Wireless companies battling for untapped, young, ‘social handset’ market

Rogers Communications Inc. is trying to remain ahead of the competition as wireless carriers battle for what analysts say is a huge, untapped market of young consumers interested in social networking smart phone plans. A bit more than 70 per cent of Canadian teens aged 13 to 19 are using wireless devices, but only 30 per cent of them are on smart phones, Kaan Yigit, president of Solutions Research Group (SRG), a Toronto-based market research firm, said in an interview. Citing data from his firm’s Digital Life Canada Quarterly, he said that only half of those smart phone users are on data plans. “The potential for growth is substantial if carriers can get young users to upgrade their phones,” Yigit said. Rogers is introducing five Android handsets that feature Social View, a new Rogers application that consolidates seven social networking platforms into one window, said Reade Barber, director of data product management with the company. These new “social handsets” have the ability to link a user’s address book to social networking communities, Barber said. “Other carriers are doing this, but not to the same degree as Rogers. Its strategy is to be first-to-market with leading edge phones, but the gap will likely close quickly,” said Carmi Levy, an independent technology analyst in London, Ont. Bell Mobility has also introduced to its line Motorola’s Motoblur "social handset." “Bell is doing something similar, but hasn’t branded it as cleanly,” Yigit said. Barber said several manufacturers are launching next-generation social handsets that run on the Android platform. Rogers’s lineup includes the Sony Ericsson Xperia X10, Acer Liquid e, Moto Quench, HTC Magic Plus and LG Eve. “It’s all contained in one place on the social handset and makes it easy to see all messages. We worked with these manufacturers to develop our Social View application,” Barber said. As an incentive, Rogers has also launched four new rate plans with different “unlimited social networking” plans, he added. “All have a data component, but social networking usage doesn’t come out of the data bucket. Someone could be on Facebook all day without using up their data plan.” Users can join the rate plan if they use an iPhone or another non-Android smart phone that doesn’t have social networking capabilities, but they won’t have the all-in-one view, Barber said. Rogers has done a good job at packaging the service, Yigit said. “Most reasonably tech-savvy kids could put that together on their own with different tools. However, promoting the service as a hub for your social life is a good angle.” Levy agreed that all-in-one social networking is a nice feature, but probably not the most important to young people. “But for a teen buying a first smart phone, it makes great marketing hype,” he added. Time will tell what kind of privacy risks may also arise from social handsets, Levy added. “Young people are less concerned about privacy, but if you have a bunch of teenagers running around with their entire social life on one device, there will be those who will take advantage of this,” he said. Text messaging appears to remain a key route to capturing the youth market. Yigit said texting remains the most important mobile function to young people, followed by photo taking. “But photos are just lubricants for social networking,” he said. Rogers recently introduced its “Extreme Text Messaging” service that offers users the ability to send messages between texting and email platforms, plus other new features, Barber said. “We’ve extended email features to SMS, and you don’t need a special plan or handset to use them. Social networking and text messaging improvements are both part of our youth strategy,” he said. It’s not rocket science, but the new texting features are innovative, Yigit said. “I’m not sure they’re must-have features, but they’re interesting and they set Rogers apart from the other carriers. Most kids don’t use email on their phones and they don’t have data plans, so if they’re able to do more with texting point-to-point, it may be attractive.” Rogers’ youth strategy appears to be bearing fruit—for now. “In our tracking, Rogers is the dominant brand among young people in Canada, especially for Fido. It’s substantially ahead of Telus and Bell combined. Rogers has been addressing the youth market longer and is protecting its lead, but it doesn’t mean other carriers can’t catch up,” Yigit said. The next big thing for young people is likely to be location-based services, he added. “Being able to broadcast your location and find friends is very appealing. hasn’t been widely adopted yet, but when it is, it could drive uptake of services by young people beyond text and voice.” Multi-media features for mobile will also appeal to next-generation users, Levy said. “Multi-media will likely leap to the fore on mobile very soon. If proper audio and video were built into mobile devices so that you could do a video chat on the go, and do the things you can do on laptops, that would be a real game-changer.” news@thewirereport.ca

Wireless companies battling for untapped, young, ‘social handset’ market

News | 05/26/2010 8:40 pm EDT

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