January 4, 2006
Battle rages for the luxury phone market
As the big national cell phone carriers try to gobble up the last nonusers of cell phones with their broad service approach, they have overlooked a market: people seeking a personalized cell phone experience, writes San Francisco Gate. Now comes a new breed of cell phone carriers called mobile virtual network operators that buy wholesale minutes and data from the large cell phone carriers and then use them to sell cell phones and service for a niche audience.
Pretty soon, a sports fan will be able to watch "SportsCenter," follow a fantasy football player and get live updates of NFL games. A hip-hop aficionado will tune into the latest video from Kanye West. Techno-geeks could watch live satellite television on the go while Spanish speakers could send text messages and get customer support services in Spanish. It will all happen on specially designed cell phones.
The niche carriers are trying to snap up some of the people who have yet to buy a phone and also lure away from the big firms those customers who yearn for a phone experience that caters to their tastes.
"The carriers are realizing to get the last customers they need to offer more than just a mass approach," said Marina Amoroso, an analyst with the Yankee Group. "The companies offer everything, but it's not customized to really penetrate the rest of the market."
Being a niche operator means that you can make plenty of profit with a small but high-paying customer base, said Peter Adderton, from Amp'd Mobile. "We don't need tons and tons of people," he said. "We're more interested in quality over quantity and saying we have good customers, low (turnover) and high revenue per user."
Analysts said the string of new carriers offering service is likely to continue. Wal-Mart and Apple have been rumored to be considering a move into mobile, but other media or retail companies could move into the virtual carrier market. The key to success won't be in simply tapping a well-known brand name, said King, the analyst. It's about delivering truly unique service.
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