Handsets

Western European handset market grows after 5 quarters of declines

Paul Rasmussen — Wed, 02 Dec 2009 12:54:20 -0500

The Western European mobile phone market rose for the first time in the last 15 months. During the third quarter of 2009 the Western European market grew 5 per cent year-on-year, according to IDC's European Mobile Phone Tracker. Handset shipments totalled 46.8 million units, representing sequential growth of 11 per cent, which shows that consumer demand is picking up and operators are not so reluctant to stock up for the Christmas season.

"The mobile phone market is showing strong signs of improvement since the onset of the economic crisis," says Francisco Jeronimo, European mobile devices research manager with IDC. "The quarter's growth was supported by the traditional mobile phones (TMP), the biggest segment of the market, but affected by the trend towards smartphones. Samsung and LG have been particularly strong in the TMP segment, with their portfolios boosting sales of feature phones. On the other hand, converged mobile devices, or smartphones, saw negative growth due to the lack of materials and supply chain problems experienced by some of the major vendors, which were not able to supply the high demand from operators." Article

GfK: UK handset market grows

Paul Rasmussen — Wed, 25 Nov 2009 12:31:12 -0500

GfK data shows that the UK handset market increased by 0.9 per cent in October compared with the same month last year; sales of open OS handsets grow by 35 per cent. The UK mobile handset market shows signs of growth moving towards Christmas, according to market analysts GfK. Article

'The Cloud' will not lead to dumb handsets, claims Nokia

Paul Rasmussen — Wed, 11 Nov 2009 12:43:35 -0500

With much being speculated about the impact of Cloud Computing on the wireless industry - particularly handsets, Nokia has batted back the concept by stating that mobile devices will not become ‘dumb clients' relying on the Cloud for the majority of intelligence.

The company's chief development officer, Mary McDowell, has stepped forward by accepting that the Cloud will grow, "we don't think the cloud is the total answer. Mobile devices are becoming more personalised and increasingly part of an individual's life. We think it will not be either/or," she said. "There will be a lot of intelligence in the Cloud and in the device, and the ability to exchange data with the Cloud will not pave the way for thinner devices, but increasingly powerful ones."

This rejection of dominance by the Cloud was supported by Heikki Norta, the company's head of corporate strategy, by claiming that Nokia was eyeing the opportunity beyond selling devices, and intends to connect "intelligent devices" to Cloud-hosted data. Norta revealed that the company was setting itself the target of 300 million users of its core service offerings, which will include messaging, map navigation, music and the Nokia Ovi Store.

McDowell added that the company was also investing in a ‘mixed reality', citing augmentative reality concepts such as "point and find" - a location-based service using GPS and camera technology that is already being provided on Nokia N-series phones.

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Total Telecom

Smartphone revolution tests established players

Keith Mallinson — Tue, 27 Oct 2009 17:13:43 -0400

With smartphones set to account for most handset sales by 2013--in terms of value if not also in terms of volumes worldwide--these devices, their operating systems and mobile Internet service delivery environments are crucial competitive elements for manufacturers and mobile operators alike. Several new entrants, rapid market growth and the precipitous share decline for leader Nokia underline that this is still an emerging marketplace. The pecking order is being reestablished with major upsets for various leading names.

Nothing could be more disruptive than Apple's iPhone and its App Store offering 85,000 applications and 2 billion downloads to date. This is an enormous success for Apple, a mixed blessing for its mobile operator partners with the business model Apple imposes and it is a major threat for many others. As Apple takes the lion's share of ecosystem value and dis-intermediates operators from applications sales with its own user experience and billing platform, partner and competing operators alike are looking for alternatives.

And Apple is just getting into its stride. It has plenty of scope to expand distribution with competing operators when exclusive deals expire. It supplies to just 80 nations so far. Corporate purchasing is only beginning to introduce iPhone, as is higher education. Apple claims more than 50 percent of Fortune 100 companies are evaluating iPhone for widespread deployment.

The smartphone market segment has been splintered. Nokia smartphones and its Symbian operating system have taken double digit market share losses over the last year or two, albeit with significant market growth. Once ruling supreme with shares of 50 percent in smartphones and 60 percent in smartphone OS, market entry of iPhone and Google's Android, together with stellar growth for BlackBerry and modest progress for Microsoft have harmed Nokia irrevocably. Further declines are inevitable as emerging competitors strengthen.

What's particularly scary for Nokia is that Apple's relatively small iPhone volumes are generating sales in the third quarter of 2009 of $4.5 billion compared to Euro 6.9 billion ($9.7 billion) for all Nokia's handset sales. Gross profits for iPhone are getting close to Nokia's Euro 2.1 billion ($3 billion). Although Nokia shipped 110 million devices in the quarter, the average price of these was just Euro 62 ($87). In comparison, iPhones yield an average of $610 apiece at the wholesale prices paid by operators...Continued

Timescales for LTE devices on the slide

Paul Rasmussen — Fri, 09 Oct 2009 12:32:57 -0400

With LTE commercial deployments planned for later this year, operators are making public their concerns over the timely availability of LTE modems and handsets. Reports from last week's ITU Telecom World event would indicate that no device will ship this year, while AT&T, NTT DoCoMo and Telefónica voiced concerns in a panel session about their ability to have devices ready for subscribers by the end of next year.

ZTE, one of the pioneers of LTE modems, has published the most detailed specs of its LTE modem, but its CTO, Xiaodong Zhu, admitted in Geneva that the company was still waiting for Qualcomm to start shipping the commercial LTE chipsets. However, ZTE confirmed that it was hopeful of shipping modems before the end of this year.

Responding to these worries, Vieri Vanghi, senior director of product marketing at Qualcomm, said that chip vendors were doing their best to ease the concern of the operators, and Qualcomm and its partners would have products ready for the early launches of LTE handsets by the end of 2010.

Another major silicon provider, ST-Ericsson, reported it was making positive progress. "We are in a phase where we have all the hardware available and we're working on integrating it with the software," said Jörgen Lantto, executive VP and CTO at ST-Ericsson, who said that products will be ready during the second half of next year.

However, Lantto admitted that 1^st generation LTE handsets would face the challenges that have been seen before with 3G handsets: power consumption, size and price. Also, to get all the performance that LTE can offer requires advanced antenna constructions, he added.

Speaking at the event, Kristin Rinne, senior VP of architecture and planning at the US operator, said that the availability of devices was one of the reasons AT&T has decided to launch LTE in 2011. "It is much more reasonable to launch during 2011, because then there will be a variety of devices."

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IDG News

Mobile device makers want common plugs for earphones

Paul Rasmussen — Fri, 09 Oct 2009 11:07:25 -0400

An international trade group representing wireless device makers announced Wednesday it was backing a drive to standardize audio and USB plugs for laptops and other mobile gadgets. The CTIA Wireless Association said it is behind an initiative to make 3.5 millimeter plugs the standard for earphones, headphones and micro-USB connections in mobile devices introduced to the market after January 2012.

"By simplifying input and output features on mobile devices, economies of scale will reduce consumers' costs," said CTIA president Steve Largent.

Members of the wireless industry came together in April to support having universal power chargers for devices. Article

T-Mobile CEO calls for simpler devices to drive mobile Internet revenues

Paul Rasmussen — Wed, 02 Sep 2009 13:40:44 -0400

Speaking to the Nokia World conference held in Germany this week, Deutsche Telekom CEO, Rene Obermann, called upon handset manufacturers to reduce the number of features and make them simpler to use.

"There is too much complexity, too much jargon," he said, adding that 59 per cent of consumers believed their handset had too many functions while a massive 89 per cent felt that complexity on the device was a burden.

Devices are becoming ever-more intelligent, capable, and powerful, which means operators and vendors have got to work on simplification or risk leaving large numbers of less tech-savvy customers behind, Obermann advised.

With the Nokia event producing no surprises, apart from a few new handsets and services, Obermann labelled the mobile industry as still immature and warned the operator community that hard work was required to capture the new revenue streams around mobile Internet and applications.

"Our voice revenues are declining and they will continue to be under pressure, and the commoditisation of our traditional services has begun," said Obermann. "It is a question of balancing commoditised services on one side of the equation with making an effort to innovate and embrace new business models on the other - and that's a very difficult balance."

Obermann also forecast that consumers should be persuaded to store less data on their handsets. "Digital assets in the consumer space will increasingly be stored and managed in the cloud, rather than on the device," he said. But for this to happen, Obermann emphasised that customers would need to trust the industry, pointing to the numerous breaches in consumer data that had already happened.

Separately, T-Mobile UK, a subsidiary that normally fails to come first in any category, has enjoyed a victory after scooping the highest ratings in more than half of the categories that were included in a UK mobile broadband survey.

Amongst the categories where T-Mobile came out on top were billing, customer service, ease of use, installation, best upload and download speeds, and best value for money for data usage

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Total Telecom and Broadband Expert

Nokia: No turnaround for 12 months, says Goldman Sachs

Paul Rasmussen — Fri, 14 Aug 2009 12:42:37 -0400

There is little hope of a revival in Nokia's fortunes in the next 12 months, says Goldman Sachs is a downbeat report that concluded the bulk of the world's largest mobile-phone maker's current woes were "self inflicted".

Goldman said Nokia's risk-reward profile remained uncompelling (relative to the broker's bullish view on the wider European technology sector) due to its continued loss of market share in the smart-phone segment, combined with a lack of convincing new high-end models scheduled for the next 12 months.

In a damming note to investors, a Goldman analyst wrote that, having experienced the Nokia N97, the company needed to start almost from scratch to create an attractive user experience, rather than following the complex menu structure of Series 60. "But this revamp is unlikely to be achieved rapidly. In the meantime, the iPhone will likely become available on a non-exclusive basis from many more operators, and move deeper into emerging markets, long the preserve of Nokia," the broker warned.

Goldman also believed that Nokia's 55 per cent market share in the mid-end smart-phone segment looked "unsustainably high" given that Nokia's brand image will ultimately suffer from its loss of leadership at the high end. In anticipation, Goldman has forecast that Nokia's value share in the segment will fall to 40 per cent in 2011.

Piling on the gloom, Goldman maintained that the key swing factor for Nokia's earnings in the mid term was the company's ability to execute its software/solutions strategy so that its high-end models could compete more successfully with products from Apple and Taiwan's HTC among others.

Unfortunately Nokia's track record in that area over the past eight years has been poor. It's failed to significantly break into the enterprise market dominated by RIM--although its latest deal with Microsoft might help combat this––and has fallen two years behind Apple in multimedia, despite the US firm's late entry into the market, the broker said.

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Market Watch

Leading retailer trials QR codes for mobile interaction

Paul Rasmussen — Wed, 12 Aug 2009 12:38:55 -0400

UK consumers shopping at a selected number of Marks & Spenser's (M&S) stores will be able to use their camera phones to scan QR codes on a small range of items. The code will then direct the user to access the Food To Go mobile web site that features a range of content and voucher codes to claim against future purchases.

M&S is one of the first UK retailers to adopt the technology to interact with customers, albeit that QR format has been popular in Japan with cell phone users, resulting in a number of high-profile attempts to repeat its success in Europe.

An M&S spokeswoman said the retailer was looking to engage more with its customers. "We're trialling QR codes as an innovative new way to communicate with our customers. But, at this stage, it's only on our Food To Go freshly squeezed juices."

The ability of handsets to read 2D, or QR, bar codes as links to urls is commonplace with the reader app being downloaded from companies that specialise in this technology. The unresolved question has been what to do with the capability within a retail environment for purchasers carrying a mobile phone.

Attempts to educate consumers to the benefits of scanning QR codes in Europe remain unproven today having seen BBC, Fanta, Ford, Pepsi and Volvo all conduct campaigns using the technology. However, large packaging and printing companies like DuPont and Prinovis have been entering into QR code deals with market leaders like NeoMedia and Scanbuy that could bring the idea to life if the retail community is able to motivate consumers with useful and rewarding mobile downloads.

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NMA

Don't be a midrange handset vendor, warns analyst

Paul Rasmussen — Wed, 12 Aug 2009 12:36:28 -0400

The strongest demand segments for handsets over the next five years will be for high-end and entry-level phones, says a new report from Juniper Research. The firm claims that these two bookends of the market are expected to account for nearly 80 per cent of all new mobile phones by 2014, or just over 1 billion units in total.

To this end, Juniper analyst Andrew Kitson believes that Apple, Nokia and BlackBerry maker RIM are well positioned to meet the strongest demands over this period, with the mid-range sector being dominated by LG and Samsung as they continue to see demand for these products in Latin America, Asia and parts of Europe.

However, Kitson claims the iPhone has changed the game for everyone, and that Motorola and Sony Ericsson might not be able to adapt sufficiently to survive.

"If a phone has wireless broadband, MP3/MP4 media players, touch-screen interfaces, etc., it's likely to do well. Hence, there have been so many iPhone emulators in recent months," said Kitson. However, he maintains that the growing acceptance of the iPhone and Blackberry among consumers have dealt blows to Motorola, which failed to innovate after its success with the ROKR and RAZR mid-tier lines.

The report states that low-cost handset shipments will number more than 700 million in 2014, up by 31 per cent from levels seen in 2008, albeit slightly down from a peak of 716 million in 2012, as some users begin to upgrade to costlier devices. "At the same time, smartphone shipment volumes will grow continuously across the forecast period, reaching almost 360 million by the end of the period. We therefore expect that midrange device sales volumes will fall by more than 41 per cent over the period," concluded Kitson.

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Eweek