Although smartphone penetration is still growing in many markets in Europe and the United States, carriers will need to get increasingly creative to get those remaining non-smartphone users to convert over to smartphones, which have higher average revenue per user, according to a new study by Analysys Mason.
The device upgrade plans recently unveiled by T-Mobile US, AT&T Mobility and Verizon Wireless likely won't save too many customers money, but they could boost carriers' margins and increase smartphone sales for handset makers like Apple, analysts say.
T-Mobile US launched a new promotion for the summer in which it is dropping the upfront price on its entire lineup of devices in stores nationwide to zero dollars down.
A new ad from T-Mobile US calls AT&T Mobility's new handset upgrade program "sneaky" and "underhanded." The ad is the latest attempt by T-Mobile to paint its larger rivals AT&T and Verizon Wireless as unfairly overcharging customers.
Even though Verizon Wireless will follow T-Mobile US and AT&T Mobility with a new smartphone upgrade program, Verizon Communications CFO Fran Shammo said he doesn't think many customers will use the plan and Verizon won't change its service pricing as a result.
T-Mobile US struck back hard against AT&T Mobility's "Next" handset upgrade program, arguing that while the plan tries to copy T-Mobile's "Jump" upgrade program, AT&T is essentially making customers pay for their phones twice with Next.
AT&T Mobility will now make customers wait 24 months instead of 20 months to upgrade to a new, subsidized device. The move mirrors one that rival Verizon Wireless announced in April.
Verizon Wireless confirmed it will launch a "Device Payment Plan" starting April 21 to help customers finance the purchase of devices that cost more than $350.
Sprint Nextel's Virgin Mobile USA prepaid brand is offering T-Mobile USA customers $100 to switch over to Virgin's no-contract service. The action is a response to T-Mobile's new no-contract business strategy.
T-Mobile USA wants you to know that it's the "Uncarrier." It's moving to a no-contract model (mostly), and doing away with the traditional Tier 1 U.S. carrier model of smartphone subsidies in exchange for a two-year contract. Unfortunately, I don't think much will change in the U.S. industry as a result.