Hands Full vs Handsfree: Consumers with Multiple Mobile Devices Leaving $50 Billion in Unused Services

Consumers are all in. You have a new mobile device for them to try? They want to see it. Feel it. Hear it. Yes, the love is reminiscent of Tommy, the Who's rock opera.

From the standpoint of historical innovation adaptation we are in a familiar love fest mode. A plethora of new devices, all with various types of functionality at reasonably affordable prices points - and with the added impetus of social status cum street cred - are driving consumers to splurge at a time when incomes and wealth creation are still weak. It has happened with cars, TVs and others. But mobile computing is considered an essential, more so even than autos were at first. Maybe not beyond coffee, but some might argue otherwise.

There are two reasons, however, why this mania may not be sustainable. The first is that lugging two or three devices with all of their cordage and associated accessories is getting old - and heavy. Laptop usage may be declining but the tab hasnt really replaced it for work purposes and the screen of the phone is too small. This is, especially, an issue for older users who still dominate the market demographically. While their usage and numbers will begin to fade, the Boomers et al probably have a good twenty or so years left and that is a lifetime when one considers that Google is 15 years old, Facebook is 9 and even Microsoft is merely middle aged (38).

The other issue, however, is that consumers have so many devices - and the telcos are so relentless in pushing limiting plan options - that the users are leaving $50 billion in unused services every year. That is a lot of unmade calls and unsent data. At some point demand for rationalization of both devices and services is going to coalesce around a disruptive offering that reduces both. The only question is not if, but when. JL

Jon Swartz reports in USA Today:

Call it mobile-palooza.
Consumers are filling their hands, pockets and purses with smartphones and tablets. One mobile device, it seems, is not enough.
Statistics bear this out. Increasingly, consumers from Silicon Valley to the Midwest, South and Silicon Alley are employing a business phone — increasingly, Android — as well as a fun phone filled with apps, usually iPhone. Add to that the ubiquitous tablet, and you have an armload.
Dual tablet-smartphones use is reflected in soaring sales figures for tablets — they are expected to whiz past PC sales for the first time in 2015, market researcher IDC says — and smartphones. Some 1.75 billion smartphones were sold last year, says researcher Gartner. (PC shipments surpassed 350 million in 2012.)
"Consumers are using devices based on what they need and when," says Bob Tinker, CEO of MobileIron, a mobile management and security company. "It could be a smartphone at a restaurant or a tablet on a train. It all depends on the task and space available. But they have multiple options."
Many of the new users in the family are kids: 37% of teens have smartphones, compared with 23% in 2011, says Pew Research Center.
What it all means in the real world is that mobile devices seemingly are everywhere. Restaurateur John McDonald watches customers stack their phones and tablets on tables or recharge them at restaurant bar outlets to replenish batteries.
"Before, it was either you used Apple or BlackBerry," says McDonald, a restaurant owner and entrepreneur in New York who recently added a Samsung smartphone to his handheld stash.
"Smartphones are our new, smaller PCs — and they are everywhere," says Rich Miner, general partner at Google Ventures, an investor in Divide, an app for the management of multiple smartphones.
Samsung has fragmented the market's dynamic and become the world's No. 1 smartphone seller, with sleek design, appealing technology and aggressive marketing.
Consumers juggle between phones to maximize battery use. And the choices of consumers have gravitated from traditional PC operating systems to Apple's iOS to, now, Android phones. The key is whose software — and apps — win out in the end, says Howard Hartenbaum, a general partner at August Capital.
Yes, some even employ the mullet strategy, named after the awkward haircut made infamous by country singer Billy Ray Cyrus in the 1990s — short in front (business), long in back (party).
Of course, there are consequences with so many devices in fewer hands, such as competition for Wi-Fi at major events and bloated phone bills.
Some $50 billion is wasted each year in the U.S. on unused voice, texts and data, says market researcher Validas.
That has spawned apps such as Divide and Zact, which help manage the cost of smartphones as they multiply among family members. FreedomPop offers a free service similar to Zact, which is a paid-subscription model.