After weeks of speculation, Apple has indeed announced a new four-inch smartphone, says Ted Woodbery of Synchronoss Technologies, packing the innards of an iPhone 6S into a chassis the size of the older, smaller iPhone 5S.
Apple’s previous effort at targeting price-conscious consumers, the iPhone 5C, received a lukewarm reception and was quietly shelved. But the iPhone SE fills a niche as a high-specification smartphone that emphasises pocketabilty and one-handed operation. How will it fare in a market increasingly dominated by phablets?
One thing Apple didn’t address was storage. The cheapest iPhone SE ships with just 16GB of on-board storage, with only around 12GB actually usable. This doesn’t just affect consumers – who face running out of space on their device – but also carriers, through knock-on effects from these limitations.
As smartphones become more sophisticated, they are used as much for creating content as they are for consuming it. The content being created today is richer and heavier than ever, placing growing strain on device storage capacities that ultimately damages user experience.
When Synchronoss and 451 Research charted the growth of smartphone content creation, it was no surprise that photos and videos were the biggest drivers, amounting to 3.6GB and 3.7GB respectively on the average smartphone user’s device, out of a total 10.8GB of content. But the impact of apps is increasing (900MB), particularly as smartphones become powerful gaming machines and developers push their capabilities, resulting in bulkier downloads.
Given that a high proportion of smartphone owners have low-capacity devices – 31% 16GB; 57% 32GB or smaller – many will (if they haven’t already) quickly find themselves having to make difficult decisions. Synchronoss and 451 Research found that the average smartphone user generated 911MB of new content every month: that 16GB iPhone with 10.8GB already used will be full in just two months.
This situation will get worse as consumers embrace higher-definition media features such as 4K video recording, with 76% saying they would create more content if they had their desired additional storage.
The impact of the ‘content explosion’ on consumers is obvious, but why should carriers be concerned? The network implications of the growth of content have long been acknowledged, with carriers spending billions upgrading their infrastructure. But comparatively little has been said or done about the knock-on effects of on-board storage limitations.
Carriers still dominate smartphone sales, accounting for 65% of sales in the US and 64% in the UK. With this set to remain the case for at least the next five years, the majority of customers will expect carriers to provide technical support when it comes to managing the content on their devices.
Physical retail is still a vital sales and customer service channel, with many consumers relying on in-store staff to help them migrate content between devices when they upgrade, or onto off-device storage. Millions of hours are spent on this that could have been used for revenue-generating activity.
Store visits will become more frequent as carriers increasingly stop subsidising handset purchases on long-term contracts. More frequent upgrades mean more time spent supporting content migration, but also increases the importance of ‘sticky’ services that keep hold of customers.
Also related to customer retention is consumers’ use of third-party off-device storage services, loosening ties between carriers and customers. If carriers sell devices that enable consumers to stockpile content, they must also proactively support the management of that content.
Cloud-based services provide the ideal platform for off-device content back-up, transfer, and restoration, while also insuring smartphone users against the loss of their data and content if their device is lost or stolen or crashes irreparably. Yet even in the US, the most mature market for consumer uptake of cloud storage services, more than half of smartphone users are not using the cloud to manage their smartphone content.
There is an obvious opportunity for carriers to offer customers a branded cloud storage service to help them survive the content explosion – and the carrier to keep the customer within their ecosystem. There is strong competition – Apple in particular has defended its 16GB models by pointing to its iCloud platform – and given the rapidly-evolving market landscape, carriers cannot afford to miss out on this opportunity to improve customer experience and reduce churn.
The author is Ted Woodbery, VP, Product Strategy & Corporate Marketing at Synchronoss Technologies
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