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.
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
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.
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