Games a Key Driver of Cellphone Usage - Report

U.S. teenagers have become among the most sought after customer segments by the wireless industry, due in part to their strong appetite for mobile data services. But the industry has yet to effectively capitalize on this demand, as marketing efforts to teens remain in their nascent stages. New research from Telephia, based on a survey of almost 1,500 mobile teens in the 35 largest U.S. markets, suggests that data services will be a critical driver of penetration and handset sales among teens, with mobile online gaming positioned to emerge as a breakthrough application.

According to the Telephia Mobile Teen Report, two thirds of mobile teens currently use, and virtually all express interest in, data services. Among teen data users, online gamers exhibit several qualities attractive to marketers. These include highly robust usage patterns, a tendency to own more expensive handsets, and higher satisfaction with their current device. These characteristics of mobile teen online gamers indicate that they may represent a good early opportunity for carriers, device manufacturers and content providers to profitably extend entertainment applications into the mobile space. "Mobile teens represent a sweet spot of industry growth, and one of the ways the industry can drive adoption and ARPU within this segment is by focusing on online gaming and other high-growth entertainment applications," said Mick Mullagh, president and chief executive officer of Telephia.

While the mobile teen online gaming market is still modest in size, it shows substantial potential for growth. Currently eight percent of mobile teens engage in online gaming, with usage patterns diminishing somewhat as teens get older. However, a full 41 percent of mobile teens express interest in having online gaming capabilities on their next device.

Mobile teens who play online games display attractive attributes when compared to those who do not, suggesting that this is a potentially lucrative segment of the emerging mobile entertainment market. Mobile teen online gamers demonstrate twice as heavy monthly minute of use patterns and are more likely to be very satisfied with their mobile device than non-online gamers. They also reportedly paid more for their current device, as indicated in the table below.

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Posted to the site on 22nd March 2004