Today, consumers typically sign up for cellular service and select a phone made by a cell phone manufacturer. But soon, service providers may start offering their own brand of cell phone. Would consumers select these phones, or want to stay with the brands they know? The latest survey of cell phone users by Harris Interactive shows that a slight majority (54%) of US adult cell phone users say they have no preference for an existing brand or a new one offered by their service provider, while the rest differ in opinion between interest in a new brand (27%) and an existing brand (19%).

These are the results of an online survey of 1,870 U.S. adult cell phone users conducted by Harris Interactive between July 14 and 18, 2006.

About two-thirds (64%) of US adult cell phone users agree that more competition among cell phone manufacturers will lead to product innovation and 40 percent believe it will ensure more choices in the marketplace. Other benefits of having cell phones and service from the same company could be increased compatibility between the handsets and the networks, according to about half (48%) of adult cell phone users, as well as overall lower plan costs (32%).

"If you were to consider buying a new cell phone, assuming that the cell phone has the same features, pricing and warranty, how likely would you be to buy a cell phone manufactured by a wireless service provider compared to a handset manufacturer?"

Much/Somewhat More Likely to Buy from Handset Manufacturer (Net)	19%
Much more likely to buy from a handset manufacturer	11%
Somewhat more likely to buy from a handset manufacturer	8%

Much/Somewhat More Likely to Buy from Wireless Service Provider (Net)	27%
Much more likely to buy from a wireless service provider	16%
Somewhat more likely to buy from a wireless service provider	11%

Just as likely to buy from a wireless service provider as a handset manufacturer	54%

There is some skepticism about cellular service providers offering their own brand of phones, and approximately one-third (29%) think this actually may result in decreased competition and higher prices in the long run. Similar numbers (30%) agree that smaller wireless service providers who cannot manufacture their own phones will go out of business, and another one in five (21%) feels that wireless service providers lack the design skills to build quality handsets.

Joe Porus, Vice President and Chief Architect for the Harris Interactive Technology Practice said, "Cell phone manufacturing by the large wireless service providers is the next logical step in this market. If they can pull this off, it will give their bottom lines a nice lift, but a failed entry here could start a new phase of consolidations in the industry. This apple is likely too tempting to leave on the tree-new cell phones could be coming your way soon."

	Strongly Some-what Agree	Strongly Some-what Disagree	Neither Agree nor Disagree
Increased competition in the manufacture of cell phones will lead to more product innovation (better features/functionalities).	64%	8%	28%
The wireless service providers will design cell phones that will work better with their networks (result in better service).	48%	16%	36%
Having wireless service providers manufacture their own cell phones will ensure more choices in the marketplace.	40%	19%	41%
My overall cell phone plan (including service and handset) would cost less if I got both the service and handset from a single provider.	32%	21%	47%
Smaller wireless service providers who can't make their own cell phones will go out of business.	30%	30%	40%
In the long run, the impact of wireless service providers making cell phones will be less competition and higher prices for cell phone service.	29%	27%	44%
Wireless service providers lack the design skills to build good cell phones.	21%	29%	50%
Current handset manufacturers have built a history of success that would be ruined if wireless service providers start to make them.	20%	31%	49%

US Consumers Are Not Loyal to Cellphone Brands