Saturday, July 14, 2018

There are Limits to How Much Mobile Data People Want to Consume

As much as connectivity is untethered and mobile; as important as internet apps now are in the mobile value proposition; as much as consumers keep increasing their data consumption, we tend to vastly underestimate consumer behavior as a moderating influence on mobile data consumption.

An analysis of mobile tariffs and mobile data consumption by Tefficient found only a weak correlation between average revenue per user and data usage, for example.

That is not what one might expect. The analysis shows that, in most countries, mobile data consumption is 3 Gbytes per month, or less, no matter whether overall recurring charges are high or low.

That seems to fly in the face of both economics and the Tefficient data, which also shows that mobile data prices and usage are directly correlated (high price leads to low usage; low prices lead to high usage). So something else is at work.

Among the logical explanations for those findings are that mobile subscriptions represent a bundle of features, including messaging, voice, device rental, plus possible bundling with other services (fixed network voice, fixed network internet access, mobile or fixed video subscriptions) that affect unit cost. So mobile data is one of many determinants of retail recurring costs.

Also, Wi-Fi offload plays a role, representing a majority of mobile device data access in many markets. End user behavior also matters, as it seems people use mobile data in different ways than data used while stationary (at home or at work).

Still, the Tefficient data suggests even at low prices, people only want to do so many things, or spend so much time, on mobile internet apps. And that is reflected in mobile data usage.

Ironically, the one development that changes the overall usage curve is the use of 5G platforms to supply fixed access.

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