Touchscreens in the mainstream will hit carrier ARPU
Published: 6 November, 2009
READ MORE: Metrics | Display | Handset
The main challenge of the handset market in 2010 is set to be the price war in smartphones, as full-OS devices move into the mass market, and also the increasing focus on 'non-smart' touchscreens. These trends will not just hit vendor average selling prices, but operator revenues too, according to new research by TNS Comtech.
The study finds that, while high end smartphones have been the carriers' friends during the 2009 downturn - because their touchscreens and full browsers boost data usage and ARPU - cheaper touchscreens will be far less advantageous and could depress ARPUs by an average of 23% compared to their high end counterparts.
Part of the reason will be consumer confusion - in a survey of 240,000 users, the researcher found that most users are not aware of the difference between a phone with an advanced OS, and a touchscreen phone with more basic software, and so will not be prepared to pay extra for the full OS and browser. In other words, they need to be "educated" in the premium advantages of open software, rather than seeing a phone's value purely in terms of hardware features like touchscreens and cameras.
Paul Moore, director at TNS ComTech, said that, although it was easy to attract budget conscious customers with non-smart touchscreen phones, "operators and manufacturers alike need to think long and hard about their handset portfolio and the effect that handset types are having on customer value. They should take care to educate consumers about the differences between operating systems and not simply push phones that drive volume sales but contribute negatively to value."
The growth in the global smartphone market slowed to 4% in the third quarter, with a fall in sales in Europe and Latin America, according to Canalys, as vendors focus more on midrange devices.
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