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Have telcos overlooked a $1.7b mobile phone market?

Source: Roy Morgan Single Source, July 2014 –December 2014, sample = 2,419 Australians 14+ with a non-smart consumer-pays mobile phone.

Australian consumers now have a $10billion annual mobile phone bill. Service providers are understandably focused on wooing high-spending, data-hungry smartphone users, but there’s a long-forgotten bloc of traditional mobile users with little interest in touch screens, apps and 4G networks. They make the odd call, send the odd text, and quietly pay telcos over $1.7 billion a year, the latest telecommunications data from Roy Morgan Research shows.

Over 4.3 million Australians (14+) still have a main personal mobile phone that is, for lack of a better term, not smart—with no computer-like functionality or ability to download apps. Remember those? This group still represents over 1 in 4 mobile phone consumers and 17% of the national expenditure on consumer-pays mobile phone services.

Of course, non-smart phone owners, on either a pre-paid or post-paid plan, spend less on average than their smartphone-wielding counterparts—but not as much as you might think: just over half of non-smart mobile owners have a pre-paid service, and they spend an average of around $26 per month (just $8 less than the average pre-paid smartphone user). The average post-paid non-smart mobile owner spends $41 per month—and while smartphone users may shell out $20 more, this often includes repayment of their smart, and expensive, handset. 

Overall, non-smart mobile owners in the six months to December 2014 reported their yearly expenditure as $686 million on pre-paid services and $1036 million on post-paid. 

Amount spent per year by Users of Non-Smart Mobile Phones

Source: Roy Morgan Single Source, July 2014 –December 2014, sample = 2,419 Australians 14+ with a non-smart consumer-pays mobile phone.

Understanding the 4.3 million non-smart consumer-pays mobile phone users:

  • The vast majority (67%) of non-smart owners say they have no intention to upgrade their handset.  
  • A similar proportion (69%) have had phone for four years or less—that is, even with smartphones already omnipresent they chose (or were given) a non-smart phone. But around 1 in 9 of them have used their current handset for 10 years or more.
  • They make an average of around 15 calls and send 14 texts per week—but around 1 in 8 of them make no calls and 1 in 3 send no texts during a normal week. 6% say they haven’t used their phone at all in the last four weeks.
  • 69% are over 50, 17% are 35-49 and 13% are 14-34.
  • And around 60% don’t agree that they enjoy people contacting them on their mobile

Tim Martin, General Manager - Media, Roy Morgan Research, says:

“In such a competitive space, mobile service providers naturally need to focus their marketing strategies and energies on customers who will need, want and eventually spend more.

But as providers create offerings and deals that appeal only to consumers hankering for the iPhone 6, HTC One M9 or Samsung Galaxy S6 on a 4G network with big data allowance, there’s $1.7 billion up for grabs in 2015 from Australians who just want to use their current phone as a phone.” 

To understand how to reach Australians with different mobile phone handsets, expenditure, usage habits and purchase intentions, contact:

Vaishali Nagaratnam
Telephone: +61 (3) 9224 5309

About Roy Morgan

Roy Morgan is the largest independent Australian research company, with offices throughout Australia, as well as in Indonesia, the United States and the United Kingdom. A full service research organisation specialising in omnibus and syndicated data, Roy Morgan has over 70 years’ experience in collecting objective, independent information on consumers.

Margin of Error

The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. Margin of error gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. Allowance for design effects (such as stratification and weighting) should be made as appropriate.

Sample Size

Percentage Estimate


25% or 75%

10% or 90%

5% or 95%