Hold the Phone: Wireless Customers Are Keeping Their Handsets Longer

by Jeff Wiener on September 27, 2010

According to a new study by J.D. Power and Associates, today’s average cell phone customers are holding on to their traditional mobile units longer than they were just a year ago.

The study revealed a number of interesting things about the relationship between consumers and the mobile phone industry, but perhaps more interesting of all was that customers were keeping their traditional cell phones an average of 17% longer than they were a year prior.

Today’s customers are keeping their traditional cell phones an average of 20.5 months, which is actually the longest amount of time since J.D. Power and Associates started keeping track back in 1999. The average then was 17.3 months.

The length of time customers keep their phones depends on the manufacturers, the study reveals, but the another key factor here is economics. “One possible reason for the significant increase in the length of mobile phone ownership is that more customers are delaying an upgrade purchase due to the general economic downturn, in which the expense of purchasing a new device could outweigh the added benefit of owning it,” said Kirk Parsons, senior director of wireless services at J.D. Power and Associates.

According to the study, customers are reporting higher monthly bill amounts and a continued steady increase in bill amounts over the last few years. In 2010, the average reported wireless bill is $78 – and that included all taxes and industry fees. That’s up from the average reported wireless bill of $69 just three years ago. With the addition of data-related services and activities like text messaging, the increases in billing are easy to spot.

It’s obvious that consumers are using their phones to do more, the study reveals, and that may have a role to play in just how long customers are keeping their units as well.

Of course, it’s a little more complicated than that. While the average bills have gone up, the cost of handsets has not. The study reveals that the average price of handsets has actually declined to $76 in 2010 from an average of $81 at the outset of 2009. Discounts and carrier incentives account for the lower prices. On top of that, 42% of customers have reported receiving a “free” mobile phone through contracts and subscriptions with wireless carriers.

Comments on this entry are closed.

Previous post:

Next post: