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Teen's cellphone talk not cheap

Wireless phone companies are rushing to offer high-tech phones and cool services to teens and young adults, realizing this group will spend big bucks to communicate on the go.

By Beatrice E. Garcia
Miami Herald
July 13, 2004

Cruise through the mall, the local burger joint, even the beach -- anyplace teens gather -- and you can't miss the cellphones.

Teens are so attached to their phones that they're spending more money on them than on CDs or even clothing.

They're demanding wireless chats, games like SpongeBob Darts or Tetris, ring tones by 50 Cent, Britney Spears, Jay-Z and Usher, and personalizing with photos of Enrique Iglesias and other celebrities -- and wireless companies are only too happy to provide them.

YouthMobile, a telecommunications research firm in London, estimates that teens and adults ages 12 to 24 will spend about $22.2 billion on their cellphones this year.

'For this generation, getting a cellphone is a rite of passage,' said Wyndham Lewis, an analyst at youthMobile. ``It's the most expensive electronics device they own. Unlike a home computer, this is a gadget they can control.'

Allie Schwartz, 20, who lives in Aventura and has had a cellphone since she was 16, says her father made her get a part-time job when she got her phone. Dad still pays her monthly cellphone bill, but the job was meant to instill responsibility.

Schwartz, who has personalized her phone with ring tones and color covers and got her dad and her older brother hooked on text messaging, says, ``No one ever calls me on the house phone.'

FEEL FREEDOM

Cellphones' appeal to youth runs broad and deep.

'Teens are all about communicating, especially girls,' said Rob Callender at Teenage Research Unlimited, a Northbrook, Ill., marketing research firm. ``But teens also don't like to be tied down, especially once they can drive. With cellphones, they can be out, meeting friends and still check in with their parents.'

Experts say it's almost natural for 12- to 24-year-olds to send e-mails with photos or video clips from their phones, play games and download ring tones and screen savers, because they've grown up using similar technology on their computers.

MANY SERVICES

Wireless companies haven't hesitated to exploit the opportunity:

  • Sprint has developed a service that allows subscribers to play video games on their phones with other PCS users -- similar to how gaming is done online.
  • To promote text messaging, AT&T Wireless sponsored the American Idol telecasts on the Fox television network during the past two seasons, allowing subscribers to vote for their favorite idol via cellphone.

    This year's American Idol shows generated 13.5 million text messages, an 80 percent gain over the first season.

    Last month, AT&T Wireless struck deals with Kellogg and McDonald's, setting up games and contests in which subscribers must use text messaging to play or enter.
  • Cingular Wireless created a youth portal on the Web to attract this group. It also partnered with several companies last month to throw 'Buddy Bashes' around the country that included concerts featuring emerging young artists.
  • Verizon Wireless has a prepaid site, www.freeup.com, that focuses on the teen and young adult market. It offers information about services, music and concerts.

    In April at six colleges, Verizon sponsored the Urban Challenge on Campus -- scavenger hunts with camera phones. College students had to decipher clues at 12 campus locations and photograph them in 90 minutes.
  • Irvine, Calif.-based Boost Mobile, owned by Nextel Communications, and Virgin Mobile USA, a subsidiary of Virgin Atlantic Airways, have made the youth market their only focus.

    Both companies offer prepaid service that requires no contracts. That's a way to allow teens to make their own buying decisions since no one younger than 18 can sign a contract.

PARENTS' ROLE

However, parents primarily do the shopping and the buying for wireless service plans for teens. Miami-based TracFone, which offers only prepaid wireless, knows this and markets to parents.

Yet a survey by the Yankee Group, a Boston research firm, found that when teens do provide input, cost is the top factor in picking a carrier and service plan.

'Teens are bargain hunters,' said Linda Barrabee, the Yankee Group senior analyst who conducted the survey.

Barrabee's work also found that teens' and young adults' use of cellphones reflects their lifestyles. This group uses their cellphones at home, work and other locations such as school, while most adults used their wireless phones primarily in their cars.

Copyright © Herald.com

For further information:

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Rob Callender
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+1 312.951-4822
robc@tru-insight.com

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