Retrevo.com, one of the world’s largest consumer electronics review and shopping sites, recently disclosed insights about U.S. cellular users gleaned from a study of online individuals conducted by an independent panel exclusively for Retrevo.com in June of 2011. We should pay attention.

First, the “tale of the tape:”

• 34% of iPhone (News - Alert) owners mistakenly think they already have 4G
• 22% of people think 4G performance is not worth the cost, and 30% think 4G data plans cost too much
• 40% of people say they'll buy the next iPhone, even if it doesn't have 4G

According to the study, the responses show that, “There's enough confusion and skepticism among consumers to keep the pace of adoption at a moderate rate. With so many potential customers expressing concern about price and performance and confusion over what exactly 4G means, providers of phones and services will have their work cut out for them to convince customers to upgrade to 4G.” They also say this confusion is why Congress has seen the introduction of legislation to force operators to do a better job of disclosure about their mobile -- specifically 4G -- services. (And, while not related to this study, policy makers’ concerns about better disclosure on wired and wireless phone bills have dominated the news the last few days).

To be perfectly honest, I do not see the 4G market, or device purchasing behavior for that matter, hampered by current 4G “confusion.” However, I do believe much better disclosure would be good for everyone —whether done voluntarily by the wireless service providers or by law.

I already have a 4G phone

This reminds me of a conversation I had about the power of a brand with an AT&T (News - Alert) executive a long time ago. They told me that a study once showed that not only did a majority of Americans believe AT&T made televisions, but 25 percent ranked AT&T’s televisions as the best. Yes, there is confusion about an iPhone 4 being a 4G phone when Apple (News - Alert) has yet to make a 4G phone. But the study says Android and Blackberry owners are not far behind in this belief. Plus, directly related to the last point above, in terms of purchasing behavior, Apple’s brand awareness and brand promise —cool products, features and functionality —are potent. It appears to make 4G speed a small consideration criterion in future purchases. This is actually a moot point. If you believe Apple will reverse its history of moving fast in the market and won’t have a 4G iPhone out long before it becomes a meaningful differentiator, I can tell you the tooth fairy is likely to be paying you a visit.

4G performance is not worth it

The study, in response to a question as to whether consumers were interested in buying 4G phones this year and hence 4G service plans, finds 22 percent of respondents did not think 4G performance was worth the cost, and that 4G data plans cost too much. It concludes that, “long term, we’re confident that 4G speeds will prevail over 3G and that carriers will ultimately provide a fair price for 4G service. In the meantime, it looks like after the kinks are worked out, marketing departments will have their work cut out for them to change consumers’ perceptions about the value of 4G.”

Interesting!  Let’s see. Many people think they have a 4G phone that do not. Yet they probably are in the group who thinks 4G pricing is out of whack. Now I am confused. How can you make a determination about price and performance on something you do not have or obviously are not using?

With unlimited data plans about to become extinct (for very sound business reasons I should add), consumers will be given lots of options and bundles on speeds and feeds, policies on who can use what, when, where, why and how, etc. The market will dictate what happens here. In fact, the virulent reaction to the recent Netflix decision to raise its online rates up to 60 percent is a warning to cellular marketing folks that should not be ignored.

A corollary point on this whole pricing thing has to do with the speed at which cellular operators will upgrade their networks to 4G.  For reasons way too long to enumerate -- not the least of which having to do with planning for and deploying the capacity required to accommodate the explosion of bit-hungry traffic as smartphones proliferate and with them, video-intensive applications -- 4G will and must come fast.

Anecdotally, I don’t remember there being these kinds of questions when we went from 2G to 3G. Again, based on individual decisions about perceived value relating to phone functionality, user needs (including the need for speed and the types of apps typically used), the market will pick winners and losers. This means devices and services.  Where those purchasing decisions intersect will be the marketing challenge that industry partnering relationships can, as they do now, impact significantly.

Finally, I cannot leave this subject without citing famous New York area discount clothier, Syms. Their tag (News - Alert) line is, “An Educated Consumer is our Best Customer.”  No truer words about the path to success in the 4G market could be spoken.

Click here for the full Retrevo analysis.

Peter Bernstein is a technology industry veteran, having worked in multiple capacities with several of the industry's biggest brands, including Avaya (News - Alert), Alcatel-Lucent, Telcordia, HP, Siemens, Nortel, France Telecom, and others, and having served on the Advisory Boards of 15 technology startups. To read more of Peter's work, please visit his columnist page.