BBaker2008_KeitaiKids

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are rabid for mobile content, but the opportunities for service providers to reach them are growing limited.

(1.4) The Connection between the Youth Market and Mobile Communications

In countries that have widespread adoption of mobile phones, there are many cross-cultural similarities between youth and their interaction with mobile phones. Youths are known to use mobile phones for emotional and social communications, especially for developing peer relations (Ito and Okabe 2004). According to Ling and Yttri (2002), adolescence is a unique time in one’s lifecycle where peers play a central role, and the mobile phone becomes a tool to define a sense of group membership. Ito and Okabe (2004) point out that there is a growing body of work on this subject in the United Kingdom, Finland, Norway, and Sweden; all displaying similar patterns. Text messaging, in particular, is a critical part of mobile youth communication in that it gives one a sense of identity and personality, a way to breakaway from parental figures, and a way to solidify social networks (Lorente 2002; Rautiainen 2002; Geser 2006). The youth of the world are using the mobile phone as a central means to live and develop who they are.

The youth of America are no different in their connection to mobile phones than the rest of the world. As of 2006, 79% of Americans aged 12 to 21 owned a mobile phone. They spend and average of 54 US dollars a month on mobile services, 87% of what the average household pays for all of the phones in one house. These young Americans have been using their phones for some time, with roughly two-thirds owning a phone for 2 years. 6 out of 10 youth prefer their mobile phone to a landline, and 57%

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say their mobile phone has replaced almost all other phone use. Instant messaging, picture messaging, and email rank in the top five most important features to them. Supporting these claims, more than 3 in 4 use text messaging daily, and 45% use instant messaging as often; making them up to 4 times more likely to use these features than adults (Golvin 2006).

In Europe, there is no doubt the mobile phone has established itself as a central part of life with youngsters. In Europe, 84% of consumers aged 12 to 24 own a mobile phone; between the ages 12 to 15, the ownership ratio is 3 out of 4. Out of youths aged 18 and over, more than 50% have owned their mobile phone for 5 years or more; 70% of children under the age of 15 have had theirs for up to 4 years. Thus a mobile phone has been a strong force in their life for roughly one-fourth of it. Their monthly spending averages at 25 euros a month (roughly 37 US dollars). More than half of young mobile users use text messaging every day, with 20% using email functionality regularly. Italy, in particular, has 74% of its mobile youth sending text messages daily. Due to the prevalence of 3G technology, around 50% of young mobile phone users in Europe browse the mobile Internet regularly, as well as display an interest in social networking sites becoming available on the mobile Internet (van Veen 2006).

For many years now, Japan has been a pioneer of the mobile phone industry. With this, the mobile phone has become an essential part of life to young Japanese more so than anywhere else in the world. According to popular research, about one-third of elementary school students, nearly 50% of junior high school students, and over 90% of high school students own mobile phones (“Children and Mobile Phone Use” 2006;

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“Cellphone Obession…” 2008). In a 2004 survey, 99% of university students were found to own a mobile phone (Nurvitadhi 2004). Of the Japanese youth who own a phone, over 30% of elementary school students, nearly 90% of junior high school students, and over 90% of high school students send emails to friends everyday. Astoundingly, the majority of these children and young adults send 20 or more emails to friends daily. Making calls and surfing the mobile Internet rank in at second and third respectively for most used features of a mobile phone (“Children and Mobile Phone Use” 2006).

Mobile phone use has been integrated into the lives of young Japanese so much that they are constantly using them to reach out to others from the moment they wake up, during travel to and from school, during class, before bed, and even in the bathtub. When in contact with another, they use the phone for arranging and coordinating, chatting, status updates, mood checks, and even just to say they are going home (Okada 2005). When not in contact with others, they can be found playing games, checking the news and weather, using mobile Internet banking features, using GPS navigation, or paying for an item at a store with their handset (McVeigh 2003). High school girls average 124 minutes a day of mobile phone use, with boys averaging 92 minutes a day. Thus, the mobile phone is not only a communication device for Japanese youth, yet a useful and irreplaceable tool for life.

The mobile phone is so important to young Japanese that in the Benesse study over 50% of elementary school students, over 70% of junior high school students, and roughly 80% of high school students claimed, “My life will be inconvenient without a

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mobile phone” (“Children and Mobile Phone Use” 2006). There are numerous studies with quotes such as, “I can’t imagine life without it,” and exceptionally high agreement to statements like, “Cannot do without keitai”1 (McVeigh 2003; Kamibeppu and Sugiura 2005; Miyaki 2005). Japanese youth have also been documented stating that mobile phones are “cool,” “fun,” “fashionable,” and “exclusive,” giving them a sense of identity and individuality (Miyaki 2005). They also claim mobile phones allow them to more easily express themselves, as well as help to create a more defined personal space (McVeigh 2003). It could be said that to many young Japanese, life without a mobile phone would not be a normal life at all.

As shown by a vast amount of research from around the world, the youth of today are eager to adopt and use the mobile phone in various ways. Such eagerness can be broken down into two simple factors: identity and communication (Lorente 2002; Geser 2006). The mobile phone gives them a way to express who they are through handset shapes and colors, ring tones, and accessories (Rautiainen 2002; Geser 2006). It also gives them a sense of privacy, having control over all aspects (who they speak to and when, etc.) of the phone, and allows them freedom from parents (Lorente 2002; Rautiainen 2002). The mobile phone also gives youth much more immediate and free access to social networks than ever before. It allows them to connect to and relate to other youths in new ways, strengthening their feeling of belonging and honing social abilities (Lorente 2002; Rautiainen 2002; Ito and Okabe 2003; Geser 2006). In summary, “The phone helps them to define one’s unique space in terms of their relations

1 Keitai is the Japanese word for mobile phone.

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to others and in terms of their relation with the technological world,” “…the phone has become an essential and natural element of their everyday life, a means to organize their daily lives with a communication style which is proper and fit to their needs” (Rautiainen 2002). Clearly, young people around the world have wholeheartedly embraced the mobile phone and there appears to be no letting go.

(1.5) The Effects of the Saturated Market

The growth rates of subscribers for mobile operators around the world are dwindling fast. The problem is twofold: first, there is a constantly decreasing number of individuals who do not own a mobile phone; second, it requires extra costs and efforts, potentially not profitable, to pull in new customers from rival companies. With this, mobile companies have begun to reach out to untapped markets and niches. The largest and most easily accessible untapped cohorts are the very young and the elderly, both of whom are being increasingly targeted as potential mobile customers. Both groups could have a large impact on the mobile industry if integrated properly, but attempts to do so in different countries have been varied.

In the United Kingdom, mobile operators have not been very keen on opening their services to the elderly. The Life Phone2, the first elderly oriented handset in the country, comes with a large screen and user-friendly buttons, as well as a panic button. However, whether these features are attractive to the target market is of no concern, because many retailers and operators have refused to stock the phone, claiming the elderly do not fit into their desired brand image (“Elderly-friendly Mobile Causes

2 See #1 in appendix.

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Debate” 2007). Ignoring these statements, several other phones for the elderly have debuted since.

Operators in the United States seem more open to business from the elderly. The operators realize that only 39% of people 65 years old and over own a mobile phone, and the ones who do own a mobile phone spend less than their younger counterparts (Richtel 2004). However, designing phones that please senior citizens, as well as making service plans easy to understand for them has been a hurdle. Handsets such as the Jitterbug3 have been relatively successful, but getting senior citizens to spend more on services has been difficult (“Senior Citizens Not…” 2006).

Japan is the country that really stands to gain from the elderly market. With about half of the adult population over 50 years old, and 10% of the whole population over the age of 75, the untapped market is vast (Rutledge 2003; Worsley 2007). All of the major operators offer easy to use phones, such as Docomo’s range of RakuRaku phones4, with larger text sizes and buttons, etc. Docomo alone has pulled in millions of new subscribers with its phone, and now a growing number of mobile content providers are aiming their services at the elderly.

An even more exciting market for the mobile industry is that of young children. As stated previously, children are growing tech-savvy at increasingly younger ages (they use more technologies and more often than older cohorts), they have a need to socialize and become a part of their community, they have a particular knack for getting what they want from their parents, and they have a potential long future as loyal customers

3See #2 in appendix.

4See #3 in appendix.

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ahead of them. It is for these reasons that many companies in the mobile industry are committing more resources towards this very young market than ever before. However, this has brought on much controversy over the issues of marketing to very young children, possible dangers to health, and access to inappropriate content. Despite these issues, the prospects of the mobile industry to acquire young mobile customers appear to be much more rewarding than those aimed at the elderly market.

The United Kingdom is a particularly interesting example as it has very high statistics for young child mobile users, yet has supported some of the strongest opposition toward young child mobile phone use seen in the world. In the UK, the average age at which a child receives his or her first mobile phone is 8. 90% of children between the ages of 13 and 14 own handsets as well (Woolf 2006). Because of statistics like this, scientists and politicians have been fighting to limit the mobile industries power to reach out to children. Sir William Stewart, president of the British Association Festival of Science, has claimed for years that it is irresponsible for mobile companies to target children, especially by marketing handsets as “back to school” devices (Wearden 2001).

More recently, in 2006, Phil Willis, the chairman of the House of Commons Science and Technology, called on the Department of Health to launch an urgent inquiry into the marketing of mobile accessories to children. Stating the issue was potentially as a serious as marketing junk food to primary school students. An official inquiry into the safety of mobile phones has also recommended to the British public not to give phones to children under the age of 8 (Woolf 2006). The British government clearly has firm

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views on the issue and is making great efforts to protect young children from the marketers of the mobile industry.

In the United States, it is the 12 and under group that poses the biggest potential for the mobile industry. The research firm, Yankee Group, expects the market to grow by 60%, up to 10.5 million children, by 2010 (Lev-Ram 2007). Yet it is not only children’s advocates that mobile companies must fight against, but parents themselves. Many American parents feel that acquiring the first mobile phone is a rite of passage for children, and 12 years and under is just too young (Lev-Ram 2007). Recently, AT&T and Verizon, the nation’s respective #1 and #2 mobile operators, have pulled their child oriented phones from shelves due to poor sales. Disney Mobile, which launched in the second half of 2006, officially terminated its services on December 31, 2007 as well (Disney Mobile 2007).

Mattel, the world’s largest toy manufacturer, attempted to enter the young child oriented mobile phone market in 2005 with the Barbie “My Scene” handset5. However, child advocate groups, such as Commercial Alert, attempted to make parents aware that this was only a rich marketing scheme to create early brand loyalty and lifelong customers. Gary Ruskin, executive director of the group, stated that “It’s open season on kids,” explaining potential dangers of kids being pressured to buy ring tones and accessories (Petrecca 2005). As a result, the handset did not remain on the market long. Firefly Mobile6 and Kajeet7, have had much more success in this niche market. Their

5See #4 in appendix.

6See #5 in appendix.

7See #6 in appendix.

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success is contributed to supplying handsets that do not look like toys and that are not covered with popular children’s brand names, as well as providing safety features parents appreciate (Firefly Mobile 2008; Kajeet 2008). However, it does not look as if American parents and child advocacy groups will be easily convinced of the mobile industry’s marketing intentions.

In Japan, the young child oriented mobile phone market appears much different. As previously stated, the marketing of mobile phones to children in Japan has taken off in recent years, and now 20% of elementary school students own a mobile phone. In the early 2000’s, major operators had attempted to draw in young children with youth oriented handsets, but their efforts were not a blatant success (New Niche Markets in Asia… 2006). The operators now realize that it is more than convincing a child to want a phone, but getting the parents on their side is necessary as well (Scuka 2007). With a recent increase in child related incidents in Japan, the operators have been able to take advantage of parents’ anxiety for their children’s safety in order to market these “safe” phones.

Only in the last two years has the competition really started to heat up; now all four of the major mobile operators produce a child-oriented phone that is fun and entertaining for kids (in both form-factor and content), as well as has safety features that are intriguing to parents. In order to make everything click, they have created a quantity of cartoon characters, websites, and television commercials that not only attract children, but that teach the benefits of the phone, such as safety alarms, so that children can use the information as a means to convince parents.

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NTT Docomo, Japan’s largest mobile operator, was the first to release a handset in the new race for young child subscribers. The SA800i8 was designed with safety and ease of use in mind. The battery can only be taken out with a special tool, and parents can block online contents. But the most important feature is the “Imadoco” function. This function allows parents to use navigation software on their phone or computer to check where their child is at anytime. It also includes an alarm that reaches 100 decibels that the child can pull when in danger. Once activated, an email will be sent to parents with details of the child’s location. In December 2007, the successor to the SA800i, the F801i9, was released. The handset features all the same safety enhancements of its predecessor, but adds 3G capabilities, an ergonomic design for small hands, and a bracelet that can be used as a locator device when the phone goes missing (NTT Docomo 2008).

On top of all these features, the handsets come in five different color schemes, and are loaded with video game applications and children song files. In case all the features haven’t quite convinced parents of the phone’s necessity, Docomo created a website for children entitled, “Mobile Playground.” There, kids are lead by a troupe of cute characters that explain the history of and how mobile phones work, as well why they are fun and convenient. Giving kids that much more ammunition to convince their parents that a mobile phone is necessary (NTT Docomo 2008).

8See #7 in appendix.

9See #8 in appendix.