With 4G mobile broadband deployments ramping up, the April Morpace Omnibus Study sought to answer a number of questions that are probably prominent in telecompetitors’ minds at the moment, including, “Will the increase of availability of 4G networks translate into immediate revenue for network providers?” and “Do the improvements of 4G networks over their predecessors play a significant factor in the purchase decision for a new phone and/or plan?”
Morpace’s research also addressed customers’ perception of their 4G service and providers, their willingness to pay for it, and current perceptions of 4G as a brand.
With consumers’ attention captured by smartphone features and, increasingly, the availability of mobile apps, telecompetitors need to do a better job at bringing out and emphasizing the importance of network performance and quality of service in consumers’ minds, Morpace recommends.
Network capabilities were consistently cited as a factor across the demographic spectrum — it was cited by 63% of consumers 18-34 and the same percentage of individuals with an annual household income > $100,000, as well as by 65% of African-Americans, Asians and Hispanics, according to Morpace’s analysis.
Nonetheless, price was the factor ranked highest among the 490 survey respondents when it came to selecting a cellphone— 65% rated it their number 1 criterion. Fifty-eight percent cited network capabilities as a “significant factor,” however; and “network capabilities” was also chosen more frequently than other phone features, including touch screen capabilities (51%), screen size (47%), and manufacturer brand name (46%).
Moreover, despite their concerns with network capabilities 29% of respondents cited data plan prices as the most important factor when deciding which service provider to go with. Network coverage ranked second at 26%, while network speeds, surprisingly, were ranked the most important by only 4% of respondents.
Just 18% of smartphones currently have 4G capabilities, according to Morpace’s results, though that rises to 23% for 23-34 year olds and 27% for Asian, African-American and Hispanic demographic. 58% of consumers’ smartphones have 3G capabilities.
When it came to consumers’ perceptions and the benefits of 4G, more than 50% cited increased downloading and Web browsing speeds as significant features. One-third cited improved content streaming, 27% better image resolution, and 25% multi-tasking abilities.
Unfortunately for service providers, 48% of respondents couldn’t identify the main benefits of 4G networks. In addition, just 40% said they were willing to pay a premium to get 4G on their next smartphone. That’s a sentiment that’s higher among those 18-34 (47%) and Hispanics (65%).
Moreover, 2/3 of consumers said they weren’t willing to upgrade their contracts for 4G, and 60% said they weren’t willing to pay more for a 4G network connection.
One-third of those with smartphones not likely to upgrade said they don’t perceive it as necessary, and 21% said the benefits of 4G aren’t worth the increased cost. Another 21% said they weren’t “completely aware” of 4G’s benefits.
These numbers may improve as 4G access spreads out from major metro areas, according to Morpace’s research. Nearly 60% with 3G said the expansion of 4G networks “will have a significant impact” on their next cellphone purchase.
On the positive side, 83% of those with 4G said they were “satisfied” or “highly satisfied” with their network. 72% said that 4G was an “important factor” when purchasing their current cellphone, while 62% said that 4G network expansion was. Nearly 50% said that they would switch service providers based on the size of respective 4G networks.
