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Mobile data allowance grows in importance among smartphone owners

Recent research conducted by GfK NOP shows that, among smartphone owners, mobile data allowance is more important than the network operator and the handset type.

From previous posts on TechTalk we’ve shown how the use of mobile apps shows no sign of abating and that the tight integration services on the iPhone drives Apple’s smartphone success. This thirst for apps and services is the reason why smartphone owners are placing greater importance on their mobile data allowance. Smartphone owners now rely on the services their phone provides and taking these away is not an option.

With many UK operators having recently capped their data allowances smartphone owners will think carefully about their next mobile tariff. GfK NOP estimates that 24 per cent of contract customers using smartphones would actually switch operators if they could get a better mobile data allowance elsewhere.

The decision to cap mobile data usage is a sensible one as the major UK network operators have millions of customers who depend on a reliable mobile network. However, in doing so, network operators need to consider the mindset of the consumer. The average mobile phone user including many smartphone users simply don’t know how much data they use. Those who require a data allowance will always prefer an ‘unlimited’ package for peace of mind. Now that ‘unlimited’ data is coming to an end, consumers will look for the safest option; in other words the operator offering the most generous package.

It is easy to see why smartphone owners react this way when you look at the level of importance they place on using services on their mobile phone. Table 1 (below), shows the level of importance consumers place on mobile services in their day-to-day routine:

Table 1: Importance of mobile service usage

There is clearly a stark contrast between the UK average mobile consumer and smartphone users. Given this huge difference in attitudes it is little wonder the extra emphasis smartphone users are placing on mobile data tariffs. The biggest challenge for network operators over the next few years is how they cope with the increasing demand for smartphones and the increase in data usage this will inevitably bring.

This research was conducted in association with Reuters who have published a thorough market analysis here

If you have any questions or comments regarding the research please click here to email us or leave your opinion in the comments section below

RESEARCH NOTES

Research was conducted by GfK NOP in association with Reuters between 16 – 19 July 2010
978 interviews were conducted online among UK adults aged 16 and over. The sample is representative of UK adults with internet access.

UK mobile app culture shows no sign of abating

A recent GfK NOP Technology report shows consumers’ love affair with mobile phone applications has turned from a dalliance into a settled and dependable relationship. With a fifth of smartphone users downloading more apps than six months ago, mobile applications may soon replace browsers as the main gateway to the web for mobile phone users.

To read the full GfK NOP Technology report click here

Recovery in full swing for consumer technology markets… and it’s expected to last

Growth returns to Western European consumer technology markets in Q1 2010. GfK TEMAX data shows that consumers are more willing to upgrade their home technology as well as experiment with new smartphone mobile technology.

GfK TEMAX data shows that, overall, the consumer technology market recorded 2.7% growth in Q1 this year compared to Q1 in 2009. Key technology sectors have recorded year on year growth, including Telecommunications (+4.9%), Information Technology (+3.6%) and Consumer Electronics (+0.7%) in Q1 2010. Smartphones, Windows 7 and LCD TVs are all driving factors of growth in their respective sectors.

Smartphones continue to drive growth in the Telecommunications market

While the telecommunications market declined by -3.2% in the fourth quarter 2009, the first quarter of 2010 returned to growth with a +4.9% increase year on year.

Growth in the telecommunications sector is being driven by the increasing demand for Smartphones as they make up 40% of the total sales value. In Western Europe one in five handsets sold runs a mobile operating system and uses a touchscreen or QWERTY keyboard as an input interface. Mobile Operating Systems include Symbian 60, Windows Mobile, Linux, Android, iPhone OS, RIM and Palm WebOS.

Internet access has become “ubiquitous” which is driving interest in mobile services to a much broader audience. Mobile email is becoming the alternative to the well perceived SMS services and navigation software often come pre-installed on the devices. Social networks have become the most popular apps on smartphones, adding more relevance and immediacy the PC at home. Furthermore, many of these mobile operating systems are also being used on netbooks and tablet PCs, which are being sold through network operators with 3G connectivity.

With a wide range of innovative, new smartphones showcased at the Mobile World Congress earlier this year and the recent interest in tablet PCs, growth in the telecommunications sector is likely to continue throughout 2010.

Windows 7 ignites upgrade cycle in the Information Technology market

The Information Technology market, the second biggest market behind Consumer Electronics in Western Europe, grew by +3.6% in Q1 2010 and is now worth EUR 11.5 billion.

Consumer demand is focusing on Mobile Computers, but also on accessories, peripherals, software and especially All-In-One-Desktop Computers too. The successful introduction of Windows 7 initiated a new replacement and upgrade cycle. Lots of consumers leapfrogged Vista, staying with existing installed hardware, software and even accessories and peripherals. Overlooking Vista led to many installed products being outdated upon the arrival of Windows 7, thus consumers were “ready” for an update. As consumers are becoming more aware, they are looking for a wide product range. As a consequence expectations for 2010 are positive following this trend in consumers’ attitude.

Strong demand for LCD-TV’s returns growth back to the Consumer Electronics market

Consumer Electronics, the largest technology sector in Western Europe, recorded year on year growth of +0.7% in Q1 2010. The impact of the recession on the Consumer Electronics markets no longer exists as demand for LCD TVs strengthens for three key reasons.

Firstly, most countries in Europe have a huge consumer demand for replacing the old CRT-TV with a new flat LCD-TV. Of course, the World Cup in South Africa is supporting this trend and quickening the desire to replace old TV sets. With the stabilisation of prices over the past months, the revenue situation also saw an improvement.

Secondly, the digital switch over is another contributing factor to the growth in this market. With analogue TV being phased out, new set top boxes or even a new TV set are required to receive digital TV channels. This development is most strongly observed in Spain (+16%), Italy (+6.9%) and Portugal (+4.4%). Home entertainment in general gained importance with better HiFi products or “TV ecosystems” becoming increasingly popular. Positive and substantial impulses were seen from Blu-ray, Home Theatre Sets, Loudspeaker Sets and of course High Definition set top boxes.

Finally, consumers’ willingness to invest in flat screens, HD and better sound systems for the home, is a clear sign of the “homing-trend”. This willingness-to-invest combined with the anticipated impact of the World Cup gives reason to expect an even better second quarter 2010.

2010 consumer technology outlook is positive

In addition, GfK TEMAX covers other consumer technology sectors in Western Europe and all but one experienced growth. Other technology sectors that grew in Q1 were Photography (+2.7%), Major Domestic Appliances (+ 4.1%) and Small Domestic Appliances (+6.5%), but Office Equipment and Consumables sector contracted -1.2% compared to the same period in 2009.

These positive growth figures in Q1 are likely to continue throughout the year and Michael Sauter, head of GfK TEMAX, comments that:

“The first signs for April are looking positive. Our data show the Technical Consumer Goods market continuing on the road to recovery, indicating more growth to come in Q2-2010.”

Check back in July for the latest data and analysis from GfK TEMAX

ABOUT GfK TEMAX

GfK TEMAX® is an index developed by GfK Retail and Technology to track the consumer durables markets. GfK TEMAX® is published internationally. The findings are based on surveys carried out by the retail panel of GfK Retail and Technology. The retail panel comprises data from over 340,000 retail outlets worldwide. Click here for all reports and press releases

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Google Chrome and Firefox gaining ground on Internet Explorer since Windows browser ballot

Since Windows introduced a browser ballot at the start of March, GfK Technology research shows that Internet Explorer has lost market share in the UK. Google Chrome and Mozilla Firefox have been the main beneficiaries of this new EU enforced regulation.

It was inevitable that Internet Explorer would lose some of its market share when its users were offered alternative browsers at the start of March. The EU thought it was essential that consumers should be offered a choice of browser, to stimulate competition in the browser market.

Early data suggests that when faced with an option, UK consumers have opted for an alternative browser. As we approach the end of March we can see that since the beginning of the month Internet Explorer’s market share in the UK has dropped 5%, with Google Chrome and Firefox each gaining an additional 3% market share.

We will continue to track the developments of internet browser usage over the course of the year so check back for more data and analysis over the next few months. If you’re interested, GfK Technology has been tracking consumer usage of internet browsers since the start of 2009 and we have created a shared Google document with our latest data here

How we collect the data

Each month GfK NOP conduct a UK based online survey among UK adults aged 16 and over. The sample is representative of UK adults who use the internet ten hours or more per month. It is important to note that we do not ask the question directly, instead, our servers determine the respondent’s browser used to complete the survey. This data is therefore more robust than stated survey data as it is based on actual usage.

Monthly sample sizes were as follows; February (n=1231) and March (n=1226)

The third device: Can the early success of eBook readers continue when faced with the introduction of multifunctional competitor devices?

The mainstream consumer generally opts for a device that integrates lots of functionality. If the ‘third device’ with greater functionality does take off, eBook readers will, more than likely, become a niche product.

I love the idea of an eBook reader especially one with an ‘always on’ 3G connection. The battery life is superb, lasting in many cases well over a week and the e-ink screens are almost essential for prolonged spells of reading. I like the idea of receiving my favourite newspaper and other magazine subscriptions directly to a device all ready for my morning commute.

However, my desire to own an eBook reader is not driven by a personal urge to carry around a library of novels. It is actually for business purposes. I could make better use of my commute by catching up on the news and reviewing work documents. Indeed, having access to meeting documents or presentations on an eBook reader whilst travelling to a meeting would be highly convenient.

It’s encouraging for eBook readers that sales of them in the USA are supposedly strong. Barnes and Noble’s Nook quickly sold out and Amazon’s Kindle is their “number one best-selling” product on Amazon.com. However, no one is sure how many eBook readers have been sold due to the secrecy of the sales figures, particularly from Amazon. Now with the arrival of tablet PCs, especially Apple’s iPad, eBook readers face stiff competition.

As a result, I fear that interest in eBook readers will be limited to two types of users; business people and extreme reading enthusiasts. If there is a big uptake in consumer demand for a ‘third device’ (i.e. something that sits inbetween a smartphone and a laptop) then I believe that the large majority of people will opt for a device that has multiple uses.

We have already seen that those who have experienced the benefits of an iPhone (and its seemingly unlimited uses) are highly interested in tablet PCs. Now that the dust has settled on the announcement of Apple’s iPad, many commentators believe its success will rely on the consumer being able to tailor the device to their own specific needs. Further to this, others are already excited at the new applications the iPad will enable. One of my favourites is to use it as a board game.

The specialist nature of eBook readers seem to be reflected in interest levels among UK consumers. Prior to Apple’s announcement of their iPad, GfK Technology research showed that interest levels in eBook readers (23%) was half that of tablet PCs (45%). Perhaps not surprisingly, interest levels for eBook readers are higher among those who had recently bought either a physical newspaper or a book.

It is my view that the success of a product is highly dependent on the problem it solves or the demand it satisfies. History has shown that those devices that satisfy numerous need states naturally succeed, limiting specialist devices to a niche audience.

NOTES

Photo courtesy of:

http://www.flickr.com/photos/johanl/ / CC BY 2.0

Research Info

*1000 online interviews were conducted by GfK NOP among a UK representative sample of internet users. The fieldwork was conducted between 15th – 19th January 2010

2010 Tech developments: keep it simple

In recent weeks, so much has been said about what 2010 will bring to the tech landscape that one can’t help but reading with a pinch of salt. For someone that works with customer opinions and observes their behaviour for a living, it becomes apparent that some of the predicted products and services, if they do make it to market, are destined to remain within that niche group of technology enthusiasts that created them in the first place.

Many of course have potential, and if implemented and marketed correctly have high chances of making it to the wider masses. That is, if they were ever intended to do so.

So – what is going to really work?

The answer is, well.. simple. Or, rather: simplicity. If given a choice, customers will always choose and glorify products and services that will offer them “more” in less time and with fewer headaches, the tools that empower them to reach a given goal with the minimum of disruption.

Luckily, optimization and simplification are recurrent themes in some of the predictions we stumbled upon:

“Third-party authentications will become the norm” (RWW). Trying to remember your password and login for the multitude of sites that request it will be a thing of the past – unless of course, you choose to be among the 46% of British internet users, 15.6 million that have the same password for most web-based accounts
Google will launch an inexpensive netbook powered by their new Chrome OS, with one goal in mind: accessing the web (IB-Times). Chrome OS is not meant to replace any of the existing operating systems (Google), and neither is it trying to do too many things; quite simply it is aimed at accessing the web, easily, and fast;
Others browsers will copy Google Chrome’s features the simplified interface, the rapid development model, the lightweight extensions, sandboxing, compiling JavaScript code;
“There are too many worthless apps and no adequate ways to find the good ones” (RWW) – this is certainly true of the i-Phone in particular, but also of the Android market. The count of apps is going up, but how do we spot the good ones?
More consumers than ever will demand the ability to easily interact fully with the mobile web on their phones;
Optimisation and stability, rather than raw speed, will acquire a position of relevance in computing. Examples have been set by Snow Leopard already. It will be a tough one as consumers will keep looking at the “higher number” (i.e. processor speed);
There will be more attempts at groundbreaking interfaces, possibly still involving touch screen technology;

Innovation extends the number and type of goals that are possible; success is then dependent on these goals being relevant and simple to achieve.

Though functionality is of paramount importance, a non-intuitive user interface will by definition reduce the number of people that will go through the trouble of learning it and using the tool in the first place.

As technology progresses, the number of options increase. The difficulty lies in how companies use those new solutions and advancements. One may choose to allocate the additional processing power available via a faster processor to run more complex operating systems, more demanding applications and fancy transition graphics in their next generation product. Another may instead choose to re-think, improve, un-clutter, optimise, speed-up.

One thing is certain: the customer will always win in the end, and they’ll win by choosing the “naturally best” fit with their way of thinking. So those innovators in the industry that really think like their customers are likely to be most successful.

NOTES

Image provided by:

http://www.flickr.com/photos/aussiegall/ / CC BY 2.0

Promising signs for 3D TV… but not this year

GfK NOP research shows good levels of interest in 3D TV amongst adult consumers. The main barriers to adoption will eventually disappear, but are likely to stall early widespread adoption.

One of the recurring items in the numerous “predicted technology trends for 2010” lists that emerged at the start of the year was 3D TV.

The interest in 3D technology has been steadily growing over the last couple of years with various films being re-released in, or designed specifically for, 3D viewing, not least James Cameron’s epic Avatar and its accompanying high budget hype machine, which exploded the awareness of the technology with the masses and smashed box-office records.

With Sky’s live broadcast of Manchester United vs. Arsenal this weekend signalling the first live 3D sporting broadcast on TV and acting as a showpiece for Sky’s 3D service that will be available from April, it’s fair to say that 3D is now firmly entering the realm of the consumer.

Of course, for consumers to experience this revolution at home it will require the appropriate hardware. A number of companies, including Sony, ESPN and DirecTV, made 3D TV announcements at the Consumer Electronics Show in Las Vegas, but whether people will be willing to spend on this technology in the near future is yet to be seen, particularly given that many consumers recently invested in high-definition sets.

That said, research*conducted by GfK NOP in January amongst a representative sample of internet users, shows that interest levels in 3DTV are relatively high, with 42% of adults expressing interest (somewhat or extremely) in buying a 3D TV.

This is not to say that interest will necessarily convert into purchase in the short term, but it does suggest there is certainly some potential; interest rises to 50% amongst males, 50% amongst those who are single and to 61% amongst those aged 16-24…offering a pretty clear indication of the target audience.

Convincing consumers…

But what of those less interested? What are the barriers which Sky and the TV manufacturers are going to have to confront to push 3D TV into the mainstream?

Just under a fifth of those not interested simply state that they don’t like the idea of 3D TV. A further 7% state that too much 3D viewing gives them a headache – fine for a one-off engaging film experience perhaps, but while the dizzying spectacle of a 3D experience within the context of a 2 hour trip to the cinema is one thing, will there really be the same desire to be immersing oneself fully in a 3D Albert Square experience with EastEnders evening after evening?

Another concern is the perceived ‘gimmicky’ nature of the proposition; while some films (such as Avatar) are uniquely suited to exploit the technology to its fullest, there is some scepticism about the benefit of routinely applying 3D to all films/ programming- particularly if focussing on the ‘wow factor’ of the technology is to the detriment of the considerations of plot or fully rounded character development. And this is before we even get to the glasses…

Ah yes, the glasses. 47% of consumers not interested in the concept state that the need to wear glasses would dissuade them from purchasing a 3D television (the biggest barrier in the research). Generally speaking, for some consumers the process of having to put on a pair of glasses will seem somewhat unnatural, as well as adding another peripheral to clutter up and lose in the sitting room. In addition, there’s also the unsettling experience of walking into your local pub and seeing a room full of football fanatics decked out like extras from the Matrix.

Of course, these barriers will inevitably disappear over time as the technology develops (and we hopefully lose the glasses), prices drop and consumers start to thinking about replacing their current HD-TV. As an example, while 39% of adults feel that there isn’t enough content to make purchasing a 3D TV worthwhile, Sky are already taking the first steps this Sunday to introduce appealing content; something which will only continue over time.

Furthermore, there is potentially huge appeal for 3D TV amongst video gamers to fully immerse themselves in a 3D environment. (This is something we hope to research over the next couple of months in more detail.)

So, all things considered, it is our opinion that 2010 will not be the year of consumer 3D TV in home. At present 3D TV seems to sit more comfortably as an ‘event’ experience (i.e. a James Cameron sci-fi opera, or a critical fixture in the sporting calendar) rather than something to enjoy on a daily basis at home – and with this limitation in mind, it’s debatable whether many consumers, outside of the early adopters or those with plenty of disposable income, will make the investment in the short term.

NOTES

*1000 online interviews were conducted by GfK NOP among a UK representative sample of internet users.

Image from…

http://www.flickr.com/photos/warrenski/ / CC BY-SA 2.0

GfK TechTalk

Independent technology research and opinion

Mobile data allowance grows in importance among smartphone owners

UK mobile app culture shows no sign of abating

The third device: Can the early success of eBook readers continue when faced with the introduction of multifunctional competitor devices?

2010 Tech developments: keep it simple

Promising signs for 3D TV… but not this year

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