This should have come a week earlier but, alas, I was on the road – quite literally – en route to San Diego and Qualcomm’s most excellent Uplinq conference.
Life of course did not stop, and amongst the things you should not miss was (and is!) the last iteration of the formidable Carnival of the Mobilists, hosted by our very own Peggy Anne Salz on her award-winning MSearchGroove blog. Amongst the gems not to be missed were:
- An interview of a company focused on Windows Phone 7 (yes, you read that right!);
- Tomi Ahonen with another go at the app economy (which he claims isn’t much of an economy; read my comments on this here);
- A look on web bookmarks as an alternative to apps (to which I still not agree; cf. here);
- A couple of posts on Android, and specifically Motorola’s Droid X (and the future, if any, of Motoblur);
- And many, many more…
Finally, my post on Vodafone’s pondered changes to its revenue share structures featured, too.
The carnival is here, and well worth a read! And, again, my apologies for the late posting of this. But the old Highway 101 along the Pacific just had me in its grips… 
Gartner published the latest smartphone numbers for Q1/2010 (or so I read), and it is testament to the continuing rise of this segment: sales increased by nearly 50% year-on-year (and do remember that there was this recession-thing last year). Total sales were 54.3m units in the first quarter of this year. Not too shabby!
On the OS side, the rising stars are Android (9.6% global market share from 1.6% a year ago), which is now bigger then Windows Mobile (and it took it only a year!) and iPhone (15.4% vs 10.5% in Q1/2009). The silverback gorilla still is Symbian which dropped to 44.3% from 48.8%. Blackberry is also down (albeit only slightly: 19.4% from 20.6%).
Here’s a table:
According to a recent report, Android has zoomed past Apple in US smartphone OS share, taking the #2 spot with 28% behind Blackberry (36%) but now ahead of Apple iPhone OS with 21% (and, yes, I know that Apple somewhat lamely queried the accuracy of this). Be it as it is, Android is growing (and we all knew that, did we not?). According to Google’s CEO, Eric Schmidt, the company now sees 65,000 new phones being activated per day; this equates to a run rate of 23.7m for the year.
This is good news for handset manufacturers like HTC, Motorola and Samsung (all of who are shipping successful Android devices) as well as Google (which is fairly tightly embedded in the whole thing) but does it also reflect on the wider ecosystem of developers producing applications and services for the platform?
The main points that are usually mentioned are:
- Low overall numbers: Digital Chocolate’s CEO Trip Hawkins moaned the company sold less than 5,000 units of its hit game “Tower Bloxx” on Android Market, which was indicative for the lack of uptake. If that is so overall, may remain to be seen. I beg to take into a account that Android as a platform is fairly new and the overall install base is still smaller than its competitors.
- High price-sensitivity: according to an AdMob survey in January 2010, 12.6% of Android apps are paid vs. 20.4% on iPhone OS; the same survey revealed however that the average monthly spend was actually similar on Android ($8.36) and iPhone ($8.18) though higher on iPod Touch, which runs the iPhone OS, too ($11.39).
- Return policy: Google allows users to return an app for a full refund within 24 hours of purchase. This is seen particularly onerous for games (a lot of which can be played start to finish inside that time frame).
- Discovery: developers feel Google fell well short of Apple on this one. There is no possibility to discover apps from outside a mobile device (i.e. no iTunes) and Google has not really done anything in terms of marketing either (very much unlike Apple).
- Ease of purchase: I would like to add ease of use of the buying process. Registration with Google Checkout is a far, far cry from setting up an iTunes account. This will very likely change very, very soon as Google will add carrier-billing now that it decided to move distribution of its branded Google Nexus One from D2C web-only distribution to the usual carrier model.
So what about it? Let us not forget how young Android is – even compared to the adolescent iPhone. The platform launched from an install-base of zero some 18 months ago, with the HTC G1 being the only device out there – and available through a single US carrier, T-Mobile (with a market share around 12%). Whilst I do not want to take anything away from Apple’s superior accomplishments with the iPhone, the growth of Android is not too shabby either! And with a plethora of manufacturers deploying Android-based handsets now (cf. the growth numbers above), Android is likely to be powering into the fore even more (irrespective of whether or not the above stats on it overtaking iPhone OS in the US already being true).
Price-sensitivity is not actually as bad as people think: the aforementioned AdMob survey shows nigh identical average spending patterns. Personal impressions may again be hampered with by early experiences: be reminded that, initially, there were only free apps out there. They will surely still be hanging around, but will they also for much longer?
Apple has always been extremely scrupulous on approval of applications on its platform. And whilst this may now be held against it every now and then (e.g. in the case of nipples or Pulitzer-price-winning political cartoons), it has helped it to uphold a fairly high standard of quality, which Android was lacking (initially) and which even led to “crap-filter” apps. One can however safely assume that this will change once the market size improves: Apple’s margins might be superior to everyone else in the world but that does not mean that the margins game developers can achieve with it are the same. With Android OS primed to expand at a much faster pace, the numbers will clearly speak for it, and – I would posit – that will bring more and more quality to the store, with the fads sinking fast.
Also, do not forget the big brands: they do not necessarily care for a small share of the audience only. Whilst Android was fledgling and just starting up, they may have held back but, ultimately, they are about reach, and Android is certainly bound to deliver that. I would therefore suggest that we will be seeing an influx of large brands (gaming and otherwise) onto the Android platform very soon, and this will also help user orientation as to what to go for and what not.
The discovery of apps will also be helped by the more open nature of Android. There have been a number of announcement for curated stores by carriers (e.g. Vodafone, Orange, Verizon Wireless, Sprint, etc.), and these will certainly not be allowing a free for all! Besides that, the app store model does per se pose some challenges on developers: the more successful a platform (and/or store) is, the harder it is to be discovered. One might need to look for other solutions in that respect…
The billing side of things is bound to improve, too. With carrier-billing around the corner (cf. supra), this will get easier and better. And also easier and better than it is on the iPhone: charges will simply appear on your carrier bill (smart pipe anyone?). Besides that, the business models for games are undergoing significant changes anyhow: Freemium takes centre-stage, and so it should: the model allows people to try a game out and be charged for it only when they know that a) they like it, b) what they are being charged for (e.g. that coveted sword, a couple of precious lives, or that cool background theme).
Remains the return policy. I have been raising this with Google, and it must be pointed out that similar things exist on the iPhone (they’re just “better” hidden). So besides the obvious (Google’s good intentions came back to haunt them), it is also time to think of new business models (cf. Freemium). It is not something constrained to Android: transparency requires you to deliver value. If you do, there are good and transparent means to monetize that value; and users will follow.
So, yes, there is game in Android. If you don’t believe it now, just wait for it! 
I will be setting off to San Francisco to seek out the geek fest that is GDC (or, to mere mortals, the Game Developers Conference).
Scoreloop (for who I am doing some work as you will have found out by now), are throwing a party (with PocketGamer and MPlayIt) and you should let me know if you think you should be there but an invite has escaped you.
We have some exciting stuff to tell (some may have seen the podcast we did with Motorola and MySpace and there is more to come), so please get in touch (contact form) if you want to meet.
As a result, I may be a little silent over the next week or so. Bear with me…
It was today, 30 years ago, that NTT (now NTT DoCoMo) launched the world’s first commercial mobile cellular telecoms network in Tokyo with 88 base stations and, boy, did we come a long way since. Take fees for a start: there was a $2,000 sign-up fee and then a monthly fee of $300. On top of that, you would be charged $1 per minute voice. A handset weighed in at a cool 10kg (more than some budget airlines allow you as hand luggage these days; but then you would probably only fly First if you had one of those…). Nokia was still into wellies at the time, I think…
In its first 10 years, mobile phone subscribers “amassed” a rather meagre 4m subscribers. The second decade was significantly better: it grew to 740m! Fixed-line telephony took 120 years to break 1bn users, mobile was dramatically faster.
If you want to learn more, head over to the unfathomable insights of Tomi Ahonen who dedicated a post to the date (and every milestone since) that will take you a good half hour to read. Well worth it!
And now, lean back, and have a glass on the arguably biggest media revolution since the printing press (because, my dear “1st World” readers, most people from “other” parts of the world, would not have any access to digital media without mobile phones at all).
And for every stickler amongst you: Dr Martin Cooper placed the first “proper” mobile phone call on 3 April 1973 but the first proper mobile network was NTT’s to claim (and someone needs to update Wikipedia as to that. Tomi?).
All of it of course went even further back than that. See:
Image credit: http://openlearn.open.ac.uk/file.php/3317/T307_1_010i.jpg
There have been reports (referred to by this here) pondering if Motorola grabbed an “exclusive” deal with the Google-led Open Handset Alliance for Android 2.0 on its Droid (or, in Europe et al, Milestone) handset. There does not appear to being any formal confirmation of this but it was mentioned that, anecdotally, other vendors (and fellow members of the Open Handset Alliance) like HTC, LG, Kyocera and Samsung were still deploying version 1.5.
They quoted industry analyst Ross Rubin as to why Android 2.0 debuted on a Motorola device:
[...] There could be several reasons. Verizon’s subscriber strength and more direct competition with AT&T and the iPhone may have led it to push for Android 2.0 to be more competitive. Or it could be simple product development timetables. Moving forward, HTC will want to put its Sense user experience on top of Android 2.0, which requires development time. Google wants a healthy Android ecosystem and a competitive Motorola contributes to that.
The article went on to refer to the respective releases for 1.0 and 1.5 (both to HTC). However, one might argue that, for the first two releases, there was not much harm done in working more closely with HTC as they were the front-runners on deploying an Android phone, so that the concerted marketing buzz etc might have been justified. However, now that there is a large number of vendors deploying, one might query the compliance of the term “open source” with such exclusivity arrangements.
It also highlights the dominance Google has in the Open Handset Alliance which might, longer-term, lead to assertions that Google is in fact using the open source road as a cover to push what is effectively an OS largely driven by them. I am not implying that it is and a healthy ecosystem with multiple strong is important in particular for the launch of a new OS in a space so full of powerful multi-nationals but there is a fine line to walk in order to get it right.
Yesterday, I blogged about Motorola’s Motoblur UI, which adds an additional SDK for its specific APIs beyond the standard Android stacks. I reckoned that this might mean more fragmentation, which would push it a step closer to the nightmare that was/is J2ME.
I received two quick reactions to this: one reader commented that this was only bad if you wouldn’t have good tools and compilers. To him (@tederf), I would respond that, while it is certainly true that good tools reduce the friction, raise efficiencies and alleviate overall pain, the smallest common denominator is always just that. In my previous companies, we used to produce up to seven or eight different J2ME builds in order to maximise performance of our games on the huge spread of handsets. Could we have done with one build? Probably. Would the result have been great? Almost certainly not!
Anyway, the more interesting reaction came from the good folks at Motorola themselves. They reckoned (via Twitter; they are @motoblur) that:
with all due respect, I feel you’ve misunderstood motoblur, and android fragmentation concerns are a wee bit overblown.
Now, now. I offered them a guest post here in order to explain this further. I have unfortunately not yet had a response (which I take, applying Twitter attention spans, as lasting silence). But I still wanted to use the opportunity to elaborate a little more on this (and, no, I will not lament Moto’s lost opportunity to feature their wares on this humble site).
To clarify a couple of things outright:
- I would be delighted would I be mistaken (and note that I am not a techie, so this is a distinct possibility!).
- I would be equally delighted would Motorola manage to regain some of its lost ground. The world clearly would be a better place with another strong manufacturer regaining old strengths (although maybe with better UI this time around – which Motoblur certainly seems to offer [see picture on the right of the Motorola CLIQ!).
But let’s go back to the general issue of Android fragmentation threats (the fact that I pointed this out – again – en cas de Moto is of course purely coincidental).
So let’s dive in: with open source software, there is always the intrinsic possibility that fragmentation will occur. Why do people customize it? Because they can! vendors, developers and operators that make up the Open Handset Alliance (which releases Android) can tweak is in whichever way they like (or “need” to) and for any number of reasons: to protect IP, to optimize performance on their network or for certain devices or simply because they feel they need some distinguishing factors, some degree of uniqueness. The result can be, however, as one analyst puts it that
there will be multiple flavors of Android, all of them incompatible with each other. That, in turn, necessitates different versions of each application or updates to accommodate the entire device ecosystem. On the whole, such activity negates the cost efficiencies inherent in the idea of a standard, open operating system, and potentially makes the Android Market a confusing place to shop for widgets.
And that’s what you call fragmentation. Interestingly, there were rumours that Google had made the Open Handset Alliance members sign “non-fragmentation agreements” but it seems that this is either not true or not enforceable.
Others point out that HTC, Samsung, Dell, Verizon, (may I add Motorola?) all have phones on the way that run on different software to the others. Reports of version conflicts, lack of backward compatibility, etc, etc. I mean, hell, there is even an “alternative” Android app store (with 223 apps as of tonight)… Sounds familiar?
Dear Motoblur, if it is different with your SDK, please enlighten us! I am sure I will not be the only one applauding!
Image Credit: http://www.visionmobile.com
A new round of fragmentation looms. It is something I have been fearing for a while now: that OEM (and carriers) would make use of the open source of the likes of Android and LiMo to produce their very own flavour of apps. So after Vodafone’s 360 announcement (with customized LiMo storefronts, etc), Motorola announced so-called “signature apps” from a number of developers that are all delivered through Motorola’s new “Motoblur” user interface, which
is based on the Google-backed Android platform for mobile systems. Motorola [will] offer an additional SDK for its APIs beyond what is available for Android.
And then it said that
Over a period of time–we’re not there yet–we’ll allow the APIs to be available so people can develop many more applications than we can think of ourselves, but it’ll take us a little bit of time to mature ourselves to a place that we could open up APIs.
Ouch. An additional SDK. Which is not yet there yet. Whilst the Motoblur UI looks actually quite nice, this sounds suspiciously like another round of walled gardens, onerous internal and external QA, fragmentation and pretty much a fall back into the traps of the J2ME uber-customized world where one needs to support hundreds of devices for a commercial roll-out (with the trouble of course being that, all too often, that work meant that it would no longer be commercially very sensible). Oh dear…
It makes one want to call out for a quick advancement of HTML5 with Gears and all, so that one won’t need apps after all. The issue of connectivity and usability, etc would of course still be there. Such despair…
Not all is in recession it seems. The handset vendor world #3, LG predicts to ship 110m phones this year, which would represent a 9% increase in volumes on a year-on-year basis (see the market shares for 2008 and Q1/2009 below; courtesy of Strategy Analytics) in the face of what it believes will be an overall flat market this year.
So whilst everyone is shrinking, LG is growing. Everyone? Ah, now, Samsung is growing, too. The victims? Seemingly Motorola and Sony Ericsson with Nokia also suffering. No news then? Well, by 2012 LG wants to be #2 and ship around 200m devices (which would be 100% more than in 2008). So 9% growth wouldn’t get them there, would it?
Joking aside. Is this surprising? I think not. LG had had a couple of very “pretty” devices out. Starting with the LG Prada, they came out with the “Shine” and had a great success with the Viewty. They have been upping their game at a time where in particular Sony Ericsson and Motorola had been struggling to compose a coherent product strategy, and this will have enhanced the overall effect.
The title of this post is not meant in any way derogatory but with all the hype about the iPhone it is sometimes easy to forget that we are talking about a niche product that will probably remain a niche product (albeit a powerful and cool one!). In the rest of the world (feature phones aside), a few consortia are fighting for the open-source market, which is – let’s face it – a considerably larger piece than the small premium segment served by Apple.
Here’s one that nearly slipped through the (well, at least my) net: according to a recent press release, the Eclipse Foundation is set to unveil a unified development platform. It is said that some major players, including Nokia, RIM, Sony Ericsson, IBM and Motorola have joined this initiative already though Android and – predictably – Microsoft and Apple are notable in their absence.
Motorola has recently been struggling a little to get the Koolaid out; it wasn’t often the pinnacle of cool recently. However, today they unveiled a new phone, the “W233 Renew” (catchy name, huh?), and that phone is made of recycled plastic bottles. Now people might jump to the fineprint to see what the percentage of re-used components is, etc but, hey, let’s just acknowledge that the concept is pretty cool, don’t you think?
“When designing the packaging, Motorola was able to reduce its size by 22 percent and the box and all of the materials inside are printed on 100 percent post-consumer recycled paper.”
Verizon‘s U-turn continues: the carrier now announced that they would support the Android OS promoted by the Google-led Open Handset Alliance. This comes only days after Verizon was met with a lot of raised eyebrows after it declared it would open up to handset manufacturers, service and application providers. Upon the launch of Android, Verizon was amongst a select few that were visibly reluctant to support the initiative, reportedly for fear of impinging on their customer base by not being able to control the user experience.
This move may well be an attempt to prevent Google from bidding in the 700 MHz spectrum, the auction for which goes ahead tonight: Google may not see the necessity to bid just as aggressively if it can basically fall back on an OS-agnostic carrier as it can then continue doing what it does best, namely sell ads. The proximity of the dates may indeed point into that direction.
Verizon Wireless had created the most profitable U.S. cellular business by tightly restricting the devices and applications allowed to run on its network. However, its management apparently now came to conclude that it was time for a radical shift: this will have been out of fear to be isolated in a niche when the rest of the market was overrun by new, more powerful devices as well as media empires old and new both of which would bring a richness of offerings mid-term that Verizon could not have supported within the constraints of its tightly-controlled environment.
It may also have thought that opening up would help them to keep growing while containing costs; probably a bit of everything. That last bit is of course one of the reasons that led many partners to throw their weight behind the various OS campaigns that recently appeared to have picked up pace: the LiMo Foundation, C-based Nokia-owned OS Symbian and the Sony Ericsson and Motorola-owned UIQ (in which Motorola had just acquired a 50% stake; see here) will also be driven by the OEM’s attempt to contain cost. Unified OS make mass production much cheaper (and the famously robust Linux kernel also will allow stability whilst being flexible enough to allow enough flavours to keep every marketing and UI expert happy, too).
Everyone coming to their senses? Oh, brave new world.
German news reports say that Vodafone Germany has sued T-Mobile over its exclusive iPhone arrangement with Apple. Vodafone challenges the “combo” of iPhone and a 2-year-contract and asserts that this might be contrary to fair competition laws. Vodafone Germany’s chief describes the iPhone as the “fall of man”, which is pretty funny, come to think of it. The manager says they would fear that the likes of Nokia and Motorola would follow the example and do the same, which would heavily distort the market. Hmm. Who had this thing with its logos on handsets again? Who was the only carrier distributing Sharp handsets? Ah… Given Vodafone’s approach with the rather successful Sharp GX series, which was exclusively (sic!) available to, yes, Vodafone customers, the suit does not feel entirely sincere. One might plead that Vodafone fails on the “clean-hands” doctrine (which, alas, is unknown to German law).
This is of course also noteworthy as Vodafone Global CEO Arun Sarin went on record saying that the iPhone makes for a “pretty poor experience” (unless you are in a WiFi area) and all.
Why then do they insist this is such a bad thing? Do we take it as a sign that the lost iPhone deal might after all have a certain sting to the mighty carrier? This is in spite of it still possibly proving to have been the right decision, with Apple’s share in user fees and all. It may well all come down to branding: Vodafone is thought to have spent hundreds of millions on trying to build its Vodafone Live! brand, which it all but abandoned recently. It was the first big carrier to partner with Nokia on the latter’s Ovi initiative (see here), which in itself may be seen as an admission of failure of its own service.
Whilst I understand Vodafone’s move from the view of the German lawyer I (also) am, the overall approach has something of a child envious of another one’s toy.
UPDATE: Further reports shed more light onto this. T-Mobile may be forced to sell unlocked phones and also give up the 2-year tie-in, i.e. offer consumers to buy the iPhone without a contract. This would be a major blow to the Apple business model and one that might force others to open up, too: MoCoNews reports that French laws have similar provisions.
Most importantly perhaps, European laws on the freedom of goods and services would prevent anyone stopping grey imports into other EU member states where Apple struck other exclusivity deals (e.g. with O2 in the UK), which might become a real threat to Apple’s business model altogether.
So, no GPhone — yet. Google, with quite a number of partners, today announced the already much-rumoured “Open Handset Alliance” under which a Linux-based OS, nicknamed Android has been launched (the SDK will allegedly be available in a week’s time). Here’s a video explaining the deep thoughts of the creators (be quick: YouTube has removed it already…).
The whole industry had been waiting for this, and Google seems to have come up with a black-white thing: it goes back to its roots in open source but overlays it with Java, which has caused the content community a lot of headaches (every mobile phone translates it slightly differently, so one needs a gazillion ports). However, Google has teamed up with no less than 34 partners for the launch alone, including such giants as China Mobile, KDDI, Sprint Nextel, TIM, T-Mobile, Motorola (who seem to be dancing on a lot of weddings recently: UIQ and Linux Mobile are also on their plates), Samsung, HTC, Intel and eBay.
So what does it all mean? According to the members of the alliance, it will be better, bigger, faster for everyone: open source means more applications, less bugs and less cost. According to Google CEO Eric Schmidt, it is “a fresh approach to fostering innovation in the mobile industry will help shape a new computing environment that will change the way people access and share information in the future.” Commentators note that there is apparently one caveat: you’ll have to use Google for navigation. Now: does that bother anyone? Give me Internet on my phone on broadband speed and I happily surf with whoever gives it to me, I’d say. To enact a platform, supported by a lot of sector muscle, that makes the developers’ life easier should be good for everyone indeed as it will undoubtedly bring more usage. Traditionally, carriers feared for the consistency of the user experience. Apparently, Verizon and AT&T have already voiced such concerns also here although the explanation sounds defensive at best: they fear too much advertising. Would it be safe to say they rather fear loss of control?
Quite a few companies have tried to take on mobile as the next frontier and quite a few fared rather miserably on the complexities of the environment presented by the sector (Disney’s MVNO attempts, Infospace and a few others spring to mind). With Google’s might this might be about to change though. A fresh breeze and a unified development platform would, in any event, be a good thing.
Interesting though that, as in recent releases on OS-driven initiatives, Nokia is again absent. This is not promising any good in terms of unifying the landscape, it seems. However, both Linux Mobile (on which Android is apparently based) and Symbian (in which Nokia holds a huge stake and which it intends to make its platform of choice) are C++-based. And that would be easing development pains after all: much easier to deal with than the Java layers, which until now were statutory but might only be optional going forth.
UPDATE 7 Nov 2007: Nokia has said its participation in Android is “not ruled out at all”. It would work with it if it would see sense. Now, a convincing statement sounds differently but it IS noteworthy that the Finnish giant felt the need to comment on it so quickly.
