One Problem with Smartphones: More Dropped Calls

U.S. wireless customer experience of wireless call quality has dropped over the last six months, according to J.D. Power and Associates.

Over the past six months, customer-reported call quality problems have increased significantly, from 11 problems per 100 calls in 2009 to 13 problems per 100 in the most recent study.

Dropped calls are on the rise, from four problem per 100 calls six months ago to six problems per 100 calls in the latest survey.

On average, smartphone customers experience problems at a rate that is 6 PP100 greater than problems experienced by traditional handset customers. In addition, smartphone customers are nearly three times more likely to experience dropped calls than are traditional mobile phone customers.

"Interestingly enough, consumers using less sophisticated (more traditional) handsets were nearly three times less likely to experience a dropped call than their smartphone counterparts," says J.D. Power.

A rational person might say those findings support the claims made by testing organizations that smartphone design can, and apparently does, have an impact on the ability of such devices to maintain calls, either because of mobile Web signaling interference or even smartphone design issues.

Frustration with call quality is often a leading reason why consumers choose to switch mobile carriers, J.D. Power notes. The study results show a PP100 rate six times as great (42 PP100 vs. 8 PP100) for consumers who report they “definitely will switch” providers in the next twelve months when compared to users who report they will “definitely not switch” carriers.

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Global Spending on Mobile Networks to Grow 4% in 2010

Given dramatic increases in mobile Internet and broadband use, it is perhaps not surprising that mobile service providers will be hiking their network investments about four percent in 2010.

Informa Telecoms & Media estimates that mobile broadband subscribers worldwide  reached more than 225 million subscribers in mid-2009, representing 93 percent year-over-year growth.

Global mobile data bandwidth usage increased by about 30 percent during the second quarter of 2009, says Allot Communications.

The investment growth comes on top of about two years of flat to negative spending where mobile service providers tried to hold down spending in the face of the global recession.

Overall investment was down about three percent in 2009, says ABI Research.

Investments in 3.5G technologies such as HSPA and HSPA+, along with the rollout of 4G LTE networks by large operators such Verizon Wireless and Telia Sonera, are driving much of the activity. The fastest growth in capital expenditures is expected to be in South America, where compound average growth rates will average 10 percent between 2009 and 2015.

”The rapid adoption of smartphones will drive service revenue growth in 2010, as more consumers adopt data plans to take advantage of their handsets’ features,” says ABI Research analyst Bhavya Khanna.

Developed markets such as North America and Western Europe saw more than 17 percent year over year growth in mobile Internet revenues, a trend that is likely to continue into 2010.

ABI Research forecasts mobile Internet service revenues to grow at a CAGR of 9.4 percent between 2009 and 2015.

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Digital Ad Spending Exceeds Print for the First Time

U.S. advertisers are spending more in 2010 on digital media than on print, says Outsell.  Outsell's study collected data from 1,008 U.S. advertisers in December 2009.

Of the $368 billion marketers plan to spend this year, 32.5 percent will go toward digital; 30.3 percent to print. Digital spending includes e-mail, video advertising, display ads and search marketing. "It's a watershed moment," says the study's lead author, Outsell Vice President Chuck Richard.


Last year, print spending accounted for 32 percent of the total, compared with 30 percent for online.

Spending on Web sites and other digital media will rise 9.6 percent to $119.6 billion this year. Print expenditures will drop three percent to $111.5 billion while total ad spending will jump by 1.2 percent to $367.9 billion from $363.5 billion last year.

Advertisers will reduce spending on marketing for events, and on television, radio and movies this year. TV, radio and movie expenditures will drop by 3.8 percent to $84.6 billion, Outsell says.

Spending on events will decline less than one percent to $45.2 billion this year.


But the survey also suggests marketers will spend 16 percent less on mobile in 2010, compared to 2009.

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Verizon Says Average LTE Speeds Will be 5 Mbps to 12 Mbps, Peak of 40 Mbps to 50 Mbps

Verizon Wireless says its 4G Long Term Evolution network field trials in Boston and Seattle indicate the network is capable of peak download speeds of 40 to 50 megabits per second and peak upload speeds of 20 to 25 Mbps, with average data rates of 5 Mbps to 12 Mbps on the downlink and 2 Mbps to 5 Mbps on the uplink in real-world environments.

Verizon says it will have the new network up and running in 25 to 30 markets by the end of 2010 and will reach about 100 million people.

Aside from the speed advantages, what might be important for many users is better indoor reception. The new LTE network will operate in the 700-MHz frequencies, which means signals will penetrate building walls far better than signals now used in the 2-GHz range.

You can make your own decisions about whether the higher speeds make wireless a reasonable substitute for fixed connections. If a user downloads a lot of video, the answer likely is "no." But if a user is a lighter user, LTE might well be a workable solution for at least some percentage of users.

We have seen what mobility has done to demand for fixed voice connections. We should soon see whether the same thing happens in the broadband access arena.