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On-deck mobile content generates $11.66 per subscription: studyBy
Mobile users with premium mobile content services through their wireless carrier pay an average of $11.66 per subscription, according to a Validas report.
The report ranked on-deck downloads, which Validas defines as those for which charges appear on a consumer’s wireless bill. The ranking system factored in criteria such as average cost per download and volume of downloads, and placed navigation applications, content subscriptions, games, text alerts and charitable donations as the top five categories.
“The on-deck download channel is clearly effective for a broad range of both paid and free content,” said Ed Finegold, executive vice president of analytics for Validas, Missour City, TX. “It’s impressive that the top-ranked paid downloads go for a greater than $9 on average in several cases.”
Validas provides consumers, businesses and government agencies with an online wireless-bill management service. It leverages that service to provide wireless bill analysis reports.
On-deck downloads are driven through two main channels, according to Validas: carrier-operated content stores, such as Verizon’s V Cast, and premium SMS messages.
The report broke on-deck downloads into 26 different categories.
Scores were generated for each category based on four factors: total download volume, percentage of paid downloads in a category, average cost per download and total revenue generated.
The data was drawn from wireless bills generated between March 2009 and May 2010.
Here is a graph with information about the top 10 ranked categories:
Verizon Navigator and AT&T Navigator applications led the top-ranked navigation category.
Flycell, a service that lets consumers subscribe to download 10 ringtones, games and other mobile content each month, was the top scoring subscriptions service.
The category also includes the popular ESPN MVP subscription service (see story), which generated more downloads than Flycell by a ratio of 3:1, per Validas.
However, despite its high ranking, the content subscription category carries with it a caveat: the potential for rip-offs.
“I was surprised at how popular and expensive content subscriptions are,” Mr. Finegold said. “When I looked deeper into it, I found a lot of postings online where people were aggravated about these charges and felt they were ‘scams.’
“In plenty of cases, there’s no such bad word of mouth,” he said. “But, clearly some people are falling for tactics that lure them into sending a text to a short code to retrieve information they think will be free and they end up subscribing to something they don’t really want.
“Mostly, I’m surprised that these tactics aren’t policed a bit better given that these services have direct access to add charges to users’ wireless bills.”
No one download was the clear front-runner in the third-placed games category, which drives downloads based on a “try before you buy” model.
“Titles like Tetris, Bejeweled and Pac-Man often come pre-loaded as demos on mobile handsets,” Mr. Finegold said. “People try the games for free a few times, like them a lot and pay several dollars to keep them working.”
Fourth-ranked text alerts include SMS subscriptions such as news, stock market and sports alerts.
And, charitable donations, which occupied No. 5 in the rankings, became popular this year as channels for raising relief funds for victims of the Haiti earthquake (see story) and the Gulf oil spill (see story).
Validas claims that paid on-deck downloads outpaced free downloads by a ratio of 1.3:1.
The on-deck landscape
“If we were to contrast on-deck Downloads to the Apple App Store or Android Market, I would say that on-deck downloads are akin to the magazine and candy rack at the App Store or Android Market’s grocery store,” Mr. Finegold said. “People buy the items on that check-out rack in many cases because that’s what’s right in front of their faces.
“Interestingly, these really aren’t niche apps; they appeal to a broad range of people – just like candy, cold drinks, and celebrity magazines,” he said.
Peter Finocchiaro, editorial assistant at Mobile Commerce Daily, New York
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