Wednesday, June 22, 2011

More expensive mobile apps are coming

One of the interesting things about legacy telephone contracts is that they were created before wireless carriers realized how valuable they were. But times change, and the carriers have been shifting their pricing plans to recognize that data access is far more valuable than minutes. The news that Verizon is moving to tiered data plans should not come as a shock to anyone. It was inevitable. And it is similarly inevitable that the other carriers will follow along. The current, unlimited, model is unsustainable.

But what will that mean to the market?

One effect is that middle-income parents will begin to think twice before buying a smartphone for their adolescent children. Maybe those kids will relearn how to play outside.

For business users, it means that those tantalizing mobile apps will become far more expensive. It won't be incrementally more expensive. It will be a LOT more expensive.

Consider this ... An electrical contractor with 30 field technicians wants them all to have tablets in order to handle work tickets electronically. If we use Verizon's pricing model as an example, that strategy will mean a minimum of nearly $11K in additional operating expenses every year. For many such firms, that will change the payback of mobile technology to something that may no longer be acceptable.

This unilateral decision by Verizon will impact mobile software developers, the Droid and Apple stores, and every firm with a mobile workforce. The technology consultant had better understand this when recommending solutions for their clients.

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