Recently, the news broke that record numbers of Spanish users are foregoing cell phones, with the total number of lines dropping by around 380,000 in April. Now it seems France has joined the club, as the French newspaper Les Echos reports that this year, the country’s mobile sales will have fallen to its lowest level in years.
Can those of us here in the States consider this a sign of things to come? Maybe, maybe not. Anyone who follows world economics knows that things are complicated in Europe right now. We all know what it’s like to face is a monster cell bill when our bank accounts are dry, so it’s not hard to understand why Spanish users — whose home country is wracked with a whopping 25 percent unemployment rate — might succumb to some belt tightening. Then there’s the carrier situation: Was it really the best time for Telefonica and Vodafone to try cutting handset subsidies? Indeed, this has hit their business interests hard, and could be contributing to the situation.
In France, a new provider called Free might be gumming up the works for the resident cell carriers. Its approach to mobile may be innovative — as it hands off calls to Wi-Fi as much as possible, which lowers prices for subscribers — but its popularity has users signing up with their own unlocked phones. They simply purchase SIM cards, and they’re good to go. And in the Netherlands, which historically has been enamored with mobiles, the mobile market has just showed signs of decline in Q1 of this year.
But all that merely scratches the surface. We know that featurephone sales are in the pits, thanks to the smartphone’s rise. And there’s nothing like a pricey device to inspire people to get more bang for their buck and hang on to their tech a while longer (or sell it off). Then there are those who give their used handsets away to loved ones, who then don’t need to buy a new one or sign a subsidized contract. There’s also growing interest from corporate employees to use their own phones instead of carting around both a personal and business device. (That last one’s a real thinker: For many years, European countries have had a mobile penetration rate of over 100 percent, likely due to dual-phone users.)
If we sit down and think about it, we could come up with myriad reasons for the shift — from cheaper and less contract-oriented MVNOs (mobile virtual network operators) earning people’s trust (and their business), to Nokia’s decline influencing the market. Then there’s the psycho-babble argument: Maybe Europeans are just getting sick and tired of being connected all the time.
Whatever the reasons, mobile phones appear to be losing some of their luster overseas, in places where their popularity has previously been huge. For us in here in the U.S., it’s natural to wonder how this might affect tech companies and their offerings worldwide. Or even, if it’s a sign of things to come here at home. What do you think? Could the mobile decline happen here? And if so, when do you think it will happen? Weigh in with your take of the situation in the comments.