Wireless Device Strategies

First to market each quarter with the most accurate and detailed data on handset strategies. The industry’s most timely, consistent and accurate tracking of device vendor KPI metrics, as well as handset market sales and shipment forecasts.

July 17, 2012 14:24 Alex Spektor

Samsung, the world's largest handset vendor, has acquired the mobile division of CSR, a UK-based chipset maker. CSR's portfolio includes key technologies for mobile device connectivity, such as Bluetooth and WiFi, including the emerging 802.11ac standard. The US$310 million purchase brings two primary benefits to Samsung:

  1. The vertical integration of components to improve its supply chain, optimize BOM costs, and introduce a point of differentiation. Samsung already makes many of its own components, such as displays, flash memory, and application processors;
  2. The strengthening of the device vendor's patent portfolio to help with IPR battles. Samsung and rivals like Apple have been in courts around the world over patent infringement issues.

Samsung is strengthening its component assets for Bluetooth, GPS and WiFi, which should eventually strengthen its handset designs. If Samsung has great displays and great chips in-house, then that’s going to be a solid basis for technology differentiation and supply chain control that can give Samsung devices a competitive edge. Of course, in the longer term, Samsung may end up juggling too many component balls at once, and a sprawling components portfolio could potentially become a negative rather than a positive if they don’t keep things under control.


December 21, 2011 16:30 Alex Spektor

The impending avalanche of NFC phones, which our Wireless Device Strategies (WDS) service projects to grow at an average of 67% per year over the next five years, has everybody thinking about contactless payments. With all the buzz around Google's soft-launched Wallet service and the US carrier joint venture ISIS, which should roll out in 2012, it makes sense. Indeed, the simple fact that money is directly involved in this particular application of NFC rightfully encourages the whole wireless value chain to think about potential revenue opportunities.

However, there is one often overlooked application for NFC -- intelligent device pairing. The idea is simple: instead of inputting PINs, passkeys, or even 26 hexadecimal digits to pair two wireless devices, the user simply "taps" two NFC devices together. The concept can be applied for any pairing event, regardless of which enabling technology, such as Wi-Fi or Bluetooth, is used to make the actual connection.

So far, only one handset vendor has actively promoted NFC for this application. Nokia's latest NFC-enabled handsets and Bluetooth headsets can be paired together using this very concept. Unfortunately, the latest Windows Lumia devices are not yet in this category, as Microsoft has not yet added NFC support to its platform. Nevertheless, Nokia's attention to NFC tech is a positive sign for the vendor's future portfolio. Nokia's strategy holds two key benefits: it future-proofs handsets, getting them ready for mobile contactless payment services once they eventually roll out, and it improves the usability of a typically cumbersome process.

Chip supplier Broadcom, whose interests span Bluetooth, Wi-Fi, and NFC has also recognized this useful application of the emerging tech, and we expect its chipsets and middleware to help device vendors think beyond mobile payments as they develop their NFC smartphones and tablets.

Alex Spektor
Wireless Device Strategies


December 16, 2011 15:18 Alex Spektor

Analysts from our Wireless Device Strategies (WDS) service attended the recent 2011 Broadcom Analyst Day held in New York City, where the semiconductor firm highlighted its recent successes in the wireless chipset space and outlined a strategy for further growth.

Broadcom's major revenue growth driver so far has been the proliferation of its "combo chip" wireless connectivity solution, providing enabling technologies like Bluetooth, Wi-Fi, GPS, and NFC. The solution, Broadcom claims, gives them a typical ASP of US $6-8, which provides a healthy contribution thanks to Broadcom's strong marketshare. Moving forward, Broadcom is seeking revenue uplift from going after the combination baseband/applications processor/GPU market, which together with the wireless combo chip would yield to Broadcom a per-handset ASP of US$12-30. Indeed, Broadcom are already well on their way, and according to our Handset Component Technologies team, Broadcom broke into top-five smartphone AP chip supplier rankings during Q3 2011.

The first phase of Broadcom's long-term plan targets the low-end smartphone market, where Broadcom claims that its solution delivers better performance, dollar for dollar. In particular, Broadcom is targeting cost-sensitive Indian and Chinese microvendors, which are small individually but, according to our Wireless Device Strategies service, together represented about 1 in 10 handsets shipped worldwide during Q3 2011. Going after the low-end smartphone segment, we believe, is a wise decision. Indeed, according to our Wireless Smartphone Strategies (WSS) service, more than half of all smartphones will be priced below US$200 wholesale globally in just a few years.

The second phase of Broadcom's long-term plan will be to target the emerging LTE market. Indeed, we expect well over 100 million LTE phones to be sold during the next two years. Coupled with the technology's significantly above-average ASPs, makes it an attractive market for Broadcom to target.

Ultimately, the success of Broadcom's long-term strategy depends on their ability to gain design wins with microvendors and megavendors alike. The recent success of the Broadcom-powered Samsung Galaxy Y is an early indicator that initial momentum is in the right direction.

Alex Spektor
Wireless Device Strategies


December 14, 2011 11:28 nmawston

Strategy Analytics forecasts worldwide HTML5 phone sales will surge from 336 million units in 2011 to 1 billion units in 2013. HTML5 has quickly become a hyper-growth technology that will help smartphones, feature phones, tablets, notebooks, desktop PCs, televisions and vehicles to converge through cloud services.

We forecast worldwide HTML5 phone sales to hit 1 billion units per year in 2013. Growth for HTML5 phones is being driven by robust demand from multiple hardware vendors and software developers in North America, Europe and Asia who want to develop rich media services across multiple platforms, including companies like Adobe, Apple, Google and Microsoft. We define an HTML5 phone as a mobile handset with partial or full support for HTML5 technology in the browser, such as the Apple iPhone 4S.

We believe HTML5 will help smartphones, feature phones, tablets, notebooks, desktop PCs, televisions and vehicles to converge in the future. HTML5 will be a pivotal technology in the growth of a multi-screen, 4G LTE cloud that is emerging for mobile operators, device makers, car manufacturers, component vendors and Web app developers. With its potential to transcend some of the barriers faced by native apps, such as cross-platform usability, HTML5 is a market that no mobile stakeholder can afford to ignore.

However, despite surging growth of HTML5 phone sales, we caution that HTML5 is still a relatively immature technology. HTML5 currently has limited APIs and feature-sets to include compared with native apps on platforms such as Android or Apple iOS. It will require several years of further development and standards-setting before HTML5 can fully mature to reach its potential as a unified, multi-platform content-enabler.

The full report, Global HTML5 Handset Sales Forecast, is published by our Wireless Device Strategies (WDS) service, details of which can be found at this link: http://www.strategyanalytics.com/default.aspx?mod=reportabstractviewer&a0=6901.


July 20, 2011 19:00 Neil Shah

The last 14 months have been eventful and exciting especially in mobile space as smartphones have been registering stupendous growth. This development has not only lead to smartphone marketshare, valueshare and mindshare battles but have also led to astounding volume and value growth for some smartphone specialists whereas some handset industry incumbents have struggled and are trying to catch up in line with market growth rate.

In this highly competitive environment we are witnessing all possible growth, hype, product cycle and consumer interest trends and innovation not only at the vendor-hardware-product portfolio (ex: Nokia vs. Apple) level but also at software platforms (Android vs. iOS vs. Symbian, etc), attached enabling technologies (ex: NFC, WiFi, HDMI, etc.) and services (ex: Music, Video or Apps) levels. The net-effect when all these components fit together well lead to a great product and experience. Thus to drive this innovation, these players are competing in building their Intellectual Property portfolio in mobile hardware and software space. However, they are not only building IP portfolio to foster innovation but also intend to protect it and at the same time build a steady stream of revenues from IP licensing.

This trend has also led to the recent battles for external patent acquisitions. For example: RIM, Apple, Microsoft, Sony and Google competed recently to bid for 6000+ Nortel’s patents which were up for sale as well as the latest development of Google’s interest in acquiring InterDigital and its portfolio of 8800+ patents to gain competitive advantage in mobile space.

 

Over the same span of fourteen months we have also seen litigation pile up surrounding these mobile handset patents with some winners, some losers and some still hanging and fighting on. Some of the recent patent battles pertaining to Android is worth noting because of the tremendous growth Android has achieved in the same time-frame. Android being open-source and perceived to be low-cost has become one of the primary platforms for many device vendors as well as operators, developers and other players across different verticals dedicating full resources to develop a product attached to the Android ecosystem.

This has hindered the growth and revenue generating prospects of many potential licensable and other open platforms from Microsoft to MeeGo. However, the “openness” of the Google innovation adopted by different device vendors has been challenged by other players in mobile ecosystem such as Microsoft and Oracle which owns a large pool of patents in mobile software space which might have been infringed or not paid for in the developed Android product that delivers the complete smartphone experience. Thus, these series of lawsuits filed by the key players in the mobile ecosystem will not only lead to bump up in product development or manufacturing costs for the vendors delivering Android products but also puts the “low-cost” nature and “openness benefits model” into jeopardy as this cost is transferred either to the next stakeholder in the value chain which may or may not absorb this increment and in the end might pass on to the end-consumer.

In addition to losing the cost advantage in long run, the multiple flavors of "open" Android (with IP owned by different vendors) may create chaos and incompatibility and ironically the "closed" OS may exceed on the innovation curve in integrating all these key components and comparatively provide a superior experience. This ongoing IP battle shall thus affect every stakeholder in the mobile ecosystem.

The detailed implications of these ongoing IP battles can be found in the following latest Wireless Device Strategies Insight:

IPR Wars: Microsoft and Oracle Seeking to Push Up the Cost of Android