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Analysts Say Wireless Carriers Make More From Data Rather Than Calls

March 14, 2014 - Written By Ray Greer

 

US carriers offer a service, that service allows us to makes calls and stay in contact with those we care about, or even those we don’t but have to pretend we do. When mobile service first started up, surely they had no idea that years down the road, their main source of money would be data, instead of calls. Even T-Mobile made moves to be cheaper in voice but actually raised the prices of data, while other companies keep the high costs for data. Though, with recent reports suggesting data is the biggest source of income for carriers there is no question as to why.

Chetan Sharma Consulting reports that in 2013, 50% of revenues for wireless carriers came from data charges. The dollar sign attached to the percentage is $90 billion, just from data usage. The president of the consulting firm, Chetan Sharma, says, “It is a milestone in the evolution of the industry.” That seems to be an understatement, seeing as how mobile carriers set out to offer us calling, and ended up making money on data.

It is no secret that as consumers we use our mobile device more so than our own desktops. We have tablets that come with mobile data options, our smartphones as well. Both devices provide great mobility and capability, so there is little reason to use a desktop unless it’s in the office or a big project. This means to get our data, we turn to our wireless carriers for access, and they happily oblige us as long as we pay up.

Cisco Systems Inc.,thinks that by 2018, more uploaded data in the US will occur on smartphones compared to the amount uploaded on laptops in 2013. With this new information and growth in the mobile data industry, it is common sense that companies will try to exploit this more. Numbers that are being predicted suggest that in the next year, US consumers will accumulate mobile data charges reaching $100 billion. One way that can be helped is by the carriers switching the way we make our calls, to internet calls.

In late 2014, T-Mobile and Verizon are launching different versions of calling over data. This will be done using apps, and will transform a voice call into a voice call over data, and will count towards data usage and possibly leave the idea of minutes behind.  According to a rep at T-Mobile, Brandy Bishop, T-Mobile customers are showing more than a 50% increase in data usage. Verizon chimes in as well, with CFO Fran Shammo saying, “What we expect is that you will get more and bigger data bundles, but people are going to use more, so the revenue drive is going to continue.” Basically what he says is we will pay for more data, but we will use more data, and have a need to pay for even more.

More data consumptions means carriers will need more spectrums. So don’t be surprised if you start hearing about battles between carriers for spectrum. Does any of this shock you? How much data do you use on a monthly basis?