iPhone Users Pay More for Data Plans, but There’s More to the Numbers

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iPhone users pay a higher monthly bill than any other type of smartphone user, and it’s not because of their usage habits. However, when you dig into the details, there is actually growing equality between iPhone and Android.

Apple iPhone 5 CostResearch from Consumer Intelligence Research Partners (CIRP) found the typical iPhone user has the highest average monthly carrier bill in the smartphone market polled during October-December 2012 period.

Almost 60% of the iPhone users CIRP surveyed spent more than $100 per month on their wireless plan, with 10% spending $200 or more. Only 53% of Android users fell into the ‘over $100 per month’ category and 7% fell in the ‘over $200 per month’ category. Just 6% of iPhone fell into the $25 to $50 bill range compared to 13% for Android users.

However, the devil is in the details. Android, being a free OS and usable by just about anyone, is frequently used by no-contract carriers or even drop phones, where you use it once and dispose of it when the minutes run out.

These plans have little or no data contracts, but when they get lumped in to the Android user base as a whole, it helps draw down CIRP’s aggregate. For high-end Android users, like Samsung Galaxy S III users, the data plans are comparable to iPhone users.

“We’re not saying iPhone users are bigger data hogs. They just pay more because that’s how the plans work,” said Mike Levin, CIRP co-founder and president. “I think [iPhone and Android] are growing more similar in terms of use, Android is kind of catching up.”

iPhone was used rather heavily for data transmissions almost from the beginning, while Android took a little longer to become a usable application platform. But now it has reached parity with iOS, said Levin.

Smartphones are doing a good job of helping carriers keep their customers, too. In the three month survey period, CIRP found that 88% of the iPhone activations were from prior iPhone users, while 64% of Android device activations were from prior Android owners. Just 7% of Blackberry users and 9% of Windows Phone users reported sticking with those operating systems.

Research has found some evidence that the iPhone has made people loyal to AT&T, said Levin. “The strategy for AT&T was brilliant. They were a distant second to Verizon and they made a commitment to iPhone that allowed them to establish the customer base of smartphone users that they didn’t have before,” he said.

So for now, AT&T and Verizon are holding on to their customers and are fighting over what’s left of the BlackBerry, Windows Phone, and featurephone market.

“When we talk about the competition between the two, it’s not about and taking iPhone customers, unlike what Samsung would have you believe in their ads. They are fighting over what’s left of the old platforms. Pretty soon they will be competing for each other’s customers and that’s going to be brutal,” said Levin.



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