Preferring to go mobile

From dealing with a single customer group i.e. fixed line only, there is now a much more sophisticated market with three co-existing customer groups - fixed line only, users of both fixed line and mobile, and mobile only users.

TNS global research on Telecoms suggests a steady decline in revenues from fixed line only. In the USA fixed line revenues declined by some 12% in the last 12 months. In the UK for the first time, in 2004 mobile revenues at $22 billion have now overtaken fixed line revenues.

In many markets we are seeing the mobile only segment now approach levels of 35 to 45% of total market. In Finland for example, the mobile only segment has reached 35% i.e. a large number of people there are now only accessible via their mobile phone. In the USA 9% of the population are mobile only users - and out of those some 58% are young males. Their conscious communication preference therefore is for a wireless service. This is true in the Middle East as well - consider this, in the UAE we have 4 million mobile lines and only around half a million residential lines.

As we continue to be more mobile in our work and our lifestyles, it seems only reasonable to expect the mobile only segment to increase even more. And that will have some interesting implications.

The share of mobile phone users has increased tremendously over the past ten years. An often ignored but key question is whether mobile phones are a replacement for fixed line, or simply a useful supplement. We're often left guessing on the basis of anecdotal evidence. Without solid evidence, both researchers and service providers risk losing track of new and emerging groups in the market who may have new preferences and behaviour patterns to traditional phone users.

As a consequence TNS has developed a new methodology to reach this new group of people with mobile phone and without fixed line phone at home. The methodology was developed by combining fixed line interviews and mobile phone interviews. We are able to isolate a potential 'Mobile Only' group (MO). MO is a growing group e.g. already comprising more than 10% of the population over 14 years of age in the Nordic regions. The numbers vary from 5% in Sweden, Denmark and Norway, to 35% in Finland.

In the Middle East where face-to-face interviews are still the most common form of interviewing we can get survey information on how many are mobile only households and how many are fixed line only households. But it will be obvious from the figures quoted above - 4 million mobile connections now compared to half a million residential landline connections - that mobile phone usage has far overshadowed landline usage. There is a large segment of people who for various reasons could not access mobile phones earlier but are now able to - with pre-paid cards etc. There are households where the husband, wife and children all have mobiles - hence there is no need for a landline connection at home, or at most the landline is reserved for internet usage. Mobile phone usage has increased dramatically both in terms of voice and data services, such as SMS etc.

What are the implications for the marketer?

- a growing realisation that one-to-one mobile phone based marketing is possible ; it is already there with SMS marketing

- a convenient channel for people to conduct their banking transactions - with access to mobiles and WAP services it is relatively easier for customers to do much of banking through this medium.

And what are the implications for the telecoms companies?

- well for one landline or fixed line companies can look forward to declining revenues as more and more voice calls are made from mobile phones, even when customers also still have access to landline phones

- with the use of pay phones reducing there will be less pressure to provide public phones

- given that mobiles as a personal device has already become ubiquitous we will see the leveraging of mobiles for non-voice related usage - this is already happening with SMS, MMS, internet browsing, camera phones, Walkman phones, etc.

Here's to a more mobile future!