State of Telecom Industry in Pakistan

Mobile Internet devices include smart phones, electronic readers, connected navigation devices, media players, gaming gadgets etc. Due to a variety of reasons will see more of these devices around. Depending on the market, the combination of online and offline capabilities of mobile connected devices will present new business models. The success of such offerings is mainly based on the utility of services and whether wireless broadband prices are affordable.

Why will these devices rise in popularity? To name a few reasons: improvements in processors and computing capacity, advances in: hardware, storage, flash memory, battery life and the explosive growth of social computing. Abundant and affordable wireless broadband could be another factor but there is still plenty of room there for improvement.

Challenges abound as well. Problems with user interfaces are still a major issue with many portable devices which connect with Internet. One of the main reasons why Apple has emerged a winner is because it provided a slick solution to the common user interface problems. Sony is an example of a large brand which used to be poor performer in user interface and lost market share. Over the years Sony has improved on usability.

Other problems include lack of standards, proprietary OS and incompatible applications which make it hard to share data and force users to duplicate efforts. Of course there are business reasons behind these which can take up many posts but for an end user this is a major headache.

Device convergence and context-relevant advertisement are the potential killer areas. Cell phones claim that they are the one gadget which can absorb everything else but that’s not how it has worked out. Apple’s iPhone has done the best so far by including iPod in the iPhone. Admit it, for a while there will be multiple devices. Cell phone has made its way into third world countries, breaking the first and most important barrier. This presents an interesting opportunity for various adaptations of technology  for commercial and even NGO purposes.  How will the new crop of mobile Internet devices interplay with the two established platforms of web and mobile phones? Will there be a clear distinction of how youth uses these devices?

An excerpt from Forrester Research about the mobile Internet devices:

Mainstream consumers are now using digital photographs and downloading music — and are even starting to download and stream digital video. Unfortunately, they confine much of this activity to a home PC — or at least use a home PC to load up or “side load” mobile devices. Being able to connect mobile devices directly to media and communications services like photo sharing sites and music download services gives consumers, content owners, and service providers far greater freedom.
 

Here’s the new world order in handsets for Q1 2008, based on an undisclosed research report.

Motorola drops to number three in volume terms and number five in value terms.

LG was the winner for the quarter with a YoY volume growth rate of 54% followed by Samsung with 33% growth. The market grew 14%. Motorola wasn’t the only loser. Sony Ericsson lost market share. And so did Apple. RIM and HTC are gaining smartphone share.

The handset market grew at YoY rate of 14% and again grew slightly less concentrated, with the top-five vendors taking 83.5% of global volume. This compares to 84.5% during the same period a year ago and 83.6% during Q4 2007. This is a reflection of both Motorola’s share loss and specialty vendors such as RIM, HTC and Apple taking higher-end share and smaller vendors taking some at the low-end (for example, the success of operator-branded handsets in Europe and some emerging markets).

The Korean vendors have been hedging their bets, using every form factor and platform known to man while working hand-in-hand with operators in key markets. In addition, Samsung and LG have been helped by the South Korean won’s weakness, which is at a two-year low against the U.S. dollar and even lower against the Euro.

Nokia’s market share for Q1, at around 41% according to Strategy Analytics, is up almost four points year-on-year and steady from the previous quarter. The combined share of Samsung, Motorola, LG, and Sony Ericsson was around 42.6%, meaning Nokia is close to matching the combined volumes of the two, three, four, and five vendors.

Intel has introduce Atom™ processor, a new family of low-power processors designed specifically for mobile Internet devices (MIDs). MIDs are devices which are smaller than a laptop but larger than a cellphone, with cost in the $500 range. Technology analysts and blogs are raving about Atom. About 25 hardware companies have decided to make portable Internet devices using Atom.  The gadgets will start appearing in late May and early June on store shelves in China, Japan and South Korea. According to Intel, China was an early focus because of the activity surrounding the Olympics, with Japan and South Korea both logical next candidates because of their wireless broadband services. More information available at Intel Mobility blog and from a report by WSJ.

Intel, which largely missed out on the market for chips used in cellphones, is using a technology conference in Shanghai to talk up gadgets it calls MIDs, for mobile Internet devices. The company hopes to attract consumers who are frustrated with trying to use the Web on their handsets. The new products, Intel says, match personal computers in their ability to play video and handle some other advanced features of Web sites.

Intel is introducing five Atom chips that draw 0.65 watt to 2.4 watts — compared with 35 watts for one of its typical laptop chips — and carry list prices ranging from $45 to $160. Companies expected to show prototype MIDs based on its chips this week include Lenovo Group Ltd., LG Electronics Inc., Clarion Co. and Matsushita Electric Industrial Co., maker of Panasonic-branded products, Intel said.

Intel won’t lack for competition. Rivals include companies that make chips for handsets called smartphones, such as Qualcomm Inc. and Texas Instruments Inc. They mainly use microprocessor technology developed by ARM Holdings PLC, and are helping to improve the Web capabilities of cellphones and other devices.

While Mr. Chandrasekher estimated the Atom chips have about twice the calculating power of ARM designs, he acknowledged that ARM still has an advantage in low power consumption. Bob Morris, ARM’s director of mobile computing, added that a coming chip design from the company offers a three-fold boost in computing performance.

Taiwan-based High Tech Computer Corp. commonly known as HTC, has been doing some amazing things but without much fanfare. Now its getting well-deserved attention from the media and investors. Analysts are projecting HTC to be a major player in Asian handset markets. One of its star products is The Touch, which, like the iPhone, uses a touch-sensitive screen rather than dedicated buttons for many of its functions. Touch was a big profit-driver for the company last quarter. This week at CTIA, HTC Touch Dual was introduced with Windows Mobile 6.1. Later this year HTC is expected to launch Dream, an ultrathin version of Touch.

Thats not all though. HTC will be making android based phones as well. A recent WSJ article says that the buzz for Google phone may make HTC a smart stock for investors seeking growth in uncertain economic times.

HTC started in 2002 making Windows-based smart phones under contract for companies such as Palm Inc., Dell Inc, and Hewlett-Packard Co. Now, nearly 80% of its sales comes from handsets it makes in collaboration with telecom operators across the globe and under its own brand.

This month, HTC announced an alliance with Reliance Communications Ltd., India’s second-largest phone company by subscribers, to promote smart phones in that country. HTC’s CDMA handsets will be used on Reliance’s network, a move that will strengthen HTC’s foothold in one of the world’s fastest-growing phone markets.

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Here’s a peek at some of the interesting upcoming mobile phone technologies. These include next generation voice-recognition which allows you real hands-free control of phone, 3D maps, sending streaming video to cell phones, games (mobile second life), digital storage of documents for mobiles, surveillance, social applications which allow you to locate buddies using GPS and location-aware apps which provide personalized suggestions about attractions like restaurants as you’re walking around the neighborhood.

This post coincides with one of the biggest wireless event: CTIA, which opens today. Many of new mobile and wireless technologies are announced there. I’ll cover that soon.

Video courtesy of Wall Street Journal. Let me know if you are interested in the full article.

It is inevitable that more and more kids (say ages 8-16) will own a mobile phone. The very qualities which make a mobile phone very useful (personal, connected and media capable) can also make it a cause for concern for parents. How can parents know if their kids are using the phones appropriately? Previously we have talked about some issues but there’s a lot more to discuss about the generation gap, content which ends up on the phone (whether it is live content or from removable media) and the vulnerabilities to which kids can be exposed to.

Results of a recent AT&T survey revealed that 84 percent of consumers believe parental controls and safety tools are extremely or very important in keeping children safe while they use today’s entertainment and communications technologies. Nearly one-third (31 percent) of those adults do not feel that they have adequate knowledge of how to use those tools to protect children from today’s threats.

There was a recent article in New York Times about the generation gap caused by mobile phones in US. It quotes a social psychologist Sherry Turkle (a professor at the Massachusetts Institute of Technology, who has studied the social impact of mobile communications) saying that these trends are likely to continue as cellphones morph into mini hand-held computers, social networking devices and pint-size movie screens. The point made by the story is that parents need to learn about how kids are using new technology. Obviously the situation varies from culture to culture but the trend is the same.

There have been attempts by a few companies to design services which allow parents control over how their kids use mobile phones and services. But there’s only so much that a parent can control and the personal nature of mobile phone makes it very difficult to monitor its usage. As many would argue, it is a social matter which should not be tried to solve using technology. However there is still a case to be made for putting controls over how the phone is used if you are the one paying the bill.

The NYT article adds: Marketers and cellphone makers are only too happy to fill the newest generation gap. Last fall, Firefly Mobile introduced the glowPhone for the preschool set; it has a small keypad with two speed-dial buttons depicting an image of a mother and a father.

Towards this AT&T has Smart Limits which allows parents to set account thresholds and to filter out content. See a flash demo here and keep in mind that it is not a complete solution by any means. Hit the link below to see details about this from AT&T website:

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I can’t tell you how many times has a dead battery disappointed me or someone I know. Despite progress in many areas of consumer electronics, there have been few battery breakthroughs recently. No wonder batteries are responsible for many of consumer frustrations with gadgets. Sounds too good to be true but take a look at this award-winning idea of a universal green battery. This eco-friendly product concept was a recent winner of the Greener Gadgets Competition in New York.

Even though buying third-party batteries is way cheaper now than before it is still a hassle. And if you don’t like the clutter of chargers with their cords, this is a great tool. Who knows if the “one battery works everywhere” concept will prove to be realistic or not as there are so many industry issues possible to its adaptation.

As with other green technologies this is not going to be cheap but I am sure it will catch on pretty fast and prices will fall once China takes over its production :)

Green Cell is a concept with a single simple idea: use safe, standardized rechargeable batteries in all portable gadgets. The environment would benefit from fewer batteries being thrown away, and you’d need fewer chargers for all your gear.

Technology often impacts society in many ways. Some times new technologies such as mobile phones come with unintended consequences. Regardless of whether you like that or not, you need to understand and deal with the change. Ignorance and avoidance is not an option.

Take Bluetooth as one example. The anonymous messaging capabilities using Bluetooth has created a new form of interaction between boys and girls in conservative Middle East. See this story from Marketplace.org’s special report from Middle East. I assume this is valid for Pakistan to some degree as well.

This is a topic with many aspects and view points will vary. However the fact remains that the youth of today have grown up with a whole new set of gadgets. The new modes of communication are part of their lifestyle. There will be applications to capture their attention, advertising to entice them. At the same time rest of the society has to adapt to this change and provide guidance to youth. The parental controls of the past will no longer work.

Jehan Ara wrote an interesting post about her successful but stressful struggle to activate her personal iPhone and then taking it to Telenor to realize that “Telenor Smart Mail did not support the iPhone”. That led me to the question which I pose to all of iPhone fans in Pakistan: which mobile company is best for iPhone users in Pakistan?

Till recently iPhone did not support the corporate email but here’s a video which shows that Apple has aggressively addressed this shortcoming and also added some other missing but highly in-demand features such as calendar, address books. Watch the game demo too. And hey, there’s the $100 million dollar fund to create some more cool apps. BlackBerry - watch out!

One of the premiere events of mobile and wireless industry, GSM annual meeting is a place to watch for trends. In the event hosted at Barcelona last month, Yahoo got the award for mobile portal, Grameenphone for social cause (note the familiar logo) and SonyEricsson got the award for mobile device. The full list of winners for 2008 can be viewed here.

Best Mobile Handset or Device
SonyEricsson: W910 Walkman Phone
3UK: 3 Skypephone - Highly Commended

Best Use of Mobile for Social & Economic Development

Grameenphone: CellBazaar

Best Mobile Game

Cellufun: Call of the Pharaoh
Glu Mobile: My Hangman

Best Broadcast Commercial
Safaricom: M-PESA ‘Send Money Home’ campaign

Best Mobile Advertising
Crossmedia Avenue: AMF Pension – the MMS campaign

Best Use of Mobile for Social & Economic Development
Grameenphone: CellBazaar

Best Network Quality Initiative
RAD Data Communications: LA-130 Cell Gateway - Cost-Effective HSPA Backhaul

Best Service Delivery Platform
Aepona: Aepona Telecom Web Services Platform

Best Billing and Customer Solution
Bharti Airtel: mChek on Airtel – Mobile Payments Service

Best Mobile Music Service
Omnifone: MusicStation

Best Mobile Video Service
mywaves

Best Mobile Social Networking Service
BuzzCity: myGamma.com

Best Mobile Infotainment Portal for News/entertainment
Yahoo! Connected Life: Yahoo! Go for Mobile 2.0

Best Mobile Enterprise Product or Service
Microsoft: Windows Mobile 6

Best Mobile Messaging Service
Seven: System Seven 7.0

The GSMA Chairman’s Award
Sunil Bharti Mittal, Founder, Chairman & Group CEO Bharti Enterprise

Location Based Services (LBS)  are one of the hottest new emerging growth area and battlefield in North America, Europe and parts of Asia (Japan, Korea, Taiwan, among others). With the sale of personal navigation devices at an all time high and with increasing number of mobile phones with GPS capability, it will be an interesting area to watch. Some of the recent events such as Consumer Electronics Show in Las Vegas provided ample evidence of this.

There are many pieces of technology which make up this: better/cheaper devices, new value added services based on connected navigation devices, alternatives to GPS for location determination on the phone, CDMA vs GSM technologies and advances in mapping technologies.

Maps have come a long way in the last few years and the need for real time location-based information whether it be traffic or product inventory is acting as a catalyst. For a view of the situation of maps technology in Pakistan see this recent entry at Green&White.

Here’s a bit more on the recent industry events related to maps and navigation from TheDeal.com.

U.S. software giant Microsoft Corp. built up its arsenal in the battle against Google Earth with the acquisition Wednesday, Dec. 12, of U.K. online mapping service Multimap Ltd. for an undisclosed sum.

Microsoft’s purchase is the latest in a series of deals in the digital mapping industry. In October Nokia acquired U.S. car navigation software provider Navteq Corp. for $8.1 billion. Last month Dutch navigation device maker TomTom NV snared Tele Atlas NV, the Netherlands-based digital map maker, for $4.3 billion.

Seattle-based Microsoft said the acquisition would enhance its existing offerings such as Virtual Earth and offer future integration potential for a range of other services and platforms.

As more and more cellular phone makers incorporate the technology into their handsets, demand for digital navigation devices is expected to explode. California research group iSuppli Corp. valued the market at about $4 billion in 2006 and projects $16.5 billion in revenue by 2013.

BusinessWeek Story. In Pakistan Nokia has the number 1 spot and Samsung faces strong competition. Motorola does not have a chance against Samsung and other Asian handset makers!

With Motorola (MOT) struggling for more than a year, Samsung overtook its American rival in 2007 to become the world’s second-largest handset maker [BusinessWeek.com, 11/30/07] after Nokia. Its global market share is up about three percentage points from last year, at 14.5% in the third quarter, compared with Motorola’s 13.1%. And for every quarter this year, Samsung set a new sales record, with the 115 million phones sold in the January-September period exceeding the 114 million sold during all of last year.

Samsung believes its record-breaking run is just beginning. This year, its sales are expected to top 160 million phones, up 40% from last year, and executives are confident the pace of its growth will be about double that of the rest of the industry next year, when they expect sales of 200 million. “The growth momentum is accelerating, and there’s no reversal in the trend,” says Samsung’s Executive Vice-President Chu Woo Sik.

Building on Cheap Handsets

The big question is whether Motorola can rebound and stop Samsung. New Motorola chief Greg Brown, who was chief operating officer before being named CEO last month, has spent the past few months tackling the company’s problems to try and restore the glory it had just after the Razr’s sensational debut in 2004. “Samsung will face challenges,” says mobile communications analyst Tina Teng at market researcher iSuppli.

Samsung’s top brass believe the company’s recent run is sustainable. That’s because Choi Gee Sung, a marketing expert who took over as Samsung’s telecom chief in January, has targeted the fast-growing market for cheap handsets, which wasn’t a priority for his predecessor, Lee Ki Tae, a former engineer.

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