Dawn of a new decade – Exciting times ahead for the Mobile industry
First of all, a very happy and prosperous new year 2010 to everyone out there. In this first post of 2010, I thought I will share my perspectives of what this new decade could hold for the Mobile industry. Mobile industry has been a very interesting and a highly dynamic industry over the past decade. Mobile subscriptions have grown multi-fold across the world and we are seeing a big shift in the business models – revenues are now being driven by Data services more than it used to be by the Voice services.
I have summarized and listed the top 10 areas which could be interesting to watch out for. I believe these could be the areas where the most of the action will be at least in the initial part of the decade.
- Continued growth of App Stores – App Stores are growing. Apple saw 2B+ downloads and other newer application marketplaces on the block are also seeing continued growth. Large Operators have also jumped into this business trying to claim their stake at it. There is going to be a lot of push from both the Handset makers and the Carriers to make each of their App Stores a success by attracting more developers and trying to catch the consumer’s attention. There is a fear that is catching up about how this could cause a fragmented experience for both the developers and consumers. We need to see how this will shape in the years to come and which ones are going to become successful. But one thing that is clear is that all the other App Stores have a lot of catch up to do to with Apple’s App Store.
- Explosion in Smart phone penetration – From being in the single digits in terms of market share, the Smart phones have started increasing their pie in the handset distribution chart. These days there is so much talk and push about smart phones that are being launched and so less about the feature phone segment. Consumers have also started to like these smart phones due to the feature functionalities they offer and since most of them have become affordable (of course with Carrier’s subsidies). I believe the forth coming years will see a lot of market share being gained by these Smart phones.
- Mobile Data Bandwidth Usage – Growing number of smart phones, explosion in digitization of content that can be consumed wirelessly and the growth in consumer’s appetite to be connected at all times via their mobile devices have all resulted in a (as some people call it) – a mobile data tsunami. There is an astronomical growth in bandwidth consumption that is clearly putting a lot of pressure on Operator networks. Though operators have made heavy investments in their Network Infrastructure, it will be interesting to see how Mobile Operators cope up with this growth in Data usage and manage to maintain the quality of their services – especially when the Mobile industry is shifting from a “Voice-oriented” industry to a “Data-oriented” industry.
- Rise of Android OS – From a humble beginning a few years ago when T Mobile introduced G1, Android OS has come a long way. Almost every OEM has started to embrace Android OS and we will be seeing more of the devices adapting Android in future. But what sets Android OS apart from other OS’s and in the path for wide spread adoption is that Android OS is being adopted for a lot of different connected device segments (other than mobile device). We have seen e-Readers like Nook and Internet Tablets like Archos come into the market. It will be interesting to see how all these device makers adopt the “openness” promoted by Google and how Android OS matures and becomes the OS of choice for these type of connected devices.
- Growth of 4G – With growing usage of mobile broadband, the consumer demand for higher speeds and the growing adoption of high-bandwidth applications and services, Carriers have started to transition towards 4G. We have seen announcements from operators across the world who are investing and transitioning towards 4G technologies like WiMAX and LTE. Though there have been market rollouts of WiMAX, we have not seen LTE come out of the market trials yet. It will be interesting to see how quickly and effectively Operators transition towards 4G and what kind of differentiated services they will be offering over 4G.
- New Players in the Wireless Connectivity Market – Traditionally, when it comes to Wireless data connectivity, it used to be the Mobile Operators who used to compete with one another. The last few years has seen a number of new non-traditional players emerging to offer Wireless Data connectivity. We have seen Cable MSOs and other companies invest heavily on Wi-Fi hotspots (even though carriers were also investing in Wi-Fi hotspots). Cable MSOs like Cablevision bundled their Wi-Fi connectivity as a free value offering for their Cable Broadband subs whereas other companies like Boingo has been selling Wi-Fi connectivity to travellers. With a heavy influx of dual mode handsets and light weight laptops (or Netbooks), these companies have seen a big fan following for these services. Cable MSOs in the US have also heavily invested in WiMAX networks of Clearwire and have started introducing 4G Mobile Broadband services like Data Cards (Time Warner for example). We could soon be seeing devices like Netbooks (embedded with WiMAX modems) being sold by these Cable MSOs in direct competition to Mobile Operators. This will be an interesting space to watch out for.
- Non-Handset devices claiming their stake at Mobile Data traffic – The embedded mobile market has seen a lot of action over the past few years with introduction of non-handset devices like eReaders and Netbooks. With a lot of investment going into the Embedded Mobile devices and their applications in Industrial Machine-2-Machine (M2M) scenarios, we will be seeing a lot of growth in this particular segment in the coming years.
- New Billing Models on the horizon – With the growing usage of mobile broadband, some operators have already hinted at tiered-pricing for their Data users. It will be interesting to see how operators introduce such new billing models and how much these new models are accepted by the consumers. Another big change in the operator’s traditional billing models will be owing to the growth in the M2M/Embedded Mobile space. Embedded Mobile space will demand an “amount of data traffic” independent billing models as they will no more serve a traditional one-to-one relationship.
- Mobile Commerce and Payments – Mobile Commerce and Payments has been one hot area in the Mobile industry in the last few years. There have been a lot of market trials around Mobile Payments, Ticketing and Money Transfer. Though Mobile Banking has picked up a lot in a number of countries, the other applications are still nascent. With developments in contactless technologies like Near-Field Communications (NFC), very soon we could see Mobile Wallet applications enabling contactless payments at retail outlets, vending machines and ticketing terminals. It will of interest to see how quickly Mobile Payments and Commerce will evolve into a mass-market service that will drive consumer adoption.
- Increasing spends on Mobile as a Marketing Channel – Today, mobile is the king! There is no other mass media like Mobile that has a ubiquitous presence amongst consumers. Consumer-focused enterprises have increased their focus on Mobile as a channel to reach out to their consumers. We have seen branded applications which are aimed at promoting their brand or specific product lines including the delivery of coupons and deals from Retailers and CPG companies. Mobile, as a marketing channel, continues to offer exciting new opportunities. But Mobile Marketing is still at a nascent stage. Will this decade see an increasing adoption and spending on Mobile Marketing and Advertising?
There are some interesting days to come and it will be exciting to see how the Mobile industry gears up for another decade of evolution and growth. I summarized the areas that I believe will see a lot of interesting action.
What are your thoughts? What do you think are the areas to watch out for as the Mobile indsutry gears up for the new decade?



Comments
Great listing but I don't see what I think is the biggest drawback of all this great technological advance. Namely that the "smart phone" devices keep getting smaller. This used to be a plus, but now with all the features, we all use our mobile devices for much more than just talking and texting. The small screens and keyboards are a real problem for many of us "over 40" folk. And we are one of the fastest rising number of new users of these devices. I think there is a real market for hardware that is just a little larger than the current crop. Something with a bigger keyboard and screen. I now have the Blackberry Tour and love it, except that the keyboard is too small! Even my daughter who sends and recieves over 20,000 texts per month, does not want a Tour because of the small keyboard. I would love it even more if it was 30% larger.
Posted by: Will | January 17, 2010 06:44 PM
Will - What you have described is very valid issue and there are no easy answers for this. I have heard similar feedback on some devices from my colleagues and friends.
I agree that the usability of the devices go a very long way in determining the success or failure of a device - especially with a flood of new devices arriving in the market than never before. And we have seen devices shrinking size over the last decade. This is why we see so much of effort is being spent on usability testing.
Typing and Screen sizes/layouts have always been at the top of usability considerations for mobile. We are also seeing innovations in soft-keypad happening. I am sure you would have seen or tried latest innovations in typing like ShapeWriter and Swype . Companies like these are trying to come up with intuitive, fast and easy ways of typing.
It will be interesting to see how mobile device makers strike a balance between technological innovation (and the ability to support more features) and the usability of the devices.
Posted by: Sandeep Chandrasekar Seshadri | January 22, 2010 05:17 AM
Mobile has become a Hand-Like-Robot for todays Technology.
It's technology is growing faster & faster.
With increasing & new advanced developement of Mobile OS like Moblin they become just like the Smart-Netbook.
Posted by: CHINTAN DONDA | January 22, 2010 08:53 AM
Yes Chintan, totally agree. As computational capabilities of the mobile device advances, the line between a mobile device and a netbook (PC) has started to blur. Companies have also start coming up intermediate devices that has the power of a netbook combined with the features of the mobile terming it SmartBooks.
These are all interesting times and the innovations we see in this industry (and the speed with which they are happening) continue to amaze me!!
Posted by: Sandeep Chandrasekar Seshadri | January 22, 2010 04:46 PM
Hi,Apple has officially announced it's ipad launch on jan 27th.In my point of view it's really targeting Amazon kindle (one of the best selling e-book reader).
Ya Apple iPad is a big screen with 1024*768 resolution . It will be like mini netbook. I am sure that apple iPad will pick the e-book reader market.
In application developer point of view there is no much difference other than screen layout and some new classes like UIGesture etc.
In architectural point of view ,we dont need to bother much about migrating apps developed for iPhone into iPad apps.
Let's see how fast iPad is changing the smartphone market to next level.
Posted by: Sakthivel | January 31, 2010 01:48 PM