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Mar. 21, 2009

Many consumers are now cutting back on mobile phone costs or switching to more affordable prepaid plans, according to a new study published by New Millenium Research Council (NMRC).

Previous research done by a variety of different groups have suggested that wireless consumers would rather cut back on food and clothing than on their mobile phone costs. The new report now suggests that this all changing, and not just in the U.S.

The survey of 2,005 American citizens was conducted by Opinion Research Corporation (ORC) for NMRC.

The study also revealed that a potentially major shift in consumer habits at the expense of contract-based mobile phone service is just under way as more and more mobile phone consumers seek to save money in the face of the global recession.

The results from the survey clearly demonstrate that about 41.3 percent of Americans with contract-based mobile phones are likely to cut back on their cell phones to save money if the economy gets worse for the balance of 2009.

The report also stated that no fewer than 40 million Americans, or 26 percent of wireless consumers with contract-based cell phone service are more inclined today than six months ago to look at different ways to save money on their cell phone bills, such as by switching to a prepaid cell phone service.

That group includes 38 percent of those in households making $35,000 a year or less, 32 percent of African Americans and 30 percent of those aged 18 to 34.

About 65 percent of prepaid cell phone customers say they are saving money compared to a landline phone or contract-based cell phone. About 29.2 percent said they were not saving money at all.

Cell phone extras such as Internet connectivity, e-mail and text messaging also are likely to take a hit in the economic downturn. About 20 percent or a total of 19 million Americans with cell-phone extras have considered cutting back or actually have cut back on such features in the last six months because of actual job loss, fear of job loss, the recession or any other related financial concerns.

“It is important to note that these findings do not just point out to a potential shift in consumer attitudes and habits about cell phones. The change in thinking and purchases is clearly already taking place and has been for months,” said Graham Hueber, senior researcher for Opinion Research Center.

Allen Hepner, scholar at NMRC said “the era of cell phone "penny pinching" is officially here. Thanks to the recession, the U.S. and even the global mobile phone marketplace is undergoing some very fundamental changes that will just get a lot worse as the economic recession deepens.”

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Source: The New Millenium Research Council (NMRC).