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Mobile becoming the primary way to access Internet: study

Although consumers are increasingly using their mobile devices as a primary outlet to the Internet, there are substantial global challenges to market on smaller-sized screens, according to a new study from the Boston Consulting Group.

The ?Through the Mobile Looking Glass: The Transformative Potential of Mobile Technologies? report breaks down mobile development into three models. The report also highlights how consumers are leading the charge with the shift to mobile-first strategies.

?The main message for marketers is that clearly the mobile devices are becoming the primary way for accessing the Internet for many consumers around the world,? said David Dean at Boston Consulting Group, Boston.

?However, clearly there are also some challenges with marketing on a device that is still quite small,? he said.

Mobile breakdown
The Boston Consulting Group report breaks down mobile into three models that are being integrated into the global economy ? collaborative, competitive and greenfield.

Each of these models can be viewed as a stack, or a set of software and hardware that drives a smartphone or other device.

Consumers who create, consume and share content through a variety of services and applications are at the top layer of a stack.

Underneath consumers are the layers that enable the consumer to interact with their mobile device ? including carriers, service providers and networks.

Four out of five broadband connections will be mobile this year, showing how the Internet is increasingly becoming dominated by smartphones and tablets.

Additionally, high-speed data, location and social all contribute to giving mobile the scale, reach and capabilities that other types of technology cannot offer.

Mobile is also changing the way that users consume media.

For example, sales of recorded music increased for the first time in 2012 since 1999 with downloads contributing to 70 percent of sales. Additionally, smartphones are the No. 3 device that consumers use to listen to music on.

Additionally, the growth of second and third screens is attributing to higher levels of perceived value from consumers. Recent research from Boston Consulting Group found that perceived brand value increases 41 percent when a second screen is added by consumers.

?The data shows that they more devices you have, the more value that you get from mobile media,? Mr. Dean said.

To keep up, companies are increasingly putting mobile at the forefront of their strategies.

Take Facebook, for example. Roughly two-thirds of the social media giant?s one billion users access the site via their mobile devices. Similarly, 60 percent of Twitter?s users access content from their mobile devices.

Mobile collaboration
The first model is collaborative and tends to be driven by operators working closely with major players in the mobile space.

Japan is one of the largest examples of the collaborative business model. Fixed-rate data plans helped mobile adoption grow in the country and today 95 percent of mobile users in Japan are on 3G networks.

Additionally, mobile marketing initiatives such as payments have taken off faster in countries such as Japan because of negotiations made between carriers and industry players.

Take McDonald?s in Japan, for example. The company has 16 million registered users on its mobile site, which is equivalent to more than 12 percent of the company?s population.

The fast food chain sends out customized mobile coupons that are based on consumers? past buying behavior, age and location.

Mobile is attributed to approximately 20 percent of all business-to-consumer ecommerce in the country.

Competitive advantage?
The second model is competitive, which is best evidenced in the United States, per the report.

In these kinds of environments, the barrier to entry is low, meaning that businesses of all sizes are eager to try out the technology to increase revenue, open up new markets and decrease costs.

At the same time though, companies are wary of competitors following their footsteps in mobile.

When it comes to mobile payments, the biggest thing holding it back is a compelling consumer proposition when credit cards work for most consumers.

Per the report, mobile payments are not likely to become mainstream for another decade in the U.S. and similar markets.

Mobile opportunity
The third model in the study is the greenfield model, which is associated with developing countries.
In these types of countries ? such as India ? limited fixed-line access and ease of deploying mobile networks means that mobile may become the only place for consumers to access the Internet.

Although smartphone penetration is low in these areas, adoption is growing.

In fact, the report points to mobile banking taking hold in India faster than it did in either the U.S. or Europe.

?If mobile marketers don?t understand these different models, then they will be frustrated,? Mr. Dean said.

?I think mobile is going to become the primary source of interaction for many consumers throughout the world,? he said.

?Many talk about mobile-first in their plans, which is essentially are saying about their devices.?

Final Take
Lauren Johnson is associate reporter on Mobile Marketer, New York