Sunday, October 30, 2011

Consumers want 4G, even though they don't understand it

4G has become one of the top features desired by new cell phone buyers. That is the case even though they really don't understand what it means.

We knew it would happen: good marketing and pounding the term into the heads of consumers has succeeded. A recent survey, Next-Generation Phones: Consumer Insights Drive Future Handset Designs, conducted by market research firm In-Stat found that 75 percent of respondents listed 4G as one of the features their ideal phone would include. The survey covered 1,208 consumers.

However, there is a lot of confusion over 4G. We've already covered how even Verizon's LTE and Sprint's WiMax aren't (or at least, weren't) really 4th generation wireless or 4G. Certainly HSPA+, which currently carries most of the 4G load for AT&T and all of it for T-Mobile, isn't.

And when asked if they knew which carrier offered the fastest 4G speeds, most respondents were dumfounded. In-Stat analyst Greg Potter said in a statement that

"Although 4G is an important feature for handset buyers, there is a lot of confusion surrounding 4G. When survey respondents were asked which carrier offered the fastest 4G speeds, the majority of the respondents either didn’t know or felt they were the same across carriers."

Makes sense: non-techies just see two-letters (4G). Techies see the additional words (HSPA+, LTE, WiMax).

There is legislation running around in the U.S. A new bill presented to the U.S. Senate that would require wireless carriers to clarify what the speeds their 4G networks supply in their marketing and advertising. It is unclear if that bill will pass, however.

Additional key points from the report: as opposed to last year's survey, which said that 23 percent said they would not switch to a different smartphone platform, this year's survey found that 36 percent had no plans to switch. The cause of the rise seems common sense to us. As we've said before, the more apps that are downloaded to a phone, especially if purchased, the less likely it is that the owner will switch. It's a form of "app tax."

Another finding from the survey, which points to bad news for T-Mobile if they a) do not get the iPhone, b) do not get acquired by AT&T: 20 percent of T-Mobile subscribers plan to switch carriers in the next 12 months.

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