Cell Phones are Still Pushing Internet Adoption Rates

Back in 1998, only one third of adults had online access and a desktop PC cost around $1800. At this time, it was mainly upper income Americans, and mostly men, using computers and the internet.

But now, it's mobile access that is bringing the internet to more people. Building from the affordable and easy-to-use cell phone, adoption patterns are different for mobile users than for those accessing the web via traditional PC-based methods. Specially, cell phone internet users include groups that had, before now, lagged in internet adoption, like some minorities and senior citizens. For example, as of December 2007, 50% of Americans age 65 and over had cell phones compared with only 36% who used the internet.

Out of all the cell phone users, on an average day 58% of adults use the devices, including PDAs, for at least one non-voice data application like text, email, photos, looking up maps or directions, or recording video.

The study groups these cell phone users into a demographic called "Mobile Centrics," a diverse group that is more oriented to the cell phone than to desktop internet access. The Mobile Centrics aren't into blogging or idle web surfing, but they do love their mobile games.

If you combine this group of mobile device users (58%) with the 41% of Americans that have logged onto the internet using a laptop or mobile device when away from home, and you have a group of 62% of Americans who have some experience with access to digital data and tools.

Wi-Fi Hotspots Everywhere

Wi-Fi is still growing. The Mobile Broadband Index put out by iPass, a global roaming service that forms relationship with ISPs around the world, summarizes their internal data representing usage behavior across its base of more than 3,000 enterprise customers, including more than 400 of the Forbes Global 2000 and across more that 80,000 hotspots in over 85 countries.

Users at a Wi-Fi Hotspot

Their most recent study showed that Wi-Fi hotspot usage by business users increased 89% worldwide over the second half of 2006, with Europe now overtaking the U.S. in usage. Business use of Wi-Fi nearly doubled.

2007 also showed a rapidly accelerating growth rate, with the number of sessions up 68 percent in the first half of 2007.

In the Wi-Fi hotspot analysis (period July 1-December 31, 2007), Wi-Fi users were logging into their wireless sessions at the usual places: cafes, restaurants, bookstores, transit stations, and office services locations.

What's different now is the length of these sessions. The increase from 2006 to 2007 had the typical café user logged in for 66 minutes, up 35 percent from the previous year; restaurant users were logged in for 44 minutes, up 217 percent; train stations, averaged 26 minutes per user, up 238 percent; bookstores had users online for 79 minutes, up 26% from last year. Only office services (Kinko's et al) saw a lost in number, losing 10% of users from 2006 to 2007. "Other" venues which didn't fit into any of these categories saw growth up 103%.

Says Rick Bilodeau, senior director of marketing at iPass, "We were very confident that there would be growth, but the fact that the growth showed at these levels really came as a surprise."

Mobile Broadband

3G Mobile Broadband use also increased during 2007. From the first quarter to the last saw an increase in overall data transfer, with the average monthly data transfer rate up 25% over the course of the year. (the iPhone effect?) Users transferred an average of 202.5 MB of data over the course of the year. Monthly usage averaged 188 MB in Q1 and 225 MB in Q4, indicating that usage seems to rise with experience.

Over 2007, 62% of users required 2.5G at some point each month. While only 3% of users relied solely on 2.5G during a given month, iPass believes this low number may reflect some users abandoning mobile data for Wi-Fi hotspots or home broadband when they can't get a high-speed 3G connection

Conclusion

It's apparent that mobile web access is a trend that is growing fast and will continue to grow. Breakthrough devices like the ultra-portable PCs and the Macbook Air make it even easier to to take full computers, and not just cell phones, anywhere and everywhere.

However, a lot of users are still using cell phones and for some it's if not the only way, then the most common way, for them to use the internet. For these users, I hope to see cloud computing initiatives that given them access to the tools and resources PC users already have such as mobile/web office suites, online RSS readers, and social networking access. Although there are some applications that provide these types of things to cell phone users today, none are truly stellar. There is still a large, untapped market of potential cloud computing customers who might stop texting and playing games for a minute if given the tools to do more.