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  • Mobile Location-based Service Revenues in Europe to Reach €420 Million by 2015

    According to a new report from Berg Insight, mobile location-based service revenues in Europe are forecasted to grow from € 220 million in 2009 at a CAGR of 12 percent to reach € 420 million in 2015.

    The research group estimates that one third of all mobile subscribers in Europe will use some kind of location-enhanced application on a regular basis by 2015.

    Local search, navigation services and social networking are believed to become the top applications in terms of number of users. The social networking category is forecasted to experience the highest growth in the coming years.

    According to André Malm, Senior Analyst at Berg Insight, location-based services are finally on the verge of mainstream acceptance. “Increasing sales of smartphones are driving end-user awareness of mobile Internet services and applications in general. On-device application stores enable access to mobile services for a broader audience at the same time as flat-rate data plans make pricing more transparent. More and more developers are now adding location support in their applications to enhance the user experience”, he said.

    He added that integration of GPS in handsets is an important driver. “The installed base of GPS handsets in Europe has recently surpassed 15 percent of total handsets and will increase to 50 percent three years from now.”

    The report shows that the revenue model for many mobile applications in the consumer segment is shifting from premium fees to ad-funding. This is especially the case for location-based services where now also navigation services are becoming free for end-users and developers monetise their offerings through ads and various bundles.

    “However, revenues may not grow at the same rate as usage because the mobile advertising ecosystem is still nascent. It will take some years before a successful model has been established that allows advertisers to reach out to a critical mass of active users. This is especially the case for emerging location-based advertising,” as the analysts claim.

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  • IDC: Mobile Payments Will Take Longer To Bear Fruit than Most Observers Hope

    IDC Financial Insights recently released a new report, which analyzes the mobile payment and mobile banking space in the Europe, the Middle East, and Africa (EMEA) region.

    The research group highlights that the mobile commerce payments market still has a long way to go before any serious impact will be felt by consumers or by the retail industry.

    “Steady moves by card issuers to increase the adoption of contactless cards and the increasing acceptance of mobile banking as a channel are prerequisites for the emergence of any meaningful, full-sized mobile payments market in Western Europe,” say analysts.

    IDC estimates that the share of contactless/mobile/remote payment transaction in 2015 will be no more than $125 billion with less than 13% of European mobile handset users registered to use a payment service.

    According to the report, the mobile payments industry must focus less on the use of advanced technology to partially replace existing payment methods, and more on the more practical (and sometimes mundane) application of the technology to specific processes.

    A close analysis of the industry shows that over the next three to five years the lack of a positive business case for all players will hamper many mobile payments projects. IDC also predicts that mobile banking (account info access and alerts) will blaze a trail over the next two to three years, laying the foundations for mobile payments.

    According to IDC analysts, key foundations for the success of retail mobile payments in Western Europe lie in the advancement of contactless debit/credit cards POS infrastructure.

    "Mobile payments are still an emerging technology capability that will take significantly longer to bear fruit than most industry observers hope," said Trevor LaFleche, senior research analyst, with IDC Financial Insights’ European banking practice for EMEA.

    "Shifting technological foundations of what constitutes a mobile device will confound industry purists, as has often happened when a technology does not take off as predicted. The varied nature of existing infrastructure and consumer need will continue to split the EMEA region into three distinct segments, which will need to be uniquely served to improve the penetration of the correct payment service to the correct market," he added.

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  • Mobile VoIP Becomes a Threat to Tradicional Voice Revenues

    Mobile VoIP is no longer just hype, but has become a credible threat to traditional voice revenues, says Frost & Sullivan.

    According to the research group, considering, that this is only a matter of time when IP becomes the principal transport for various access technologies, an ambitious group of mobile VoIP start-up companies are creating a paradigm shift in the way users communicate with each other, with voice services moving to a true internet era of Telco 2.0.

    New analysis from Frost & Sullivan, Impact of Mobile VoIP on Next Generation Cellular Networks, finds that at the end of 2008, approximately $605.8 million of mobile VoIP revenues were generated in North America, Europe, Asia Pacific and Latin America. This is expected to grow to $29.57 billion by 2015.

    The technologies covered in this research service are high-speed packet access (HSPA), third-generation long-term evolution (3G LTE), global system of mobile communications (GSM), IP multimedia subsystem (IMS), HSPA+, general packet radio service (GPRS), voice over Internet protocol (VoIP) and session initiation protocol (SIP).

    "The emergence of flat rate mobile data pricing, positive growth of smartphone shipments, and high-speed mobile broadband availability has spurred the adoption rate of mobile VoIP," saiid Frost & Sullivan Senior Industry Analyst Saverio Romeo.

    He added that mobile operators realise they can no longer ignore the fact that mobile will be a key component of integrated IP-based communications and next generation wireless technologies such as HSPA+ and LTE.

    According to the report, significant traction in the application space, primarily driven by the success of the iPhone, has resulted in several smartphone vendors making provisions in their applications stores for users to download and use third-party VoIP clients over both wireless fidelity (WiFi) and cellular broadband networks.

    “However –the report continues– many cellular operators have prohibited the use of mobile VoIP over their cellular networks, with some imposing a surcharge to avoid cannibalisation of their circuit-switched voice revenue streams. Moreover, cellular operators face intense competition from the more popular Web-based VoIP alternatives that are permeating the mass market.”

    Romeo claims that despite user demand for cost-effective services, some mobile operators will continue to discourage mobile subscribers from using VoIP over cellular networks and suggest that it will not provide the same quality, efficiency and reliability of services offered by the GSM network.

    "Recent surveys indicate that nearly 60 to 70 per cent of the major European mobile operators prohibit or restrict the usage of VoIP over their popular mobile broadband data plans," he said.

    Analysts say that mobile operators should eventually do away with imposing bans or surcharges to their mobile broadband packages to support mobile VoIP, as the client devices supporting HSPA+ and LTE will be based on open platforms and support SIP for third-party applications.

    "When the operators migrate to an all-IP IMS network, they should drive innovative services such as multimedia telephony, high definition voice, integrating voice with context-based information about the user, and the device from a converged presence-enabled address book," concludes Romeo. "This will enable them to differentiate their services from mobile VoIP start-ups."

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  • Gartner: Worldwide Smarpthone Sales Grew 49% in Q1 2010

    Worldwide smarpthone sales to end users reached 54.3 million units in the first quarter of 2010, an increase of 48.7% from the first quarter of 2009, according to Gartner. Mobile phone sales totalled 314.7 million units, a 17% increase from the same period in 2009.

    Gartner report "Competitive Landscape: Mobile Devices, Worldwide, 1Q10" shows that among the most successful vendors were those that controlled an integrated set of operating system, hardware and services.

    "In the first quarter of 2010, smartphone sales to end users saw their strongest year-on-year increase since 2006," said Carolina Milanesi, research vice president at Gartner.

    Q1 2010 saw RIM, “a pure smartphone player”, make its debut in the top five mobile devices manufacturers, and saw Apple increase its market share by 1.2 percentage points. Android’s momentum continued into the first quarter of 2010, particularly in North America, where sales of Android-based phones increased 707% year-on-year.

    According to the report, growth in the mobile devices market was driven by double-digit growth of smartphone sales in mature markets, helped by wider product availability as well as mass market price tags.

    “Increasing sales of white-box products in some emerging regions, in particular India, also drove sales of mobile phones upward. We expect sales of white-box products to remain very healthy for the remainder of 2010, especially outside of China,” said Milanesi.

    The first quarter also saw some movement outside the top five mobile handset vendor rankings: Hong Kong-based manufacturer G-Five made its debut into the top 10, grabbing 1.4% of market share

    The rise of white-box manufacturers from Asia has also helped the "others" section, as a proportion of overall sales, increase its market share to 19.20%, up 2.7 percentage points.

    “This is having a profound effect on the top five mobile handset manufacturers’ combined share that dropped from 73.3 in the first quarter of 2009 to 70.7% in the first quarter of 2010,” said Milanesi.

    In Q1 2010, Nokia‘s mobile phone sales to end users reached 110.1 million units, a 1.2% decline in market share year-on-year. Although Nokia’s midtier products sold well, Nokia lacks a high-volume driver in the high-end, according to the analysts.

    “MeeGo based devices and other high-end products will not rejuvenate Nokia’s premium portfolio until the end of the third quarter of 2010 at the earliest, and Nokia will continue to feel pressure on its average selling price (ASP) from vendors such as HTC, RIM and Samsung,” said Milanesi.

    The reorganisation announced last week demonstrated that Nokia is trying to streamline the reporting process to deliver results quickly, which Gartner believes shows its recognition of the pressure it faces from investors.

    Samsung sold 64.9 million devices in Q1 2010, an increase of 26.3% year-on-year. Samsung was one of the five vendors in the top10 vendors ranking to grow its market share, which increased by 1.5 percentage points year-on-year.

    RIM’s mobile phone sales reached 10.6 million units, a 45.9% increase year-on-year. RIM is making its debut into the top five worldwide mobile handset manufacturers ranking. RIM’s focus this quarter was centred on its ecosystem strategy, its tightly integrated control of store, OS and device played to RIM’s strengths, according to the report.

    The reports also shows that the first quarter of 2010 was Apple’s strongest quarter yet, which placed the company in the No. 7 position with a 112.2% increase in mobile devices sales.

    “Growth came partly from new communication service providers in established markets, such as the UK, and stronger sales in new markets such as China and South Korea,” said Milanesi.

    She claims that the second quarter of 2010 will be a very important one for Apple. “We expect that Apple will present its new iPhone in June during its Worldwide Developer Conference, which will be the first to feature the latest release of the iPhone OS that includes welcome improvements for developers and users, such as multitasking,” she said.

    OS market
    In the smartphone OS market, Android and Apple were the winners in Q1 2010. Android moved to the No. 4 position displacing Microsoft Windows Mobile for the first time. Both Android and Apple were the only two OSs vendors among the top five to increase market share year-on-year.

    Symbian remained in the No. 1 position but continued to lose as Nokia remains weak in the high-end portfolio.

    Smartphones accounted for 17.3% of all mobile handset sales in the first quarter of 2010, up from 13.6% in the same period in 2009.

    “As seen with the iPad and web books based on Google’s Android platform, mobile OS ecosystems are developing and will move beyond smartphones to continue to deliver consumer value and a rich user experience,” said Roberta Cozza, principal research analyst at Gartner.

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  • ABI Research: 2012 Will Be a “Bellwether” Year for 4G

    ABI Research has been tracking cities and population coverage for 4G for the past year. The research group reports that at the end of 2009 there were more than 170 802.16e carriers across 65 countries, covering 480 million people. That number is projected to cross the 1 billion mark by 4Q-2012.

    According to ABI, USB dongles have been an excellent vehicle to prime the market along with CPE and laptops, but mobile handsets will be essential to the success of WiMAX.

    Yota, Sprint, and Clearwire have already started beefing up their lineups with models from HTC and Samsung. Meanwhile, mobile operators are seeking out LTE licenses. ABI predicts that twenty carriers will launch by 4Q-2010. Population coverage lags WiMAX but will catch up, reaching 600 million people by 4Q-2012. LTE coverage will start in urban hotspots but carriers indicate they will push coverage rapidly in order to handle the increasing mobile data wave.

    Analysts also think that the 4G market could well have 150 million subscriptions by 4Q-2014. They claim that the split between WiMAX and LTE will depend on WiMAX carrier commitments to upgrade to 802.16m. “WiMAX vendors such as Motorola and Huawei are gearing up to offer “802.16e+” which will bring features of 802.16m to the current market. Many companies in the ecosystem are already working on interoperability testing for 802.16m,” says the report.

    According to Jake Saunders, VP for forecasting at ABI Research, TD-LTE is the “wildcard.” “It was originally primed as an evolutionary technology for TD-SCDMA carrier China Mobile, but has been gaining interest from some WiMAX carriers. Both camps will be frantically trying to ramp up IC wafer manufacturing, product portfolios and population coverage. There will be considerable scrutiny over the next few years,” he said.

    Practice director Philip Solis added, “Some WiMAX service providers may switch from WiMAX to TD-LTE, but others are doing this partly as insurance and partly to assure investors of an alternate path so they may go forward with WiMAX. This is something for smaller greenfield service providers to consider. Large mobile operators will move forward with LTE whether it be on FDD or TDD spectrum. Clearwire can do both WiMAX and LTE if it wants to since it has the spectrum to do so.”

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  • NPD: 75% of US iPhone and iPod Touch users Download Apps and Games

    The NPD’s "Entertainment Trends in America" update reveals three quarters of iPhone and iPod touch users are connecting to the Web to download entertainment content and apps.

    According to the latest update to the NPD’s tracking survey, 16 percent of Americans age 13 or older are using devices other than their home computers to download software applications, music, video, and other entertainment content from the Web.

    Based on NPD’s entertainment market research, 75 percent of iPhone and iPod Touch users are connecting to the Web to download entertainment content and apps, compared to 19 percent of game console users and 17 percent of Blu-ray Disc set-top product users.

    “It’s not surprising that Apple users are ahead of others when it comes to downloading Web-based content, given the breadth of the company’s app catalog and the head start iTunes had selling music for the iPod,” said Russ Crupnick, entertainment industry analyst for NPD.

    “Like other groups of early adopters, consumers downloading entertainment content are mostly younger and male; however, as app stores expand beyond Apple, as connected devices become more commonplace, and as connectivity is simplified we expect to see more activity on other devices and platforms,” he added.

    According to the report, among iPhone and iPod Touch users who downloaded content, free apps were the most popular download category, followed by video-game apps, and music downloads.

    Among consumers who connected via game consoles, game add-ons were far and away the most popular category, followed by purchased downloads of entire games, and movie rentals.

    In addition, one-third of Blu-ray Disc consumers who actually connected via their BD reported downloading a movie rental.

    “Music now competes with games and other apps for share of device, share of wallet, and share of time,” Crupnick said.

    He says that entertainment companies need to start to thinking of apps in broader terms, not only as a way of garnering direct sales from downloads, but also as a pathway to paying for additional entertainment content.

    “For example, an app that reviews movies could also be a direct channel for purchasing DVDs, BDs, or digital forms of video,” Crupnic concluded.

  • IDC: Mobile Phone Recovery Continues with Nearly 22% Growth in Q1

    The worldwide mobile phone market grew 21.7% in the first quarter of 2010, a strong rebound from the market contraction in Q1 2009. Growth was fuelled by increased demand for smartphones, and the global economic recovery.

    According to the IDC Worldwide Mobile Phone Tracker, vendors shipped 294.9 million units in the first quarter of 2010 compared to 242.4 million units in the first quarter of 2009.

    The report shows that growing demand for smartphones helped Research In Motion move into the top 5 vendor rankings for the first time. RIM, which replaced Motorola in the top 5, tied Sony Ericsson for the number 4 position in IDC’s 1Q10 vendor rankings.

    RIM shipped 10.6 million units in the first quarter while Motorola, which had been a top 5 vendor since the inception of IDC’s Worldwide Quarterly Mobile Phone Tracker in 2004, shipped 8.5 million units.

    Motorola, the number 2 overall vendor in 2004, registered a fifth place finish last year by virtue of its overall strength in the lower-growth traditional mobile phone category. Motorola has steadily lost share since 2004 when the market started its shift toward higher-end feature phones and smartphones.

    "The entrance of RIM into the top 5 underscores the sustained smartphone growth trend that is driving the global mobile phone market recovery," noted Kevin Restivo, senior research analyst with IDC’s Worldwide Mobile Phone Tracker.

    "This is also the first time a vendor has dropped out of the top 5 since the second quarter of 2005, when Sony Ericsson grabbed the number 5 spot from BenQ Siemens," he said.

    IDC believes the worldwide mobile phone market rebound will continue in 2010, though not at the same growth rate as the first quarter.

    "It should be noted that the market’s first-quarter growth, while impressive, is relative to one of the worst quarters in mobile phone industry history (1Q09)," noted Restivo.

    He said that the market’s growth should not be taken as a proxy for future quarters nor annual growth. “In fact, the results essentially match our first quarter projections. We are still expecting growth of 11% for 2010," he added.

    Top five mobile phone vendors according to IDC:
    1. Nokia
    2. Samsung
    3. LG Electronics
    4. RIM
    5. Sony Ericsson

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  • VoIP Helps HBBs Survive

    In the current economic environment, home-based businesses (HBBs) in the U.S. are increasingly turning to the web to boost business. According to a report from AMI-Partners, VoIP is playing an increasingly prominent role in the survival of the HBB.

    The implementation of VoIP communication system is among the areas that improve efficiency and reduces cost of HBBs. The report finds that the number of U.S. HBBs using VoIP technology has increased by 48% in 2009. The need for HBBs to cut costs thereby maintaining an adequate cash flow has directly hit the areas of telecommunications and business travel.

    “VoIP providers such as Time Warner, Optimum Lightpath, Verizon, to name a few, are offering very attractive bundled VoIP and broadband internet access packages. Current penetration of VoIP technology is still incipient, but strong interests by U.S. HBBs suggests a vast opportunity for VoIP providers in 2010,” said Yuki Uehara, Research Analyst at AMI-Partners.

    “On the business travel front, video capability over instant messaging (Skype, AOL’s AIM, and Yahoo’s Messenger) and web conferencing (MS Live Meeting, WebEx, etc.) will continue to help defray the cost of staying in contact with clients and vendors in the HBB market in 2010,” he added.

    According to analysts, HBBs are realizing the advantages of investing in technology that improves their business and brings tangible results in the short run. For IT vendors and service providers, it is vital to pin-point the needs of U.S. HBBs and target the HBBs that are proactively investing in those technologies.

    “In the past HBBs had focused on more improving internal efficiency such as IT security, data backup & management (back-office functions). Presently we are seeing a shift to reaching out to clients and prospects and communication (front-office functions) to keep baseline revenue and/or catching every possible sales opportunity,” said Uehara.

  • Mobile Handset Industry Considers Recession to be Over

    According to recent iSuppli report, the mobile handset industry is proclaiming the end of the recession for the segment following an outstanding final quarter of 2009 and a projected substantial growth for smart phones in 2010.

    The report shows that the mobile handset industry closed 2009 with shipments of 1.15 billion handset units.

    While that number is down from the overall 2008 figure of 1.2 billion handsets, shipments in the fourth quarter of 2009 represented the culmination of an increasing growth pattern throughout all of last year. Compared to third-quarter shipments of 290 million, about 335 million mobile handsets shipped in the fourth quarter, up 15.5 percent.

    “Given the recovery of the market in the final quarter of 2009, and with Europe, Latin America and the Middle East/Africa regions doing exceptionally well during the period, the recession can be said to be officially over for the industry. The continued growth this year of total handsets—up a projected 11.3 percent to 1.3 billion units—further bolsters such a view,” iSuppli maintains.

    Among the various handset categories, smartphones are projected to expand 35.5 percent in 2010. According to the report, smartphone growth will be driven by a number of promising developments, including the introduction of entry-level smart-phones, enthusiasm from vendors across the mobile phone and PC industries, the prevalence of 3G network deployments and the promotion of data-centric services in mature markets.

    With handset shipments in the fourth quarter of 2009 amounting to approximately 257.6 million units, the Top 5 players accounted for a whopping 77 percent share of the total handset market.

    The report says that Nokia remained the leader of the handset market, shipping 126.9 million handsets during the period, giving it a 37.9 percent share of market. Runner-up Samsung, which has introduced its own smart-phone operating system, held the No. 2 spot with 20.6 percent share.

    The remainder of the Top 5 are rounded out by LG Electronics, in third place with 10.1 percent share; Sony Ericsson in fourth, with 4.4 percent share; and Chinese giant ZTE, whose impressive 77 percent growth from the earlier quarter vaulted it into fifth place, with a 4.0 percent share.

    A second Chinese handset manufacturer, Huawei, landed in seventh place after also finishing an outstanding quarter with 82.4 percent growth.

    “Together, the two Chinese companies indicate the strong momentum occurring in the emerging market as well as an increasing presence in Europe on their part with key operators,” said Tina Teng, iSuppli senior analyst.

  • Visiongain: The Perspectives for Mobile VoIP Market

    The mobile market is growing, up 1.4% to €417 billion in 2010. The strongest growth is posted by data services such as mVoIP, both on fixed and mobile networks, finds Visiongain in its recent “The Mobile VoIP Market Report 2010-2015.”

    Analysts predict that sales of internet connections and data services on fixed networks will grow in 2010 by 7% to almost €200 billion. Mobile data services – such as mVoIP are posting even stronger growth: up 16% to over €140 billion.

    The report also examines how the growing market share of smartphones offers potential for third-party applications developers in the mVoIP market. In 2010 for example, mobile phone users will download over 6 billion applications to their mobile phones, growing to 7 billion by 2013.

    According to Visiongain, there will be opportunities for the mobile telecoms industry in the IP convergence/substitution market. By introducing fixed VoIP to cellular telephony and mobile VoIP to fixed telephony, operators will have the opportunities to grow on a unified voice and multimedia service experience.

    “VoIP services are cheaper than circuit-switched services on traditional legacy networks. VoIP has diversified from purely voice implementation to a complete multimedia experience offering video calling, video conferencing, gaming and many other features,” the analysts say.

    Visiongain claims that the global economic crisis appeared to have had only a slight impact on the global telecommunications and IT markets. After a slight dip of 0.5% in 2009, the information and communications (ICT) market will increase by 1.9% to €2.3 trillion in 2010 and by 3.7% to €2.4 trillion in 2011, according to the European Information Technology Observatory (EITO)’s forecast. The number of mobile subscribers (currently four billion) is set to reach 6 billion by 2013, and smartphones will outsell PCs by 2011, growing to over 50% of the total handset market share by the end of 2013.

    As the report highlights, the strongest growth markets are in the BRIC (Brazil, Russia, India & China) countries – where in 2010 the Chinese telecom market will grow by 8% to €126 billion and the Indian market will grow by a staggering 15% to €40.5 billion. The inherent cost advantage of mVoIP may help drive and contribute towards wider proliferation of the telecoms sector for the near-term, by way of accelerated take-up among more price-sensitive consumers.

    The research group also notes that the online social networks such as Facebook and Myspace have integrated mVoIP services to offer opportunities for development of third-party applications and software, as well as multimedia content and advertising. Facebook users for example currently send one billion IMs per day.