When it comes to selling tablets, it's a brand new ball game for mobile operators. How do they effectively package the tablet and their services?
The Samsung GalaxyTab offers some interesting insight into this area since all four of the nation's operators are expected to sell the tablet. T-Mobile will be the first out of the gate launching the device Nov. 10 and offering the it for $400 with a two-year mobile data contract tied to it. Sprint Nextel will be introducing the tablet for $400 as well with a two-year commitment. Meanwhile, Verizon Wireless will launch the device Nov. 11 for $600 and no contract commitment.
Interestingly, Current Analysis analyst Emma Mohr-McClune points out in a recent research note that penetration of the 30-day contract has grown significantly throughout Europe, thanks primarily to the iPad and tablets.(A 30-day contract is defined as a hybrid postpaid/prepaid model whereby users commit to a monthly spend, but may exit the contract in any single month.)
"In Q3 2010, over half of all 30-day contract plans in Europe were aligned specifically with iPad or tablet offers," Mohr-McClune wrote.
Operators are now entering an era where their customers will have two relationships with them. Do customers really want to be tied into a second contract for what can be characterized at this point as a more casual use product? That freedom to come and go is appealing for subscribers. Moreover, analysts talk of a day when customers can buy one big bucket of data "minutes" and use them however they want, whether they are using a smartphone or tablet.-Lynnette