Free Smartphones May Push Connectivity and Efficiency To New Levels
Internet traffic growth is being driven by mobile devices and emerging markets. Now, as smartphone manufacturers, mobile carriers and forward thinking digital business owners all take notice, rumors are spreading that free smartphones may soon be offered by large players seeking to capture market share. Smartphones, tablets and other mobile devices already account for 25% of internet traffic. In the first quarter of 2013, tablets exceeded traditional desktop computer conversion rates for the first time according to reports by industry trade groups and Apple announced a new iPhone 5C at a much lower price point to spur growth. Now rumors persist that Amazon may soon unleash a free smartphone to capture market share and the pressure free content has caused on evolving business models may soon be amplified by free hardware providers.
In a recent frenzy of activity Microsoft has bought mobile device maker Nokia, Verizon and Vodaphone announced one of the largest deals in history, Apple released a low price iPhone 5C and now with rumors are suggesting E-commerce heavyweight, Amazon may be getting into the cellphone market by offering free smartphones. Amazon has subsequently denied the rumors with an official statement that “it will not offer a phone this year” and that the phone would “not be free.” However parsing their statement, particularly when there are only four months left in the year, it appears to offer little consolation for their competitors in the wireless space who have relied on wide per-device profit margins.
Unlike Apple or Samsung, who generate income by selling hardware, Amazon and Google generate revenue primarily through e-commerce sales and online advertising respectively, that puts them in position to sacrifice some potential profit on the sale of devices to bolster their primary businesses by increasing usage and expanding their own markets.
Even if Amazon is being candid about choosing not to release a “free” phone, it is still reasonable to expect that someone else will soon be offering free smartphones to the masses in the near future. Facebook has recently launched Internet.org, as previously reported here at NationalNet, to get cheaper or free data service to the developing world, and an ad-based smartphone system similar to what MagicJack or Walmart’s Basic Talk have done to land lines makes a lot of sense.
Given that non-desktop traffic is becoming a larger portion of internet traffic, site owners should definitely see now as the time to get your mobile house in order, particularly as mobile users have no patience for dealing with websites that don’t work well on their devices. In a recent survey, a full 76 percent of mobile users say they that they will leave if your site if it’s not optimized for mobile, and almost a third say they will never return.
Free internet connectivity from the Internet.org consortium seems to be making progress and now a price crash on mobile devices or free alternative appears to be looming on the technology horizon as well. That likely means a much greater benefit for sites that optimize their designs, reliably provide digital services with greater up-time, and efficiently make use of visitor bandwidth to reduce connectivity issues will stand to benefit greatly. What we have seen from free content users is that their expectations of quality and ease of use remain high, and converting them into consumers often means impressing them with the unique value of your product line.
NationalNet continues to evolve all aspects of our infrastructure to provide the best possible user experience for your mobile or traditional traffic because we understand that one day very soon, visitors who neither bought their own connection devices nor paid for their own data plans may become the largest segment of your site’s paying customers.