Mobile Customers Prepared To Pay Premium Price For Location Based Services
Mobile phone customers in Great Britain believe that location based services will be valuable and they would be prepared to change operator and pay a premium price to have access to them according to research commissioned by AirFlash, the premier provider of location-based development platforms for carriers and portals.
Location-based services could hold key to achieving mobile customer loyalty
Mobile phone customers in Great Britain believe that location based services will be valuable and they would be prepared to change operator and pay a premium price to have access to them according to research commissioned by AirFlash, the premier provider of location-based development platforms for carriers and portals.
Over half of consumers said they would value the service whilst one in five would change mobile operator to be able to access the services. The research also uncovered widespread willingness to pay a premium for location-based services - 58% of consumers interviewed who considered the service valuable said they would be prepared to pay up to 16310.99 per month. Even mobile phone users who currently only spend less than 16320 per month on their mobile phone bill are willing to spend between 1631 and 1635.99 per month in addition to their normal charges, suggesting they also see real value in these services.
Interestingly, a third of consumers also said they were interested in receiving targeted location based advertising and 45% were interested in hearing about last minute opportunities in their area.
"Mobile operators are in a quandary about how to recoup the significant financial outlays made to purchase 3G licences," said Rama Aysola, founder and CEO of AirFlash. "This research has conclusively proved that consumers are ready for location based services and this will be a viable market for operators to tap to generate new revenue streams."
The report also suggests that location based services will be a key weapon in the battle for customer loyalty in a market estimated to be worth in the region of 1631billion* in Great Britain.
The research, conducted by MORI, comes weeks after Forrester Research predicted that mobile penetration in Europe would reach saturation point by 2005 - with the result that operators will need to focus on keeping those who already have mobile phones as opposed to attracting those who do not.
Note to editors
The AirFlash research was conducted in Great Britain, France and Germany between 4 and 17 December 2000. In the Great Britain, MORI interviewed 2041 respondents face-to-face as part of the MORI Omnibus survey.
In France, the research was conducted by MORI partner Demoscopie who carried out 1,000 telephone interviews. In Germany, the research was conducted by MORI partner INRA who carried out 1041 face-to-face interviews.
* This figure was calculated by multiplying the number of mobile subscribers in the UK (source: Salomon Smith Barney) by the percentage of people who will find location based services valuable and by the percentage of people who are prepared to pay up to 16310.99 per month for the service.
About AirFlash
AirFlash empowers mobile carriers and portals with the SmartZone development platform and applications for building location-based wireless services. Founded in July 1998 by industry pioneer Rama Aysola, AirFlash is a privately held company based in Saratoga, Calif. with offices in the United Kingdom, Germany and France. Customers include Orange PLC, Mviva and Excite@Home. Investors include Inktomi Corp. ((NASDAQ: INKT), Bay Partners, Band of Angels, PTI, Trio Investments and Pitch Johnson/Asset Management Company.
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