Wireless Users Keep Phones Longer

September 27, 2010

US wireless phone customers are keeping their phones longer as monthly charges go up, according to new data from J.D. Power and Associates.

Mobile Phones Kept Longer, Cost More per Month
Data from the 2010 U.S. Wireless Smartphone Customer Satisfaction Study – Volume 2 and the 2010 U.S. Wireless Traditional Mobile Phone Satisfaction Study – Volume 2 indicates customers are keeping their traditional mobile devices 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 current level of ownership tenure does differ by manufacturer brand, with the highest reported ownership tenure at an average of 27.8 months, and the lowest at 17.5 months.

Meanwhile, customer-reported monthly bill amounts, which have increased steadily during the past several years. The study finds the average reported monthly wireless bill is $78 in 2010, including federal and industry service taxes and fees, compared with $69 just three years ago. The increase is mainly due to the addition of data-related services, increases in usage activity such as text messaging, and added fees and taxes.

Apple, LG Lead in Satisfaction
These two studies measure customer satisfaction with traditional wireless handsets and smartphones across several key factors among owners who have used their current mobile phone for less than two years. In order of importance, the key factors of overall satisfaction with traditional wireless handsets are: operation (30%); physical design (30%); features (20%); and battery function (20%). For smartphones, the key factors are: ease of operation (26%); operating system (24%); physical design (23%); features (19%); and battery function (8%).

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For a fourth consecutive time, Apple ranks highest in customer satisfaction among manufacturers of smartphones with a score of 800 on a 1,000-point scale, and performs particularly well in ease of operation, operating system, features and physical design. Motorola (791) and HTC (781) follow Apple in the rankings.

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LG ranks highest in overall wireless customer satisfaction with traditional handsets for a fourth consecutive time with a score of 731. LG performs well in all four factors, particularly physical design, features and operation. Sanyo (712) and Samsung (709) follow LG in the rankings.

Traditional Mobile Phone Price Drops
The average price of a traditional wireless mobile phone has declined about 6% to $76 in 2010 from an average of $81 at the beginning of 2009. J.D. Power analysis suggests the decline is primarily due to discounts given by handset providers and wireless service carriers to incentivize sales. Currently, 42% of customers report having received a free mobile phone when subscribing to a wireless service.

Games, Travel Apps Popular for Smartphones
More than two-thirds of users say they download third-party games, while 54% say they download travel software, such as maps and weather applications. Forty-one percent say they download utility applications, while 36% say they download business-specific programs. J.D. Power says this indicates that smartphone owners are continuing to integrate their device usage into both their business and personal lives.

Quality Problems Drive Switching
Results from the recent J.D. Power and Associates Wireless Call Quality Performance Study, Volume 2 show that 14% of customers say they “definitely will” or “probably will” switch wireless providers in the next 12 months and that these customers experience a particularly high rate of call-related problems. The rate of call quality problems among customers who say they “definitely will” switch their current wireless provider is more than four times higher than problem rates among customers who say they “definitely will not” switch in the next 12 months (29 PP100 vs. 7 PP100, respectively).

About the Data: The J.D. Power and Associates 2010 U.S. Wireless Smartphone Customer Satisfaction Study – Volume 2 and the 2010 U.S. Wireless Traditional Mobile Phone Satisfaction Study – Volume 2 are based on experiences reported by 11,803 traditional mobile phone and 6,821 smartphone owners. The studies were fielded between January and June 2010. These studies are the source of the enclosed charts.

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