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Mobile Breakfast Series: Internet of Things March 23, 2014

Posted by chetan in : Internet of Things, IoE, IoT, Mobile Breakfast Series, Mobile Future Forward, US Wireless Market, Worldwide Wireless Market , add a comment

Internet of Things: Exploring the next big thing in mobile

We hosted our first Mobile Breakfast Series of the year at Columbia Tower Club last week and the topic was Internet of Things (IoT). IoT is the hottest thing in the mobile industry right now with investment pouring in from all sides. Our expert panel took a deeper look into the opportunities, the hype, and the challenges in the evolving mobile segment. Mobile Breakfast Series works to bring you the current thoughts, expert brains, and probing questions about the main issues of the day.

Internet of Things (IoT) has been hailed as the next big thing in the mobile industry. As connections from objects and things interconnect with existing and new end points, the networked effect can provide tremendous opportunities; reshape existing processes, user experiences, and expectations. But, really, how real is IoT and what will it take to reach the billions of dollars promised. Will it fundamentally alter how we do things? We are starting to see signs of tremendous progress. GE is investing $4B+ into its version of IoT – the industrial Internet and it is making the difference in operations and machine learning. Connected consumers’ gadgets are enabling us to lead healthier lives, work more efficiently, and manage our time more effectively.

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We had a superstar panel discussing the IoT evolution from different angles.

Bobby Morrison, President, Verizon PNW has his ears to the ground as he works with his customers big and small on using mobile to solve real-world problem that improves productivity and financial performance. Verizon is one the top digital operators in the world who understands the implications of the 4th wave and is investing appropriately.

Tim Moss, SVP, Ericsson was one the key guys behind the analysis that led to the 50 Billion connected devices paper in 2011. He has 20+ years of experience in the industry and worked across many verticals so has a real deep understanding how mobile can be incorporated in various industries.

Chris Murphy, Director, Brand Communications and Digital Marketing, adidas US is close to the consumers as to what matters most. Companies like adidas don’t introduce technology in their products for the sake of technology. Each mistake can be costly if it is not well thought out. It doesn’t mean that are constantly tinkering at the edges. His team has been introducing new concepts and new ways to engage the consumer throughout their

Shankar Chandran, VP, Samsung Catalyst Fund is part of the new investment group at Samsung in Silicon Valley who is looking to invest in cutting edge startups and technologies in both hardware and software that can give Samsung and its ecosystem an edge. His areas of interest are IoT, cloud, security, mHealth, and next-generation user interfaces. Samsung is one of the top 3 important players in the mobile and technology ecosystem.

From wearables to automobiles to industrial automation, the use cases are endless and we are just trying to make sense of what such a connected world will mean to productivity, human behavior, safety, privacy, and the society at large.

As we stand today, here are some of the forecasts:

In 2011, Ericsson forecasted 50 Billion Connected Devices by 2020

In 2012, Cisco agreed with the forecast and said they too expect the same number of connected devices and in 2013 came out with a paper talking about a $14.4 Trillion economy powered by IoE

In 2013, GE came out with their research and paper on the Industrial Internet powered by sensors and calculated that we could see $10-15 trillion dollar impact on the GDP in the next 20 years.

So, these are massive numbers. It does feel like we are entering a new phase of technology growth due to connected sensors, what I call the “Golden Age of Mobile” and I was seen that in my work in both developing and developed nations that the use cases are everywhere. In many instances, developing countries are not waiting but leapfrogging some of the developed nations. So, very exciting times ahead.

The salient point of discussions were:

I really enjoyed the discussion and we covered quite a bit of ground. As usual, the audience were well informed and did their homework.

Given the importance of the topic, we are expanding our Mobile Breakfast Series on IoT and going back to London this summer and in partnership with Telefonica hosting a session on IoT on June 17th. Hope our friends and colleagues in western Europe can join us.

We will also more details on our annual summit Mobile Future Forward in September. Stay tuned for more details.

Thanks and see you around.

Mobile Breakfast Series Recap – Mobile Platforms and the future of HTML5 June 12, 2013

Posted by chetan in : 4th Wave, Chetan Sharma Consulting, HTML5, Mobile Breakfast Series, Mobile Future Forward, US Wireless Market, Wireless Value Chain, Worldwide Wireless Market , add a comment

We hosted our 15th Mobile Breakfast Series event yesterday. The topic was – Is HTML5 Really Disruptive?

HTML5 has been talked about for a long time as the most disruptive force for mobile applications since the Apple Appstore was launched 5 years ago. But, can it really change the industry dynamics? How do you solve the reach problem for the developers? Many interesting initiatives in 2013 like Firefox OS but will they make a difference? How do developers view HTML5?

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The platform wars are not new, they have been around since computing evolved. The discussion and debate just morphs into the flavor of the day. In the recent past, smartphones and tablets have redefined computing as we know it. The vitality and strength of any ecosystem is determined by the number of app developers developing for a platform and actively monetizing. Right now there are only two sheriffs in town – for units it is Android and for revenue it is iOS. Others play on the fringes. HTML5 has been in the discussion for a while and whether it can stand on its own as a platform has been a matter of great debate amongst the participants of the trade. As usual, we had an outstanding line of speakers which over a 100 years in combined experience in the mobile space, which is just phenomenal. These guys have worked with all the major computing and device companies so the depth of understanding of real issues, challenges, and opportunity really showed. The panelists were:

Hank Skorny – VP/GM – Software Services, Intel. Hank is a veteran of the platform industry with successful stints at Apple, AOL Mobile, Microsoft, Adobe, Infospace Mobile, and now with Intel. He recently acquired Mashery and Aepona to beef up the Open API initiative for enterprises, operators, and developers.

Jeff Warren – VP – Mobile and Online Partner Marketing, Expedia. Jeff previously worked at Motorola and his team has been doing some great work in mobile at Expedia, a real example of how companies are adapting to the 4th wave that I have been talking about.

Asokan Ashok – Director – Content and Services, Samsung. Ashok has worked for Motorola, Nokia, Ericsson, HP, and now with Samsung. You can say, he knows a thing or two about devices.

Sundeep Peechu – Partner, Felicis Ventures. Remember Rovio or rather Angry Birds. Well, he was one of the early believers and investors when it was not fashionable to invest in apps. Now it is a multi-billion dollar industry. Felicis itself is fairly impressive. Just in 6-7 years, they have made 100+ investment with 46 exits.

I kicked off the discussion with an animation of how the market shares have changed in the smartphone space since 2004 from Symbian, Windows and Blackberry to iOS and Android. We do seem to go in cycles. Are we on the tip of another cycle?

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Source: © Chetan Sharma Consulting, 2013

Not a complete change but Hank made the case for HTML5 and articulate a well reasoned thesis that HTML5 is not going to be disruptive because it is the web but rather due the economic reasons. Companies are just running out of people they can hire to build apps and HTML5 provides a solution with more trained staff and cheaper cost of development.

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Source: © Hank Skorny, Intel, 2013

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Source: © Hank Skorny, Intel, 2013

Below is the summary of the discussion:

HTML5 needs a champion

Is it the economics, stupid?

Enterprise to lead the way

HTML5 needs to solve

The world is not either/or

What do consumers think?

All in all, a great discussion. Had insightful questions and comments from the audience as well who are well-plugged into the debate.

Thanks for all those who came and participated. My thanks to the speakers for making the time to share their insights.

Next, our Mobile Future Forward Summit is coming up on Sept 10. The early bird expires this friday so make sure you grab your tickets.

We also released our Mobile Future Forward Research Series Paper -

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It goes into details about why some players are successful in the device space and others aren’t. You can download it here.

Thanks and have a great rest of the month.

Mobile Breakfast Series – Dallas – LTE & Beyond: The future of mobile networks April 3, 2013

Posted by chetan in : 4G, 4th Wave, LTE, Mobile Breakfast Series, US Wireless Market, Wireless Value Chain, Worldwide Wireless Market , add a comment

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We are pleased to announce Mobile Breakfast Series is coming to Dallas for the first time. Below are some details about the program:

Mobile Breakfast Series - Excellent Speakers. Invaluable Insights. Peerless Networking.

Mobile Breakfast Series is a quarterly event that brings together thought leaders and visionaries from the global mobile industry to interact and share ideas, insights, and best practices with the entrepreneurs, enthusiasts, and everyone who is passionate about mobile. We dive into the most important issues and opportunities in front of our industry with the executives who are making things happen.

Date: June 25th, 2013

Time: 7:30-11am. 7:30am – Registration, 8:30am – Discussion Begins, 10:00am - Networking

Venue: Tower Club, 1601 Elm Street, Thanksgiving Tower, 48th Floor, Dallas, TX 75201

Registration is open now.

Topic: LTE and Beyond – The future of mobile networks

US is leading the globe in LTE deployment. In fact, most of the cutting-edge engineering with mobile networks is happening here with all major operators deploying LTE. What’s next for mobile networks? How will they evolve over the course of the next decade? Will we be able to keep ahead of the insatiable consumer demand for more? We will have an in-depth discussion with our distinguished speakers.

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Fireside Chat:

Kris Rinne, Senior Vice President – Network Technologies, AT&T Labs

Vish Nandlall, Chief Technology Officer & Head of Strategy, Ericsson

Chetan Sharma, President, Chetan Sharma Consulting (moderator)

Kris Rinne, SVP – Network Technologies, AT&T Labs

Kris Rinne is responsible for network architecture, service platforms, radio access roadmap and initial implementation, wireless device requirements and certification, network platforms, network performance analysis, and industry standards development at AT&T. Previously, Rinne served as Cingular’s chief technology officer with similar responsibilities. She earlier served as vice president—Technology and Product Realization, responsible for new product development from a technology standpoint, handset certification, and infrastructure vendor coordination. Prior to joining Cingular, she was vice president—Technology Strategy for SBC Wireless, responsible for new product development and network operations support. She has worked for Southwestern Bell Mobile Systems as managing director—Operations. In 2011, Kris was named as “The Most Influential Woman in Wireless” by Fierce Wireless and was a member of the Global Telecom Business Power 100 list of the most powerful telecom executives.

Vish Nandlall, CTO and Head of Strategy, Ericsson

Vish Nandlall is Head of Strategy, Marketing and Chief Technology Officer for Ericsson’s North American region. He is responsible for identifying Ericsson’s long-term vision, defining the overall company strategy, and driving business value creation for Ericsson’s customers in North America. Nandlall joined Ericsson in 2010, most recently serving as Chief Technical Officer for the company’s AT&T Customer Unit. He previously served as CTO of Extreme Networks and CTO and distinguished member of technical staff for Nortel Carrier Networks. Nandlall has led architecture and standards direction for product portfolios ranging from GSM, CDMA, WiMAX, LTE, metro DWDM, carrier routing and switching, and carrier VoIP portfolios. His recent areas of research include M2M, augmented reality, and mobile virtualization.

Mobile Breakfast Series – June Events March 26, 2013

Posted by chetan in : HTML5, LTE, Mobile Breakfast Series, Mobile Future Forward, Wireless Value Chain, Worldwide Wireless Market , add a comment

Greetings,

It was awesome to see so many of you at the Mobile Breakfast Series Event last week. For those of you who couldn’t make it, here is the summary.

We also announced the date for our Mobile Future Forward program – Sept 10th in Seattle. Stay tuned for some really exciting announcements regarding speakers and the program.

Also pleased to announce the next two breakfast series events.

June 11th – Seattle – HTML5 – Is it really disruptive?

HTML5 has been talked about for a long time as the most disruptive force for mobile applications since the Apple Appstore was launched 5 years ago. But, can it really change the industry dynamics? How do you solve the reach problem for the developers? Many interesting initiatives in 2013 like Firefox OS but will they make a difference? How do developers view HTML5? We will take the pulse of the industry and ask the tough questions.

Hank Skorny, Vice President and GM – Consumer Software, Intel

June 25th – Dallas – LTE and Beyond – The Future of Mobile Networks

US is leading the globe in LTE deployment. In fact, most of the cutting-edge engineering with mobile networks is happening here with all major operators deploying LTE. What’s next for mobile networks? How will they evolve over the course of the next decade? Will we be able to keep ahead of the insatiable consumer demand for more?

Kris Rinne, Senior Vice President, Architecture and Network Planning, AT&T

Vish Nandlall, Chief Technology Officer and Head of Strategy, Ericsson

.. more speakers to be announced.

Registration is open now. First come, first served.

If you have any burning questions or any feedback, please feel free to send us a note.

Have a great spring and we will see you soon.

Thanks

Mobile Breakfast Series Recap – Cloud, SDN, and the art of mobile computing March 25, 2013

Posted by chetan in : 4th Wave, AORTA, ARPU, Applications, Big Data, Mobile Applications, Mobile Breakfast Series, Mobile Cloud Computing, Privacy, Security, US Wireless Market, Wireless Value Chain, Worldwide Wireless Market , 2 comments

Mobile Breakfast Series entered its 5th year of operation this week with our first event of the year in Seattle. The topic of discussion was Cloud, SDN, and the art of mobile computing.

2012 has been an incredible year for mobile. Despite the global economic doldrums, mobile is a $1.5 trillion economy with new entrants, new disruptions, new devices, technologies, networks, etc. One of the major shifts is in how the revenue is generated for the industry. Mobile operators around the world capture over 85% of the industry’s profits. However, if you take a look at the top 5 global players by profits – it is China Mobile, Apple, Verizon, AT&T and DoCoMo. Still dominated by service providers but Apple wasn’t on the list 2 years back. So, how will the list look like 5 years from now?

There is a clear shift going on what I call “the fourth wave” i.e. industry’s new revenues are going to come from services and solutions. And mobile operators are not silent participants on this wave. Players like Verizon, AT&T, Telefonica, and DoCoMo are going toe-to-toe with the OTT or Internet players. If you remember the early 2000s, mobile data wasn’t even registering on the revenue scale; 10 years ago mobile data revenues were less than $1 billion per year in the US. Last year, we reported $79 billion, this year it will grow to $90 billion. In fact, we might see a shift where data revenues > voice revenues this year in the US. It has already happened in Japan, over 65% revenue coming from data. But what happens when data saturates, the revenue is going to come from fourth wave services and solutions. You will start to see operators break out revenues from digital services.

So, the question is what those services are – cloud is on top of the list, big data and analytics is on the top of that list? How are these going to be supported – by LTE network, buy SDN enabled network infrastructure? To discuss all of this we assembled a great panel.

Mitch Lewis, Vice President, Juniper Networks

Biju Nair,  EVP and Chief Corporate Strategy Officer of Synchronoss

Randy Wagner, Executive Director, B2B Sales and Marketing, Verizon Wireless

Louis Brun, Senior Vice President, Marketing and Product Strategy, Guavus

Chetan Sharma, President, Chetan Sharma Consulting (moderator)

Before we began, Mitch Lewis gave a talk on “Seven Leadership Principles From Everest” .. yes, you read it right, Everest. Mitch has not only climbed Everest but each of the 7 highest peaks on the 7 continents. If that were not enough, he has run 7 marathons on these continents as well. It was indeed a thrill and a privilege to host my friend Mitch and have him talk about his experiences and the lessons from a dream that he accomplished over the course of 8 years. Just a phenomenal achievement.

Below is his presentation and a video from his talk. Enjoy and get motivated.

 

 

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We could have just stopped there :)

But we had plenty to discuss on the state of mobile cloud computing and the emergence of SDN.

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Below is the summary of the discussion:

Cloud Computing

SDN

Privacy and Security

Big Data

As usual, it was a lively discussion and with the added presentation from Mitch, a memorable one indeed. Mobile cloud has become a layer of computing just like security or connectivity. This fundamental capability has led to a thousand new companies looking to move the art of computing a bit forward. Software Defined Networking is slated to disrupt the infrastructure in a big way, provide more flexibility to service providers and developers to create even more compelling services and user experiences.

We also announced the date of our 2013 Mobile Future Forward. On Sept 10th this year, leaders of the mobile industry will gather in Seattle to brainstorm the future of mobile. As usual, it is going to be a delight to host the best and brightest. So mark your calendars, make your plans, and we hope to see you there later this year. More news to come in the coming weeks.

Thanks to all those who attended and thanks to Synchronoss for being our series partner.

Chetan

Mobile Breakfast Series Recap – Mobile 2013 December 13, 2012

Posted by chetan in : Chetan Sharma Consulting, Mobile 2013, Mobile Breakfast Series, Mobile Predictions , add a comment

The Mobile Breakfast Series Event returned back to its home ground in Seattle after a detour to Atlanta and London earlier this year. As is the tradition, we go into the pontification mode for the last event and assemble experts to help us gauge what’s going to be exciting in the coming year, the shakeups that are coming and what should we keep an eye on.

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The panelists were:

Zaw Thet, Advisor, Signia Venture Partners

Zaw is a veteran entrepreneur who has been at the forefront of search, social networking, mobile, and adtech since the age of 19. Most recently Zaw was the founder and CEO of 4INFO, one of the largest mobile advertising platforms in the world. Business Week recognized him as one the “Mobile Barons” helping to shape the mobile ad industry since 2004.

Omar Javaid, Managing Director, BBO Global

Omar is the managing director of BBO Global, a boutique advisory and early stage venture firm in the wireless and media space. Prior to BBO, Omar Javaid is Vice President, Product Management of Emerging Technologies Group at Motorola Mobility, a Google company. He was part of the executive team that lead the successful turn-around of Motorola, culminating in the $12.5B acquisition by Google. In this role, he was responsible for next generation smart phone and convergence products Motorola Mobility.

Tracy Isacke, Director of Investments and Business Development, Telefonica Digital

Tracy started her career at Xerox, rising to be the first female member of the UK Board, leading a team of over 450 people. Tracy joined Telefónica in 2006 as the head of the Enterprise Sales Team for O2 UK, then she led on Telefónica’s $207m acquisition of Jajah, the Valley-based VOIP/IP Telephony company. Tracy is currently spearheading the growth of Telefónica Digital as Director of Investments and Business Development, focusing primarily on Silicon Valley, Israel and Europe, with a growing team of half a dozen employees, based in Mountain View, Madrid, London and Tel Aviv.

Todd Achilles, VP, Mobility, Hewlett-Packard Company

Todd Achilles is Vice President, Mobility for HP’s Printing and Personal Systems business unit, where he leads strategy and execution for delivering a connected experience to HP customers. Todd has spent his career in product, marketing, sales and engineering roles within telecommunications sector, including leadership positions with HTC and T-Mobile USA.

What is in store for Mobile 2013?

2012 has been an incredible year for mobile. We crossed several key industry milestones – 6.5B subscriptions, 1B subscriptions in China, 1B broadband subscriptions, 500M android activations, Apple’s monstrous march towards $1T market cap. We also saw Amazon’s aggressive moves in the mobile space, Facebook eclipsing 1B active users, and Nokia/Microsoft/RIM trying to stem the tide. Some big M&A maneuvers throughout the year. All this is setting up a very exciting Mobile 2013. There was a lot to discuss – from the tussles of Apple and Android to opportunities in commerce and big data, from Microsoft’s comeback to challenges in managing the network growth and consumer expectations. We assembled a stellar panel of mobile veterans to help us brainstorm what the big trends, big movers and shakers, and the big opportunities of 2013.

Below is the summary of the discussion:

  • Post-PC or PC+
  • Mobile Platforms
  • Digital Telcos
  • Hardware
  • Commerce
  • Misc
  • It was a lively discussion and I could have easily gone on for another 2-3 hours. Our audience is always top-notch and is highly educated about the nuances of the industry as was evident from the questions. 2012 was the year when Mobile Breakfast Series spread its wings and went to Atlanta and London. We had a great time putting together each of the events in 2012 and we have many more planned for 2013, so stay tuned.

    Our annual thought-leadership summit – Mobile Future Forward returns in Sept 2013. More details to come.

    From all of us at Chetan Sharma Consulting, we wish you and yours a great holiday season and a terrific 2013.

    Finally, as we do it every year, we launched our Annual Mobile Predictions Survey for 2013. There will be prizes for the 25 lucky winners. Be sure to share your thoughts. The survey ends Dec 28th. We will release the results in January.

    Until then,

    have a good time.

    Chetan

    Mobile Breakfast Series Recap – London – Operator/OTT – The Way Forward July 5, 2012

    Posted by chetan in : Mobile Breakfast Series, Mobile Operators, OTT, Wireless Value Chain , add a comment

    June has been a very exciting month for us at Chetan Sharma Consulting. We took our Mobile Breakfast Series first outside Seattle to Atlanta and then, last week, outside US to London. Both places, it was very well received and we thank all the partners, speakers, and attendees who helped us out. On Jun 29th, we hosted our first European Mobile Breakfast Series at Wayra, Telefonica in London. My thanks to the Telefonica team for hosting us and making the whole experience worry-free. The topic of the discussion was Operator/OTT – The Way Forward. Regular readers would remember, we did a Seattle Breakfast Event on the same topic earlier in June. Wanted to get the European flavor of the same hot topic.

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    Operator traditional revenue streams are under threat esp. voice and messaging. Access margins will continue to stay under pressure. OTT players are coming in fast and furious and it is not just the big ones like Google but also players like Whatsapp, Voxer, Viber and others. How do operators play in the new landscape – lessen the decline of their traditional revenues while investing in new areas that improve their overall margins and revenues. Do they play the role of an enabler, a utility player, or become the OTT player themselves? In a software-driven world, how do they stay nimble? On the flip side, what are some things that operators can provide to the OTT players that make them successful, take them to the market quickly and maintain a long-term healthy and mutually-beneficial partnership? Operators still generate 70% of the global mobile industry revenues, so they are an important part of the chain but how do they ensure they have an equally relevant share in the profits. The panel will discuss how operators and OTT players think about the challenges and the opportunities, the competition and the coopetition.

    To discuss the topic we had excellent panel with Jamie Finn, Director of Product Design at Telefonica Digital. This is a new unit within Telefonica that is doing some great work (recently released TU Me – a messaging application to compete with other VoIP/IP messaging apps) and Jamie is an integral part of the team.

    Jamie was joined by Dominique Rougié, Director, TV Interactive Services & Media, Digital Innovation, Orange Group. Dominique has an interesting perspective since he is responsible for services across the three channels – online, cable, and mobile. From the OTT side, we had Andreas Bernström Chief Executive Officer, Rebtel. Rebtel is the second largest VoIP player after Skype with over $80M in revenue slated for 2012. Finally, we had Frank Meehan who has been doing OTT for a long time first at 3Uk and then at INQMobile. Some of the earliest OTT integrations of Skype, Facebook, and Twitter came from his team.

    Some highlights from the discussion -

    I really enjoyed the discussion and audience participation. We now take a break from our Mobile Breakfast Series and focus our attention to our annual mobile executive summit – Mobile Future Forward which is going to be held on Sept 10th in Seattle. We have an extraordinary group of executives who are joining us and I hope you can too.

    Until then, have a great summer and see you soon.

    Mobile Breakfast Series Recap – Atlanta – Connected Devices, Cloud, and Consumer June 24, 2012

    Posted by chetan in : 3G, 4G, AORTA, ARPU, Applications, Connected Devices, European Wireless Market, Mobile Advertising, Mobile Applications, Mobile Breakfast Series, Mobile Cloud Computing, Mobile Commerce, Mobile Content, Mobile Devices, Mobile Ecosystem, Mobile Future Forward, US Wireless Market, Wireless Value Chain, Worldwide Wireless Market , 2 comments

    We started doing Mobile Breakfast Series in Seattle back in 2009 and after hosting10 straight events, it was time to expand the wings and explore other cities. The first stop in this journey was Atlanta and we worked closely with our partners at “Wireless Technology Forum” to make it a successful event last friday. I also had the good fortune of participating in WTF’s event the night before. Both events focused on Connected Devices and their impact on the consumer, the ecosystem and the value-chains thus making it a “connected week” in Atlanta.

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    As I mentioned, the night before the event, I had the opportunity to present and moderate a panel on Connected Devices with Glenn Lurie, President of Emerging Enterprises at AT&T and Jeff Smith, CTO at Numerex. Both are movers and shakers in the space and it was such a pleasure meeting with many WTF members and interacting with the top-notch panelists. The event was recorded and is available on WTF’s Youtube Channel.

    We hosted the Atlanta Mobile Breakfast Series Event in Atlanta at the Commerce Club of Atlanta which has beautiful views of the Atlanta area.

    There is an old Chinese saying, “When the wind of change blows, some build walls others build windmills.” Our industry is going through tremendous change; it won’t be an exaggeration if I say that the tectonic plates are moving and moving fast. The motion is being forced both by the economic conditions but also the technology and business progress. I have been around the industry long enough but it still amazes me – the stuff that’s in the pipeline and how quickly consumers absorb it.

    The topic of our discussion was Connected Devices, the Cloud, and the Consumer. With connected devices, I am referring to the broad availability of devices that are connected to data networks – so they include smartphones, tablets, connected auto but also wellness devices like fitbit, energy meters, dog collars, medical devices, etc. as of last year, the subscription penetration was at 6B, next year, we will have more connections than people on this planet. In another 5-7 years, we might touch 20 Billion sensors on the planet. So you can see the growth is going to be astronomical.

    Another phenomenon is that of cloud. If a startup mentions Cloud in their presentation to a VC, the valuation doubles, you say mobile, and it quadruples. I don’t know how many of you are a fan of Mark Weisier, the Xerox Parc researcher who pioneered what became “always on, always connected” tagline of pervasive computing. It was more than 20 years ago, we finally are seeing that with the help of broadband networks, amazing devices, and open business models, information is truly available at the fingertips.

    The third leg of our discussion was the consumer – their appetite for new and the latest is creating this tremendous opportunity that is shaping their behavior and expectations.

    We had an awesome panel to discuss things in detail. First I discussed the topic with David Christopher, Chief Marketing Officer at AT&T Mobility. As most of you might be aware, AT&T is leading not only the US but the globe in their efforts to bring connected solutions to the market. I work around the world with top operators, and I can tell you there is no exciting place in mobile right now than right here in the US of A. US is leading in innovation, technology, and business model. We had lost touch after 1G and US truly teaching rest of the world how to do 4G right. David has a terrific background – a product and operationally driven CMO at one of the world’s biggest mobile operator and it was a delight to have him on the panel.

    I have known both Biju Nair and Louis Gump for sometime – several decades of mobile expertise. Louis is with CNN, has been running their mobile efforts which are top-notch. He is a recognized leader in the mobile advertising space and given that CNN’s properties span across multiple screens, he has really great insights as to how consumers behave across n-screens.

    Biju is a hard core technologist, has been working at solutions that make Louis’ stuff work across networks and devices. Many of you might not know but Synchronoss where Biju is the Chief Strategy Officer and Products EVP, powers online activation at AT&T. If you bought the iPhone over the last few years at AT&T, there is a good chance your order was processed by Synchronoss.

    Highlights from the discussion below:

    The team at Chetan Sharma Consulting really enjoyed taking the Breakfast Series to Atlanta. My thanks to the terrific team at WTF for their support and to the Atlanta Mobile Community for making the event so successful. Finally, the event wouldn’t have been possible without the support of our series partner – Synchronoss.

    As you might be aware, our fall mobile executive summit – Mobile Future Forward is going to be on Sept 10th. Registration is open. We are likely to sell out so grab your tickets early.

    Next Stop – London for our first venture across the pond. On June 29th, we host the discussion on Operator/OTT – The way forward with Telefonica, Orange, Rebtel, and Horizons Ventures. Read Frank Meehan’s pre-event interview about the topic here.

    Operators and OTT - The Way Forward - London

    Operator traditional revenue streams are under threat esp. voice and messaging. Access margins will continue to stay under pressure. OTT players are coming in fast and furious and it is not just the big ones like Google but also players like Whatsapp, Voxer, Viber and others. How do operators play in the new landscape – lessen the decline of their traditional revenues while investing in new areas that improve their overall margins and revenues. Do they play the role of an enabler, a utility player, or become the OTT player themselves? In a software-driven world, how do they stay nimble? On the flip side, what are some things that operators can provide to the OTT players that make them successful, take them to the market quickly and maintain a long-term healthy and mutually-beneficial partnership? Operators still generate 70% of the global mobile industry revenues, so they are an important part of the chain but how do they ensure they have an equally relevant share in the profits. The panel will discuss how operators and OTT players think about the challenges and the opportunities, the competition and the coopetition.

    MBS London – Frank Meehan Interview June 9, 2012

    Posted by chetan in : Mobile Breakfast Series, OTT, Wireless Value Chain, Worldwide Wireless Market , 1 comment so far

    Mobile Breakfast Series Frank Meehan, Horizons Ventures VC: Why Operators Should Follow Telefónica & AT&T Innovation Blueprint

    With MBS Seattle behind us, we are gearing up for Atlanta and London. Our good partner Mobile Groove did a nice interview with one of our speakers and my good friend – Frank Meehan who will be with us in London on the Operators/OTT panel. Frank has done terrific stints at Ericsson, 3 UK, INQMobile and now is with Horizons Venture -

    Some highlights:

    What must mobile operators do?

    Yes, OTT players have had a hearty meal at the expense of the mobile operator, but there is still money to be made if mobile operators concentrate on what they do best.

    As Frank puts it: “Going out and trying to build a social network is probably not the right thing to do, but there are some great things that operators are doing.  I particularly like the way Telefónica Digital has set up really a separate company which is designed to go after digital opportunities.  That’s the right way to do it.”

    Facing the talent crisis

    Operators should stake their turf (connected home, security, the Cloud, etc) and build their business. But, Frank warns, the biggest challenge for operators is talent. “A lot of the young and upcoming talent is going off to work for startups.”

    What can operators do to stem the flow of talent to startups (that may one day be their rivals)? A lot! Follow the Telefónica Digital blueprint and give your talent freedom to innovate. “You’ve got to have incentives that compete with startups, or with the Facebooks and Googles otherwise it will become very difficult.”

    When it comes to software solutions or the way they are developed, mobile operators should see these are the work of a “separate team outside of the operator standard operations.”

    What awaits operators?

    As a VC, Frank is convinced there is money to be made. “Operators are cash rich and it’s still a good business and they will snap up things, so certainly there’s an opportunity for investments to crystallize, particularly from a sale — then operators are very interesting.”

    Overall, Frank says 2012 has been a great year from “an investment and a start-up perspective.” In his view, it’s “booming” — in part thanks to the Facebook IPO and the excitement it has generated around other companies that tap into our mobile Zeitgeist and requirement for social, sharing and connectedness. “Facebook is literally now the electricity of the Internet … and it’s a huge shift — you’re seeing the big companies like Spotify and others — and it’s just really dragging a huge start-up industry along with it, and it’s accelerating.”

    You can listen to the whole interview here.

    Mobile Breakfast Series Recap – Operators/OTT – The Way Forward June 8, 2012

    Posted by chetan in : AORTA, Applications, Carnival of Mobilists, Connected Devices, Mobile Advertising, Mobile Applications, Mobile Breakfast Series, Mobile Ecosystem, Mobile Future Forward, OTT, US Wireless Market, Unified Messaging, VoIP, Worldwide Wireless Market , 4 comments

    June is the Mobile Breakfast Series Month with 3 programs planned in 3 cities across 2 continents. We kicked things off with the first one earlier today in Seattle. The topic of discussion was Operators and OTT – The Way Forward.

    We also announced our fall program of Mobile Future Forward. More about that later.

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    There is an old Chinese saying, “When the wind of change blows, some build walls others build windmills” Our industry is going through tremendous change; it won’t be an exaggeration if I say that the tectonic plates are moving, in some places quite violently. The motion is being forced both by the economic conditions but also by the technology and business progress. I have been around the industry long enough but it still amazes me – the stuff that’s in the pipeline and how quickly consumers absorb it.

    The topic of our discussion was Operators and OTT or Over the Top. These are services like Skype, Youtube, Amazon video, HBO, etc. things that go over the network. I wanted to broaden the discussion to another acronym – VAS or value added services – both for the consumer segment and the enterprise segment. These will be simple things like address backup or CRM applications to more sophisticated supply chain management, in-store location targeting, advertising etc. To discuss this we have an absolutely brilliant panel representing various parts of the value chain.

    RealNetworks has been the Kevin Bacon of startups in Seattle. Thanks to the people Rob Glaser hired, RN has done a better job at spawning up new ideas that your bigger cousins in town. Rob is well known for his pioneering work in giving Internet its voice (in the words of Kara Swisher in the 1998 article for WSJ). But lately, Rob has been busy with Sidecar – a next generation communication app that does more things than messaging and voice. If you haven’t tried, please do so.

    Mary Jesse is one of the most distinguished engineers in WA State going back from the McCaw days, VP of Eng at AT&T, CTO of RadioFrame and now CoFounder and CEO of an enterprise communications company called Ivytalk. Again, if you haven’t tried it out, please do so.

    Michael Shim was with Yahoo before Groupon and Yahoo was one of the true pioneers in the mobile space and now at Groupon he is seeing the new opportunities on the VAS, payments, and commerce. It will be great to get his view of how Groupon thinks about the space.

    Have you tried T-Mobile’s Bobsled? Well, Alex Samano is the man and energy behind this service and T-Mobile is one of the few operators globally who are taking this OTT opportunity head-on. At TMO, he has been involved some really interesting initiatives like @home and wifi calling.

    Last but not the least, Abhi Ingle from AT&T who heads up the mobile enterprise business. The industry has been talking about enterprise mobility for ages but his team generates more revenue than majority of the industry players combined. Did you know that AT&T is one of the biggest app developer on the planet? I bet you didn’t know that.

    Operator traditional revenue streams are under threat esp. voice and messaging. Access margins will continue to stay under pressure. OTT players are coming in fast and furious and it is not just the big ones like Google but also players like Whatsapp, Voxer, Viber and others. How do operators play in the new landscape – lessen the decline of their traditional revenues while investing in new areas that improve their overall margins and revenues. Do they play the role of an enabler, a utility player, or become the OTT player themselves? In a software-driven world, how do they stay nimble? On the flip side, what are some things that operators can provide to the OTT players that make them successful, take them to the market quickly and maintain a long-term healthy and mutually-beneficial partnership? Operators still generate 70% of the global mobile industry revenues, so they are an important part of the chain but how do they ensure they have an equally relevant share in the profits. The panel discussed how operators and OTT players think about the challenges and the opportunities, the competition and the coopetition.

    Some highlights from the discussion:

    Our next breakfast event is in Atlanta on Connected Devices on June 22nd. Then we revisit the Operator/OTT discussion again from the European point of view in London on June 29th. Tell your colleagues and friends about it. They will thank you for that.

    New Research: US Mobile Data Market Update Q1 2012 May 21, 2012

    Posted by chetan in : 3G, 4G, AORTA, Connected Devices, Infrastructure, Mobile Breakfast Series, Mobile Cloud Computing, Mobile Commerce, Mobile Ecosystem, Mobile Future Forward, US Wireless Market, Wireless Value Chain, Worldwide Wireless Market , add a comment

    US Mobile Data Market Update Q1 2012

    http://www.chetansharma.com/USmarketupdateQ12012.htm

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    Summary

    The US mobile data market grew 6% Q/Q and 21% Y/Y to reach $18.7B in Q1 2012. Data is now over 40% of the US mobile industry service revenue. For the year 2012, we are forecasting that mobile data revenues in the US market will reach $80 billion.

    For the first time in the history of the industry, the US operators had a net decline in postpaid subs. The top 7 operators lost a combined 52K postpaid subs. In overall net-adds, Sprint bested both of its bigger rivals for the first time since Q1 2002. That was exactly a decade ago when Cingular and Nextel brands were still around, before Google IPO and before Zuckerberg enrolled into Harvard. In fact, Sprint is the only US operator that has added more than 1 million subs every quarter since Q4 2010. However, most of these net-adds are coming from prepaid and wholesale segments. If we look at the net-adds over the last 4 quarters, AT&T comes out on top by a distance. In terms of postpaid net-adds only, Verizon is the clear leader during the same time period.

    In terms of Y/Y growth, Connected Devices segment grew 23%, Prepaid 15%, Wholesale 10%, and Postpaid 1%. AT&T, Sprint, Sprint, and Verizon are number one respectively in these categories.

    One-third of US consumers don’t use landline phones. The wireless only US population went past 100M subs in Q1 2012. Mobile will continue to increase its share of the household IT budget and thus improving the overall revenue picture. However, there will be fierce battle for the prized postpaid subs that have been slowly migrating to prepaid as a result of the economic doldrums. It is quite possible, they will come back but predicting the reverse migration is tough.

    Q1 2012 will also be remembered for Samsung’s ascend to the top of the hill ending Nokia’s 14 year run. In terms of unit sales, it dominates the overall unit shipments and also the more lucrative smartphone segment. However, Apple dominates both the device revenues and more importantly just crushes the competition on device profits. It has only 8% of the global unit shipment share but over 70% profit share.

    Apple has the complete stronghold on the supply chain and has sucked out the oxygen from the OEM world. Samsung for its part has done a credible job at keeping pace and in being competitive. As expected, the Chinese OEMs – ZTE and Huawei (and some new ones that you will hear about in the next few quarters) are coming on strong from the bottom. This means, the players caught in the middle face perilous times.

    AT&T edged past NTT DoCoMo to become number two in global mobile data revenues rankings for the first time. Now top positions in the global rankings are occupied by the US operators.

    Smartphone sales continued at a brisk pace accounting for almost 70% of the devices sold in Q1 2012.

    Operator and OTT – The way forward

    We are at a critical juncture of the industry evolution. The OTT phenomenon is shifting the tectonic plates at a rapid pace. What seemed like a minor irritant only a few quarters back is become a nuisance virus that is eating away the core. Some operators have gone into panic mode while others have stepped back, assessed the situation, embraced it, and will try to exploit the opportunity. The truth of the matter is that the two biggest apps – voice and messaging didn’t really evolve a period of two decades. When the last big invention was interoperability and that too a decade ago, you know things are ripe for disruption. Thanks to the availability of always-on IP networks, new and nimble players are pushing the boundaries of what’s possible. It is not that some of these concepts haven’t been around for a while. RCS has been around for the last 5 years and this year there has been some tangible progress. However, while the world waits for interop and wide availability, startups can offer similar and in most cases, better services now. They can iterate rapidly and reach scale at much faster pace. We are in software-defined world after all. Smarter operators are launching their own OTT services while nodding at the standards implementations.

    It is such a critical topic for the industry that we are devoting two Mobile Breakfast Series events to this topic. The first in Seattle on June 7th with AT&T, T-Mobile, Groupon, Ivycorp, and Sidecar and the second in London on June 29th with Telefonica, Orange, Rebtel, and Horizons Ventures. We will also be delving deep into the subject at our annual mobile brainstorming summit – Mobile Future Forward on Sept 10th in Seattle.

    Mobile First to Mobile Only

    Couple of years, the realization in the industry set in that mobile is going to really dominate the world. Senior executives like Eric Schmidt at Google started to preach the gospel. Very quickly, we are at another pivot point wherein the mobile first doctrine is going to move to mobile only. It is not that the desktop world will disappear into oblivion. Far from it. But, the investments, strategy, and execution will be driven by mobile. As we said in our global research update last month, in 3-5 years, with few exceptions, if a company is not doing majority of its digital business on mobile, it is going to be irrelevant. There are already several data points to support the theory. Leading apps and services like Facebook, Twitter, Pandora are already operating in the world where mobile is driving majority of their user engagement. Expedia, Fandango and others are seeing the early signs of migration into the mobile dominated world.

    Postpaid Doldrums

    For the first time in the history of the industry, the US operators had a net decline in postpaid subs. This is because of the shift to prepaid in recent times as well as the increased competition for the last few potential postpaid subs. So, the question emerges, where will the net-sub and net-revenue growth going to come from in the next few years. The smartphone penetration in the US was at 43% as of Q1 2012 so the significant opportunities are in the upgrades and non-data to data conversion. Family data plans (see below) will help in bolstering data revenues as well. Multiple devices/consumer will increase the sub penetration which is at 110%.

    Family data plans

    We have been big advocates of family data plans for the last 2 years and they are finally coming to the US market in the next few months if not weeks. Like gravity, it’s inevitable. Consumers want simplicity and common sense. Family data plans doesn’t necessarily mean that all family members will be forced onto a single data plan but rather the consumers given the opportunity to combine data usage under the same umbrella if they wanted to. If all in the family are heavy data users, initially, some of the data tiers might not make sense but for the vast majority, there are always going to be devices or family members who don’t need a separate full-fledged data usage plan.

    When I talked to CNBC earlier this year (Jan), I said that there is a 90%+ probability that the family data plans will be introduced in the US market in 2012. I discussed this more with Bloomberg andUSA Today last week. Verizon and AT&T have been preparing the media and the consumers for this eventuality. Once one operator opens the door, expect rest to follow. Our Atlanta Mobile Breakfast Series will touch upon this topic during the discussion on Connected Devices, the Cloud, and the Consumer (with AT&T, Synchronoss, and CNN).

    Mobile Data Growth – The Gigabyte Generation

    The smartphone data consumption at some operators in the US is averaging close to 800 MB/mo. As we move into the 1GB range along with the family data plans getting introduced shortly, you can expect the data tiers to get bigger both in GBs and $. Mobile data traffic growth continued unabated doubling again for the 8th straight year. We expect the mobile consumption to double again in 2012. Data now constitutes over 85% of the mobile traffic in the US. As new devices and new network technology roll-outs continued in 2012, the data traffic will grow at the expected pace. The signaling traffic is growing at even a faster pace, 3 times in some cases. Stay tuned for our research paper in the Yottabyte paper series on the topic later this year.

    Platform wars

    Now that Google’s Motorola deal is approved in China and Facebook’s stellar IPO is behind us, we are going to witness a contentious platform battle between the fab five. Google is preparing to get deeper into handset business while Amazon and Facebook are tinkering with their own handsets. Microsoft is banking on the Lumia success and the release of Windows 8 and its impact on the ecosystem will be closely monitored. Samsung is putting some resources behind Tizen to hedge its bets in case things go south with its current partnerships. The platform narrative is still being defined by Apple which has the commanding mindshare of the developers, operators, and the profits. Follow the money and the puzzle unravels in front of your eyes.

    Mobile Patents Landscape

    2011 was the most active year for mobile patents in terms of disputes. All the major players were active in filing and protecting their turf for the future battles. IBM topped the industry in the most number of mobile patents granted in 2011 in the US followed by Samsung and Microsoft. The rest of the top 10 in order included Sony, Qualcomm, LG, Ericsson, Panasonic, Broadcom and RIM. Of the major players, Nokia occupied #12, Intel #13, Apple #16, Motorola #21, and Google #23 spot in the top 50 ranking. Amongst the mobile operators, Sprint was the leader with 323 patents granted in 2011. We have more research coming out later in the year that shows the relative patent strength of the various mobile players.

    Market Consolidation

    The AT&T-T-Mobile merger might not have gone through but that doesn’t stop industry to play the M&A speculation parlor game. Except for a few impossible scenarios, all sorts of deals are being contemplated. The market economics is clearly crying out for more consolidations. However, in an election year, there is an uneasy uncertainty that is gripping the market. The smaller M&As won’t move the needle and bigger M&A are not going to be on the table until we get into a new calendar year.

    Connected Universe, Monetizing Opportunities

    While 2011 was the year of figuring what the opportunities are in the new connected era, 2012 is starting to focus on how to monetize those opportunities. That will be the theme of our Mobile Future Forward Thought-leadership summit in Sept. More details to come. Almost all the vertical industries are benefiting from the connected devices and ubiquity of broadband networks – security, health, retail, utility, transportation, entertainment, and others. We will take a deep dive into the issues, the best case studies, the opportunities, and the players. We are assembling industries who’s who to help you figure out where the industry is headed next.

    What to expect in the coming months?

    All this has setup an absolutely fascinating 2012 in the communication/computing industry. Convergence is everywhere and is leading to a fundamental reset of the value chains and ecosystems.

    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 2012 US wireless data market is:

    Service Revenues

    ARPU

    Subscribers

    Applications and Services

    Handsets

    Mobile Data Growth

    Global Update

    Your feedback is always welcome.

    Chetan Sharma

    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 Aug 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.

    CTIA Wireless 2012 Recap May 14, 2012

    Posted by chetan in : 3G, 4G, AORTA, CTIA, Carriers, European Wireless Market, Infrastructure Providers, Mobile Breakfast Series, Mobile Future Forward, Mobile Operators, Worldwide Wireless Market , add a comment

    CTIA Wireless 2012 Recap

    http://www.chetansharma.com/ctiawireless2012.htm

    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 – 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 what’s working and what’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 – 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 “Mobile Operators and OTTs: Building a win-win.” 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-Mobile’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 – 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 – 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 – Last year, AT&T’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-Mobile’s acquisition of MetroPCS along with Nokia and RIM’s long-term prospects remained popular water cooler topics.

    Nokia’s revival – Nokia has a lot to prove. Its future is riding on the success of the Lumia series of devices in 2012.  Though it hasn’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 – 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 – 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 – 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 – 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 – LTE – 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 innovationAs 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 didn’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 – 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 – 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 – 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 – 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 – 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.

    Chetan Sharma

    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.

    Global Mobile Market Update 2012 (Annual Edition) April 30, 2012

    Posted by chetan in : 3G, 4G, AORTA, BRIC, European Wireless Market, Indian Wireless Market, Japan Wireless Market, Mobile Breakfast Series, Mobile Future Forward, Mobile Operators, Mobile Patents, Mobile Payments, Patent Strategy, US Wireless Market, VoIP, Wireless Value Chain, Worldwide Wireless Market , 7 comments

    http://www.chetansharma.com/GlobalMobileMarketUpdate2012.htm

    Global Mobile Market Update

      

    State of the Global Mobile Union - 2012

    1. Total Global Mobile Revenues to hit $1.5 Trillion in 2012, over 2% of Global GDP

    – Top 10 operators control 42% of the global data mobile revenues

    1. Mobile Services Revenue exceeded $1 Trillion for the first time in 2011

    – The number of mobile operators with > $1 Billion in yearly data revenues will touch 50 in 2012

    1. Total Global Mobile Data Revenues went past $300 Billion in 2011

    – Non-messaging data now owns 53% of the global mobile data revenues

    1. Mobile Operator Profits have more than doubled over the last 10 years.

    – However, the wealth is not divided evenly. Asia’s share has tripled at the expense of Europe whose profit share has declined by 50%

    1. Total Global Subscriptions to exceed 7 Billion in early 2013

    – China exceeds 1 Billion, India 950 Million. Subscriber growth is in Asia, Revenue growth is in Asia+North America

    1. China and India represent 27% of subscriptions but only 12% of the global service revenues

    – US represents only 6% of the subscriptions but 21% of the global service revenues, 26% of the data revenues, and 27% of the global CAPEX

    1. Mobile Devices are now exceeding traditional computers in unit sales + revenue

    – 70% of the device sales in the US are now smartphones. Device Replacement cycle is shrinking

    1. Samsung and Apple now account for 50% of the smartphone unit share and 90% of the profit share

    – Difficult environment for other OEMs esp. when ZTE and Huawei are coming strong from the bottom. It will be difficult for pure play device OEMs to survive long-term

    1. Tablets (iPads) has created a new computing paradigm that is having a significant impact on commerce, content consumption, and developer investments

    – Apple will continue to dominate the segment and iOS will be the leading OS for the segment. Amazon, ZTE, Huawei, to chip away at the sub-$200 tier.

    1. Mobile Broadband (4G) is being deployed at a faster rate than previous generations, first time data is leading the charge

    – Over 1.5 Billion broadband connections by 2012

    1. Global Mobile Apps revenue has completely (and irreversibly) tilted to off-deck

    – The decline is directly proportional to the increase in smartphone penetration by region

    1. All major markets are consolidating with the top 3 players at 85% of the market

    – Regulators will have to be more prudent and proactive about managing competitiveness and growth

    1. Mobile data traffic 2x YOY in most markets. Mobile Data will be 95% of the global mobile traffic by 2015

    – Many countries are facing spectrum exhaust in the next 2-3 years (in certain markets)

    1. Mobile Signaling takes up 2x the resources as Mobile Data Traffic

    – Signaling traffic is growing faster than the data traffic on broadband networks

    1. Connected device segment is growing at the fastest pace in the western markets

    – Operators will have to quickly adapt their strategies to stay relevant in this segment

    1. Several multi-billion dollar opportunity segments are emerging

    – Mobile Advertising, Mobile Commerce, Mobile Wellness, Mobile Games, and Mobile Cloud Computing to name a few

    1. Mobile Ecosystem has become very dynamic and unpredictable

    – The 5 Platform Amigos – Apple, Google, Amazon, Microsoft, and Facebook dominate though the first two have the real power

    1. Mobile Operator Revenue is under pressure from OTT Players

    – OTT Share of the Global Mobile Revenues increased to 4%

    1. OTT players forcing operators to up their game

    – Operators are partnering, launching their own OTT apps, increasing tariffs to manage the margins

    1. Intellectual Property has become a key component of long-term product strategy

    – 21% of all patents granted in US are mobile related. Top 20 control 1/3rd of the overall mobile patent pool

    1. Mobile Patent Rankings: US – IBM, Microsoft, Nokia. Europe – Alcatel-Lucent, Nokia, Samsung. Overall – Nokia, Samsung, Alcatel-Lucent

    – OEMs – Nokia, Samsung, Sony. Service Providers – AT&T, NTT DoCoMo, Sprint

    1. In 3-5 years, with few exceptions, if a company is not doing majority of its digital business on mobile, it is going to be irrelevant

    – Majority (by a good margin) of the consumer interactions with brands will be on mobile

    1. Mobile has become the single most important digital channel for engaging consumers and it shows

    – In the US, mobile revenues were > all Ecommerce And > Music, ISP, Hollywood, and Cable revenues combined

    1. We have entered the mobile 3.0 era where “data” is all that matters and it disrupts the value chains

    – Data will drive majority of the network growth, Contextual data will drive majority of the VAS growth

    1. There will be more changes in the next 10 years than in the previous 100

    – The value chains will keep disrupting every 12-18 months by the new players and business models. Several verticals are already getting redefined e.g. retail, health, education, etc.

    The Big Picture

    The global mobile industry is the most vibrant and fastest growing industry. We expect the total revenue in the industry to touch approximately $1.5 Trillion in 2012 with mobile data representing 28% of the mix. Mobile data services revenue stood at 33%. Global Mobile Data revenues eclipsed $300 Billion for the first time in 2011. It is also the first year in which non-messaging data revenues will make up the majority of the overall global data revenues at 53%.

    By the end of 2011, the global subscriptions exceeded 6 Billion. The first 1 billion took over 20 years and this last one took only 15 months. The primary growth drivers are India and China which are cumulatively adding 75M new subs every quarter. China became the first country to eclipse the 1 billion mark in March 2012. India is likely to arrive at the milestone by early 2013.

    Smartphones are driving tremendous growth around the globe. Amongst the major markets, US leads with 69% sales. The global figure stands at approximately 32%. Some operators expect 90-95% of their device sales to be smartphones in 2012. In terms of the actual smartphone penetration, we expect the US market to eclipse the 50% mark in 2012.

    China leads in the number of subs but US dominates in both total and data revenue. A number of emerging nations are now in top 10 – Brazil, India, Russia, Indonesia, Pakistan, Mexico while once dominant – Korea, UK, Italy, Germany have dropped off or slipped in rankings.

    Global Mobile Data Growth

    Japan continues to be the leader in mobile data with NTT DoCoMo, KDDI, and Softbank Japan ahead of the pack in terms of mobile data revenue and data as a % of total ARPU. Country average is now at 60%.

    Next, Australia and the US have made good inroads in the last two years. In fact, if we look at the overall data revenue, US is much further ahead than any other nation due to the size of the market.

    While India has the highest subscriber growth rate in the world right now, the revenue generating opportunity remain down right anemic compared to other major markets with average dropping down to $2.50 in overall ARPU. Even with significant subscriber base, there is going to be a general lack of opportunity in the market for the next couple of years relative to other markets.

    Devices – Changing Landscape

    Apple has had the tablet space to itself. Thus far the response from the competitors has been tepid esp. on the pricing dimension. Apple has had such a mastery over the supply-chain and months ahead of the competition that by the time they figure out details, Apple already locks up the pricing advantage for the cycle. OEMs try to catch-up on the features but can’t do on the margins. OEMs can grow the pie by bringing products at a better price points that helps attract different demographics to the mix. Microsoft can make good inroads into the space with its Win8 tablet release in 2012 but it will be again in a catch-up mode as the iOS ecosystem will be even more robust by then. The cheaper Android tablets will do well in the market. As expected, tablets will pretty much eliminate the need for netbooks and are starting to eat into the desktop/laptop revenue.

    Apple and Samsung are strong on the top. Huawei and ZTE are coming up strong from the bottom. The middle tier players will have a tough time going forward.

    It will be difficult for pureplay device OEMs to survive long-term.

    Nokia and RIM are under severe market scrutiny as investors and developers leave in droves. Lack of product planning and execution has left their market share in disarray. Nokia’s valuation has been cut into half. Nokia’s release of N9 shows the engineering and creative design depth but a lot is riding on the first generation of Nokia Windows Phones (Lumia). While the market hasn’t shown much appetite for Windows phone thus far, a good family of devices might be able to slow the loss trajectory and position the combined team for the up-for-grabs 3rd spot in the ecosystem. Given that the computing is shifting to mobile devices, we can expect some of the weaker desktop/laptop players will exit the industry.

    Majority of the tablet use is in the WiFi mode because the primary use case is indoors and WiFi gives a better (and cheaper) user experience. However, of the users who use cellular, the churn is low. Once operators start to roll out user-friendly family data plans across multiple devices, we can expect the cellular activation go higher (e.g. Rogers, Vodafone Spain) but will still be dominated by WiFi overall.

    Mobile VAS and OTT – The Big Picture

    • The traditional operator revenue streams of

    – Voice – declining and under threat from VoIP

    – Messaging – flattening/declining and under threat from IP messaging

    – Access – rising but margins are shrinking fast

    – VAS – declining in proportion to the growth of smartphones

    • Operators are fighting back with

    – Voice – launching their own VoIP apps e.g. Bobsled from T-Mobile, partnering with VoIP players e.g. Skype integration, charging for VoIP apps e.g. TeliaSonera €6/month

    – Messaging – launching their own IP messaging apps e.g. Huddle from AT&T, partnering with IP messaging players e.g. Whatsapp partnership

    – Access – Tiering

    – VAS – launch their own VAS apps and industry vertical apps and services

    Managing Mobile Data Traffic and Profits

    As a result of the data tsunami, there are two types of opportunities that are being created, one that take advantage of the data being generated in a way that enhances the user experience and provides value and the other in technologies that help manage the traffic data that will continue to grow exponentially.

    To be able to stay ahead of the demand, significant planning needs to go in to deal with the bits and bytes that are already exploding. New technical and business solutions will be needed to manage the growth and profit from the services. Relying on only one solution won’t be an effective strategy to manage rising data demand. A holistic approach to managing data traffic is needed and our analysis shows that the cost structure can be reduced by more than half if a suite of solutions are deployed vs. a single dimensional approach and thus bringing the hockey stick curves of data cost more in line with the revenues and thus preserving the margins.

    The decision making process within the operator organizations will need to be streamlined as well. Operators should also consider creating a senior post which focuses on both the cost side and the solution side so they can devise and institute a sustainable long-term policy and keep the margins healthy.

    Mobile Intellectual Property

    • The IP tussles are playing out as expected

    • Players with strong IP portfolios will be able to command better negotiating positions, new revenue streams, competitive positioning over the long-term

    • On average mobile companies file patents 1.7 times more in the US vs. Europe

    • Mobile Patent Leaders in US: IBM, Microsoft, Nokia

    • Mobile Patent Leaders in Europe: Alcatel-Lucent, Nokia, Samsung

    • Mobile Patent Leaders in Infrastructure: Samsung, Alcatel-Lucent, Ericsson

    • Mobile Patent Leaders in Devices: Nokia, Samsung, Sony

    • Mobile Patent Leaders in Service Providers: AT&T, NTT DoCoMo, Sprint

    • Top 20 control 1/3rd of the total mobile communications patent pool

    Mobile Competitive Dynamics

    The Rule of Three is evident in all major markets. While the percentage market share might vary, on an average, the top 3 control 93% of the market in an given nation. It doesn’t matter if the market is defined by “controlled regulation” like in China, Korea, and Japan or if it is “open market” driven in markets such as the US, UK, and India. Eventually, only top 3 operators control the majority of the market. There are niches that others occupy but they are largely irrelevant to the overall structure and functioning of the mobile market.

    Markets such as US and India experienced similar competitive environment in their hyper-growth phase. For the US, this phase was in the nineties-mid-2000s while India has been experiencing the similar environment in the last 3-4 years. In both cases, at the start there are 5-6 players with no more than 25% market share but higher than 10% of the mix but gradually the market forces enable consolidation. Over a period of 18 years, US is settling into a “top 3” operator market. India’s brutal price wars are going to trigger the consolidation in the next 12-24 months and will eventually settle into a structure similar to other markets.

    The competitive equilibrium point in the mobile industry seems to when the market shares of the top 3 are 46%:29%:18% respectively with the remaining 7% being allocated to the niche operators. To achieve some semblance of equilibrium in the market the top operator shouldn’t have more than 50% of the market share and the number three player shouldn’t have less than 20%. This helps create enough balance in the market to derive maximum value for the consumer.

    Mobile operators will face some hard choices in developing and protecting the role they want to play in a given region and the ecosystem at-large. The strategy they choose will have a direct impact on the expected EBITDA margins, investment required over the long-haul, how investors view them, and on the competitive landscape of the country. Given, the fast pace of globalization, new rules and trends might emerge over the course of this decade that further define “communications” and “computing” as we know.

    Key Industry Micro-Milestones

    1. Apple captures 70% of mobile device profits – defies gravity, obliterates competition
    2. Apple mobile appstore downloads exceed 25 Billion, 100 Million on Mac – can you spell domination
    3. Samsung ends Nokia’s 14 year reign as the device king – brutal execution
    4. Android 300M activations – Juggernaut
    5. Paypal does $7B in mobile transaction volume
    6. Square does $5B in commerce transaction volume
    7. Google > $5B in mobile revenues
    8. Microsoft revenues from Android > Windows Mobile
    9. Pandora’s 70% usage is on mobile, Twitter’s 60% of the usage is on mobile – heading towards a mobile-dominant world
    10. Facebook Instagram Acquisition $1B – Mobile only acquisition to beef up mobile strategy
    11. Angry Birds approaches a billion downloads
    12. ESPN does 3.1 billion minutes on mobile in 3/12 – Mobile is where the action is
    13. Skype traffic over 150 billion minutes – OTT pressure
    14. KPN messaging volumes decline 15% YOY – OTT pressure
    15. Mobile Security threats grow 7x in last two years, Android threats up 3000% – Mobile IS IT
    16. Cisco BYOD ratio – 70% (up 52% in 2011) - BYOD is creating new opportunities for vendors
    17. US data traffic over 130 quadrillion bytes/month in 2011 – Data traffic 2X YOY, welcome to the yottabyte era
    18. Fandango sells quarter of its ticket on mobile – commerce is happening
    19. Expedia does > $1B in mobile commerce – see above
    20. Microsoft Nokia Multi-Billion partnership – It takes two to tango
    21. Lightsquared fails – Keep your friends close, enemies closer
    22. Google Motorola $12.5B – IP becomes key to strategy
    23. Nortel Patent acquisition $4.5B – IP becomes key to strategy
    24. AT&T/T-Mobile Failure – DOJ/FCC put down the gavel
    25. 40% of Kenya’s GDP comes from mobile money – impact of mobile is pervasive
    26. Millennial Media IPO at $2B – first public market validation of the mobile advertising space
    27. HP gives up on Palm – Competition forces Corporate Schizophrenia

    What to expect in 2H 2012

    • More Tiering, faster pace of change of plans. More options, family data plans

    • Cost reduction is as important as revenue generation. More players will align their value-chains and cost structures

    • Facebook IPO is probably going to be the single biggest event in the technology industry in the next few months.

    • Radios will start connecting the digital world with the physical world with significant disruption opportunity

    • Mobile Payment Networks will remain intact for the near future as the ecosystem largely focuses on building value on top of the existing exchange platforms

    • The intersection of Social, Location, Identity, and Gaming is creating new opportunities

    • With connectivity becoming pervasive, mobile will fundamentally start to alter the legacy infrastructure – retail, health, education, energy, computing, travel, entertainment

    • Significant tablet adoption in the enterprise directly impacting the traditional computer manufacturers

    • Both HTML5 and Apps will continue to grow, the relevancy to any given application will depend on the reach and economics requirements. HTML5 is not going to replace Apps.

    • Mobile data growth will double again in 2012. Significant opportunities in managed and understanding of mobile data growth

    • Regulators will need to evolve to keep up with the trend to keep their nation globally competitive

    • More IP scuffles before licensing settlements

    • Consolidation of weaker players, more global M&A

    • Significant progress in emerging areas like mHealth, mPayments will come from the developing world while the western countries get mired in regulatory and legacy mess

    • Several players face challenging times ahead and 2012 will be critical in their turn around sojourn.

    Your feedback is always welcome.

    Chetan Sharma

    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.

    Atlanta – Mobile Breakfast Series – Connected Devices – June 22nd April 16, 2012

    Posted by chetan in : Mobile Breakfast Series, US Wireless Market, Worldwide Wireless Market , add a comment

    Our first Mobile Breakfast Series event was in Seattle back in Sept of 2009. Since then, we have expanded the program to include a full day thought-leadership summit – Mobile Future Forward which is going to be on Sept 10th this year. I am very excited to announce that we are expanding the MBS series to Atlanta and the first edition is going to be on June 22nd. The topic of discussion is “Connected Devices and Connected Consumers.” If you are in Atlanta or nearby cities, hope you will join us. Also, please let your friends know about the event.

    Atlanta, June 22nd 8:30-10:00 am

    Commerce Club of Atlanta

    Registration

    We have a terrific line-up of speakers.

    Details below:

    The connected devices segment is the fastest growing category of the market and is also the most profitable due to higher margins. Consumer behavior is changing as they consume and interact with content across multiple devices. Connected devices are also impacting a rethink in virtually all key verticals – healthcare, housing, travel, entertainment, communication, energy, and others. It is also disrupting the traditional value chains and revenue models. Which segments are yielding the highest ROI? Does computing fundamentally change forever or are connected devices just a part of the PC hub? How does M2M fit into the world of smartphones and tablets? How are businesses and solution providers taking advantage of the growing connected universe? What’s most important for the consumer and what are their expectations on design, pricing, and connectivity? From connected cars to wireless pill bottles, our world is going to change forever. Meet the leaders who are shaping the growing connected devices ecosystem to get insights that will inform your strategy and decide your future revenue streams.

    Fireside Chat

    David Christopher, Chief Marketing Officer, AT&T Mobility and Consumer Markets

    David Christopher, chief marketing officer of AT&T Mobility & Consumer Markets, leads product strategy, marketing and execution across AT&T’s extensive portfolio of wireless and consumer communications, entertainment products and services. Previously, David served as chief marketing officer for AT&T’s wireless business unit–where he led all marketing functions and drove the company’s strategy to introduce groundbreaking devices and applications. He also served as vice president of product management for AT&T’s wireless unit. David currently serves on the Ad Council’s board of directors and its executive committee.

    Panel Discussion

    Louis Gump, VP, CNN Mobile

    Louis Gump is vice president of CNN Mobile, responsible for managing CNN’s mobile business globally. Recognized internationally as a seasoned leader in the mobile marketplace, Gump directs CNN’s mobile strategy and development to meet consumer needs and grow overall reach, usage and revenue. Before joining CNN, Gump worked at The Weather Channel, where he led their mobile business. Since 2003, Gump has served on the Board of Directors for the Mobile Marketing Association (MMA), where he is past global chairman as well as past global treasurer. Last year, he received the MMA’s first annual Lifetime Achievement Award for his leadership.

    Biju Nair, EVP and Chief Strategy Officer, Synchronoss

    Biju Nair has over 18 years’ experience as an entrepreneur and technology industry leader. In this role as CSO, Mr. Nair is responsible for leading the strategic vision of the connected devices and cloud computing for profitable growth of the company’s product portfolio. Prior to joining Synchronoss, Mr. Nair was the Chairman & CEO of Sapience Knowledge Systems, Inc., a venture backed wireless software company (acquired by Synchronoss Technologies in 2011). Previously, Mr. Nair held the position of Senior Vice President & GM of the Connectivity and Security Group at Smith Micro Software (NASDAQ: SMSI) and Corporate Vice President & GM and founder of Mobility Solutions Group at PCTEL, Inc. (NASDAQ:PCTI) which was acquired by Smith Micro in 2008).

    Mobile Breakfast Series – How Mobile is Impacting Media, Commerce, and Consumer Behavior April 3, 2012

    Posted by chetan in : AORTA, Connected Devices, Mobile Breakfast Series, Mobile Commerce, Mobile Content, Mobile Ecosystem, Mobile Future Forward, Wireless Value Chain, Worldwide Wireless Market , add a comment

    We entered our 4th year of running Mobile Breakfast Series and hosted 2012’s first Mobile Breakfast Series on March 28th. The topic of discussion was “How Mobile is Impacting Media, Commerce, and Consumer Behavior.”

    First of all my thanks to our series partner: OpenMarket and Synchronoss Technologies. Both of them have been great partner to this series and I very much appreciate their support.

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    Before I get into the details of the panel discussion, a few announcements about the upcoming events. We are planning on hosting MBS events in Atlanta and London this summer and need your assistance in getting the word out. On June 22nd, we will be in Atlanta to host a fireside chat with David Christopher, CMO, AT&T Mobility. The following week, we will be in London and in partnership with O2 UK, we will have some great discussion about the future of the Operator/OTT tussle in the ecosystem.

    Our fall summit – Mobile Future Forward is scheduled for Sept 10th later this year and we are making good progress in setting up the agenda and the topics of discussion, already have some terrific speakers lined up. The theme is to connected universe, monetizing opportunities. We will open up the registration late April, so, keep an eye for that.

    We released our yearly update on the US market earlier this month and you might have noted that 40% of the service revenues are now coming from mobile data. In Japan, this figure is getting close to 60%.

    If you look at the consumer IT spend – mobile now occupies 50% of that budget and it is increasing. More than 35% households in the US are mobile only. More than 90% of the devices sold last quarter in the US were smartphones. Mobile influences 30-50% of our commerce transactions. In 2009, ESPN noted that their mobile web traffic is exceeding desktop traffic, now most brands have noted that they are already there or within the next 12-18 months mobile will be the majority traffic owner.

    The impact of mobile is even more profound in developing countries. The first billion mobile subs took 250 months, the last billion took only 15 months to 6 billion and we will reach 7 billion in 12 months. Mpesa, kenya’s mobile payment now drives 20% of the country’s GDP. In Bhutan, where I spent some last quarter, mobile is the only way to deliver health care to remote areas. Earlier this month, China surpassed a billion subscribers. The opportunities are literally endless. In 2002, I had the good fortune of writing a book with then CTO of NTT DoCoMo, Dr. Yasuhisa Nakamura and he used to say – mobile networks need become omnipresent like air – clearly he didn’t have to pay for roaming data charges. Mark Weiser, from XEROX PARC, one of my heroes, considered the godfather of pervasive computing who first articulated the concept of everywhere, anytime computing back in the eighties and early nineties would have been proud to see the progress we have made.

    Mobile is disrupting many industries – two of the most prominent being media and commerce and it is all driven by how consumers perceive the value of mobility, how they interact with content and devices, and how their consumer behavior is shaped over time. To discuss all of that, we had a great panel.

    Michael Bayle, Senior Vice President and General Manager, ESPN Mobile. Michael Bayle is Senior Vice President and General Manager of ESPN Mobile. A former Yahoo! and Microsoft executive, Bayle develops and manages all aspects of ESPN’s mobile strategy and execution, including content production, programming and publishing on every ESPN Mobile platform.  He reports to John Kosner, Senior Vice President and General Manager of ESPN Digital and Print Media. Before ESPN, he did stints at Amobee, Yahoo, and Microsoft.

    Len Jordan, Managing Director, Madrona. Len joined Madrona in January 2010 and is actively pursuing opportunities to lead new investments.  He currently serves on the boards of Cedexis, MaxPoint Interactive, and Zapd on behalf of Madrona. Len has served on the boards of ten early-stage companies and on behalf of Frazier Technology Ventures currently serves on the boards of Control4, DSIQ, Medio, and Wetpaint. Prior to joining Frazier Technology Ventures as a General Partner in 2004 Len spent 16 years in the software industry.  He most recently served as a senior vice president at RealNetworks.

    Megan Tweed, VP, Media, Razorfish. Megan brings bleeding-edge media strategy and planning innovation to clients like Best Buy, Weight Watchers, and Nike. She is a leading agency and industry voice on the benefits of holistic, platform-agnostic planning and measurement across all viable platforms. Before Razorfish, Megan spent time at Carat and UniversalMcCann working on key global accounts.

    Vik Pavate, VP of Business Development, Kovio. Vikram Pavate joined Kovio in 2002 with extensive experience in business development, product management and strategic planning. As vice president of business development, he is responsible for Kovio’s corporate strategy, business development, product management and marketing, OEM relationships and strategic joint development and technology alliances.

    We touched upon a range of topics, players, issues, and opportunities. Below is the summary of the discussion:

    Always, great to moderate a panel with terrific speakers. MBS audience is top-notch as well. Great questions and follow-up. That’s why it is so much fun putting these together. The next MBS event in Seattle will be on June 7th. Hope to see you there.

    Until then, do good work and keep in touch.

    thanks

    Chetan

    Bonus: Some ESPN stats that will rattle your mind

    ESPN Mobile enjoyed a record-setting month in March, with new highs for mobile web and app usage, as well as video content and alerts.  ESPN mobile web and apps served an average minute audience of 103,000 in March, with an average of 5.1 million daily unique visitors (an increase of 22 percent over March 2011) and 3.1 billion total minutes for the month. ESPN apps in March had 3.6 million average daily uniques (up 125 percent over March 2011) and 1.5 billion minutes (up from 595 million in March 2011).

    ESPN Mobile delivered 45 million video starts in March, including 24.6 million from mobile web and 19 million from the ESPN ScoreCenter handset and table apps, both record highs for a single month.  In addition, ESPN delivered 1.5 billion alerts in March, also a record high for any month.

    (Source: ESPN)

    US Wireless Market Update Q4 2011 and 2011 March 19, 2012

    Posted by chetan in : 3G, 4G, AORTA, ARPU, Applications, BRIC, China, Connected Devices, Indian Wireless Market, LTE, Mobile Advertising, Mobile Applications, Mobile Breakfast Series, Mobile Cloud Computing, Mobile Commerce, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Future Forward, Mobile Payments, Mobile Search, Mobile Wallet, Networks, Patent Strategy, Smart Phones, US Wireless Market, Wi-Fi, WiMax, Wireless Value Chain, Worldwide Wireless Market , 1 comment so far

    US Wireless Market Update Q4 2011 and 2011

     

    http://www.chetansharma.com/USmarketupdate2011.htm

    Summary

    The US market generated $67 billion in mobile data revenues in 2011 accounting for 39% of the overall revenues for the country. The mobile data market grew 4% Q/Q and 19% Y/Y to reach $18.6B for the quarter. For the year 2012, we are forecasting that mobile data revenues in the US market will reach $80 billion.

    The US market accounts for 5% of the subscriber base but 17% of the global service revenues and 21% of the global mobile data revenues. It also accounts for 40% for the global smartphone sales.

    If the Martians landed on earth in early 2012, they will conclude the following: there are only 3 things certain on earth – death, taxes, and the direction of Apple’s stock price. Apple had a monster quarter with record sales of iPhone and iPad not only in the US but also around the world. Apple sold over 93M smartphones outpacing its nearest rival Samsung by a good distance. Its share of the profits is more than rest of the OEMs combined. Its stratospheric rise is legendary by any measure. Today Apple eclipsed the combined market cap of Microsoft, Google, and Amazon. Think about that for a minute. In 6-12 months, you could probably add Facebook to the equation as well. The question on rivals’ mind is when will Apple stop defying gravity. Until then, better be a fast follower.

    Smartphones continued to be sold at a brisk pace accounting for 65% of the devices sold in Q4 2011. US Operators are averaging 80% of their postpaid sales as smartphones with Android dominating though iPhone leads in mindshare. The Obama administration formally placed featurephones on the endangered species list but either chamber is unlikely to pass any resolution to save it.

    Nokia launched its Lumia series of devices with good acclaim however it remains to be seen if it will be able to win back the customers in big numbers in 2012.

    The Post-PC Era

    Ever since the iPad came into being, the chants of the post-pc mantra are getting louder. But what is it? Is it just the untethered devices? Isn’t iPad a person computer too? What about the smartphones? They have more horse power than my first few PCs combined. Is the personal computing morphing into something else or is there a clear delineation between the Mesozoic era and the new tomorrow? While we in the industry get obsessed by these minutiae, what do the real consumers think about it? Clearly, tablets are selling better than the PCs (as our previous research has shown) both in units as well as the revenue. But so did the laptops compared to the desktops.

    So, does the miniaturization of a screen and improving computing power represents a big shift or is this just an evolution of personal computing. Consumers rarely think about what computing era they are in. Between the time they wake and go back to bed at night, there are a series of tasks they have to accomplish. The technology is their companion to accomplish them, from keeping calendars to creating corporate presentations to sending messages to watching TV for entertainment to socializing with family and friends.. the list seems endless. Often times, the time is too short. Technology finds a way to give the time back to us by reducing the distance between the tasks as well as compressing the duration.

    As I have said before, nothing collapses time and distance like mobile. Tablets, particularly, iPad and the smartphones, if seen through the eyes of the year 2000 make us superhumans providing us capability to process several tasks in parallel. We can even direct the computing device to figure things out while we sleep. Computing is morphing into a true companion, a wily butler who just knows what’s needed next. Being untethered to a desk makes us more productive. Taking the computing evolution further – what if we can create a desktop environment wherever we are instead going to a desk. For my work setup, I have 4 or 5 screens running at the same time and it does help. It is hard to see tablets in their current incarnation competing with that task environment. However, it does allow us to collapse the desktop and take it with us.

    Tablet+Network+Cloud is an enormously powerful value proposition. It should be noted that apps and services on the mobile platform are defining the desktop environment now.

    For the enterprise worker, many of the day-to-day tasks don’t really need the real-estate of 3 big monitors; we can easily accomplish a lot with a smartphone or better yet the tablet. As such, we are seeing corporations de-investing in desktops and laptops and moving this investment into tablets, smartphones, apps and make their work force more nimble and competitive. This also means, apps that used to be written for Windows will be predominantly written on iOS and Android, at least for the near-term. Microsoft has a strong offering in 8 and the fact that it will work across the three screens gives it some chips to play in the new world. Whether we call it a post-pc era or the computing continuum doesn’t seem that relevant. What matters most is the set of tools that help us accomplish the tasks at hand on a daily basis. The shift is tectonic in nature, and it is creating winners and losers at an incredibly fast pace. However, my sense is that we are finally entering into the ambient computing era where the computing capability is all around us, something that Mark Weiser of Xerox PARC envisioned more than 20 years ago and something we imagined growing up with the original Star Trek.

    We will be dealing with multiple connected devices which share a common identity, cloud, media, security layer, and most importantly the apps and services. The traditional PC won’t disappear but our reliance on one single machine for creation or consumption will continue to dissipate. We will have scores of radios around us, multiple objects that can think and communicate from cereal boxes to security alarms; from windows to fabric shirts; from tables to automobiles; it feels more like the connected era - where objects with brains and energy are connected to create an unprecedented universe of intelligence and productivity. This will indeed impact purchasing behavior and the commerce flow. The social and computing interactions are more intimate, have more purpose, and are available everywhere. The work-life boundaries only exist in one’s mind. A business can be started with an app on a smartphone, anywhere serving to any consumer on the planet. The impact on productivity, the shrinking human capital needed for a set of tasks, corporate and nation’s competitiveness is significant.

    In many developing nations, the PC era never arrived. They jumped right into the mobile computing era. They have always lived in the post-PC era. The implications are profound.

    More than anything else, the old guard is having a tough time adjusting to the new computing paradigm. HP, Dell, and others have tried but failed thus far to either launch a decent tablet or a smartphone. While Apple invented the new computing paradigm only Samsung has been able to stand up as a worthy rival. The success of a vertically integrated success strategy has seduced Microsoft and Google to the doorstep of a vertical strategy. Will they cross the chasm remains to be seen. Much depends on how Nokia performs for Microsoft and how long can Android juggernaut keeps growing for Google. Then, of course, there are Amazon and Facebook who are attacking the market from a services angle. With a strong entry of the likes of Huawei and ZTE, players caught in the middle are struggling for a viable long-term path to success.

    The engagement model with the computing resources is undergoing significant evolution as well. Keyboard and mouse seem relics of a bygone era. We are falling in love with gesture computing combined with a myriad of input and intelligence techniques. Data processing at the speed of light is the new competitive advantage at all computing layers.

    In every shift, winners and losers are created. The ones who fail to recognize and adapt become the relic of the historical past duly replaced by the new creators and implementers. If we look at the US household IT spend, over 50% of that spend now goes to mobile. The life time value will increase for players who can tie experiences together across multiple screens in a seamless fashion. This will enable them to not only capture the device revenue but also the commerce and services revenue built on top of it.

    The battle for the consumer wallet is being fought on Apple’s turf; it is the one driving the industry narrative and the agenda for its competitors and the ecosystem at large. Am pretty sure we will stop using computer to define computing. Interesting times indeed.

    Competition

    In any other year, the AT&T and T-Mobile merger would have likely gone through. The interconnection of policy, politics, and private enterprise was on vivid display last year. The failure of the merger forced Deutsche Telekom to resort to the only second viable option - to take the plunge and invest in the US market. Whether 4 competitors can survive 3 years from now is still questionable. Given that DOJ and FCC have set the precedent, the only way a major M&A can take place in the US service provider segment in the near term is if one of the tier 2 operators falters Q/Q. We still believe in our thesis as outlined in our research paper “Competition and the Evolution of Mobile Markets” last year that the US market can’t support 4 large operators and we are likely to see further M&A activity in the sector before too long.

    Mobile Data Growth – The Gigabyte Generation

    Mobile data traffic growth continued unabated doubling again for the 8th straight year. We expect the mobile consumption to double again in 2012. Data now constitutes over 85% of the mobile traffic in the US. Approximately 30% of the smartphone users average more than 1GB/mo. As new devices and new network technology roll-out keep pace in 2012, the data traffic will grow at the expected pace. The signaling traffic is expected to grow in even faster. Stay tuned for our research paper in the Yottabyte series of papers on the topic later this year.

    Mobile Patents Landscape

    2011 was the most active year for mobile patents in terms of disputes. All the major players were active in filing and protecting their turf for the future battles. IBM topped the industry in the most number of mobile patents granted in 2011 in the US followed by Samsung and Microsoft. The rest of the top 10 in order included Sony, Qualcomm, LG, Ericsson, Panasonic, Broadcom and RIM. Of the major players, Nokia occupied #12, Intel #13, Apple #16, Motorola #21, and Google #23 spot in the top 50 ranking. Amongst the mobile operators, Sprint was the leader with 323 patents granted in 2011. We have more research coming out later in the year that shows the relative patent strength of the various mobile players.

    Connected Universe, Monetizing Opportunities

    While 2011 was the year of figuring what the opportunities are in the new connected era, 2012 is starting to focus on how to monetize those opportunities. That will be the theme of our Mobile Future Forward Thought-leadership summit in Sept. More details to come. Almost all the vertical industries are benefiting from the connected devices and ubiquity of broadband networks – security, health, retail, utility, transportation, entertainment, and others. We will take a deep dive into the issues, the best case studies, the opportunities, and the players.

    What to expect in the coming months?

    All this has setup an absolutely fascinating 2012 in the communication/computing industry. Convergence is everywhere and is leading to a fundamental reset of the value chains and ecosystems.

    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 Q4 2011 and full year 2011 US wireless data market is:

    Service Revenues

    ARPU

    Subscribers

    Applications and Services

    Handsets

    Mobile Data Growth

    Global Update

    Your feedback is always welcome.

    Chetan Sharma

    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.

    2012 Mobile Industry Predictions Survey January 3, 2012

    Posted by chetan in : 3G, 4G, AORTA, ARPU, Applications, BRIC, CTIA, Carnival of Mobilists, Carriers, Connected Devices, Disruption, Enterprise Mobility, European Wireless Market, IP Strategy, Indian Wireless Market, Infrastructure, Intellectual Property, Japan Wireless Market, Location Based Services, M&A, Mergers and Acquisitions, Messaging, Microsoft Mobile, Middleware, Mobile Advertising, Mobile Applications, Mobile Breakfast Series, Mobile Cloud Computing, Mobile Commerce, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Future, Mobile Future Forward, Mobile Gaming, Mobile Payments, Mobile Search, Mobile Traffic, Networks, Patent Strategies, Privacy, Smart Phones, Speaking Engagements, Speech Recognition, US Wireless Market, Wi-Fi, Wireless Value Chain, Worldwide Wireless Market , 12 comments

    2012 Mobile Industry Predictions Survey

    http://www.chetansharma.com/MobilePredictions2012.htm

    Download PDF

     

    First things first. From all of us at Chetan Sharma Consulting, we wish you and yours a very happy, healthy, and prosperous 2012. My thanks to all who participated in our 2012 Mobile Predictions Annual Survey. It gives our community an insider’s view of trends.

    2011 was a terrific year for the mobile industry. With all its ups and down, consumers embraced devices, applications, services, and technology with more gusto than ever before. In the waning hours of 2011, we crossed the 6 billion subscriptions milestone. While the first billion took 19 years, this last billion only took 15 months.

    Smartphones are selling like hot cakes. We estimate that by the end of Q4 2011, over 60% of the devices sold in the US were smartphones and over 30% of the global sales were for the evolved brethren of the primordial featurephones. Sparked by insatiable consumer demand for mobile data, LTE and HSPA+ networks are sprouting all over the planet with US leading the charge for broadband deployment.

    Our annual survey is a way for us to engage our community on the trends for the next year. We put some of the pressing questions to our colleagues and industry leaders. We are able to glean some valuable insights from their choices and comments, some tangible shifts, and get a sense of what’s to come. Executives, developers, and insiders (n=150) from leading mobile companies and startups from across the value chain and around the world participated to help see what 2012 might bring to keep us on our toes. What makes this survey unique is that it draws upon the collective wisdom of folks who are at the center of the mobile evolution.

    Fifteen names were randomly drawn for the limited edition of the Mobile Future Forward 2011 book. The winners are:

    1. Tor Bjorn Minde, Head of Ericsson Labs, Ericsson

    2. Sunder Somasundaram, Industry Solutions Practice Director, AT&T

    3. C. Enrique Ortiz, Mobile Technologist, About Mobility

    4. Russell Buckley, CMO, Eagle Eye

    5. Marianne Marck, VP – Engineering, Starbucks

    6. John Foster, President, ZED USA

    7. Angel Luis Saez, Sr. Director, Orange Spain

    8. Dilip Mistry, Senior Director, Microsoft Asia

    9. Phyllis Reuther, Advanced Analytics Lab, Sprint

    10. Gene Keenan, VP of Mobile, Isobar

    11. Elizabeth Day, Director of Finance, Trilogy International

    12. Alan Cole, Research Staff Member, IBM T.J. Watson Research Center

    13. X J Wang, VP – GM China, Vesta Corp

    14. Michelle Lee, Director, SK Telecom

    15. Hemant Chandak, Sr. Analyst, Cisco Systems

    Thanks again to everyone who contributed. We will be calling on you again next year. It has been a terrific year for us at Chetan Sharma Consulting and we are looking forward to an engaging and productive 2012.

    Be well, do good work, and stay in touch.

    Thanks and with warm wishes,

    Your feedback is always welcome.

    Thanks

    Chetan Sharma

    Now onto the 2012 Mobile Industry Predictions Survey Results.

    2012Survey-a

    1. What was most newsworthy in Mobile 2011?

     2012Survey1

    Android had a spectacular rise in 2011 around the globe. Android OEMs collectively shipped the most number of devices and while margins shrank, they were able to put a united front to iOS. 2011 will always be remembered for the passing away of the industry transformer Steve Jobs. His work directly or indirectly touched billions of souls around the planet, many times over – something rarest of human beings are able to achieve in their life time. Regulatory tussles and significant increase in IP disputes also occupied the headlines. Amazon announced its intention for the mobile space with the launch of Kindle Fire.

    2. What will be the biggest mobile stories of 2012?

     2012Survey2

    As we look towards 2012, our panel voted for the continued growth of mobile data as the biggest story followed by Amazon’s entry into the mobile space. Some key questions for the year are: Will Microsoft/Nokia devices will make any meaningful progress? Will RIM survive the year? How does Google manage the fragmentation, decline in margins (for the OEMs), and the IP issues? Will any high-profile security and privacy mishaps lead to more regulatory entanglements? Facebook IPO and its mobile ambitions? How do operators manage the data demand? Which M&As will capture industry’s attention? Will Apple continue to dominate on both smartphone and tablet front? What does Apple do with mobile payments? and much more. Clearly, it is going to be a terrific year.

    3. Who will be the most open player in the mobile ecosystem in 2012?

     2012Survey3

    File this in the “perception is reality” folder. Despite all the criticism, Google has maintained its strong position as the most open player in the mobile industry.

    4. What applications will define 4G?

     2012Survey5

    Still looking for a killer-4G app? Video, cloud computing, and access will continue to drive 4G demand and growth.

    5. What will be the breakthrough category in mobile in 2012?

    2012Survey5

    For a second year in a row, the panel voted for mobile payments and mobile commerce as the top two category that will find their voice. Mobile advertising has become mainstream so it lost its ranking in the top 3.

    6. What will be the most popular consumer mobile applications in 2012?

     2012Survey6

    Apps preferences vary by regions depending on a whole range of factors. Messaging and Commerce are the top two categories for the developing world while consumers in the developed nations are likely to gravitate towards commerce and location based services.

    7. Which will be the most dominant (unit sales) tablet platform in 2 years?

     2012Survey7

    iOS and Android will dominate the tablet landscape for the next 24 months. A late entry by Windows 8 tablets could make a dent but don’t count on it.

    8. Who will make the biggest mobile acquisition in 2012?

     2012Survey8

    2011 had its fair share of block-buster acquisitions, some successful while others were not. Our panel expects Microsoft and Google to continue making the biggest acquisitions.

    9. How will the "Apps vs. Mobile Web" debate shape up in 2012?

     2012Survey9

    It seems like the pendulum is swinging towards the mobile web though hybrid solutions are likely to stay with us for a long time.

    10. Who will define the mobile payment/commerce space?

     2012Survey10

    The financial companies safely locked in the mobile payments space and while the value chain is fairly complicated and definition confusion abounds, the likes of Visa, Operators and Google will continue to drive the payments/commerce space.

    11. Which solutions will gain the most traction for managing mobile data broadband consumption?

     2012Survey11

    Managing data growth and margins drives all strategies at mobile operators these days which in turns drives the value chain. 4G, tiered pricing, and mobile offload continue to be the top solutions if one has the spectrum that is.

    12. Which category will generate the most mobile data revenue in 2012?

     2012Survey12

    Messaging, access, apps, and advertising are the four broad categories that drive mobile data revenues around the world. The developing markets rely on messaging while the developed markets are increasingly looking to access as their dominant form of revenue generation.

    13. What will help mobile cloud computing gain traction in 2012?

     2012Survey13

    Mobile cloud computing will continue to be defined by enterprise, storage, and media needs.

    14. Which enterprise segment will mobile impact the most?

     2012Survey14

    Best buy is becoming the next Circuit City. Other retailers will follow unless they can successful reinvent themselves. Health is more regulatory driven so the progress will be slow though it is ripe for a complete overhaul and developing nations are moving much faster in this space.

    15. What will be the dominant revenue model for apps in 2012?

     2012Survey15

    In-app revenue model made good strides in 2011 but the combination of the various available revenue models will be the norm for most application developers.

    16. What mode of mobile payments will get traction in North America and Western Europe in 2012?

     2012Survey16

    2011 was the year to set the ground work for growth in the mobile payments space. Given the investment and focus, we are likely to see more movement and consumer involvement in 2012 with proximity based solutions and commerce of physical goods on mobile.

    17. What will be the most successful non-mobile-phone category in 2012?

     2012Survey17

    Tablets dominate. Period.

    18. Which of the following are likely to happen in the near future?

     2012Survey18

    The is a significant shift in computing taking place right in front of our eyes wherein tablets are replacing laptops and even desktops in the enterprise. European operators have been experiencing tough times while some of the Asian operators are flush with cash, they might make their move in 2012 though regulatory hurdles might prove to be an issue. 33% of the nations will have elections in 2012, maybe which will move mobile voting to the forefront in some nations. Our panel thought there is a better chance of humans discovering water on another planet than rise of another significant mobile OS.

    19. Which areas will feel the most impact from Regulators in 2012?

     2012Survey19

    Net-neutrality and market competitiveness will keep the regulators busy in 2012.

    20. Who was the mobile person of the year?

     2012Survey20

    Clearly, Steve Jobs was an easy choice but who will replace him 2012? Jeff Bezos has an early lead followed by Andy Rubin and Mark Zuckerberg. Angry Birds representing the developer community will be in for another terrific year. Other honorable mentions were Tim Cook, Paul Jacobs, Sanjiv Ahuja, Dan Hesse, and Glenn Lurie.

    A lot to look forward to in the New Year. My thanks to all who participated and we hope you found it useful as you embark on your journey for a successful 2012.

    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 Feb 2012. The next Global Wireless Data Market update will be issued in Apr 2012.

    Disclaimer: Some of the companies mentioned in this survey are our clients.

    US Wireless Data Market Update Q3 2011 December 12, 2011

    Posted by chetan in : 3G, 4G, AORTA, Applications, CTIA, Carnival of Mobilists, Carriers, European Wireless Market, Indian Wireless Market, Japan Wireless Market, Location Based Services, Mobile Breakfast Series, Mobile Cloud Computing, Mobile Commerce, Mobile Content, Mobile Ecosystem, Mobile Event, Mobile Future, Mobile Future Forward, Mobile Payments, Mobile Search, Mobile Traffic, US Wireless Market, Unified Messaging, Wi-Fi, WiMax, Wireless Value Chain, Worldwide Wireless Market , 5 comments

     

     

    http://www.chetansharma.com/usmobileupdateQ32011.htm

    Download PDF

    Summary

    The US mobile market continued its blistering pace of growth and ecosystem restructuring. While China and India lay claim to the fastest growing markets on the planet, the many of the meaningful and impactful trends are originating out of the US market with software at the epicenter of creation, growth, change, evolution, and destruction.

    The US wireless data market grew 5% Q/Q and 21% Y/Y to reach $17B in mobile data service revenues in Q3 2011 and is on course to increase Y/Y by 22% to $67B in 2011.

    As predicted, Samsung overtook Apple as the leading smartphone OEM. However, Apple will continue to dominate profit share for the foreseeable future.

    Smartphones continued to be sold at a brisk pace accounting for 57% of the devices sold in Q3 2011. Operators are averaging 70% of their postpaid sales as smartphones with Android dominating though iPhone leads in mindshare. The featurephone as a device species is on the verge of extinction.

    Mobile Ecosystem Complexity

    As expected, Amazon entered the mobile tablet space with a killer value proposition - $200 for a tablet, something the market sorely needed. While other OEMs tried to compete with Apple on performance (and have been retreating from the market one by one), Amazon is entering the battle on its own turf – a hardware platform built on Android with a slew of services to underwrite the device discount. Incumbent OEMs just can’t compete with that strategy without a complete rethink of their product strategy. What happens when Amazon’s strategy migrates to handsets? While Kindle Fire is not a serious threat to Apple iPad, and the current version has a lot of deficiencies, Amazon has carved out a nice market for itself that will continue to grow in the coming days. In some sense, with its tight integration of commerce, cloud, and advertising, it has out-maneuvered even Google.

    Amazon’s impact will be felt by many others in 2012 as its strategy becomes more apparent. Retailers will be facing the brunt of the wave that Amazon represents i.e. etailers supplanting physical retailers. Don’t be surprised if Amazon purses Apple like stores to showcase its merchandize and puts a dagger at the heart of retail.

    Google has done a masterful job of shepherding Android through the turbulent platform waters and make it the dominant mobile platform in terms of shipments.

    Microsoft and Nokia finally introduced the Windows devices and it has at least given them a fighting chance in 2012, though a far more competitive offering would be needed to make any significant market share or revenue share inroads. Microsoft’s Xbox/Kinect integration remains its best card for 2012.

    In a severe case of corporate schizophrenia, HP first launched webOS devices, then backed away, then thought of re-launching only to give it away to open source. Similarly, RIM faces critical test in 2012 and all its hopes are pinned on the new OS that is expected to come to the market sometime next year.

    Mobile is changing the way we spend

    It is very clear that mobile will be at the center of the human evolution for years to come. Mobile collapses time and distance and as such impacts every facet of our lives. While we have come to know the mobile phone as a communications device, their role in our daily lives has been expanding. From checking emails, paying for tickets, sending money transfers, taking pictures of your kids, watching soccer World Cup live, checking commodity pricing, to emergency response to mHealth (mobile Health), mobile devices have become an essential tool to help us navigate our day.

    Mobile also plays a key role in how we go about the most basic transaction in a given day that keeps the economy humming – spend. We discussed this and more in the paper “How Mobile Will Change The Way We Spend”  that was released last quarter.

    What to expect in the coming months?

    All this has setup an absolutely fascinating 2012 in the communication/computing industry. Convergence is everywhere and is leading to a fundamental reset of the value chains and ecosystems.

    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 Q3 2011 US wireless data market is:

    Service Revenues

    ARPU

    Subscribers

    Applications and Services

    Handsets

    Mobile Data Growth

    Global Update

    Mobile Future Forward

    Our annual mobile thought-leadership summit - Mobile Future Forward was a grand success. Our thanks to all those who attended as well as to the speakers, sponsors, and well-wishers for making it happen. Planning for 2012 summit are underway and we will keep you posted as plans develop.

    More information at http://www.mobilefutureforward.com

    Mobile Predictions Survey 2012

    As is the tradition, we are running our annual Mobile Predictions Survey for 2012. Will appreciate your input in understanding the trends and news stories that will make 2012 another big year in mobile. Winners of the survey get our fabulous limited edition Mobile Future Forward 2011 book that contains 19 essays from the global leaders in the mobile industry. (Mobile Predictions Survey Results for 2011 here)

    Your feedback is always welcome.

    Thanks.

    Chetan Sharma

    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 Feb 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.

    New Paper - How Mobile Will Change The Way We Spend – A Mobile Future Forward Paper August 5, 2011

    Posted by chetan in : 3G, 4G, AORTA, CTIA, Connected Devices, Enterprise Mobility, European Wireless Market, Indian Wireless Market, Mobile Advertising, Mobile Applications, Mobile Breakfast Series, Mobile Cloud Computing, Mobile Commerce, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Future Forward, Mobile Payments, Mobile Search, US Wireless Market, Wi-Fi, WiMax, Wireless Value Chain, Worldwide Wireless Market , 1 comment so far

    How Mobile Will Change The Way We Spend

    A Mobile Future Forward Paper

    clip_image001

    The Mobile Future Forward 2011 Book will contain 18 essays from thought-leaders around the globe and is going to be distributed exclusively to the Mobile Future Forward attendees on Sept 12th. The book is published by FutureText, UK.

    The essays from the Mobile Future Forward speakers and industry luminaries are:

    1. How Mobile Will Change The Way We Spend – Chetan Sharma, President, Chetan Sharma Consulting

    2. The Mobile Cloud Connected Enterprise – Abhi Ingle, VP, Advanced Mobility Solutions, AT&T

    3. Mobile and Health Possibilities – Subba Rao, CEO, Razi Health

    4. Buying a Mobile Device in 2014 – Frank Meehan, CEO, INQMobile

    5. Surviving and Thriving in the Age of Mobile Internet – An MNO Game Plan – Manoj Leelanivas, SVP and GM, Juniper Networks

    6. Mobile Future Forward Interview with Steve Elfman – President, Sprint Nextel

    7. Is Mobile Local Advertising Finally Poised to Take Off? – William Hsu, SVP and CPO, AT&T Interactive

    8. Implications of a Connected Society – Danny Bowman, President, Sprint Nextel

    9. Big Data and Mobile – Braxton Woodham, Head of Engineering, AVOS

    10. Broadband for All – Sanjiv Ahuja, CEO, LightSquared

    11. Wireless Competition and Innovation – Stephen Bye, CTO, Sprint Nextel

    12. The Future of the Personal Information Economy: Enabling Success Across the Mobile Ecosystem – Ken Denman, CEO, Openwave

    13. T-Commerce – Carving Out and Extending E-Commerce – Ramneek Bhasin, SVP and GM, TheFind

    14. The Case for Building a Mobile Broadcast Content Delivery Network – The Critical Piece to Fulfilling Mobile Data Demands of the Future – Erik Moreno, SVP, FOX Network

    15. Connected Devices – Redefining the Channel – Biju Nair, Chief Strategy Officer, Synchronoss Technologies

    16. How Mobile Can Turn Retailers Into Media Companies – Dale Nitschke, CEO, Ovative Group

    17. The Future of (Mobile) Communications – Carlos Domingo, CEO, Telefonica R&D

    18. Competition and the Evolution of Mobile Markets – Chetan Sharma, President, Chetan Sharma Consulting

    Download (http://www.mobilefutureforward.com and click on the White paper image)

     

    Executive Summary

    In his 1943 paper titled “A Theory of Human Motivation”, the famed philosopher Abraham Maslow theorized his observations of human needs and curiosities. His pyramid came to depict the human hierarchy of needs. If we map the physiological, safety, love, esteem, and self-actualization needs onto how much we spend as a community, it correlates rather well. As you would expect, human spending behavior is tightly tied to the basic needs. The amount of money we spend on these basic needs might vary by demographics or region but in aggregate, we tend to spend the most for the things that are the bottom of the pyramid – shelter, food, and water.

    Over time, entrepreneurs have used technology to drive fundamental changes in consumer behavior for e.g. Microsoft with personal computers, Google with search, Apple with devices, Facebook with social connections. Of course, the web of interconnection, the various vertical industries that map against the human needs is very complex and as new technology cycles come into play, inventors get busy with enhancing performance sometimes by manifold to keep up with the insatiable demand and appetite to do more.

    It is very clear that mobile will be at the center of human evolution for years to come. Mobile collapses time and distance and as such impacts every facet of our lives. While we have come to know the mobile phone as a communications device, their role in our daily lives has been expanding. From checking emails, paying for tickets, sending money transfers, taking pictures of your kids, watching soccer World Cup live, checking commodity pricing, to emergency response to mHealth (mobile Health), mobile devices have become an essential tool to help us navigate our day. As we alluded to earlier, it is not just the traditional phones that have cellular connection these days; we are slowly but surely moving into an era where a majority of electronic devices from small tags to giant billboards will have a communication channel that both machines and humans can interact with.

    Mobile also plays a key role in how we go about the most basic transaction in a given day that keeps the economy humming – spend.

    In this paper, we will take a look at how the connected universe of devices and sensors are going to impact the way we spend and how all this creates new opportunities to meet the basic human needs.

    Your feedback is always welcome.

    Thanks

    Chetan

    Mobile Breakfast Series – Mobile Commerce and Payments June 29, 2011

    Posted by chetan in : Mobile Breakfast Series, Mobile Payments, Mobile Wallet, Smart Phones, US Wireless Market, Wi-Fi, Wireless Value Chain, Worldwide Wireless Market , add a comment

    We held our 7th Mobile Breakfast Series Event earlier today. The topic of discussion was “Mobile Commerce and Payments.”

    image

    The killer views of the Olympics and the Sound

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    Mark Young did a great job moderating the panel

    image

    The panel expertly delved into the intricacies of the mobile commerce/payments opportunity

     

    The 2011 Mobile Breakfast Series is sponsored by Amdocs. A big thank you for the support.

    At the end of every year, we do a forecast survey. In the last survey, Mobile Payments and Commerce were considered the top two categories for growth in 2011. Given the activities thus far – Google Wallet, ISIS, number of startups – Payfone, BilltoMobile, existing players like OpenMarket, financial guys across the board – past few months have been full of significant activity. The mobile commerce developments are right behind the AT&T/T-Mobile proposed merger and Microsoft/Nokia partnership in terms of news coverage.

    I remember back in 2001/2, I was writing my 2nd book with my good friend and co-author Nakamura-san who was CTO at NTT DoCoMo and while doing some work for DoCoMo and AT&T, we were exploring ways the mobile device will be used for commerce not only for digital goods but also for physical things. MCommerce has been around for the better part of the last 12 years in some form and fashion, in fact today it is a multi-billion dollar market already. Mobile payments are in different states of maturity and experimentation depending on the region. Do you know the value of US payment distribution - $75 Trillion out of which only 5% is based on cards which accounts for almost $3-4 trillion Total Transaction Value. Paypal is expected to process $4B in mobile payments this year generating over $70M in mobile payments revenue.

    OpenMarket processes a significant amount of mcommerce business in the US today. As you will hear from the panelists, they are starting to see good traction from merchants and things are moving from digital to physical. However, things are very complicated – it is a highly regulated segment and changes don’t come every so often. The payment networks are from pre-Internet era and yet they maintain their complete dominance of the ecosystem. So, this sets up a very interesting next few quarters and a perfect time for us at Mobile Breakfast Series to assemble a stellar panel to unwind the realities of the evolving landscape.

    Our panelists were:

    Mark Young, VP - Strategy, NBC Universal and Digital Networks (moderator)

    Rodger Desai, Founder and CEO, Payfone

    Jim Greenwell, President & CEO, BilltoMobile

    Andrew Lorentz, Partner, Davis Wright Tremaine

    Michael Goo, VP - Mobile Strategy, T-Mobile

    Joe Megibow, VP - Mobile and E-Commerce Optimization, Expedia

    Mark has been involved in mobile for a long time and has been at the center of commerce on mobile since the ringtone days at Moviso. Rodger and Payfone have been in the news lately for some raising money and some key partners like Verizon and American Express. BilltoMobile has been involved in mobile payments first in Korea (under Danal) and lately in the US with all the operators for doing payments. Payments is a heavily regulated industry so players in the ecosystem need to have a firm grasp on regulatory winds to ensure their future revenues. Andrew with his deep background in the space was perfectly suited to bring up to speed with pending and existing rules. ISIS has been in the news throughout the year and Michael Goo has been representing T-Mobile to help define the operator strategy in payments. Expedia is one of the largest ecommerce companies and they are seeing some tremendous growth in mcommerce. Joe is right in the middle of all the craziness and his analytical mindset gave audience some great insights.

    As i mentioned, mcommerce is not new but mobile web and apps infrastructure along with new methods of interactivity like the NFC are making things simpler for the consumers that it is moving from novelty to convenience to actual dollars.

    The panel was just full of great insights and nuggets. The highlights of the discussion was as follows:

    The panel was full of key insights that impact strategy in this space. I was thankful for the speakers to have made the time, especially the ones who traveled great distances to be with us to share their insights.

    Next, our focus moves to our annual mobile thought-leadership summit – Mobile Future Forward on Sept 12th in Seattle. It is shaping up really nicely with some terrific speakers. You can take a look at the info here.

    The goal of the event is to look a bit into the future 2-5 years out and see what’s on the horizon. We are deep into the planning stages of preparing another successful event. I want to thank our partners of this initiative – Qualcomm, Ericsson, AT&T, Openwave, Millennial Media, Real Networks, and Synchronoss Technologies.

    Hope you can join us. It will be worth your while.

    Until then, enjoy the summer.