2008 - year in review December 26, 2008Posted by chetan in : 3G, 4G, AORTA, ARPU, BRIC, Carriers, European Wireless Market, Wireless Value Chain, Worldwide Wireless Market , trackback
2008 has been a great year for the mobile industry with several key milestones. We will be detailing them in an another post. For this one, just wanted to look back and see how we did in our last year’s predictions survey where we invited the industry insiders to predict the events that will shape the industry this year. The full discussion is here.
We will be presenting our 2009 findings next week. For now, let’s briefly look at the year that was:
1. Will Google introduce a Google Branded Phone in 2008?
Will it? Won’t it? 44.5% gave it a 75% or higher chance of happening while 40% thought it ain’t happening. GPhone is a temptation Google will find hard to resist though a lot will depend on how various initiatives and partnerships shape-up on the ground. In any case, expect another major announcement in the next 2-3 months.
Google did announce the G1 and it launched in Sept. Even though it was launched by T-Mobile USA, in the industry it was known as the Google Phone with Google logo prominently embedded on the phone. Look for several Android launches in 2009.
2. Will Google play to win in the 700MHz Spectrum Auction?
Google has played the spectrum chess game effectively. Almost 50% respondents gave it a 75% or higher chance of Google winning the bid. Though expectations are high, Google is unlikely to play to win. Services business is not their cup of tea, they could still fund the Clearwire-Sprint deal but that investment can be spent differently to get better end-results, i.e. mobile ad revenue.
Google has been pretty savvy with its mobile strategy pushing the ecosystem to its tune. We didn’t think that Google was in it for the win, it just wanted to muddy the waters a bit to makes things interesting. As predicted, it also invested in the Clearwire deal.
3. Will Microsoft launch its own mobile phone?
Unless Google comes out with GPhone, Microsoft will stay content with its operator distribution strategy. 63% of respondents gave it less than a 25% chance of Microsoft releasing their own phone. If GPhone comes out and gets some traction, expect Microsoft to get its “fast follower” strategy into high gear.
Our panel didn’t give Mphone much of a chance. Will it happen 2009? well, probability just got higher.
4. Will Mobile Payments get traction in North America and Western Europe?
Only 9% thought it is a sure bet for 2008. True mobile commerce hasn’t really started in the western world. While there are significant movements, 2008 will just be a “lay the groundwork” year for mobile payments.
We didn’t think so. Groundwork was laid but not much real traction.
5. Will WiMAX regroup from its setbacks?
Only 35% gave it a 75% or higher chance (of WiMAX resurrecting itself esp. in the US in 2008). A lot depends on how Mr. Hesse deals with Sprint’s WiMAX business. Indications are there will be a deal with Clearwire to off-load the risks via some external investment (Google?).
The Clearwire deal did happen and as predicted Sprint decided to offload the business with the help of external investments. The success of the venture is still an open question.
6. Will Helio survive 2008?
Almost 70% respondents thought Helio won’t make it. Given the flameout of some of the prominent new-generation MVNOs, it is hard to see how Helio will see 2009. It will all come down to how persistent is SK Telecom. Earthlink doesn’t have the bank balance to keep funding this initiative.
Writing was on the wall and our panelists called it out explicitly.
7. Will Verizon truly open-up its garden for third-party visitations?
Only 5% thought it is a sure bet for 2008. Verizon’s open posturing was more to ward off any regulators and to improve its image. There is unlikely to be any meaningful progress on this front this year.
“Open” was one of the biggest buzzwords of the year. For Verizon, it was more of a posturing game.
8. Will 2008 be the inflection year for Mobile Advertising?
42% gave Mobile Advertising a 75% or higher chance for rapid growth. Market will mature, more consolidation, some privacy gaffes but overall things are looking up for mobile advertising.
While the market matured a lot, consolidation didn’t really take place this year, perhaps in 2009.
9. Will Femto-Cells gain any significant momentum in 2008?
It will be an introduction and experimentation year, so no significant traction is expected. Over 52% thought Femto-Cells will be just a buzz word in 2008.
It was primarily a buzz word with Sprint launching Femto Cells and T-Mobile pushing hard on the @Home strategy. Given the pressure on the 3G networks, Femtocells will become an integral part of the carrier strategies in 2009.
10. Will Nokia be able to extract iPhone-style rev-share from carriers in 2008?
Less than 20% thought Nokia will be able to do an Apple when it comes to rev-share arrangements. For OEMs, going direct to the consumers was considered treachery to the sacrosanct relationship with the operators. Until Apple showed up with iPhone. Now, Nokia is putting its services strategy in motion and is building a direct relationship with the consumers worldwide and it has a good shot at pulling it off though it will be a long haul.
Well, Nokia didn’t and Apple backed off their rev-share scheme coming back to the tried and tested model of the subsidy model.
11. Will Palm survive 2008?
Only 8% gave it a 100% chance of surviving 08 as an independent entity. It will be difficult for Palm to stay in a status-quo mode. They desperately need a hit device that can give them some breathing room. Given all the operational and strategic problems the company is having, a sale is likely.
This is probably the only prediction that we got wrong though we came pretty close. Palm is still struggling and in spite of the $100M investment late in the year and the announcement of Nova coming up at CES, the company is still struggling. It has got some breathing room but desperately needs a hit, a big hit.
12. Will iPhone truly open up?
Over 45% thought iPhone won’t open-up in any meaningful way. Apple has built-up one of the most profitable closed empires in the digital world. Are they about open things up? While the iPhone SDK is scheduled for early 08, don’t hold your breath on accessing the critical native APIs.
Well, “Openness” is in the eyes of the beholder. The Appstore has been a super hit and has become a standard for the industry such that everyone is rushing to copy the model. Apple opened up but lot of work still needs to be done.
13. Will there be more unsubsidized devices introduced in the US market in 2008?
Almost 49% thought we are likely to see another unsubsidized device in the US market this year. Nokia is looking to go direct and some GSM handset manufacturers are likely to entertain the idea of testing the market with unsubsidized devices.
The Apple model changed and that was pretty much the death knell to the unsubsidized device model in the US.
14. Will Mobile TV move the needle in 2008?
Almost 70% thought mobile TV won’t make much of a difference in 08.Though AT&T is slated to introduce MediaFLO to join Verizon in the Mobile TV services market, lack of devices and better pricing models will hinder wide adoption in 2008. However, downloadable video and VOD content will experience significant growth.
Mobile TV suffers from highpricenditis and users stayed away as expected.
15. Will Android make a dent in handset shipments in 2008?
Only 15% gave it a more than 75% chance this year. It is going to take some time for Android plans to mature and materialize. Don’t see any material impact in 08.
1M+. Enough for the buzz but not making any material dent into the market share. 2009 could be different.