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Carriers Betting On Smart Money

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By RICHARD MULLINS

rmullins@tampatrib.com

Published: November 21, 2008

If you don't already have a smart phone such as a BlackBerry or iPhone, there are some wireless companies who would very much like a minute to chat with you.

Major cell phone carriers such as AT&T and Verizon Wireless are unloading an onslaught of marketing and advertising this holiday season aimed at persuading anyone who doesn't already own a smart phone to go ahead and convert.

Today, another big part of that marketing push starts. No. 2 U.S. carrier Verizon Wireless begins selling the BlackBerry Storm phone, a gadget aimed at combining the sleek design of an Apple iPhone with BlackBerry's smooth links to corporate e-mail systems.

Once hooked on these smart phones, wireless companies think, customers will never go back to a phone that can't send and receive e-mail and surf the Internet, thus racking up more data traffic on their account.

That's why prices for some smart phones have now fallen below $100 with a two-year service contract and rebate.

In other words, the wireless game used to be about getting customers to burn up more voice minutes. Now the game is about getting customers to burn up data use - and bring in more types of customers. A BlackBerry isn't just for CEOs anymore, these companies say. It's for all the chatty middle-schoolers who are dying to send their friends video of what just happened.

That kind of use could boost global smart phone ownership from 13 percent now to 23 percent by 2012.

"As a society, at all tiers, we're getting more comfortable with the mobile phone doing a lot more than voice: We want texting, e-mail, a Web browser," said Kevin Burden, director of mobile devices at ABI Research.

That's showing up in the revenue figures, Burden said. For instance, ABI research found the average owner of a BlackBerry 8100 Pearl spends $54 a month on voice minutes, but an additional $26 on data usage.

A sluggish economy is definitely having an effect on phone sales overall, with major makers such as Nokia issuing warnings about the future. However, Burden said, "We're getting to the point where people are walking into the store and not getting turned off by a smart phone. They're curious."

One of the Storm's main selling points is a large, high-resolution "clicking" touch screen that gives a bit of physical feedback each time a user taps a finger onto a virtual QWERTY keyboard to send a message.

Reporter Richard Mullins can be reached at (813) 259-7919.

Coming Monday: Read Walter Mossberg's review of the Storm in the Business section

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