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Mobile Industry Update: Barcelona 2010


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Mobile Industry Update: Barcelona 2010

  1. 1. Mobile Industry Update: Barcelona 2010 A Report on the Mobile World Congress and What to Watch This Year T he world’s largest gathering of the mobile ecosystem convened in Barcelona, Spain last month, attracting 49,000 attendees from carriers, device manufacturers, developers, the media, and interested onlookers. According to GSMA, organizer and host of the four-day Mobile World Congress, attendees hailed from 200 countries and included 2,800 CEOs.i Keynote Benchmark
  2. 2. 2 Such robust attendance is a sign that the stop the Global Mobile Awards from dubbing Google’s reports — an annual rate of 21.9 mobile industry is ready to shrug off the Jobs the Mobile Personality of the Year. The million units — they could pass the iPhone world’s economic woes, if it hasn’t done so moment must have been a bit awkward, with installed based before the end of 2010.ii already. It’s also a sign that the myriad mobile no one from Apple to accept the award, and “Definitely the iPhone is changing players are anxious to find out where the the most prominent runner-up, Google’s Eric the world — it affects every company out frenetic changes in the industry are taking Schmidt, in attendance and delivering the there,” says Shlomi Gian, Keynote’s director of them, what technologies they should hang show’s keynote address. mobile business development, who was in their hats on, and how they’re going to make In a way, the scenario was symbolic Barcelona for the congress, “But Android is (lots of ) money. of the relatively new and increasingly bitter catching up. Many people believe Android will The industry appears to be on the rivalry between Apple and Google, which is take the lead not too far from now.” cusp of major changes on a variety of fronts, being fought almost entirely on the mobile from network technology to applications to front. For now, Jobs and Apple are still the A BALANCE SHIFT TOWARD MOBILE? how devices are being used. A sea change industry darlings. Indeed, it is not a stretch to Is the online access point of choice shifting to toward smartphones, and smartphone-like trace virtually all of the major trends and mobile? Benchmark has reported previously functionality on feature phones, is clearly technology in mobile operating systems, on the predictions that say it will be so. Most underway. As keynote speaker Eric Schmidt software, interfaces, and app stores to the visibly, perhaps, the Morgan Stanley “Mobile put it, “it’s now the joint project of all of us to iPhone. But Schmidt, Google, and Android are Internet Report,” authored by Mary Meeker, make mobile the answer to pretty much fast at Apple’s heels, and clearly are serious that predicts that in five years, more people everything.” about the fight. With 60,000 Android-driven will access the Internet on mobile devices than For some “old-timers” in attendance, phones shipping every day, according to on desktops. Already, the report says, “the it felt a lot like the 1990s all over again, a iPhone is growing faster than the Internet did miniaturized replay of the scramble brought during the 90s.”iii on by the ascent of the World Wide Web. A recent report by Gartner concurs Browsers were duking it out for the desktop, that smartphones will be the most common broadband technology was getting sorted out, primary Internet access device by 2015. The dot-coms were attracting cash beyond all installed base of smartphones and browser- reason — and in the midst of it all, enterprises equipped phones will actually exceed the PC were trying to figure out how to leverage this installed base as early as 2012, according to exciting new channel. Gartner, but they will not serve as the primary The analogy is apropos, but with access point until 2015.iv significant differences in velocity. The In his keynote at the Mobile World technology is moving at a much more rapid Congress, Schmidt sounded a theme of pace; the tech industry is that much more “mobile first.” He cited the “three Cs,” three mature today, and simply moves much more drivers that will push mobile to the foreground quickly. At the same time, carriers with their not just of daily online access, but of daily huge and expensive infrastructures are being computing. First is computing power itself — deliberate in their progress, making sure their the tremendously increased processing power central role is not undermined even as they of mobile devices. Second, connectivity — the begin the first phases of huge investments to installation of higher-speed, higher-capacity accommodate exploding data usage. wireless networks. And third, the cloud — the The Android home screen here looks strikingly tethering of mobile devices to remote servers STEVE JOBS WINS TOP AWARD, IN ABSENTIA similar to an iPhone home screen. But the not just to store or access data and media, but Apple doesn’t even attend MacWorld, the show Android OS can be implemented in different to tap into tremendous processing power. ways by device manufacturers, and the home that’s just for Apple, and they don’t attend the According to Schmidt, Google screen can be customized by the user, for wide Mobile World Congress, either. But that didn’t variations in interface look and feel. engineers now want to work on mobile first, Keynote Benchmark
  3. 3. 3 and then have their products ported back to 2010, according to industry observer Chetan indicate an unfulfilled potential of 7.5 billion the desktop. Several Google engineers joined Sharma.v And one of the biggest drivers of that apps to be sold for non-Apple smartphones, Schmidt onstage to demonstrate a few of the data, in the U.S. and around the world, is apps. roughly speaking. In other words, the biggest mobile projects they’re working on. An Apps have been around for mobile piece of the pie is waiting to be served. And engineer from the translation group demoed phones for quite a few years. But once again, using Gartner’s numbers, that unserved pie both real-time voice translation — he spoke it was the iPhone and the Apple App Store should be worth about $16.8 billion. into the phone in one language and Google that caused a veritable explosion in mobile Enter App Planet, the newest computers in the cloud instantaneously phone apps. In 18 months, users downloaded addition to the Mobile World Congress, a translated it into another — and also print 3 billion applications from the App Store; show-within-the-show in its own exhibit hall translation, where he took a photo of a menu reports quote Garnter putting Apple’s 2009 that attracted more than 20,000 visitors. App with his phone and Google translated it into share of mobile apps at 99.4 percent. No, that Planet gave developers, manufacturers and his native language. is not a misprint, and yes, that number is carriers the opportunity to check out each A second engineer demoed Google nearly impossible to believe; readers sent Ars other’s wares, and for the big players to hold Goggles, an app that lets you search using the Technica back to Gartner and to Apple to application developer conferences. The mere confirm the number, which they existence of the App Planet, as well as the Whatever numbers you go by, the announcement there of the Wholesale Apple App Store is a multi-billion business Application Community, points out the almost (even accounting for the many free apps), and feverish land-grab mentality that has taken Apple takes a 30% cut of every app sold. hold of the industry around apps. Gartner puts 2009 app volume at $4.2 billion, The Wholesale Application contributing an estimated $1 billion to Apple Community was formed by two dozen carriers Google Goggles lets Android users search using the camera’s built in phone. Snap a revenues.vii literally from every corner of the globe, plus photo of a landmark, building, product, book, So, let’s do the math: If Apple Samsung, LG, and Sony Ericsson. Its stated barcode — basically anything that’s not a accounts for 25.1 percent of mobile subscribers purpose is “to create a ‘wholesale applications person — and Goggles will deliver information as of January 2010,viii and Apple moved about community’ that will establish a simple route and search results. 2.5 billion apps in 2009,ix then that would to market for developers, in turn, providing phone’s camera. Take a picture of a book or access to the latest and widest range of DVD, landmarks, a logo, artwork, business, innovative applications and services to as product, barcode, or text, and Google delivers many customers as possible worldwide. This descriptions and data about the subject. alliance will deliver scale unparalleled by any Google Goggles is currently available on application distribution ecosystem in existence phones running Android 1.6 and above. today.”x Another Google engineer showed a It’s a lofty ambition, and if it can be game built in Flash running on an Android pulled off, it could theoretically simplify life for phone, which highlighted Adobe’s important developers trying to tackle multiple operating announcement at the show of Flash 10 and systems. But whether a globally diverse group, AIR for mobile devices (except for Apple, primarily made up of carriers with very which rejects Flash). different markets, different needs and different business objectives, can pull together and play 6,850,000 APPS EVERY DAY? nicely in the same sandbox together remains to There was a time when phones were used for be seen. This was the first year for MWC’s App Planet, talking. But for the first time, in 2009 U.S. And in the end, how wise a strategy a separate exhibit hall devoted entirely to data traffic exceeded voice traffic on mobile mobile applications. Some 20,000 attendees would it be for carriers that are trying to phones, and that ratio is expected to widen in passed through App Planet. competitively differentiate themselves? If Keynote Benchmark
  4. 4. 4 customers can get the same apps and a decent Also announced was MeeGo, a mash-up of users to pull from and post to a variety of phone from any of their local carriers, where Nokia’s Maemo and Intel’s Moblin, both social media communities from one central does that leave the carriers? In the Q&A Linux-based operating systems. And Samsung screen. following the keynote, an audience member introduced a new operating system, Bada, for At this point, Microsoft Phone 7 is questioned whether Google was trying to turn its Wave phone,xiii which begs the question: if something to watch on the horizon. Its release the carriers into “dumb pipes” that are merely Samsung chooses Microsoft for its search is slated for “holiday 2010,” which ostensibly the conduits for data, a charge Schmidt engine, will it be called “Bada-Bing”? means the end of this year. Microsoft will have emphatically denied. But through WAC, could to overcome the serious stumble it made in the they be doing just that to themselves, in return WILL 7 BE A CHARM FOR MICROSOFT? mobile market with Windows Mobile; it has for a cut of app sales? The biggest OS news at MWC was that demonstrated its ability to overcome its own Even network equipment Microsoft is restarting its mobile operating missteps in the past. But a year is practically manufacturers are getting into the app act. system, jettisoning the flawed Windows an eternity in today’s mobile market — Alcatel-Lucent announced at MWC a cloud- Mobile platform, and introducing the especially a year in which Google Android is based “sandbox in the sky” development Windows Phone 7 Series. It will include anticipated to gain serious traction. laboratory to help coordinate and accelerate Microsoft’s Zune music and video software, “Microsoft is making a desperate broad-based app development. The new and be able to run Xbox LIVE games. And attempt to get back into the game,” Keynote’s initiative follows on the heels of their naturally, it will include Bing search and map Gian says, “They made a big push. They Application Exposure Suite, announced in services, reportedly accessible via a dedicated realized they’re late. So Windows Phone 7 is December 2009.xi With these efforts, Alcatel- hardware button. coming in December. Between now and then, Lucent appears to be positioning itself as a A fresh user interface feature on the though, all they can do is wave their hands, broker and go-between among carriers, Phone 7 Series is the organization of and that’s what they did. Steve Ballmer was developers, and content providers, and would functionality around “hubs” — the there, and they put up a pretty good demo.” take a cut of whatever is created in the process. music+video hub, the people hub, etc. The “I think a lot of folks, myself people hub reflects the platform’s potentially included, are probably thinking ‘hmm,’” adds BUT WHAT OPERATING SYSTEM? impressive social media integration, enabling Keynote Senior Director of Mobile Despite efforts of various players to come together on apps, the fact remains that the mobile industry is seriously fragmented among operating systems. This is a persistent challenge for developers, and a situation that is not likely to change soon. The Mobile World Congress saw its share of operating system announcements. The biggest was the introduction of Windows Phone Series 7 (more below). Others included Symbian^3, an open source version of the operating system most closely associated with Nokia. Symbian^3 adds improvements in touchscreen features, memory management, graphics and UI to the widely distributed Symbian OS, which claimed a 46.9 percent share of smart mobile devices shipped worldwide in 2009, making it the most widely “People” is one of the “hubs” in the future Windows Phone 7 Series interface. Hubs cluster used smartphone OS.xii related functionality into one screen. The People hub promises advanced social networking functionality, enabling users to push and pull status from various networks all in one place. Keynote Benchmark
  5. 5. 5 Technologies Manny Gonzalez. “There’s Term Evolution, a next-generation technology accounts for carriers’ measured embrace of the nothing there that makes you want to run out that offers theoretically possible peak technology. The New York Times quotes a and get it as soon as it comes out. But they download speeds of 100 Mbps and beyond. London research firm, Aircom International, have a track record of coming in and just Already deployed in parts of Scandinavia, test as estimating a price tag of $1.8 billion for a systematically getting there. Microsoft has results show that LTE is delivering average U.S. operator and $880 million for a European shown that they can take their time and still speeds of around 12 Mbps. Verizon Wireless operator in the first year.xvi come back.” reports its testing has achieved download peaks of 40–50 Mbps and upload peaks of UNTIL NEXT YEAR… THE NEED FOR SPEED 20–25 Mbps, but average speeds hover around The Mobile World Congress highlighted a The undercurrent to all the new product 5–12 Mbps for upload and 2–5 Mbps for number of things to watch in 2010, and a announcements and apps and slick new download.xiv number of questions looking to be answered. phones was the question of the networks Nonetheless, 51 of the world’s largest Will it be the year Android achieves critical themselves. How will they accommodate the operators have expressed their intention to mass and gives the iPhone a run for its money? tremendous new data demands being placed adopt LTE, with 19 expected to begin this year. Most likely. Will the various players, mostly on them by all of the new smart devices? How Several big players have indicated they may the carriers, collaborate successfully and arrive will they service a world that is increasingly begin introducing LTE service in 2010 or 2011, at some sort of standards or common using mobile devices for primary Internet including AT&T and Verizon Wireless in the infrastructure and cooperation for apps? We’ll access? How will they deliver the speed that is U.S., Australia’s Telstra, and Japan’s NTT see. And will Microsoft succeed in getting back a requisite for a quality user experience? Docomo.xv into the mobile game with Windows 7 Phone The leading topic in the network The costs to build out an LTE Series? That’s likely a story for 2011 and next conversation in Barcelona was LTE, or Long network are monumental, which no doubt year’s MWC. FOOTNOTES i. GSM World, “The Mobile Communications Industry Demonstrates Momentum,” 2/18/10 ii., “60,000 Android Phones Shipped Every Day, Says Google,” by Stan Schroeder, 2/17/10 iii. “The Mobile Internet Report,” Morgan Stanley, December 15, 2009 iv. “Gartner Top End User Predictions for 2010: Coping with the New Balance of Power,” summary report, Gartner, Inc., 2010 v., “US Wireless Data Market Update — Q4 2009 and 2009,” by Chetan Sharma, 2/2/2010 vi., “Apple responsible for 99.4% of mobile app sales in 2009 (Updated),” by Chris Foresman, updated 1/18/10 vii. The New York times, “A Conference Keen on Finding Open Communication,” by Kevin J. O’Brien, 2/17/10 viii. comScore Press, “comScore Reports January 2010 U.S. Mobile Subscriber Market Share,” 3/10/2010 ix. op cit x. xi. Alcatel-Lucent press release, “Alcatel-Lucent opens developer sandbox in the sky,” 2/16/10 xii., “Symbian remains top, Android closing in,” 2/23/10 xiii., “Mobile Platform Competition Benefits Consumers,” by Michael J. Miller, 2/17/10 xiv. Rethink Wireless, “TeliaSonera aims to boost LTE performance to 80Mbps,” by Caroline Gabriel, 3/14/10 xv. The New York Times, “Mobile Data, the Next Generation: High Speeds but at What Cost?” by Kevin J. O’Brien, 2/16/10 xvi. ibid ............................................................................................................................................................................. © 2010 Keynote Systems, Inc. All rights reserved. The trademarks of Keynote Systems, Inc. include Keynote®, DataPulse®, CustomerScope®, Keynote CE Rankings®, Keynote Customer Experience Rankings®, Perspective®, Keynote Red Alert®, Keynote Traffic Perspective®, Keynote WebEffective®, The Internet Performance Authority®, MyKeynote® , SIGOS®, SITE®, keynote™, The Mobile & Internet Performance Authority™ and all related trademarks, trade names, logos, characters, design and trade dress are trademarks or registered trademarks of Keynote Systems, Inc. in the United States and other countries and may not be used without written permission. Keynote Benchmark