By mid-2001 all new mobile phones sold in the UK will be WAP-enabled, driving a two-year period of hypergrowth, according to a new report from Forrester Research Ltd. (Nasdaq: FORR). And as the price of WAP handsets reaches parity with today’s phones, consumer uptake will increase rapidly creating a market of 41 million mobile Internet users in the UK by 2005.
Caroline Sceats, analyst at Forrester Research commented, “As the UK’s mobile Internet matures, users will fall into two groups — multi-device users and single-device users. Multi-device users will have alternative methods of accessing the Internet such as a PC and digital television, and their expectations of WAP will be shaped by their experience of fixed-line Internet. By 2005, there will be 28 million multi-device users in the UK. These users will thrive on multi-channel integration, and to counter initial negative experiences of WAP, businesses must use mobile to give compelling customer service across all channels. Significantly, the PC will remain centre-stage for information-rich purchasing, searching and browsing with this group.
“Single-device users however, will only have the Internet through their mobile phones, and this will be achieved through a natural cycle of upgrading their handsets over time. This single-device market will exceed four million by 2002, reaching 12 million in 2005,” she added.
At present, network operators have the strongest brand relationships with single-device users through their control of the billing infrastructure, and operators will seize this opportunity to become mobile eCommerce enablers through existing billing relationships. Single-device users’ lack of alternative devices will bolster ‘brick-and-mortar’ outlets, creating opportunities for incumbent retailers to push back against pure-play Internet companies.
“Revenue models from WAP are not the same as traditional online business models. Retail revenues from the mobile Internet will prove difficult to attain because consumers will be unwilling to make complex purchases over the mobile Internet, although simple transactions such as ticket purchases and stock trading can be successful. Content providers cannot create revenues without a billing interface — although personalised content may be able to sustain subscription fees. And because WAP users are unlikely to use their handsets to browse the Internet, WAP will not bring more airtime to operators. Instead, successful WAP propositions will deploy ‘trigger services’ to make all channels more effective,” Sceats said.
Sceats continued, “The most appealing services link the intimacy of the mobile phone with the richness of the Web. Well-executed trigger services will build on existing channel strengths, form only part of a customer interaction — not all of it — and bring new value to users. Triggering interactions to the Web offers the best platform for compelling service and WAP needs the Web to create personalised services and increasing loyalty. Additionally, trigger services will leverage existing call centre operations and location-based trigger services will support offline brands, enabling multi-channel companies to trigger interactions to physical locations.”
For the report “UK Mobile’s Split Personality,” Forrester spoke with 30 UK executives, benchmarked 37 current WAP offerings, and spoke with an additional 23 Network operators, handset manufacturers, fixed-line Internet companies, and technology vendors.