the year 2006 winds to a close, Roman Polz, Senior Manager of Agere
Systems' Mobility Division suspect a key question on all our minds: "What will
happen in the wireless industry in 2007?"
Roman makes ten predictions and while I wouldn't agree to all of them, they are
a great starting point for further discussions and thoughts how the mobile
industry might goes on in 2007, what the customer expectations are (or not) and
how we might start (or already continue) to use our mobile devices in 2007.
Prediction Number 1: CD-Quality Music Will Be The Killer Cell Phone
Within four years compact disk (CD)-quality music is going to be on more than
half the entry-level cell phones used around the world. Music will be the killer
application on cell phones measured by consumer use and revenue-generated by
handset makers and wireless service providers.
For substantiation of this prediction consider the iPod's enormous success.
People will pay for good-sounding music, including hundreds of their favorite
songs, easily accessed by simply pressing a button. And these music cell phones
will store hundreds and later thousands of songs, which is plenty for the
average music fan.
Prediction Number 2: Mobile TV Use on Cell Phones Will Grow, but Not as
Fast as CD-Quality Music
Mobile TV will continue to be developed in the next few years, but will be
challenged to win market acceptance because of the small size of cell phone
screens. These diminutive screens make long-term, non-stop viewing unappealing,
not a wonderful user experience.
Conversely, music will be a non-stop, slam dunk appealing feature of a cell
phone that won't require staring into a small screen. It will only require the
cell phone user to listen and relax.
The most likely mobile TV applications will be people checking sports scores and
updates; cartoons, videos, standup comedy and general news. All these will need
to fit in about a 3-to-20-minute time frame, according to industry experts. Most
people won't watch TV on a cell phone for much longer than that, except for some
special, out-of-the-mainstream reasons.
Prediction Number 3: The Earliest and Most Frequent Users of Mobile TV
Will be People Riding Trains To and From Work
Mobile TV's early adopters are expected to be mass transit commuters, primarily
Asian and European adults wanting to get the early morning news or sports
highlights for 10-to-15 minutes from TV stations. This already has started in
Asia and will take off in Europe in particular because a much higher percentage
of them take trains to and from work each day than Americans.
Put another way, in America, every cowboy has his own horse, meaning his own
car. This is not literally true but the concept is accurate. Because such a
large percentage of them drive to and from work, they won't be able to watch TV
as much as people riding trains.
This kind of mobile TV viewing will replace to a substantial extent the time
such commuters historically have spent reading newspapers.
One problem that will continue to vex mobile TV, however, is that it can swallow
the bandwidth available in the network, which is why only a few wireless service
providers plan to provide mobile TV as an individual data stream. Instead, they
are working on collaborations with companies that have broadcast TV networks,
but these relationships are in their early stages of business development.
Wireless service providers want to increase the average revenue they can
generate per subscriber. Just giving a subscriber that has mobile TV capability
does not immediately and easily translate to boosting those revenues per user.
So why should they promote mobile TV if it won't help them generate more
revenues? This is a key, largely unresolved question.
Prediction Number 4: Digital Cameras on Cell Phones Will Have Less
Customer Adoption Compared with Music
A cell phone camera generally produces average-to-poor quality photos compared
with stand-alone cameras, which is no wonder when looking at the price. Average
cell phone cameras cost virtually nothing whereas stand-alone cameras have a
price tag similar to a feature phone.
So who wants to use a bad camera to take relatively low-quality photos? It
doesn't make much sense. If you are interested in taking good photos, you might
as well pay for a good camera.
Furthermore, only a small percentage of cell phone users, similar to the overall
population at large, are avid users of cameras. This percentage is much lower
than the number of people who like to listen to music.
Still, to be clear, cameras will not disappear from cell phones, but usage of
average cell phone cameras will be low compared to music players.
Prediction Number 5: The Entry-Level Cell Phone Market Will Be the Sweet
Spot for CD-Quality Music Applications
There is a large market, called the entry-level cell phone market, just above
the emerging markets ultra-low cost cell phone segment. Users that can't or
don't want to spend money on feature-rich, high-end phones still have the desire
for functionality that goes beyond just voice and short messaging service.
That's why the entry-level market, offering compact-disk quality music, will be
the sweet spot of the market for the next several years. These entry-level
phones will be higher-performing and more feature-rich than the ultra-low-cost
segment, which are extremely basic phones. These entry-level cell phones will
also be much more affordable than the Ã¢â‚¬Å“Swiss Army KnifeÃ¢â‚¬Â type of phones with
lots of unused features.
Prediction Number 6: India Will be the Fastest Growing Cell Phone Market
for the Next Several Years
India, which has emerged as a great new frontier for cell phone business,
will in the near future focus heavily on the ultra-low-cost cell phone segment
but soon develop a strong market for entry-level cell phones. A huge number of
Indian citizens won't be able to afford the higher-end models priced in the US$
200 - US$ 400 range.
But they can afford lower-cost ones. According to the Gartner Group, India's
mobile penetration rate hovers at 7 percent now. It is projected to grow to 32
percent by 2010. According to Gartner Group, India is the world's fastest
growing cell phone market at 31 percent annually.
Prediction Number 7: Simultaneous Cell Phone Applications Will Be Crucial
Think about this: You don't want to stop listening to music while you receive
and answer a text message. You don't want the music player to stop playing while
a call comes in; you prefer that it just pauses, waits in the background and is
ready to continue playing after the call.
Or let's say you're speaking to someone on the cell phone about going to a movie
together that night. You want to download a video clip to view it so you can
decide with the person on the phone whether the one you have the video clip for
is the one you want to see.
You don't want to have to turn off your cell phone-essentially ending the
call-to see the video clip. You want to be talking to the person on the other
end, then look at the phone's display screen so you can view the video clip.
Then you can put the phone to your ear and talk about the video clip.
These are examples of simultaneous cell phone applications, which are growing in
number, complexity, and benefits. Cell phones that can do the most simultaneous
applications at the most affordable costs will win over consumers.
Prediction Number 8: More Feature-Rich Cell Phones Will Be Key in Enabling
Wireless Service Providers to Boost Their Average Revenues Per User
Wireless service providers will continue to grapple with a problem that has been
vexing them for years. The problem is that even though the growth rate for cell
phone sales and cell phone subscribers continues to increase, the average
revenue the service providers and handset manufacture gain from each subscriber
continues to fall.
To increase that revenue, a growing number of service providers will continue to
pitch and offer cell phones and subscribers on more feature-rich,
revenue-generating services such as high quality audio streaming, download
portals for music and video, and mobile TV.
The basis for people to have a good experience using these services is the
performance of the network connection and the quality of the multimedia in the
Prediction Number 9: 3G Cell Phones Will Not Be All About Merely Enabling
the Connected Lifestyle, but Rather Perfecting the Connected Lifestyle
The cell phone will be central for perfecting the connected lifestyle. This
means that in the future reliable, consistent, always-on connectivity will
become essential anywhere, anytime.
It will become less acceptable during the next few years to just make a cell
phone connection. The connection will need to be perfected, meaning not flawed
and unreliable, but rather as good as it can be.
Lousy service, interrupted calls, the inability to connect and stay connected
will become less tolerated than ever. An industry-changing mindset will take
over, in which it won't be about being wirelessly connected. It will be about
being wirelessly connected quickly, easily, inexpensively and reliability-in
other words, perfectly.
Prediction Number 10: More Collaborations Will Be Necessary to Survive and
Thrive in the Cell Phone Market
Wireless service providers are teaming with the holders of music and video
rights to offer downloads, and they will be building relationships with
broadcasters to deliver mobile TV without burdening the mobile network. On the
handset side, a rapidly growing number of collaborations will be formed between
hardware and software companies to build more complete, more reliable, and more
feature-rich cell phone platforms.
Fewer companies will be able to do everything required to build a platform on
their own. Cellular baseband experts, for example, will collaborate with
providers of global positioning system solutions, for installation in these
basebands, to provide value-added functionality. These collaborations will help
accelerate time to market while minimizing research and development expenses.
So what do you think about these 10 predictions? Any additions or
Cheers ~ Arne