Best Buy To Meet Mobile In The Middle
Monday, March 29th, 2010
By Ross Rubin, Executive Director, NPD Connected Intelligence
On its earnings call last week amidst the backdrop of CTIA, Best Buy noted its intention to open 75 to 100 “small-format” stores, the lion’s share of which will be Best Buy Mobile stores. The retailer, which is a dominant seller of televisions and PCs, sees great potential in the “third screen” of the cell phone, even though it has limited control of device pricing (and even less control over subscription pricing). First, it believes that its impartiality, selection, and customer service can offer advantages that the carrier stores cannot. And handsets offer supplemental revenue streams of accessories, Geek Squad setup, and ongoing maintenance and data management services.
Indeed, as CTIA continued to demonstrate, handsets are beginning to bore into the heart of the home theater. Samsung showed how its forthcoming Galaxy S could be used as a DLNA client, routing content to the television from other sources around the home. And the HTC Evo 4G, slated to be the first 4G handset in the U.S., has an HDMI port for sending high-definition video to a TV. Both handsets can also capture HD video.
Revenue stream diversification in the cellular service market is also working in Best Buy’s favor. While Best Buy Mobile enables the retailer to gain more experience with the subscription model, increasingly we will see models for connected devices that are either fully subsidized (such as those for e-readers such as the Kindle) or pay per use plans such as the iPad. At AT&T’s briefing at CTIA, it was clear that the carrier is opening its doors to a wide array of devices that include the familiar (PNDs) to the emerging (the OpenPeak Web tablet) to the quirky (a connected dog collar). Regardless of whether it’s participating in the heart of the cellular market or preparing for the next generation of mobile electronics, retailers will need to master the art of selling the connected product.
Tags: Best Buy, cell phone, CTIA
Wireless | Ross Rubin, Executive Director, NPD Connected Intelligence | 
March 29, 2010 2:35 pm
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