Alternative Wireless Plans Key to Faster Smartphone Upgrades, Says Parks

Alternative early upgrade and no-contract wireless plans are disrupting the market’s traditional purchase model for handsets, said Parks Associates research released Thursday. A quarter of T-Mobile subscribers prefer the traditional two-year wireless contract model with a subsidized handset, while a third prefer to pay full price upfront and 31 percent would rather pay in monthly installments, Parks said. T-Mobile and AT&T “have tapped into the consumer desire for the latest and greatest smartphone with their early-upgrade programs,” said Harry Wang, Parks director-health and mobile product research. Some 14 percent of smartphone owners plan to upgrade to their next device more quickly than they did for their current device, with a quarter of them citing special operator incentives as the reason. “These alternative plans are one stone for two birds -- they help operators acquire new subscribers and retain loyal, high-value customers,” Wang said. The challenge for operators is to persuade smartphone users to upgrade early and buy more-profitable data plans while minimizing voluntary customer churn, he said.