Devices: M2M up; 3-D smartphones down - CTIA Wireless 2011 Scorecard

Whose profile is rising? M2M

Amid all of the tablet and smartphone launches at CTIA Wireless 2011, the area of machine-to-machine wireless connections for mobile devices stood out as one that is growing rapidly.

M2M's potential has not been nearly tapped yet, analysts said. But the flurry of major M2M announcements by carriers at the show was a clear indication that they are moving full steam ahead, even thought they can't quite agree on how they will report metrics from their M2M businesses. 

According to a recent research report from the Yankee Group, cellular M2M connections will grow from 19.6 million connections this year to 50.2 million by 2015. The report said that while mHealth and M2M energy verticals will mature more slowly, well-established ones such as fleet management, industrial applications and consumer telematics will flourish.

Major M2M announcements at CTIA ran the gamut. AT&T announced deals to with Ford to connect its Focus Electric vehicle and with E3 Greentech on a wireless home energy management system. T-Mobile, along with its UK sister and Giesecke & Devrient, announced the ongoing development of an embedded multi-mode international SIM as well as a deal with Audi on its Audi Connect system. Not to be outdone, Sprint Nextel (NYSE:S) inked a deal with Macheen to help consumer electronics manufacturers and retailers deliver out-of-the-box M2M solutions. And Verizon Wireless (NYSE:VZ) had a handful of important M2M announcements, including one with Sierra Wireless to deliver a cloud-based platform for end-to-end M2M solutions.

The announcements served to highlight the value of teamwork in the M2M space. "The role of partnerships in M2M is significant because of the diversity of applications and vertical segments and the number of different but necessary players in the eco-system," Current Analysis analyst Kitty Weldon wrote in a research report. "Not only are operators announcing alliances with application providers in different verticals, but they are allying with platform providers that simplify development and management of M2M applications; in addition to increasing the numbers of connectivity deals, these alliances may result in incremental service revenues for the operators in the areas of managed and professional services."

M2M may not be as sexy as the latest smartphone, but carriers are clearly looking to M2M as a growth driver--more so than ever before.


Whose profile is rising? 3-D smartphones

Two of the biggest non-tablet device announcements at CTIA revolved around two smartphones that offer users a glasses-free 3-D experience: the HTC Evo 3D for Sprint Nextel (NYSE:S) and the LG Thrill 4G for AT&T Mobility (NYSE:T). Both gadgets sport 4.3-inch screens and dual-core processors--but right now, analysts said, the whole concept of 3-D smartphones feels like a gimmick.

One of the main reasons it is a gimmick is that right now there is a dearth of 3D content for phones, said CCS Insight analyst Geoff Blaber. However, he added that he expects 3-D content partnerships to start coming through in the not too distant future both from LG (which already has such a deal with YouTube) and HTC, which will take advantage of its Saffron Digital acquisition.

"We were somewhat surprised to see HTC jumping into 3-D at CTIA so I think it's clear that manufacturers are trying to seize any opportunity for differentiation," Blaber said. "Subsequently, I think the floodgates have opened for 3-D so we have no doubt that more manufacturers will follow if more through fear of being left on the sidelines than any real conviction in the technology."

Ultimately, the long-term competitive advantage in 3-D devices will come from 3-D content partnerships, not the speed with which OEMs embrace the technology. Current Analysis analyst Avi Greengart agreed 3-D is a way to differentiate devices, but also agreed that right now it's a gimmick.

"As gimmicks go, it isn't a bad one, provided it is easy to turn the effect off," he said. "For what it's worth, we found the glasses-free display on the LG Thrill (coming to AT&T) considerably better than that on the HTC Evo 3D (coming to Sprint), and LG also has preloaded the Thrill with 3D game demos and a 3D carousel menu."

Devices: M2M up; 3-D smartphones down - CTIA Wireless 2011 Scorecard
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