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48% Would Drop Mobile Data Service Plans

Faced with the need to reduce household expenditures, forty-eight percent of Americans would drop their mobile data plan completely, according to research about to be published by Strategy Analytics’ Multiplay Market Dynamics service. Only 10% would drop their home broadband subscription.

“Given the extraordinary importance consumers place on home broadband, we fully expected broadband to have a high ‘keep rate,'” said Ben Piper, Director of the Strategy Analytics Multiplay Market Dynamics Service. “What surprised us was the vulnerability of mobile services.”

Under the same scenario, 12% of Americans said they would drop their pay-tv service completely, while 41% indicated they would scale service back to a lower tier. Fifty-six percent of respondents said they would make no changes to their home fixed voice service, compared to 51% for mobile voice.

“These results suggest that, while American consumers consider home broadband service to be a vital utility, they see mobile data service as simply a ‘nice to have,'” noted David Mercer, Vice-President of the Strategy Analytics Digital Consumer Practice.

The study, fielded in early June, surveyed 1,110 household decision makers regarding their multiplay spending intentions over the next year, the impact of the economy on household entertainment purchases, and the relative importance of each component of the so-called multiplay “bundle” (broadband, digital television, fixed voice, mobile voice and mobile data).

Question: Imagine that, due to household budgetary constraints, you have to reduce home entertainment/communications services expenses. How would this affect your spending on:

Broadband Internet Digital Television Fixed Voice Mobile Voice Mobile Data
Drop Completely 10% 12% 21% 19% 48%
Scale Back to Lower Tier 21% 41% 22% 28% 17%
Leave Unchanged 67% 45% 56% 51% 33%
Move to Higher Tier 2% 1% 1% 2% 2%

Source: Strategy Analytics Multiplay Market Dynamics service, June 2009

About Strategy Analytics
Headquartered in Boston, MA, with offices on five continents, Strategy Analytics, Inc. focuses on market opportunities and disruptive forces in emerging technology, communications and media sectors.

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