Tablets Reach Critical Mass in U.S. Market

Tablets have quickly reached a critical mass in the U.S. with almost 20 percent of all  smart phone owners using tablets during the three-month average period ending April 2012. 


A study also found that tablet users were nearly three times more likely to watch video on their device compared to smart phone users, with one in every 10 tablet users viewing video content almost daily on their device, according to comScore. 


“Tablets are one of the most rapidly adopted consumer technologies in history and are poised to fundamentally disrupt the way people engage with the digital world both on-the-go and perhaps most notably, in the home,” said Mark Donovan, comScore SVP of Mobile.


For many app and content providers, the key development is creation of an additional "screen" for content consumption, joining TVs, PCs and smart phones. 

Tablet Users Among Mobile Audiences 3 month avg. ending Apr. 2012 vs. Apr. 2011  Total U.S. Mobile Subscribers (Smartphone & Non-Smartphone), Ages 13+  Source: comScore MobiLens
	% of Audience that Uses Tablet
	Apr-11	Apr-12	Point Change
Total Mobile (Feature Phone & Smartphone)	4.7%	16.5%	11.8
Smartphone Only	9.7%	23.6%	13.9
Feature Phone Only	2.3%	10.4%	8.1

Tablets are Shopping Platforms

More than half of tablet owners surveyed by Zmags in January 2012 reported shopping on their tablets at least once per week and 12 percent shopped daily. Already, nearly 30 percent of Internet users owns a tablet, and that should grow to more than 50 percent sometime in 2014 or 2015. 

Offers are Where Mobile Wallet Value Lies, Says Isis

The value of a mobile wallet is in the data-driven offer and coupon systems that allow consumers to save money, and "Isis does not directly deliver any of that value," says Jim Stapleton, Isis chief sales officer. That isn't to say Isis believes it does not add value, simply that the value comes as Isis is an enabler for its partners. 


Isis also emphasizes that it is a partner for banks, not a competitor. "At Isis, we're very much a platform provider for the banks," said Stapleton. 


Of course, not every contestant hopes to build a new business on offers, advertising, analytics or loyalty mechanisms. PayPal has been in the payments business, and wants to extend from online to offline. Square, Intuit and Sage also believe the revenue model is in handling payment transactions. 

Worldwide mobile payment transaction values will surpass $171.5 billion in 2012, a 61.9 percent increase from 2011 values of $105.9 billion, according to Gartner. 

The number of mobile payment users will reach 212.2 million in 2012, up from 160.5 million in 2011.

"We expect global mobile transaction volume and value to average 42 percent annual growth between 2011 and 2016, and we are forecasting a market worth $617 billion with 448 million users by 2016," says Sandy Shen, research director at Gartner. 

Mobile Devices will Pass PCs by about 2013

According to comScore, the number of mobile "computers" will pass desktop PCs sometime in 2013. 


Other forecasts suggest roughly the same thing, given sales trends. 

Cord Cutting Might Only Save a User About $10 a Month?

The point of video cord cutting typically is to "save money." So what potential savings might exist if a user with cable TV service quite that subscription, then signed up for a service such as Aereo, providing off-air signals, plus some content from Netflix or iTunes?


About $10 a month, says Barclays media analyst Anthony DiClemente. According to the Barclays analyst, users also have to factor in the higher costs of an unbundled broadband connection as well. 


Some might disagree. DiClemente uses a a cable TV charge of  $60 a month, which many users will find too low, substituting an $80 to $100 a month figure, instead. . In that case, a user might well save $30 a month to $50 a month for an alternative over the top approach. 

The Long Tail of Mobile App Purchases

It looks as though there is a "long tail" or Pareto distribution to mobile app purchases. According to a U.S. consumer survey conducted by ABI Research​, about two thirds of app users have spent money on an application on at least one occasion. Among these paying users, the mean spend was $14 per month. 


“The median amount among the consumers who spend money on apps is much lower than the average, just $7.50 per month," says Aapo Markkanen, ABI Research senior analyst . 


"The highest-spending three percent of all app users account for nearly 20 percent of the total spend, while over 70 percent spends either nothing or very little,” he says. 

PwC Data Shows Why Verizon Wireless Pricing Moves Make Sense

The new Verizon Wireless pricing plans, which make U.S. domestic voice and text messaging unlimited and a part of the basic subscription, while shifting the variable cost of service entirely to the mobile data plan, make sense. 


Consumer spending on broadband access is climbing at a robust 15-percent annual rate. With a continuing shift to consumption of video, the rate of consumption could increase even faster. So it makes sense that Verizon Wireless would want to shift pricing to a mode where data usage is variable, as that is where the additional costs of providing service will grow.