Cellular phone plan rating

Safety surpassed business use as the reason behind purchasing a cellular phone, according to a survey conducted by MTA-EMCI. Forty percent of subscribers surveyed said they bought a cellular phone primarily for safety, whereas 38 percent said they did so for business. Among newer users (one year or less) safety ranked even higher: 46 percent said safety was their reason for buying a cellular phone vs. 31 percent for business reasons.

The downward trend in business share is indicated further by the number of non-users who said they would buy a cellular phone for business: 27 percent. However. while business use as the primary reason to buy a phone has decreased, it does not mean that users are using their phones less for business, stressed Thomas Ross, a consultant at MTA-EMCI. He said that even though customers originally may buy a phone for safety reasons, that does not mean they will use it only for that function.

Ross said that the shift from business to safety as the primary reason for buying a phone indicates the industry's penetration into the consumer market. "These results show cellular is becoming a part of American life," he said.

...Offering Free Talktime Great Way To Encourage Use

Ross suggested that offering free minutes is a great idea for carriers because it encourages people to use the service and become more familiar with the variety of functions cellular phones have. On the manufacturing end, Ross suggested vendors could package products in a more consumer-friendly way or offer options on equipment geared toward the personal user rather than the business user. For example, a business user wants a battery with more talk life, but a personal user wants a battery with more storage life.

Motorola, AT&T and Nokia remain the most popular brands. Among non-users, Motorola tops the list, named most frequently by 53 percent of those surveyed. Cellular One is the second most frequently named brand among non-users, with 20 percent of the vote. Brand loyalty increased; 82 percent of users said they would purchase the same brand phone compared with 67 percent last year.

Responses indicated a decrease in phone prices. The average phone price among all users surveyed was $188, whereas the average price for subscribers online one year or less was $167, suggesting that newer subscribers are paying less for equipment. Length of service also influenced length of use. Subscribers who had service for three or more years had the longest length of use, averaging 171 minutes per month. The average bill among all users was $77.

...Survey Indicates Carriers Need To Promote Brand Name Awareness

The survey indicated service operators are failing in one key area: name awareness. Among non-users, 57 percent could not name a single cellular service carrier. Also, the survey reflected a decrease in carrier satisfaction. The average carrier satisfaction rating on a scale of one to 10 was 7.6 compared with 8.3 in 1993. However, service providers remain the most popular distributors of cellular phones. Thirty-four percent of newer users purchased their phones from a cellular service provider, 14 percent from an electronics store and 13 percent from a department store. Non-users also favored service providers as distributors; 23 percent said they probably would purchase a phone from a cellular service provider. Twenty-five percent of non-users said they would prefer a cellular phone store. Word of mouth continues to be most influential among respondents when choosing equipment.

Churn continues to be a concern for carriers: 10 percent of users said they had switched carriers; 4 percent said they plan to discontinue service in three months; and 3 percent said they plan to switch carriers within three months.

...Potential Users Remain Skeptical of Benefits

A large percentage of non-users remain uninterested in using a cellular phone. Only 13 percent of non-users said they were "definitely," "probably" or "maybe" interested in using a cellular phone. The most frequent reasons for not purchasing a cellular phone were "don't need it" (73 percent), "service is too expensive" (16 percent), and "phone is too expensive" (7 percent).

Cellular phone service beat out personal communications services (PCS) by 1 percent among non-users. Only 12 percent said they would definitely or probably subscribe to PCS. But appproximately 60 percent of users and 44 percent of non-users said they would prefer PCS over cellular service if PCS cost 50 percent less than cellular. Yet only 9 percent of users and 20 percent of non-users said they would make the switch to PCS from cellular if it cost 10 percent less.

Non-users are willing to pay $22 per month for cellular service, far from the $77 average monthly bill found by the survey. To convince non-users of the merit of cellular phones, Ross suggested carriers either devise a cheaper pricing plan or "convince potential subscribers that $50 per month is worthwhile, which could [be done with] more consumer-oriented marketing."

While forecasts have said data transmission using cellular phones is on the rise, this survey indicated otherwise. Eighty-one percent of users said they do not know how to use their phones to transmit data. Two percent said they use their cellular phones to transmit data using a computer and fax machine.