Chetan Sharma: Shared data plans will continue to be a boon for Verizon, AT&T

The shared data plans instituted last year by Verizon Wireless (NYSE:VZ) and AT&T Mobility (NYSE:T) have performed well for the carriers and will continue to gain steam in terms of adoption in the months ahead, according to new research from Chetan Sharma Consulting.

The findings are part of Sharma's expansive quarterly report on the state of the U.S. wireless and mobile data markets. According to the report, "the tablet and other device attachment rate has gone up by 60 percent" on the plans. Sharma noted that shared data plans "moved tablet session based consumers to postpaid tablet plans with more predictable revenue stream. The $10 surcharge for every device is still an inhibitor for many consumers. Over time, we expect this fee to go away" as carriers work to get more consumers to experience mobile data services across devices other than their smartphones.

Verizon noted in mid-May that it has fully one-third of its postpaid subscriber base on its Share Everything plans, less than a year after launching the plans (new customers need to sign up for the plans if they want subsidized smartphones). AT&T said that it had 3.3 million Mobile Share shared data accounts at the end of the first quarter, which the operator said covered about 10 million devices. Sprint Nextel (NYSE:S) and T-Mobile US (NYSE:TMUS) do not offer the kind of shared data plans for individual customers that Verizon and AT&T do.

Despite the focus from carriers on getting more customers to use mobile data on tablets, mobile hotspots and USB modems, smartphones continued to sell at a brisk pace in the first quarter, according to Sharma, accounting for nearly 85 percent of the devices sold in the first quarter.

Sharma said Apple's (NASDAQ:AAPL) iPhone dominated smartphone sales in the first quarter, accounting for 50 percent of the total smartphone sales at the Tier 1 carriers. Samsung Electronics remained strongest in terms of total unit sales in the United States. Sharma said "while it is fairly clear" that Microsoft's (NASDAQ:MSFT). Windows Phones will get the No. 3 smartphone spot behind Android and iOS, "the journey to a substantial and competitive market share is still ways off. It renewed its entry into the battlefield with Windows Phone last year but sales have been poor." He said in the first quarter Windows Phone device sales were less than 500,000 in the U.S. market despite heavy marketing.

Overall, in terms of smartphones Sharma wrote, "While the U.S penetration of smartphones is over 50%, the 50% of the sub base is concentrated in only 30% of the households thus leaving plenty of growth in the marketplace."

Looking at the wider market, Sharma found that the U.S. mobile data market grew 2 percent sequentially and 14 percent year-over-year to reach $21 billion in mobile data revenues. Data is now almost 45 percent of the U.S. mobile industry service revenues, and Sharma predicts it will cross 50 percent later this year. For 2013, he said he is expecting $90 billion in mobile data service revenues for the U.S. market, compared to $79 billion in 2012.

For more:
- see this presentation (PDF)
- see this page

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