Despite extensive challenges that carriers have encountered building out LTE in rural areas, carriers should not lose heart, said Competitive Carriers Association President and CEO Steven K. Berry in an interview with Telecompetitor.
“For our guys, in rural America, there’s a reason for small carriers to build out LTE,” Berry said. “There is a reason to invest in advanced technologies because there is a market there.”
For evidence, he pointed to the results of a survey of rural wireless users conducted by Current Analysis for the CCA and released yesterday to CCA members.
The study showed that 80% of rural subscribers who plan to purchase a wireless device within the next three months plan to purchase a smartphone and 10% plan to purchase a tablet. Only 9% plan to purchase a basic feature phone.
Even among lower-income people making $25,000 a year or less, 70% plan to purchase a smartphone.
“It doesn’t matter what the level of income of a household [is], there’s demand for smartphones,” said Berry. “Even the economically disadvantaged will buy the high-end phone.”
For some of these people, a smartphone is an alternative to a traditional computer, Berry said. “It’s how they access the Internet and [send and receive] emails, text and voice traffic,” he said.
Berry argued that the research should help dispel some misconceptions about rural wireless that he has seen on the part of the FCC. “About two years ago we started working with the FCC economic division to challenge [device] exclusivity issues,” he said. “When we met with them on several occasions, they indicated their assumptions were [that you] couldn’t sell as many smartphones in [rural] areas because of household income. What we have seen with this study is that those assumptions are no longer relevant.”
The CCA/ Current Analysis research also showed the importance of brick-and-mortar storefronts for rural wireless carriers. Although nearly half (44%) of rural purchasers shopped at more than one carrier store or website, more than half (57%) ultimately made their purchase at a carrier store rather than online through the carrier or a third party or from a third-party bricks-and-mortar retailer.
“There is a high preference for consumers to go into a store and to feel, touch and experience the device,” said Berry. “There is a high preference for actually going to a carrier’s store and having that experience of deciding ‘Do I want this device or not?’”