Media integration/streaming music services: Increasingly, analyst said, smartphones will be seen as media hubs, not just communication and information devices. ABI analyst Kevin Burden said that as more media services move into the cloud, the phone might become more of a remote control than it is now.
While Gartner analyst Michael Gartenberg rightly points out that there are already numerous cloud-based music services like Rhapsody that have yet to become mass-market must-haves, more smartphone platforms are expected to launch cloud-based music services next year, Palm and Google (NASDAQ:GOOG) among them.
Further, more smartphones will be able to share DLNA content with TVs, NPD Group analyst Ross Rubin said. At least one firm, Samsung, has said it is working on a joint software platform for both mobile phones and TVs.
"All of the guys on the supply side are going to try and insinuate themselves into the revenue streams of content, services and media," CCS Insight analyst John Jackson said. "What are the models that are going to create those incremental bits of revenue? The smartphone either becomes a hub or some extension of a hub. That's another vector you'll see materialize. The industry is after this Holy Grail of mutli-platform integration."
Voice commands: Analysts said that voice-activated commands will become integral parts of smartphone platforms in 2011. Apple (NASDAQ:AAPL) added voice controls to the iPhone in 2009, and Research In Motion (NASDAQ:RIMM) licenses Nuance's voice control technology. Additionally, Google expanded the concept on Android earlier this year with its Voice Actions interface, which allows users to send text messages, navigate to Web pages and play music via voice commands.
"I just get the sense we're at the point where people are going to finally want to start interacting with their phone at a higher level," Burden said, adding that voice technology is becoming cheaper.
Nielsen analyst Roger Entner said he expects the technology to improve with the addition of extra features and functions. Along with touch, voice commands may become one of the primary ways users interact with their phones.
Upgradeability: As software differentiation becomes more critical next year, consumers will want to know that their smartphone will be upgraded for at least one or two cycles, Gartenberg said. "Consumers are going to be frustrated if they can't get that degree of future protection," he said.
This is one area where Android, in particular, faced serious issues this year. Some mid-range Android devices running older versions of Google's platform were either not upgraded to the latest version of Android (2.2) or faced delays in getting the upgrade (even Samsung's Galaxy S line is still waiting on the upgrade in the United States).
Near Field Communications: Nokia (NYSE:NOK) has dabbled in Near Field Communications technology for years. NFC chips, which enable smartphones to act as mobile payment mechanisms, should become table stakes next year, analysts said, at least in high-end smartphones.
Google has said it will integrate NFC capabilities into Android 2.3. RIM has indicated BlackBerry devices will get NFC, and Apple recently named NFC veteran Benjamin Vigier product manager of its mobile commerce unit, fueling speculation that future versions of the iPhone will include m-commerce capabilities.
"The business side was holding it back," Burden said of NFC. "And that seems to be working itself out now."
Indeed, Verizon Wireless (NYSE:VZ), AT&T Mobility (NYSE:T) and T-Mobile USA earlier this month partnered to launch Isis, a nationwide mobile commerce network enabling consumers to make point-of-sale purchases via mobile devices.