Hasta La Gadget!

Hey everyone–we’re in a recession! Bet you didn’t know that. New data from ABI Research suggests that the economic downturn is finally hitting the wireless industry in earnest, saying that the average revenue per users (ARPU) of
mobile users worldwide was down between five and 15 percent in the fourth
quarter of 2008 compared to the year-earlier period, according to MediaPost.

That’s significant because it means that cell phone subscribers are choosing less expensive plans and spending less money overall on their handsets–which directly affects profit margins. One bright spot: the report said that the overall decline was offset in part by increasing mobile Web use, leading to revenue gains of 15 to 20 percent in that category. ABI expects that growth to continue, as more users explore the mobile apps and other data services.

Voice traffic was also up from between two and 10 percent, but that was offset by overall declining revenue and minutes use, according to the report. I wonder if phones that look like that red LG Lotus in the picture have something to do with all of this. I mean, yeesh–look at that thing.

For quite some time now, the number of people in the U.S. that have dropped landlines in favor of cell phones has gradually increased. However, it seems we’ve reached a milestone. According to the Associated Press, the number of U.S. households opting for only cell phones has for the
first time surpassed those that just have traditional landlines.

A Centers for Disease Control and Prevention survey released Wednesday said that fully 20 percent of U.S. households only had cell phones in the second half of 2008. That’s a three point increase since the first half of 2008–a big jump, statistically speaking–and also three points higher than the 17 percent of households with landlines but no cell phones.

For comparison purposes, in 2003, just three percent of households were wireless only, whereas a whopping 43 percent had landlines but no cell phones yet. In the meantime, about 60 percent of households have both landlines and cell phones. The report attributed the accelerated shift to the recession, and the fact that the cell phone offers extra features–namely, mobility and texting, among others–that landlines generally don’t have.

Sprint-Nextel got some welcome relief from its prepaid Boost Mobile service in the first quarter, particularly due to the $50 unlimited calling plan Boost unveiled in January, according to MediaPost.

That plan helped drive a net gain of 764,000 prepaid user for the previous quarter. That helps offset the 1.2 million additional subscribers that Sprint lost yet again. Even so, it’s getting really bad. During the last six quarters, Sprint has lost
more than six million customers over network quality and
customer service issues, the report said.

Sprint CEO Dan Hesse said in a conference call with analysts on Monday that the company is beginning to stabilize its subscriber base and financials. But when it comes to stemming the loss of high-profit contract-based
subscribers, “we need to do better,” he acknowledged, according to the report.

Motorola has announced it sold 14.7 million phones
in the last quarter, down from 27.4 million a year ago, according to Reuters–an almost 50 percent drop from the same time last year, and one that brings the manufacturer to just six percent of global market share.

That’s no surprise, since the company has lacked a strong handset line-up for ages now. The lone bright spot, at least in terms of the struggling handset division, is its strong commitment to the open-source Google Android smartphone platform.

Several new Android-powered handsets would be welcome in 2009, especially considering that the Palm Pre and a third-generation iPhone loom over the horizon, and that Android seems to be off to a slow start otherwise.

Here we go again. On CNN, a caller by the name of Alberto told HLN money expert Clark Howard that he was charged $62,000 to download the movie WALL-E for his nephew while vacationing in Mexico, according to Ars Technica. As is probably obvious to everyone by now, the caller forgot to activate a data roaming plan on his cellular data card before leaving for the trip.

Of course, the carrier would never think to alert the customer of such a thing beforehand–and any text alerts about extra charges get lost in the ether when you’re using a data card. After some haggling on the phone, the carrier “reduced the bill to $17,000, arguing that the five-figure charge was what it cost them to deliver the movie”–which is baloney, given the existence of said international data roaming plans.

It’s tempting to blame the customer, and granted, he should have checked into this. But at the same time, I run into well-meaning folks all the time who forget to update their virus definitions on their PCs, or even install a security suite in the first place. A beginner’s mistake, but no worse or better than not knowing about how to reconfigure a data plan. A $17,000 bill isn’t fair, period.