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Complimentary Analyst Webinar Replay
Smartphones: The Death of Device Subsidies
A cross-regional view of carrier moves surrounding device subsidies
| June 12, 2012
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Featured Speakers
Emma Mohr-McClune Emma

Research Director,
Consumer Services
Wes Henderk Wes

Principal Analyst,
Consumer Services
Moderated by Willam Ho, Vice President, Consumer Group

Since the birth of mobile, carriers worldwide have used device subsidies as prime bait for both contract acquisitions and retention. Problematically, users today are no more loyal than they were yesteryear, and the common practice of bundling handsets with plans has diminished the competitive differentiation value of providing subsidies at all.

Today, many carriers in Europe are wondering out loud if they can afford this legacy practice. In fact, several European carriers have already moved away from subsidies in order to rationalize customer acquisition and retention cost structures. On the other hand, the U.S. market is still as deeply entrenched in the subsidy model as ever. In addition, subsidies are starting to trickle down into the U.S. prepaid market as customers gravitate towards smartphones. How will the subsidy model play out between both markets over the next several years?

In this presentation, Current Analysis Principal Analyst Wes Henderek and Research Director Emma Mohr-McClune will set out and dissect the key examples to date of device financing used within the U.S. and European carrier community. Key issues to be addressed include:

  • The differences between the various models, their strengths and weaknesses
  • The differentiation vacuum challenge
  • The competitive shake-out
  • The impact on product portfolios, go-to-market strategies
  • How carriers are positioning moves towards and away from subsidies

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