In Business Model, Internet Access, Mobile, News

Despite the bans on zero rating in India and some other countries, there is mounting evidence that offering users and customers access to valuable apps without charge provides both clear value and a sampling mechanism allowing Internet service providers to gain paying customers.

Without those paying customers, it will be very hard to create sustainable and widespread Internet access services in many rural and lower-income areas.

That is the principle behind Facebook’s Free Basics program. Now there is evidence that zero rating stimulates app usage in U.S. markets, especially related to use of video streaming apps and services.

U.S. users of mobile apps seem to be spending more time using the mobile network than Wi-Fi, according to a study conducted by P3 and commissioned by Fierce Wireless.

In the United States, Wi-Fi’s share of mobile app connection time has been declining since the beginning of 2016.

In January, some 60 percent of the time Verizon subscribers were using a mobile app, those interactions used a Wi-Fi connection.

By August, mobile app use when connected to Wi-Fi dropped to 52 percent.

In January, Sprint subscribers used Wi-Fi for apps 56 percent of the time. By the end of August, Wi-Fi was used for apps 45 percent of the time.

T-Mobile US customers had the smallest decline in Wi-Fi usage for apps. In January, Wi-Fi connections supported 40 percent of app usage time. By August, that figure was 39 percent.

Users of all the studied networks consume more data on Wi-Fi compared to the mobile network.

Only T-Mobile US customers spend more time using apps on the mobile network. Analysts at P3 believe that is a direct result of T-Mobile US “Binge On” plans that do not count streaming consumption against a data usage plan.

Verizon users show the fewest app sessions, lowest total data consumption and least amount of usage time among the four top U.S. mobile operators. T-Mobile US subscribers are the heaviest users across these categories.

Some would suggest that is because Verizon generally is considered to have the highest prices of the four carriers, while T-Mobile US has been the most-aggressive on price over the past several years.

Basic economic theory suggests that when a supplier lowers the price of some product in demand, customers buy or use more of that product.

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