Analysis: Consumers Still Confused About New 4G LTE Systems

WASHINGTON, July 20, 2011- Both AT&T and Verizon taken steps to to deploy their 4G LTE networks in recent months, with Sprint and T-Mobile heavily advertising their existing 4G technologies. With rampant speculation regarding the iPhone 5 industry watchers have predicted that consumers would be clamoring for the faster speeds promised by LTE.

“Not so,” says consumer research firm Retrevo.

In fact, a third of iPhone owners already think they have the technology despite the lack of a 4G-capable iPhone on the market. Maybe it’s the fact that the latest iPhone is called the iPhone 4, but the Retrevo study indicates a quarter of  Blackberry owners are also confused and believe they have 4G, despite Blackberry not currently producing a 4G handset. Similarly, many Android owners believe they have 4G despite the number of 4G-capable devices being much smaller than the percentage that believe they have devices with this technology.

Retrvo’s research also shows that consumers are in no rush to adopt the new data technology. Both Verizon and AT&T have indicated that smartphones, such as the iPhone, are data hogs and tax their networks. The companies’ solutions have been to build faster networks based around LTE and to expand their spectrum -the prime reason AT&T cites for its acquisition of T-Mobile.

Of the consumers surveyed, thirty percent said that they did not share the feeling that faster networks were the solution and that the higher cost of the faster network is the high hurdle for consumers to adopt it. Others cited  the the minimal increase in performance over 3G networks as a prominent factor and nineteen percent were confused about what exactly a 4G network was.  Another factor might be that both Verizon and AT&T’s shift from unlimited to tiered data plans earlier this year which put consumers on their guards. Despite the research the companies cited showing that most users don’t use much data and would save money buy selecting a cheaper data plan, the specter of costly overage charges from their wireless providers seem to come to the front of most consumers minds when selecting data plans.

The slower technologies also extend battery life as Apple’s tech specs list more than double the talk time for 2G over 3G on the current iPhone 4. This is further illustrated by T-Mobile’s recent claim that close to a million iPhones are currently used on its network despite the iPhone not supporting T-Mobile’s 3G band -meaning those subscribers are using T-Mobile’s 2G data service at a significantly slower speed. For these consumers the functionality of the devices and the network and cheaper price trump the network’s speed.

As for the new iPhone, many consumers say they don’t care if the iPhone 5 has 4G LTE, with sixty-one percent saying that they will consider the new iPhone regardless of it’s 4G LTE capability according to Retrevo’s survey.  Good news for Apple as it’s been rumored that a 4G LTE capable iPhone won’t be introduced until 2012.