Why Cell Phone Service Extras Don't Sell

At this point, a great many of the cell phones on the market are capable of doing amazing things, but at a price. My own phone, for example, can function as a normal cell phone, send text messages at $0.15 a pop, and connect to the internet for an additional $15 a month to be able to send and receive emails, and browse as much of the web as its 1.5" screen and slow connection would permit. Of course, like most people around the world, I don't use my phone's internet capability, because it simply doesn't make sense for me to.

This has been a major problem for cell phone companies. Although fancy cell phones, ranging from phones that can access the internet to full-fledged Treos and BlackBerries, have sold quite well, there just aren't enough people willing to shell out the money to make their elaborate functions work.

There are a number of reasons for this. As far as web goes, having internet on a phone is simply not useful or cost effective. Although a businessman might be able to justify a $50 a month mobile broadband subscription for his BlackBerry, your average Joe would have no desire to make his phone access the internet. The square inch of internet and the pathetic connection speed would simply not justify the price. He would do much better to go home and use his internet connection there.

MP3's on a phone are another matter. At this point, 17% of all cell phones in the US are capable of playing MP3's, but usually with the catch that the MP3's must be purchased from the cell phone company for as much as three dollars each, three times the price of a song on iTunes, and much more than most people pay for music. A cute moneymaking gimmick, to be sure, but it is no surprise that according to an M:Metrics poll, only 2.7% of MP3 phone owners actually take advantage of this feature. However, according to the same poll, 12.2% of MP3 cell phone users have figured out how to "sideload" music, transferring it from their computer music library to their phone.

This trend is something that cell phone companies will have to adapt themselves to in the future. As we enter an age in which cell phones can do more and more, quickly adding cameras, MP3 players, and soon GPS systems, cell phone service providers will have to find a way to convince their customers to pay for these options.

Sources

http://www.pcworld.com/article/id,125937-page,1/article.html