Handset Country Share Tracker

A vital tracking tool for helping companies measure the success of competitors and partners in their local markets.

December 22, 2010 16:12 bjoy

Nokia has a healthy working relationship with Microsoft, and the partnership has been growing over the past few years. Recent initiatives include:

  • Microsoft Office Mobile Suite for Symbian.
  • Microsoft Sliverlight for Symbian.
  • The Nokia Booklet, a 3G netbook based on Windows 7.

On the organization front, Stephen Elop, a Microsoft veteran, took over the helms at Nokia earlier this year, bringing both companies closer than ever. While Sliverlight, Microsoft Office, and Windows 7 netbook initiatives are all signs of a healthy partnership, embracing the WP7 platform in its totality takes the relationship to the next level. Shifting the building blocks of your device/software/service ecosystem in favor of third parties is no small decision and will have effect on your intangible sub-brand assets such as Ovi. And that exactly is the rumor from this week, that Nokia will launch WP7 devices in 2011. While we have no official version of the story, it would be interesting to assess the impact of such a partnership in the market. On the positive side, Nokia’s industrial design, distribution and supply chain process are among the best in the industry. WP7 will gain a strong partner in Nokia to bring the best-in-class devices among Windows Phone series. But how much of an impact it will have on Nokia’s platform portfolio, positioning and regional priorities? Where WP7 sits in Nokia’s portfolio?                                        Given the base set of high-end hardware requirements for WP7, the Nokia WP7 device will be positioned in the same premium space occupied by the MeeGo platform. Will Nokia abandon the MeeGo platform in favor of WP7? Or are they going to co-exist, with WP7 focusing on the prosumer and business segments along the same lines of the S60 E-Series? Will there be any major shift in regional platform trends? USA: With an estimated 6% marketshare in 2010 (nearly all basic and featurephones), Nokia has been steadily losing marketshare and carrier shelf space in the US. The partnership is unlikely to change the competitive landscape in the US market, where Apple, HTC, Motorola and Samsung lead the operator shelves. WP7 LTE phones in H2 2011 / H1 2012 might be a potential option for Nokia to make inroads in the US. Western Europe: Microsoft will find more acceptance in carrier channels through Nokia in Western Europe. But beyond the “foot in the  door” strategy, the partnership will have to do little with the success of the platform. In emerging markets, where Nokia has the broadest reach in mid-tier smartphones, the WP7 will be not be the obvious choice for the cost sensitive segments. We believe Nokia will continue to rely on the S60 platform in the mid-tier smartphone segment. Overall, while the idea of a Nokia WP7 device looks like a big win for Microsoft, it’s unlikely to change the prospects of Nokia or WP7 in the smartphone department. Nevertheless, Nokia needs to raise its profile in the US, and this would be a step in the right direction, but it will need step-changes in distribution and subsidies. But for the most part, it’s going to be just another partnership for Microsoft and Nokia – you’re only as strong as your weakest link. - Bonny Joy


August 4, 2010 23:08 nmawston


Blackberry has finally introduced its much-awaited OS 6 upgrade with the launch of the Torch 3G smartphone. It will initially be sold exclusively at AT&T in the USA in August 2010, giving the operator an alternative to the iPhone. OS 6 employs a Webkit engine, HTML5 support and universal search. The Torch is a QWERTY slider with a 3-inch HVGA+ touchscreen optimized for messaging and media prosumers. Can the Torch outshine Apple? Is it an Android killer?




Well, the external design is a little unexciting. It looks not dissimilar to the Palm Pre. The hardware-list ticks the right boxes for a premium handset -- with 802.11n, 5MP camera, and so on -- but the 624MHz Marvell processor might be perceived as sluggish compared with the emerging tide of 1GHz superphones. The software-list looks good, with Flash, HTML5 support and Webkit for developers. The Webkit-rendered browser will compress data traffic, benefitting AT&T's stressed network. RIM has opened up the platform a little for a better developer environment. Data services are prosumer-friendly and consumer-friendly and primed for email, Internet-browsing, social networking, instant messaging, maps, WiFi geolocation, universal search, RSS feeds, media playback, Blackberry World and PC tethering. No head-to-head videophony, though.

Navigation of the UI is delivered through 3 main interfaces; touchscreen, trackpad and hard-QWERTY keyboard. Our brief trial of the handset in New York recently found the user-experience to be generally satisfying with a responsive touchscreen and good discoverability for apps and services. Retail pricing will be set initially at US$199 postpaid with a two-year contract. This is just in the sweetspot zone for high-end users, and it indicates AT&T will be subsidizing the Torch to the tune of roughly US$200 per unit.

So... are OS 6, Blackberry World and the Torch an Android killer? No. The overall package of hardware, software and services lacks a true wow factor. The Torch helps RIM to close the gap on Android models and iPhone, but it does not overtake them. Is the Torch a Blackberry savior? Maybe. Torch 1 is a solid step in the right direction to stemming churn by upgrading its touchphone portfolio. Torch 2 and Torch 3 will need to be even better, though, with improvements like a 2GHz processor, because the consumer-enterprise handset market in the US has become hyper-competitive and the Torch will not be a leading light for long.


June 7, 2010 21:06 nmawston
The Apple iPhone 4 and iOS4 finally arrived today. After months of leaks, there were no major surprises about the hardware, software or services. There are up to 100 improved features, of which 9 were prioritized by Steve Jobs at launch. They include a pixel-dense 3.5-inch “retina display”, Apple A4 processor, bigger battery, 802.11n WiFi, gyroscope, 5-megapixel rear camera, front-facing camera, HD video-capture and multitasking. All packed into a thin 9mm formfactor. Apple iPhone 4 becomes reality. Phones, Mobile phones, Apple, iPhone 4, WWDC2010, iPhone 3GS 0 Services were front-and-center. Apple continues to favorably position its brand as an enabler of fun media for young-at-heart consumers. There is iBooks for reading, iMovie for film-editing and iAds for advertizing. The most ambitious move is FaceTime, a head-to-head videophony service using the front camera. The service has a catchy sub-brand, so it is off to a good start. But videoconferencing has been around for years and never really gotten off the ground outside Japan, so it will be interesting to see whether the iPhone ignites demand among western consumers or businesses. Two-way webcamming, via sites like Skype, is not uncommon among PC users, so it may be possible to transfer some of those usage traits to the mobile. FaceTime will initially be available only over WiFi, because operators’ 3G networks are not fully ready to cope with the potential spike in data traffic. Many of the iPhone’s weaknesses remain. Despite the hype, Apple is not flawless. There is still no support for popular Flash software. The iPhone’s closed ecosystem and apps-approval process are not ideal for some developers. And the handset’s expensive pricing makes it heavily reliant on operator subsidies. Overall, the iPhone 4 is another step forward. It raises the smartphone and services bar a little higher. Apple has done just enough to maintain its leadership in design, UX and consumer content. Nokia, RIM, Google, Microsoft, Samsung, LG and other OEMs still have some catching-up to do.

June 4, 2010 19:06 Neil Shah
The global handset industry continues to grow and fragment. Due to platform facilitators like MediaTek, manufacturing a 2G cellphone is easier than ever. These trends have led to the emergence of a long tail of dozens of microvendors, mostly from China and India. Numerous microvendors have benefitted from the surging demand for low-cost 2G phones in rural and suburban markets. According to our Handset Country Share Tracker (HCST) report for Asia, leading microvendors Micromax and Tianyu are ranked among the top 6 brands in their domestic markets of India and China. What have been the main reasons for the microvendors' growth? • OEM-partnered low-cost handset solutions; • Strong ultra-low- and entry-level portfolios at very competitive price-points; • Innovative features for local needs and tastes, such as 30-day standby battery (important feature for regular electricity deprived rural markets), torch-light, theft tracker, multimedia player, video call, AM/FM Radio and dual-SIM; • Extensive retail distribution footprints; • Aggressive advertising and brand promotions; The microvendors have gone after first-time and second-time buyers and emerged with some success. However, key questions that arise are -- how many microvendors are successfully selling and how have they originated? Is there any major differentiation between their offerings? How are the microvendors positioning their brands? What are the microvendors doing in order to compete at the next level, such as 3G smartphones? Thus, starting in Q1 2010, we are now actively tracking an additional 25 emerging microvendors every quarter. These top 25 microvendors have captured a combined 4% global marketshare. Micromax and Spice top our rankings, which include other vendors from diverse industries such as consumer electronics and personal computing. We expect the long tail of Asian vendors will remain active for the foreseeable future, as they focus their efforts on a next wave of emerging 3G handset growth in 2011. Our published Microvendors report for Q1 2010 is available to download for clients here.

May 20, 2010 21:05 David Kerr

sa photo dk

 

May you live in interesting times as the old Chinese proverb goes. Well in the information, communication and entertainment industry we certainly do. Some very interesting questions face our industry whether we look at:

  • the outcome of much delayed Indian 3G auction or
  • the battlegrounds around HSPA+ and LTE or
  • the surging Android ecosystem vs. weakening Symbian or
  • the upside potential for WebOS under it new owners
  • the potential disruption caused by mobile cloud phones and device

Every major technology advancement has lead to a massive disruption in the handset and infrastructure vendor community.

  • In 3G, Motorola’s slim myopia led to its near ruin and has provided huge growth for Samsung and a foothold in international markets for LG and SEMC.
  • On the infrastructure side 3G was expertly grasped by Huawei and ZTE leading to a new wave of M & A and a new world order which counts Nortel as a victim and seriously challenges ALU.

So how will the migration to 4G change the playing field?

  • Who will benefit most on the operator/service provider side?
  • Will Cloud Phones be disruptive in LTE?
  • Will operators find a path to realign the traffic/revenue mix with mobile broadband devices?

I would welcome your thoughts on these key questions. Also don’t forget to join our client webinar on Thursday May 27.

 

David


May 7, 2010 17:05 nmawston

The big two Chinese vendors, Huawei and ZTE, have initially focused their handset activities on emerging markets, such as ChIndia, Africa and Latin America. Enabled by MediaTek, Qualcomm and Via chipsets, the two handset brands have achieved solid shipment growth in GSM and CDMA since 2007. Both vendors will ship tens of millions of units in emerging markets this year, mostly for low-end prepaid users, giving them a base for scale and buying power. This is phase 1.

Phase 2 of their growth targets mature regions, such as Western Europe and the US. ZTE and Huawei are using their success in emerging markets as a springboard to attack developed markets. The Chinese rightly believe carriers are king in developed countries, and they are quietly partnering with a growing number of the biggest players to deliver carrier-branded hardware. Vodafone recently unveiled 8 new Vodafone-branded models across low-, mid- and high-tiers for its European markets, 6 of which are manufactured by ZTE and Huawei. For example, the Vodafone 845 3G touch-smartphone with Android 2.1 is built by Huawei. The Vodafone 547 EDGE touchphone is made by ZTE. In the US, Huawei made the popular mid-tier Tap touchphone for T Mobile. Carriers like the cost-competitiveness and flexible customization offered by the Chinese brands, and they are useful alternatives to the European, American and Asian vendors such as HTC.

Phase 3 will eventually require a more-complex five-pronged strategy to defend against existing or potential new competitors in the operator-branded handset industry such as Sagem or  Foxconn. Huawei and ZTE will need to upgrade their companies’ competences in:

1. branding;

2. industrial design;

3. portfolio management for build-to-plan products;

4. software usability;

5. content and services.

For now, both Chinese vendors are happy to provide 3G handsets mostly as a delivery tool for operator services. For example, the Vodafone 845 from Huawei is optimized for Vodafone 360 services. But ZTE and Huawei will arguably struggle to sustainably differentiate their own brands on pricing and hardware alone. Developing a software and services (S&S) strategy beyond hardware will therefore become an important value-add for Chinese vendors to attract and retain affluent users in mature regions. An S&S strategy will subsequently open up opportunities for Chinese services brands to partner with ZTE and Huawei to showcase their products in new markets abroad. We have a Google phone and a Microsoft phone; how about a Baidu phone?


March 17, 2010 23:03 bjoy
High-end mobile handsets have more in common with the consumer electronics industry than they used to. Music, camera and GPS segments are some of the early examples that have lost increasing ground to the mobile industry. As the industry converges further, more use-cases and functions will be bundled on high-end handsets and crimp the growth of other consumer-electronic segments such as portable gaming. Retailers are closely watching the evolution of cellular devices and treading the waters carefully. Connectivity will of course be common across multiple device categories, whether it is your 65-inch Plasma TV or internet-enabled table clock – and for the most part, this is a new learning experience for major main-street retailers. Connectivity adds another dimension and requires additional training for their customer representatives – initial set up, configuration, billing, activation, rebates and contract obligations are areas where retailers need to climb up the experience ladder. Some interesting trends from the buoyant US market: Best Buy is betting its future growth on high-end smartphones and emerging connected devices such as 3G laptops. Smartphones are just the launch pad for Best Buy’s broader strategy in taking an early position in the evolving connected terminals space. Wal-Mart is embracing a different route that is aligned with their low-cost mass-market philosophy. The no-frills service plan StraightTalk, developed in conjunction with TracFone, was a big success during the last holiday season. The business is changing in the online channels as well; Amazon launched is beta program last year and connected devices are often sold at significant discounts than through carrier-direct channels. On one hand, third-party specialist retail channels will expand operators' addressable markets to new segments. Operators do not have all the necessary assets to tap the long tail of emerging 3G device segments or new service plans that are aligned more with the consumer electronics industry. In this scenario, retailers are the operators' friend. On the other hand, dilution of operators' direct channels will be a threat for operators' control, and without proper checks in place, the thousands of existing operator stores in the US will soon become much less important. In this scenario, retailers will gain more distribution power and become the operators' foe. - Bonny Joy

February 1, 2010 19:02 nmawston

February is here. And that can only mean one thing: Mobile World Congress (MWC). The world's largest wireless trade show takes place in Barcelona, Spain, from Sunday 14th to Thursday 18th. In between eating, drinking and sitting in the sun, I might even do a little work. Which handset players will be important and who should I go visit?

Nokia is a good place to start. Nokia will stage an off-site event called Connecting People. Connecting People is its longstanding theme to connect people and places with devices and contextual services. Nokia will no doubt unveil a new handset model or two, but we don’t expect anything seismic because Nokia will not want its products to get overshadowed by the noise of MWC.

Samsung will be about Bada, the vendor’s new platform which sits on top of a proprietary or Linux kernel. We recommend demoing its new Bada phone, to see if it matches up with Android, Apple and Symbian devices for usability and richness.

LG, like Samsung, will have a big stand at the show. LG is keen to reposition as a credible smartphone player for 2010 and there will be heavy promotion of its Android and Microsoft portfolios. LG is expanding (belatedly) into content and there should be a display of its 3-Screen 3-Way Sync converged-application service for smartphones, netbooks and TVs.

Qualcomm will be found in several smartphones and smartbooks using its high-speed 1GHz Snapdragon processor. The chipmaker will show its roadmap for the next wave of 1.3GHz (8X50A) and 1.5GHz (8X72) Snapdragons, available for commercial launches of devices over the next 6 to 18 months.

The much-hyped Google Android HTC Nexus One will be on show. However, the handset will be of less interest than the business model. I’ll do some discreet research and see if we can get more color on Google’s underlying plans for its direct-to-consumer online distribution strategy.

We will see a few HSPA+ and LTE demos this year. The dongle players, such as Huawei and ZTE, should have such devices on their stands. This will be a double opportunity to see how next-generation technologies are progressing, while examining how the emerging Chinese brands are performing.

That is a partial snapshot of who I will be visiting. How about you? Let me know by clicking on the Comments link.


January 20, 2010 16:01 bjoy
 Here in the US it is an all too increasingly common occurrence to hear everyday someone new telling us something that we “have” to do. Verizon Wireless and AT&T introduced new data rate plans recently. Hidden in the hullabaloo about lower unlimited price plans was the new announcement from both that users now “have” to buy a minimum data plan with any new feature phone:
  • Verizon Wireless created a new category called 3G multimedia feature phones that  encompasses a range of cool and not-so-cool devices.  An additional $9.99 monthly data plan, providing 25Mbytes of data use per month, is a requirement on any new 3G multimedia feature phone purchased. Unlimited data plans for these phones cost $29.99.
  • AT&T announced an unlimited texting/browsing plan that will be a requirement for any new Quick Messaging Device (also a new device category) purchased. The rate plans for these phones start at $20/month for individual lines and $30/month for family plans, for either browsing or messaging with no data cap.
We can understand the approach – both operators want to drive use of their portal based offerings. AT&T at least went one step further and eliminated the data cap, but consider that that 20$ doesn’t include both messaging and browsing.  Its an either or proposition. We still “have” to choose one. These plans not only miss the mark in terms of their potential to drive meaningful growth in usage of feature phones, they penalize users for wanting to get a cool, mid range phone that lets them do a little more than talk. This is a significant issue for both operators when you consider that they both have a large share of their users on family plans. Will these prices stimulate usage on all the phones sitting idly in family plans? What’s the thinking here? Are buyers on these plans going to be willing to commit to an extra $20 to $40 per month for two to four additional lines? …”Well, since we “have” to buy it, we might as well use it…” I think not. This approach risks slowing take up of new family plans and may result in a slowing of handset replacements in the featurephone category. At the end of the day, this is one thing these users will quickly decide that they don’t “have” to do.

December 4, 2009 15:12 David Kerr

sa photo dk 

As we rapidly close the cover on one of the toughest years the telecommunications, content and internet industries have ever seen, SA takes a look ahead beyond the recession to detail the key megatrends for the mobile industry in 2010.

We see a tough but positive mobile ecosystem outlook with devices recovering stronger than services. More consolidation is likely among network operators, while profits for device vendors will continue to flow away from handset only vendors in favor of device/services integration specialists. Emerging markets will continue to dominate volume with strong 3G rollout competition expected. The global market for services, applications, devices and infrastructure will post modest growth of approximately 3% in 2010.

The total mobile industry revenue including services, infrastructure and devices was flat in 2009. We expect a modest growth of 2.8% in 2010 to $1140B.

· In 2009, only strong growth in data spends by users ensured that total industry revenues did not decline. Data revenues grew 9.5% in 2009 and are expected to grow at a 13% rate in 2010 reaching over $200B.

· Handset market sell through revenue will rebound well in 2010, posting growth of 4% while the infrastructure market will continue to struggle and will decline slightly.

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Key issues shaping the 2010 landscape include:

  • Operators needing to balance the the strong rise in Capex requirements driven by the data traffic explosion against slow revenue growth. The likely outcome being significant M&A, network sharing and even applications development.
  • Handset OEMs will be forced will put the early stake in the ground for new device categories. Traditional OEMS will continue to struggle to match the Apple & Google vertical integration strategy which has proven so successful.
  • As the big five vendors focus on smart phones and content/services in the open markets, a race develops to get services/apps onto feature phone products or other operator customized devices
  • On-portal traffic continues to grow but is outpaced by off portal session growth. Contextualization and personalization of the user experience will determine winners and losers.
  • The rapid diffusion of Flash and HTML 5 on handsets could negate much of the need for mediacos to use open platforms/app stores in mature markets.
  • In the business sector we see SMEs and Manage Mobility as key battlegrounds. We see growth in hosted services for SMEs (e.g. Unified Communications infrastructure-one phone mobile and fixed, one voicemail etc.  Personal v corporate liable devices (iPhone v BlackBerry) becomes a major issue.
  • In the Emerging Markets area we see consolidation & 3G expansion in urban areas as key battlegrounds. With improved financing prospects, there will be significant consolidation among regional operators and rationalization of holdings.