Handset Replacement Sales Bring Challenges For Carriers
By Carlo Longino, Wed Oct 06 23:00:00 GMT 2004

While the booming market of existing users buying new handsets is driving global sales, all those new devices don't make things easy for carriers.

Replacement cycles are handset manufacturers' best friends. And as device technologies and features improve rapidly, those cycles get shorter and shorter. But while the vendors thrive, these new handsets can cause problems for operators as they find out there's a downside to owning the customer, too, when people can't easily move over their contacts or get their devices configured properly.

SmartTrust, which sells products to help carriers deal with and support their users' new phones, says that by 2006, more than half of all mobile users will replace their handsets each year, either just buy simply buying a new one, replacing a lost, stolen or damaged device or getting one passed on by family or friends. It adds that 10% of all support calls to operators are already configuration queries.

Apart from any potential damage to their brand and increased support costs, carriers also risk missing out on service revenues from advanced services if users' handsets aren't properly set up -- a task that's outside most average customers' realm of comfort. If users try a service and it fails the first time, there's a good they won't try again.

SmartTrust, of course, has a solution for carriers in its SmartManage product, which is a network-level product that senses when a user has a new device on the network, then sends out the proper settings over the air. Of course, OTA settings are offered by pretty much every carrier, but many users aren't likely to either know or want to call tech support and ask for them. The ease with which GSM handsets can be swapped from carrier to carrier, as well as the great number of them that aren't bought through operator retail channels makes the problem especially pressing for carriers using that standard.

It can cause headaches for CDMA carriers as well, though since the vast majority of handsets on those networks are bought through carriers, configuration is less of a problem, but reducing the hurdles slowing users from migrating to new handsets capable of using new advanced services -- that generate new revenues -- should be a priority. It's often not technical issues that hold things up, but something as simple as a user not being able to transfer their contacts from an old phone to a new one, a byproduct of the relative lack of Bluetooth and other connectivity options and sync software for non-GSM phones.

US CDMA operator Verizon has announced Backup Assistant, a BREW-based application and service from developer FusionOne. For $1.99 a month, Backup Assistant keeps a user's address book synced up to a server, and can then restore it if it gets deleted, or transfer it to a new device.

Even though moving names and phone numbers over to a new phone is little more than a hassle, it's enough reason to keep some people from upgrading their devices, or even from switching carriers. In any case, operators need to evaluate their support systems and make it as easy as possible for their customers to use advanced data services, particularly when it involves a new handset.