US Wireless Market Update Q1 2013 June 20, 2013Posted by chetan in : 3G,4G,4th Wave,AORTA,Chetan Sharma Consulting,Connected Devices,Infrastructure Providers,Mobile Future Forward,Mobile Patents,OTT,Speaking Engagements,US Wireless Market,Wireless Value Chain,Worldwide Wireless Market , add a comment
US Wireless Market Update Q1 2013
The US mobile data market grew 2% Q/Q and 14% Y/Y to reach $21 billion in mobile data revenues. Data is now almost 45% of the US mobile industry service revenues and as we had forecasted a few years back, the cross-over point of 50% might occur later this year. For the year 2013, we are expecting $90 Billion in mobile data service revenues for the US market.
For the quarter, the market added a paltry 1.1 million new connections, a decline of 60% from Q1 2012. It was the lowest net-adds Q4 quarter in the US mobile history (barring the early days of tepid growth). The postpaid category added only 200K subs largely on the back of Verizonâ€™s 677K net-adds.
AT&T sold more iPhones but Verizon sold more smartphones. With T-Mobile joining the iPhone bandwagon, iOS lead in the US market is likely to continue.
T-Mobile continued to lose their postpaid subs for the 11th straight quarter. Sprint also lost over half a million postpaid subs primarily due to the Nextel business. Once Nextel is sunsetted mid-2013 for good, we can expect a pick-up of net-postpaid subs at Sprint.
The see-saw battle between Softbank and Dish for Sprint/Clearwire continued as expected but as expected Softbank is likely to prevail when it is all said and done. After completing the Metro acquisition, T-Mobile started to integrate the 8M+ base into the company. We can expect that the next round of M&A will continue once we are done with the Sprint decision.
As we mentioned in our previous updates, smartphones are now past the 50% mark in the US and continue to sell at a brisk pace accounting for almost 85% of the devices sold in Q1 2013. Apple led the smartphone sales amongst the top 4 operators with 50% share for the quarter. While the US penetration of smartphones is over 50%, the 50% of the sub base is concentrated in only 30% of the households thus leaving plenty of growth in the marketplace.
In terms of Q/Q growth, Connected Devices segment grew 17%, Wholesale 5%, Prepaid 4%, and Postpaid was flat.
Verizon and AT&T maintained their top positions in the global rankings by mobile data revenues. A survey of the entire ecosystem shows that the US companies dominate the top 5 rankings of profit share. China Mobile leads the industry with Apple, Verizon, AT&T, and NTT DoCoMo completing the rankings.
What really drives mobile device performance?
Will a 3rd mobile ecosystem emerge this year? Is it necessary? Specifically, what problem does it solve? What factors influence the purchase behavior of the consumer? And can OEMs change their strategy to impact sales? Why have Microsoft and Nokia not been able to make a dent in the trajectory despite having a compelling OS, range of devices, consumer-friendly price-points, better distribution, and increased level of advertising dollars? Will Blackberry be able to recover? Why hasnâ€™t HTC One been able sell in similar numbers as the Galaxy S4 despite being better by most accounts? What will it take for LG to increase share? Can Motorola stay relevant? Can new entrants disrupt the waters? Can ZTE and Huawei come from the bottom and disrupt the top players? Will Apple and Samsung be able to protect their position on the top?
These questions have been a matter of intense debate in the media and in the ecosystem. We try to address these questions in some detail in our recent paper â€œWhat Really Drives Mobile Device Performance?â€ As I mentioned to the New York Times, it is no longer good enough to have a great product, an OEM needs to perform well across multiple variables.
The Fourth Wave and the shift towards services
It is evident that there is a subtle shift from devices/access to services/solutions. In our paper on the topic â€œOperatorâ€™s Dilemma (and opportunity): The Fourth Waveâ€, I proposed that we need a new framework to think about the next generation of revenue opportunities. The fourth curve opportunities are massive but require a different skill set and strategic approach than the past three curves. It is being widely adopted in the operator community around the world and some operators have started to break out the 4th wave revenues in their financials.
We will be discussing fourth wave in much more detail at our annual thought-leadership summit â€“ Mobile Future Forward with the incredible leaders who are making billion dollar decisions every day.
OTT impact on legacy businesses and models
In the last 12 months, Whatsapp moved around more messages than all the mobile operators combined in any country and that includes US and China. US and China collectively have approximately 1.5 billion subscriptions. Whatsapp with its 200M base has moved more messages in the last 12 months than all the operators in both US and China combined. Ok, let that sink in for a few minutes. For a significantly small fraction of the cost, Whatsapp moves around more messages than every single telecom operator on the planet. Of course, Whatsapp makes a tiny fraction of the revenue compared to the operators. What Whatsapp and similar players lack in ubiquity and interoperability, they make it up by being the commodity utility provider at a low cost to the consumer. The notion of designing by a standards committee above the IP layer is just no longer needed in majority of the cases. Once you have the IP connection, consumers will gravitate towards innovative solutions and be willing to fragment their communication behavior across multiple apps. SMS will stay relevant for the foreseeable future but the growth is in IP communication. We will also see more cooperation between the IP app players and the operators as they find common strategic grounds.
We will see the same impact of IP and mobility on the various verticals like Retail, Energy, Education, Entertainment, Travel, etc. Some operators have been preparing for this shift and going outside their traditional products and services to launch services like AT&Tâ€™s Digital Life to address opportunities in the home, Verizonâ€™s efforts in health and public safety and Sprintâ€™s steps in mobile advertising and analytics.
Operator M&A â€“ The Rule of Three Strikes Back
The M&A game continued with intense frenzy in the ecosystem. T-Mobile completed the Metro acquisition which gives it more heft and scale to compete as a value-player. However, the real drama has been going on with the Softbank and Sprint merger with Dish playing the role of the spoiler. Our original thesis has been that Softbank is a better fit than Dish and Dishâ€™s strategic intention might actually be T-Mobile not Sprint. It was a masterful decoy to raise the cost and pain for Softbank and Sprint. It is likely to be all sorted out in the next few weeks.
There have been some interesting twists and turns but as we have stated before, the US market competitive equilibrium will be complete when Sprint and T-Mobile get together at some point down the road. As outlined in our research paper on the subject, market forces find their way to get to 3 dominant operators that compete for attention and revenues, rest becomes noise. While the regulators might scoff at the idea, the inevitable market forces will find their way around.
Operators with better balance sheets will also look for global expansion especially in Europe where economic impact on the telcom operators has been severe, however the M&A efforts will be complicated by respective governments desire to keep control of the national infrastructure provider.
The Patent Battles
In 2012, Samsung had a strong showing not only in the market place but also in the patents area. It edged past Nokia to become the overall mobile patents leader in the industry. IBM and Microsoft also improved their rankings. Nokia, Ericsson, and Alcatel-Lucent slid in rankings. Motorola dropped out of top 10. Not surprisingly, companies who have been around for a while especially in the infrastructure and the platform space lead the overall mobile patents. Samsung has been fiercely building its patent portfolio in both Europe and the US and the efforts have paid off as it has built a significant portfolio and a formidable lead that is likely to serve it well in the coming years.
A more startling observation is the mobile patent grants as a percentage of the total patent grants in a given year have risen significantly for the US market indicating the importance innovators attach to mobile in their business. In the US, one out of every five patent granted in 2012 was related to mobile. Less than a decade ago, this number was less than 10%. The European market has seen lower growth relative to the US market. Roughly one out of every ten patents granted in Europe are mobile related.
Samsung was the leader in the mobile patents granted in 2012 in the US and that propelled the company to the top ranking in overall patents (1996-2013). Samsung was followed by IBM, Sony, Microsoft, RIM, LG, Qualcomm, Ericsson, Panasonic, Alcatel-Lucent, and Nokia for the top 10 companies by mobile patent grants in 2012. The top 5 categories for patents grants in the US for 2012 were Telecommunications, Digital Multiplexing, Digital Processing â€“ Data Transfer, Digital Processing â€“ Financial, and Digital Processing â€“ Databases. The top 5 filers of mobile patents in the US were IBM, Microsoft, Samsung, Qualcomm, and Sony. Apple made it to top 10 for the first time on the strength of its patents filed in the computer graphics processing category.
For more detailed analysis, please refer our research paper on the subject â€“ Mobile Patents Landscape â€“ An In-Depth Quantitative Analysis.
SMB leading indicator of mobile adoption
Small businesses are at the heart of the US economic engine. They represent roughly 45% of the non-farm GDP. Every administration, every president focuses on small business growth and job creation. In our paper â€œThe ABCs of SMB Transformation: Apps, Broadband, and the Cloud,â€ we explored how mobile is transforming the SMBs. The main conclusions were: a) SMB segment is a leading indicator of technology adoption and we can learn a great deal about the broader trends by understanding how SMBs adopt technology b) there are tangible gains in productivity â€“ on average SMB workers save 40 minutes per worker per day which translates into significant impact on profits and c) there is a tangible impact on computing, enterprise software and services as the business processes are shifting towards iOS and Android.
What to expect in the coming months?
All this has setup an absolutely fascinating 2013 in the communication/computing industry. Convergence is everywhere and is leading to a fundamental reset of the value chains and ecosystems. Players who firmly attach themselves to the 4th wave will reap benefits while the ones who miss it will see their fortunes dwindle. We are gearing up for our annual Mobile Brainstorm Summit â€“ Mobile Future Forward on Sept 10th, hope you can join us.
As usual, we will be keeping a very close eye on the micro- and macro-trends and reporting on the market on a regular basis in various private and public settings.
Against this backdrop, the analysis of the Q1 2013 US wireless data market is:
- The US Wireless data service revenues grew 2% Q/Q and 14% Y/Y to over $21B in Q1 2013 thus exceeding $20B for the second straight quarter.. For the year 2013, we are forecasting that mobile data revenues in the US market will reach $90 billion.
- Verizon and AT&T dominated the quarter accounting for 70% of the mobile data services revenue and had 66% of the subscription base.
- Verizon and AT&T maintained its #1 & #2 mobile data revenue ranking in Q1 2013. Sprint and T-Mobile also maintained their rankings in the top 10 global mobile operators.
- The Overall ARPU increased $0.35. Average voice ARPU declined by $0.42 while the average data ARPU grew by $0.87 or 3% Q/Q.
- The average industry percentage contribution of data to overall ARPU is now at the 45% mark in Q1 2013 and is likely to exceed the 50% in 2013. All the top three US operators are over the 45% mark. (For reference, all three major Japanese operators are now over the 65% mark).
- The US operators added 200K postpaid subs and approximately 1.2M total.
- T-Mobileâ€™s postpaid woes continued for the 11th straight quarter.
- Verizon led the market with 720K net-adds. It was followed by AT&T at 291K, and T-Mobile at 5K. Verizon and AT&T accounted for 86% of the marketâ€™s net-adds Nextel continues to drag Sprintâ€™s postpaid additions. Sprint is expecting the transition from Nextel to Sprint to be complete in the next few months.
- AT&T continued to lead the connected device segment with 48% market share.
Shared Data Plans
- Shared data plans launched by Verizon and AT&T saw positive results. The tablet and other device attachment rate has gone up by 60%.
- Shared data plans moved tablet session based consumers to postpaid tablet plans with more predictable revenue stream. The $10 surcharge for every device is still an inhibitor for many consumers. Over time, we expect this fee to go away to bring in many more consumers experience data services across devices other than their smartphones.
Applications and Services
- The market is seeing a lot of activity in the mobile commerce and payment services as well as in various industry verticals like healthcare, retail, and education. We will be discussing how mobile is changing all the vertical industries at our fall summit Mobile Future Forward where industry leaders in each of these vertical segments will convene to share their experiences and expectations.
- The cloud and security segments have also gained significant traction with incumbents as well as startups launching new initiatives and technologies.
OTT and the impact on legacy services
- In the last 12 months, Whatsapp has moved around more messages than all the mobile operators in the US and China combined. Those of you who have read our Fourth Wave paper shouldnâ€™t be surprised by this shift.
- Smartphones continued to be sold at a brisk pace accounting to almost 85% of the devices sold in Q1 2013.
- iPhone dominated smartphone sales for Q1 2013. In Q1, iPhone accounted for 50% of the total smartphone sales at the top four operators.
- At the end of Q1 2013, Samsung continued its lead in unit sale category both on the world stage as well as in the US. However, profits are a different equation where Apple overshadows its rivals like Gulliver on the Lilliput land.
- While it is fairly clear that Windows will acquire the #3 spot behind iOS and Android, the journey to a substantial and competitive market share is still ways off. It renewed its entry into the battlefield with Windows phone last year but sales have been poor. In Q1 2013, Windows device sales were less than 0.5 million despite heavy marketing (read our paper to get more insights into why Windows hasnâ€™t been able to make a dent so far).
- Apple finally launched its iOS 7 update with the hardware unit to be launched later this year.
- Verizon continues to sell more LTE smartphones as its LTE sub tally rose to 27.5M making it the leading LTE operator in the world. AT&Tâ€™s and Sprintâ€™s LTE rollouts are gathering steam. T-Mobile is also ramping up its LTE deployment. Expect the â€œfastest networkâ€ marketing to continue for at least another seven quarters. Verizon reported that 50% of its total data traffic is on the LTE network now.
- There is always a beauty contest amongst operators as to who sold more iPhones. AT&T again bested its rivals by selling roughly 47% of the iPhones in the US.
Mobile Data Growth
- The smartphone data consumption at some operators is averaging over 1 GB/mo. Some devices are averaging close to 2-3 GB/mo. As we move into 1GB range along with the family data plans kicking in, you can expect the data tiers to get bigger both in GBs and dollar amount.
- While the spectrum debate rages on, in addition to the network and backhaul upgrades, policy management and data offload have emerged as top two solutions that operators deploying around the world. Signaling management solutions like Diameter routing are also getting good traction. However, a long-term video solution is still elusive. As we have been saying in our Yottabyte series of research papers, a comprehensive solution strategy is needed to effectively manage margins/bit.
Your feedback is always welcome.
We will be discussing a number of issues raised in this research update at our annual mobile executive thought-leadership summit â€“ Mobile Future Forward on Sept 10th in Seattle. Thought-leaders include: Biju Nair, EVP and CSO, Synchronoss; Curtis Kopf, VP â€“ Customer Innovation, Alaska Airlines; Danny Bowman, Chief Sales and Operating Officer, Samsung; David Small, Chief Platform Officer, Verizon Enterprise Solutions; Erik Moreno, EVP, Fox Networks; Fay Arjomandi, CEO – Vodafone Xone, President/Chairman â€“ Vodafone Americas Foundation; Geeta Nayyar, Chief Medical Information Officer, AT&T; Glenn Lurie, President, AT&T Wireless; Hank Skorny, VP and GM â€“ Software Services, Intel; Henning Schulzrinne, CTO, FCC; Jef Holove, CEO, Basis; Jude Buckley, President â€“ Mobility, Best Buy Co; Kevin Packingham, Chief Product Officer, Samsung; Manish Jha, GM â€“ Mobile, NFL; Marianne Marck, SVP â€“ Consumer Products, Starbucks; Marios Zenios, VP â€“ Uconnect, Chrysler Group; Matt Carter, President â€“ Emerging Solutions, Sprint; Raj Toleti, CTO, Patient Point; Ralph de la Vega, CEO, AT&T Wireless; Rowland Shaw, VP – Strategy, Ericsson; Stephen David, former CIO, P&G; Steve Elfman, President, Sprint; Terry Myerson, Corporate Vice President â€“ Mobile, Microsoft; Tracy Isacke, Head, Telefonica Digital Americas
We will be keeping a close eye on the trends in the wireless data sector in our blog, twitter feeds, future research reports, articles, and our annual thought-leadership summit â€“ Mobile Future Forward. The next US Wireless Data Market update will be released in August 2013. The next Global Wireless Data Market update will be issued in July 2013.
Disclaimer: Some of the companies mentioned in this research are our clients.
CTIA Wireless 2012 Recap May 14, 2012Posted by chetan in : 3G,4G,AORTA,Carriers,CTIA,European Wireless Market,Infrastructure Providers,Mobile Breakfast Series,Mobile Future Forward,Mobile Operators,Worldwide Wireless Market , add a comment
CTIA Wireless 2012 Recap
CTIA returned to New Orleans after many years and it was great to see the city revitalized and ready to host the wireless show. Overall there were no big announcements, no blockbuster deals, no zingers from speakers that made the headlines. However, it was good to take the pulse of the industry. We met with several prominent industry executives, long-time colleagues, and new entrepreneurs. This note presents the summary of my observations from the show.
Mobile Web and Apps â€“ I had the opportunity to chair the Mobile Web and Apps event and kick off the proceedings with an opening keynote on the State of the Mobile Industry. It was based on our recent global market update that we released last week. In fact, many CEOs and speakers including FCC Chairman Genachowski frequently referenced from the research throughout the show. Wireless Week did a nice cover story based on the talk. There was good discussion and debate about whatâ€™s working and whatâ€™s not, how developers try to create demand and monetize eyeballs, the issues of security and privacy. Mastercard announced its payment developer APIs program. In fact, the show had the presence of all the major credit card companies. Payments, wallet, and commerce were the big talking point.
Operators vs. OTT â€“ The theme of Mobile World Congress continued at CTIA with the topic dominating in both open forums as well as behind closed doors. While most of the ink has been focused on how OTT players are killing operator revenue streams, there is the untold story of operator collaboration with the OTTs. I wrote a piece on the topic for Synergy magazine â€œMobile Operators and OTTs: Building a win-win.â€ The manner in which operators respond to the OTT opportunity/threat will end up defining their future in the years to come. Some operators like TeliaSonera have reacted by throwing their hands and just charging extra for OTT services while others like Telefonica are launching innovative services. We have looked at this topic in-depth for many years and have some more new research coming out in the next few weeks. Stay tuned.
The challenge for some of the operators is in stark display. While T-Mobileâ€™s Bobsled app garnered (95% users non-TMO customers) 1 million users, Viber announced the 70 million milestone. To be a relevant app, one needs scale. Operators have the advantage of providing better call quality. The call quality on many mobile VoIP services is subpar and enterprise customers (and consumers) will pay a premium for better call quality.
Digital Life and New Revenue Streams â€“ In the US, AT&T dominates the connected devices spaces. Indeed in terms of rolling out new services, it is a step ahead of the competition. AT&T has been showing the Digital Life concepts at Mobile World Congress and at CTIA they announced the trial and actual product availability in 2013. This clearly bodes well for the industry for there are many adjacent industries where operators can play an important role. Other operators should pay close attention. We will be discussing the Connected Devices opportunities in detail at our Atlanta Mobile Breakfast Series Event on June 22nd with AT&T, Synchronoss, and CNN.
Traffic Growth and Signaling storm â€“ As we have mentioned in our various research papers and research updates, mobile traffic is roughly doubling YOY in most major markets including the US. While data traffic hogs the headlines, signaling is becoming a menace to network management esp. Android which tends to be more inefficient in handling network resources. We will have a more in-depth discussion of these topics in our upcoming Yottabyte research paper.
TMO Acquisition â€“ Last year, AT&Tâ€™s proposed acquisition of T-Mobile rocked the industry and kept the regulators busy for better part of 2011. While there were no blockbuster announcements, T-Mobileâ€™s acquisition of MetroPCS along with Nokia and RIMâ€™s long-term prospects remained popular water cooler topics.
Nokiaâ€™s revival â€“ Nokia has a lot to prove. Its future is riding on the success of the Lumia series of devices in 2012. Though it hasnâ€™t exactly set things on fire, the sales are actually doing fine. It is amongst the top selling devices at AT&T and is showing stickiness. However, Nokia is getting crushed in other markets, so the net impact on overall cash position can be significant if it is not able to arrest the downfall in the next 3-4 quarters.
Small Cells â€“ A couple of years ago, small cells and HetNets were just talking point. Now, operators are weaving them into their execution plans as they lay out their 4G networks. Given that mobile data growth is going to stay front and center for the foreseeable future, expect to hear about small cells and HetNets for some time to come.
TMO $4B network deal â€“ Generally, the network deals of this size takes many quarters to iron out. T-Mobile moved fairly quickly to iron out its LTE rollout plans and its vendors. Not surprisingly, the spoils of the deal went to Ericsson and NSN. In light of the collapse of LightSquared, this deal might provide NSN a lifeline to continue operations for a few more years.
Mobile Wallets and Mobile Payments â€“ While 2012 will not be the year of mobile payments; it certainly is the year of mobile wallets launches and lots of them. Every financial institution worthy of its salt has launched a wallet. We are just going through the early turbulence cycle of this new segment. However, the opening up of the payment APIs from the financial industry is leading to some compelling experiences and use cases.
NFC was absent â€“ The talk of NFC as a payment solution was noticeably muted. We have always said that NFC will have more impact from other solutions than payment.
Verizon â€“ LTE â€“ Competing on LTE, the fight to build the fastest and biggest LTE network is on. Verizon has an early formidable lead but in 2013 rivals will start to catch-up.
Messaging innovation â€“ As I mentioned to the NY Times and discussed it in our annual global mobile update, messaging revenue has started to decline in some countries. Some operators in Europe are in a state of panic. Chaos creates new opportunities. While operators have just given up on fighting the OTT war, others are gearing with new apps and services of their own (TU Me from Telefonica, Bobsled from T-Mobile, On from Orange). Several startups are also helping the operators innovate on the messaging front. SMS was invented in the early nineties but operators didnâ€™t really take messaging to the next level for the last two decades. I met with a number of companies which are doing some interesting work on the messaging side â€“ like ZipWhip, Maxx Wireless, OpenMarket, and others. Some of these companies are still in the stealth mode and expect to make some waves in the coming months. We will be taking this topic head-on in our Mobile Breakfast Series in Seattle (w/ AT&T, Groupon) and London (w/ Telefonica, Orange, Horizons Venture, Rebtel)
Sprint Guardian, and other apps â€“ in line with generating more revenue form other apps, Sprint guardian was launched with Safely and the service is seeing pretty good traction in the early days and might be able to increase the lifetime value of the customer. Other US operators have similar services available on their network as well. Operators will have to invest heavily in VAS ecosystem and services to arrest the declining revenue in other segments.
FCC, Spectrum and Regulations â€“ FCC continued to make its case for more spectrum via incentive auction. With a change of guard expected next year, it will be interesting to see how some of these efforts pan out. FCC should create parallel incentive programs like a $1B prize for tangibly solving the spectrum crisis w/o the need of new spectrum.
Absence of large players â€“ The lack of any major announcements was only rivaled by the absence of the former CTIA heavyweights like Samsung, Alcatel-Lucent, Nokia, Motorola, and Microsoft. Others had fairly low-key presence.
Regulations â€“ Regulations lag the technology industry progress and it is getting to the point that they might end up hindering growth esp. related to communication, privacy and monetization of network assets. It is time to consider bringing all communication, and data privacy rules under the same umbrella so both the telecom and Internet players are guided by the same set of principles.
Your feedback is always welcome.
We will be keeping a close eye on the trends in the wireless data sector in our blog, twitter feeds, future research reports, and articles. The next US Wireless Data Market update will be released in May 2012. The next Global Wireless Data Market update will be issued in Nov 2012.
Disclaimer: Some of the companies mentioned in this paper are our clients.
Mobile Patents Landscape – An In-depth Quantitative Analysis April 17, 2012Posted by chetan in : 3G,4G,AORTA,European Wireless Market,Infrastructure Providers,Intellectual Property,Mobile Advertising,Mobile Applications,Mobile OEMs,Mobile Operators,Mobile Patents,US Wireless Market,Wireless Value Chain,Worldwide Wireless Market , add a comment
In April 2012, in its report on Intellectual Property, the US Patent Office (USPTO) concluded that the entire US economy relies on some form of IP, because virtually every industry either produces or uses it. The foreword of the report said,
â€œInnovation protected by IP rights is key to creating new jobs and growing exports. Innovation has a positive pervasive effect on the entire economy, and its benefits flow both upstream and downstream to every sector of the U.S. economy. Intellectual property is not just the final product of workers and companiesâ€”every job in some way, produces, supplies, consumes or relies on innovation, creativity, and commercial distinctiveness. Protecting our ideas and IP promotes innovative, open, and competitive markets, and helps ensure that the U.S. private sector remains Americaâ€™s innovation engine.â€
Intellectual property has been an integral part of the economic engine of the western world for many decades if not centuries. Over the past two decades, nations and corporations have competed on the creation, funding, execution, and protection of the new ideas. Increasingly, the role of mobile devices, networks, and applications has become an important component of the growth story worldwide.
To say that the mobile devices have become the remote control of our lives would be an understatement. Mobile phones stay attached to us almost 24 hours a day. From waking us up in the morning to keeping us connected and entertained, from speeding up a commerce transaction to being a trusted advisor; mobile is fundamentally changed how we as consumers behave and how societies and cultures evolve over time. As a result, there has been a big influx of investment and innovation over the last decade. This surge of activity has also translated into increased number of patent filings in the two major jurisdictions of US and Europe. Even the developing countries like China and India have seen a significant increase in patent activity in the country. In fact, in terms of filings, Chinaâ€™s share of the global patent grants has increased from 0.8% in 1996 to 15% in 2010 placing it third behind Japan and the US and well ahead of Korea and Europe.
According to the US Patent Office (USPTO), in 2011, the number of applications reached over 535,000 growing by almost 54% from a decade ago. Similarly, the number of patents granted grew 35% to 224,505 by the end of 2011. The numbers of foreign filings are now in the majority for both the applications filed as well as the patents granted. In Europe, similar trends were observed where the EPO (European Patent Office) patent grants increased by 46%.
The number of mobile related patents that were granted by the USPTO and the EPO increased significantly over the course of last decade. The US market saw a 390% increase while the European market saw a 173% increase in mobile related patent grants.
Another interesting fact is that as of Q1 2012, over 21% of the patents granted by the USPTO now are mobile related. This grew from around 2% in 1991 and 5% in 2011. In Europe, roughly 9% of the patents granted are related to mobile.
Chetan Sharma Consulting analyzed almost 7 million patents granted by the USPTO and EPO over the last two decades to understand how mobile has become a key enabler for all technology companies. Furthermore, we looked at patent granted to the top 65 technology companies who are active in the mobile space to understand their relative strengths and weaknesses in the mobile patent landscape. In a first of its kind study, the paper presents and discusses these findings in more detail.
Your feedback is always welcome.
We will be keeping a close eye on the trends in the wireless data sector in our blog, twitter feeds, future research reports, and articles. The next US Wireless Data Market update will be released in May 2012. The next Global Wireless Data Market update will be issued in Apr 2012.
Disclaimer: Some of the companies mentioned in this paper are our clients.