-point scale — is "a fourth consecutive time" the Cupertino company has held first place in the category, J.D. Power said, with the iPhone performing "particularly well in ease of operation, operating system, features and physical design."

Behind Apple are Motorola, with a score of 791, and HTC, with a score of 781. Both companies have made popular phones that use the Android operating system, including the Motorola Droid, Motorola Droid 2, HTC Droid Incredible and HTC Evo 3G/4G.

Research In Motion's BlackBerrys had a score of 737; Samsung, 736; Palm, 726; and Nokia was last, at 711.

LG ranks highest in "overall wireless customer satisfaction with traditional handsets" for a fourth consecutive time, with a score of 731, J.D. Power said.

"LG performs well in all four factors, particularly physical design, features and operation. Sanyo (712) and Samsung (709) follow LG in the rankings."

Behind LG were general feature and cell phones made by Sanyo (712), Samsung (709), Motorola (706), Sony Ericsson (687), and again, Nokia was last, with a score of 677.

The research firm said its studies are based on "experiences reported by 11,803 traditional mobile phone and 6,821 smart phone owners" between January and June of this year. It measures customer satisfaction by wireless owners who have had their devices for less than two years.

"In order of importance, the key factors of overall satisfaction with traditional wireless handsets are: operation (30 percent); physical design (30 percent); features (20 percent); and battery function (20 percent)," J.D. Power said. "For smart phones, the key factors are: ease of operation (26 percent); operating system (24 percent); physical design (23 percent); features (19 percent); and battery function (8 percent)."

Among other findings:

• "The average price of a traditional wireless mobile phone has declined to $76 in 2010 from an average of $81 at the beginning of 2009. The decline is primarily due to discounts given by handset providers and wireless service carriers to incentivize sales."

• Customers are also hanging onto their phones a bit longer before switching to new models, staying with them for an average of 20.5 months, "which marks the longest period of time since the study’s inception in 1999, when the average was 17.3 months."

The economy, of course, is the main reason for that. "More customers are delaying an upgrade purchase due to the general economic downturn, in which the expense of purchasing a new device could outweigh the added benefit of owning it,” said Parsons. "Typically, when upgrading to a new cell phone, there’s the added expense of either subscribing to a more expensive service plan and/or incurring termination fees when switching service providers. Today, consumers are really watching their wallets, and any added discretionary expenses are being considered more thoughtfully than in the past."

• In examining the operating systems used in smart phones, Android, Apple and Palm's WebOS platform performed "particularly well," J.D. Power said.

• Mobile apps are playing a growing role in smart phones' success. "More than two-thirds of users say they download third-party games, while 54 percent say they download travel software, such as maps and weather applications. Forty-one percent say they download utility applications, while 36 percent say they download business-specific programs. This indicates that smart phone owners are continuing to integrate their device usage into both their business and personal lives."

• 42 percent of customers "report having received a free mobile phone when subscribing to a wireless service."

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