Top 10 Mobile Phones - March 2009

The monthly numbers on best-selling phones from our accessory-maker friends over at Krusell are out. In March, it looked like this:

1. (1) Samsung SGH-i900/i910 Omnia

2. (7) Nokia 3109

3. (3) Nokia 6300

4. (2) HTC Touch HD

5. (8) Nokia E71

6. (4) Nokia E51

7. (10) Nokia 3120

8. (8) Nokia 5800

9. (5) Blackberry Storm

10. (-) Samsung M8800

() = Last month’s position.

Not too many changes as compared to last month. The trend to higher-end phones is maintained (or is it that owners of shiny touch-screen phones tend to spend a little more on that stylish holster?).

Be it as it may be (and my earlier comments on the holster-phone correlation probably stand true to an extent), the numbers are roughly in line with the previously noted growth of the smartphone sector, which continues to outperform the rest of the handset market.

Photo credit: http://www.crunchgear.com/wp-content/uploads/2008/12/cellphone-holster01.jpg

Games Pulsating Through One Platform?

Here's one that nearly slipped through the (well, at least my) net: according to a recent press release, the Eclipse Foundation is set to unveil a unified development platform. It is said that some major players, including Nokia, RIM, Sony Ericsson, IBM and Motorola have joined this initiative already though Android and - predictably - Microsoft and Apple are notable in their absence.

The concept is oh so simple: a developer goes to the site, downloads the platform and is ready to rumble. The platform (called Pulsar) would pull together vendor-specific SDKs and off you go. It is clearly geared to tackle the fragmentation of the many, many handsets to be addressed when publishing to "mainstream" mobile phones.

At present, it's an initiative (as there have been so many) and the presence of industry heavyweights does not always guarantee their success. I am (cynicism coming with age...) cautious over black box approaches (remember Tira Wireless?). I would love to see this succeed but let's see what it comes to...

Image credit: digitalvish.com

Best-selling Mobile Phones 2008

There is this Swedish maker of phone pouches and accessories, Krusell, and they deduce from the number of model-specific pouches (or cases) ordered from them the top-selling handsets each year. And the winner is the iPhone. Or is it only that iPhone users buy more pouches than others in order to protect their shiny toy? We don't know. 

Anyway, here's the list (via Cellular News):

1.       (-) Apple iPhone

2.       (-) Nokia 3109

3.       (2) Nokia 6300

4.       (-) Nokia E51

5.       (-) HTC Diamond

6.       (-) Nokia N95 8GB

7.       (-) Sony Ericsson K800i

8.       (-) Sony Ericsson C702

9.       (-) Sony Ericsson K850i

10.    (-) Sony Ericsson K530i 

() = last year’s position.

Light-Green Moto

Motorola has recently been struggling a little to get the Koolaid out; it wasn't often the pinnacle of cool recently. However, today they unveiled a new phone, the "W233 Renew" (catchy name, huh?), and that phone is made of recycled plastic bottles. Now people might jump to the fineprint to see what the percentage of re-used components is, etc but, hey, let's just acknowledge that the concept is pretty cool, don't you think? 

However, from their press release, there are little bits that do annoy me a little. They say that:

"When designing the packaging, Motorola was able to reduce its size by 22 percent and the box and all of the materials inside are printed on 100 percent post-consumer recycled paper."

Now, why on earth can't you do this with all your phones? It surely is not that big a thing, is it? And that would give Moto also a big 2l PET bottle of KoolAid: imagine the headline telling everyone that Motorola embarked on a company-wide strategy to go green. Woah!  

Lower Handset Sales in 2009

The financial crisis will - what a surprise - also catch the handset manufacturers. A report tells us that handset sales are bound to fall in 2009, by 5.6% or 1.215 billion units, to be precise. The backend of 2008 already sees the impact, too: growth predictions have been reduced from 10.4% year-on-year to 8.9%.

This is in line with reports from Blackberry maker RIM who reduced its forecasts today. Even mighty Nokia is expected to lower its forecasts.

It can probably be expected that this will also impact the mobile content market: it is widely accepted that consumers tend to spend on mobile content in the first 3 months after they got a new phone. So: no new phone, no new content... Moreover: the above reduction in growth does not actually show the whole picture. Mobile content uptake is much higher on high-end phones. However, these are normally bought by way of upgrades, and it is there that the most severe drops are being predicted.

“While new subscriber additions are continuing at a healthy pace and are poised to grow by 563.9 million in 2008 and by 506.5 million in 2009, an overwhelming majority of the new subscribers are coming from the rural areas of emerging regions,” Teng said. “These subscribers primarily are purchasers of low-cost, entry-level handsets. However, the pricier feature-phone and smart-phone market segments are driven by existing subscribers who are upgrading their mobile devices to take advantage of new features and advanced data services. As the economic climate deteriorates, these customers are delaying their purchases.”

All doom and gloom then? Well, maybe not: others predict that the recession (at least in the US) will actually drive the number of wireless-only households. And, after all, a mobile game at €/$/£ 5.00 a pop is not the world, is it?

Fragmented?

Funny. Sometimes a theme somewhat haunts you... After I have posted about the demise of Tira Wireless (and added some alternative views on the labyrinth that is platforms and handset fragmentation; also go and revisit my posts on the same topic here and here), today we can read that it will all get worse (or maybe not). I bet they read my recent post on the issue... ;-)

The article only mentions somewhat curtly two new platforms, namely iPhone and Android (both of which I have covered before, namely here, here and here - amongst others), and then goes on to report on a panel at CTIA where a panel sponsored by the "Symbian stakeholders" apparently dismissed the whole notion, stating that the market would solve it. Now, it will have to, I guess. However, it is not all that bleak: Symbian, UIQ, Linux, BREW, Win ME and ultimately the iPhone OS are all C-based. Most of them (with the notable exception of the iPhone) also run Java Virtual Machines (JVM), so you can either code in J2ME (which is arguably the most widely supported language) or go native and code native in C+/C++ with then much easier ports to the varying iterations.

The challenge naturally remains (and, yes, I have voiced this previously) with a view to supporting all those odd handsets here and there and everywhere but, let's face it, a lot of them are being imposed on publishers by the carriers who want to make sure that even that last customer that hangs on to his SE T-610 will be served with content (even though he won't ever download a piece). Wouldn't it be so much better marketing if they would simply return a message telling that poor customer:

"Hey, we noticed you tried downloading content to your T-610. You may not have realized that this phone is utterly outdated and will give you no joy when playing games. We would like to offer you a discounted upgrade to the brand-spanking new N76/ W880i/ Pearl/ iPhone/ Viewty/... and your life would be so much cooler. We are confident that you would then also have more luck with the girls/boys... Best. Your carrier"

What I am trying to say is that a lot of the fragmentation issues are (nowadays) artificially imposed, not technologically warranted. Any carriers reading this? Think about it, folks. It won't harm you, I bet!

Re Tira: there are others!

My post on Tira Wireless' apparent demise triggered a few e-mails, and it was pointed out that, whilst my observations generally seem to have been accurate, I forgot a few players that actually do deliver porting solutions across platforms (e.g. from J2ME to BREW) rather successfully (and do work with some of the larger publishers, too). There is for instance Innaworks, whose Alchemo solution is pretty powerful.

So, I stand corrected: it is actually possible to ease porting nightmares with smart transcoding solutions. I would still maintain though that porting from a single J2ME build (rather than a reference code base) to all devices under the sun is only possible with severe constraints. If that is understood though, the likes of Innaworks and Metismo provide a great ease of pain!

How many handsets does a game need to support?

GDC Mobile co-founder and, I am honoured to say, my good friend Robert Tercek, came out with all guns blazing against the carriers' demand for maximum handset coverage for mobile games that they allow to publish through their deck. Tercek called it a "lie" that operators basically insinuate that a game will run equally well on every handset, and he called mobile games publishers hypocrites as they moaned and whined about it but still play ball... Well, what else are they to do? Stop publishing games?

Since I still work in this industry, I would not perhaps put it that harshly as Rob did but the question is indeed if the network operators' rationale ("we need to provide for the best possible user experience for every one of our users") stands true when it comes to this. After all: if you offer a full music track for download, your phone needs to be able to support MP3; an old battered brick that only plays monophonic ringtones won't do. To put it into slightly starker contrast still: it would be like an ISP would prevent a web publisher from putting a site live only because there are a lot of PCs out there that do not have the right software support. Or if the Germans would not allow any car to be imported into Germany unless its engine software was geared to allowing a top speed of min 200 mph because otherwise the user could be disappointed with the driving experience on the Autobahn.

Is the assumption that someone who has an old T610 would actually expect to be able to play a modern-day 3D racing game on his battered old handset really correct? If I drive a 10-year-old little Twingo, I know that I will not go 200 mph, Autobahn or not. And I will certainly not blame it on the operator of those roads.

If I want Vista Premium or Leopard, I need the machine to support it. And that is an informed decision I need to make. The operators' approach may have been understandable a few years ago: mobile was a very, very new platform and people had not actually got round to the idea that one could actually do more with one's mobile phone than making phone calls when away from a fixed-line phone. However, this has changed very quickly very much: even my 80-year-old neighbours now communicate via SMS with their kin. I believe it is safe to assume that the consumers of the year 2008 can very well distinguish between a low-end and a high-end phone and will actually appreciate the difference in performance without blaming their operator for a sub-par one when their phone happens to be a sub-par one. Time for change then, folks!

The constraints of having to support hundreds of handsets impacts the mobile games sector manifold: it makes it prohibitively expensive to develop and publish games with porting costs often being equal or even higher than the actual development. The effect is less innovation (how can you dare trying something new if you have to expend so much money before you even get it in front of a consumer?) but also less usage: it is often more of the same as developers try to minimize their cost by re-using engines (Gameloft has used the same basic side-scrolling engine for at least 20 games to date; highly polished and constantly evolving though, to be perfectly fair to them) and running risk-averse design philosophies where they try to stay as close to a proven hit as possible. This will however not drive consumers to get back for more.

I am however doubtful if operators will come to terms with this in the near term, and, let's face it, they are not the originators of this platform mess: isn't it more often the handset manufacturers that fiddle around with screen sizes that differ for more or less every device, that take great pride in running a gazillion different operating systems only to be slightly different to the other guy, that allocate soft keys rather randomly and occasionally swap the green and red call/end call keys from one side of the keypad to the other? Just imagine this last bit on a computer keyboard: is now on your left... try get going with that... Add to that the - yes, they're here still - operators and their specific demands for this, that and the other, and the fragmentation does indeed create an economic landscape that is very hard to navigate.

This is one to the OEMs and the operators alike: get down to business, compete on the strengths of your devices and services and not on some OS and other software tweaks where the upside to the consumer is, if distinguishable at all, minimal.

In the interim, it would indeed be upon the operators to start trusting the good judgment of their customers in the hardware they hold in their hands better and start dropping those old devices from their requirements that will manage to screw up even the best game.

The prosecution rests... ;-)

German iPhone exclusive again...

German carrier T-Mobile today scored a victory against competitor Vodafone: the court declared that the exclusive deal the carrier struck with Apple over the distribution of the iPhone, the coveted darling of mobile fashionistas, in Germany.

The court ruled that it could not find a violation of German competition or anti-trust laws. Vodafone had invoked an injunction forcing the sale of unlocked devices, following which T-Mobile offered the unlocked device without a contract for a whopping EUR 999. This let a competitor, Debitel, into offering a cheaper contract to owners of such unlocked iPhones under the terms of which they would also get EUR 600 back (the difference between the T-Mobile price for locked and unlocked models).

The decision is not final; Vodafone has the right to appeal. Also, the judgment does not do away with the fact that French law prevents the closed business model favoured by Apple where it is also on offer unlocked. Under European law, unlocked French iPhones can be re-sold in every EU country once deployed in the marketplace.

The biggest impact of this of course is that it effectively puts Apple's approach to force operators to pay it cut of the usage revenues under threat. This might now be averted as cross-border trade will likely remain marginal compared to overall sales.

Apple's iPhone with 10-30% market share? I don't think so

Another survey with interesting numbers: according to this one, 9% of all US consumers are "very" or "somewhat" likely to buy Apple's iPhone. Funny that: The iPhone is initially only available on Cingular/AT+T (cf here), which has a market share of 28%, so just about 1/3 of all Cingular subscribers (or c. 19 million) would have to be interested in buying an iPhone.

Folks, buy Apple stock now. But then (screeech): Apple said they were only targeting 1% of the market, which makes it 1m devices, and AT+T's COO says they have already 1m inquiries ... this would lead 18 million willing Cingular subs + everyone outside the US without the sleek and coveted thing. Not so good...

Isn't all this somewhat weird? The phone costs $499 and $599 respectively (at least according to this), and 1/3 of a carrier's subscribers going for one of the top-priced options would be contrary to everything we've seen so far. Rather unlikely, I'd say. So: if the price was dropped to below $300, an additional 10% would buy the 4GB model and a staggering 20% the 8GB model. Make that 30% market share then - with one device. Woah.

The blurb concludes that Apple should exceed its sales goals for, wait a minute, 2008 (sic!) and then closes with the beautiful caveat "provided the device lives up to consumer expectations". Amen!

If Apple gets it right (which I hope as I like them), then 1m devices in 2007 would not be a bad start (considering it is one carrier and one country), in particular as high-priced as they are. Assuming that they could in fact open the pipeline for higher demand, we could well be seeing one of the top handsets in the market place (so-called blockbuster handsets regularly are between 2-3.5% share of all handsets on a carrier). That would be impressive enough.


Then they would only have to add 3G, I suppose...

GPS mobile phone showcase - 30% take-up with the right service!!!

And the pretty news comes from Disney Mobile. The MVNO shared some insight on usage patterns of its subscribers, and there is some interesting little pieces of information that would suggest that the combination of a consumer value driver (here: security) with a technology (here: GPS) might make a business:

Allegedly 30% of the their subscribers use its GPS location tracking services (parents can locate their kids via the handsets' GPS functionality), and parents who do so use the feature 14 times per month on average.

56% of Disney Mobile subscribers are adults and 44% are children.

A take-up rate of 30% of a relatively novel service with high service usage (every other day) is pretty impressive for any media!

Final blurb: 30% of location requests were made from the Web and 70% from the handset, demonstrating the cross-platform nature of the application - and the huge potential of mobiles.

Which mobile are you?

Here's who you are according to the mobile phone brand you carry:

Nokia - the choice of family-minded, middle aged managers
Motorola - favoured by fashion conscious under 24s
Sony Ericsson - for ambitious young men trying to make their mark
LG - favoured by mums
Samsung - for young women focused on their career

That's at least what Nielsen Media Research says... I wonder where all the divorced, child-less middle managers are...

>1/3 of mobile handsets were changed in 2006

So this is how fast the hardware landscape can change. Imagine BMW's market share could double (or be halved) in one year. With dynamics such as the ones reported here for the mobile handset sector, this would be entirely credible:

Some 36% of mobile phone users in Argentina replaced their handsets in 2006, according to a recent study by local consultancy Carrier y Asociados as reported by Cellular News.

The study, called Telefonía móvil 2007: Segmento individuos, concluded that replacement of mobile devices was common in all income segments.

According to the study, one out of four mobile telephony users in the country plans to replace their handset in 2007, which would mean nearly 8mn new devices.

"Young people aged below 18 tend to replace their device more than others because they want telephones with new features such as MP3 or cameras," Carrier told BNamericas.

Carrier also stressed that handset subsidies operators offer to clients are crucial to keeping turnover high, although he considered subsidies are lower than a couple of years ago.