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Author: Horace Dediu

Google and Apple as mobile co-belligerents

The relationship between Google and Apple is an interesting one. It’s enticing to declare them “at war” with one another, but that type of relationship does not account for the collaboration and partnerships they enjoy. To wit:

  • Google pays Apple for default Search placement on Safari. This means that Google treats Apple as a distributor.
  • We can presume that there is a deal between the two over Gmail and Maps on the iPhone as well.
  • AdMob is available on iOS without hindrance.

The business relationships between the two companies are self-evident. However, I would suggest that there are more important strategic reasons why Google and Apple are in fact implicitly collaborating against a common goal.

The concept of “co-belligerence” may describe the relationship: Continue reading “Google and Apple as mobile co-belligerents”

Nokia's Burning Ships strategy

In the recent series of exposés on Nokia’s new strategy I sought to paint a background for what caused such a dramatic decision:

This gives a backdrop to the decision, but it does not explain the most crucial part of the decision: why did Stephen Elop decide to maintain an exclusive platform for Nokia rather than a multi-platform approach as chosen by successful competitors such as HTC, Samsung and Sony Ericsson. Continue reading “Nokia's Burning Ships strategy”

Platform sunk (cost): What is the value of a quarter billion Symbian users?

In the quarterly smartphone summary published here, I noted the significant acceleration of Android sales at the expense of “other” and Windows Mobile/Phone. Some share was also lost to Symbian. This might be seen as justification for the “platform jump” that Nokia undertook.

In a second discussion, I published the history and life cycles of the smartphone platforms, identifying 10 platforms (out of 16) still in the market. This challenged the view that it was a two horse race today and that it will become no more than a three horse race in the future.

Questions came up about the “quality” of these platforms. Clearly some are barely viable while some are thriving. To explain the value of a platform, one metric we can use is the cumulative sales which allows us to derive the installed base.

The following charts do just that. Continue reading “Platform sunk (cost): What is the value of a quarter billion Symbian users?”

The lives and deaths of mobile platforms

When Stephen Elop said that Nokia and Microsoft sought to create a “three horse race” he implied that there were only two viable mobile ecosystems today. With that statement he sought to deprecate or declare “end of life” two platforms: Symbian and MeeGo, implying that Nokia’s efforts at being the third way failed.

However, he also implicitly declared irrelevant a larger set of market participants. In fact, the market is awash with platforms. Far more than the three or five that Stephen considered.

Continue reading “The lives and deaths of mobile platforms”

Where is the Windows Phone Tablet?

The Windows Phone platform currently has hardware specifications that imply a cellular phone device. What is interesting in light of the new WebOS TouchPad, the newly announced Android tablets, the RIM Playbook and the iPad is that this supposed “third horse” of Windows Phone has no hint of present or future presence in the tablet form factor.

That might have something to do with the plans to move Windows to the tablet form factor. Perhaps Microsoft thinks that pocket size devices deserve a separate operating system, platform and ecosystem than portable mobile computers. Perhaps Microsoft plans to have two separate interfaces for these tablets (slates vs. tablets?) Then again, Ballmer held up a Windows Phone and said “This is Windows too.”

Continue reading “Where is the Windows Phone Tablet?”

The price of Windows Phone: Nokia's evaporating smartphone share

In the last quarter Nokia sold 28.3 million Symbian phones. The average selling price was €156 or approximately $210. That price was down 17% year-on-year.

According to the company,

The 17% year-on-year decline in our converged mobile devices ASPs was mainly driven by general price erosion and an increase in the proportion of lower-priced converged mobile devices sales.

ASP erosion has been a fact of life across all of Nokia’s products for quite some time, checked only by the increasing mix of smartphones. However the smartphones it sells have been consistently positioned for lower price points. This is consistent with Nokia’s long-term goal of serving “billions” of users.

The trouble with the new strategy is that the Windows Phone product lines currently in the market are not likely to be priced in the $200 range. The reason is that the minimum specifications for Windows Phone 7 are: Continue reading “The price of Windows Phone: Nokia's evaporating smartphone share”

Mobile World Congress: Revisiting the $85 smartphone

While a low-end 3G Android smartphone could be sold currently at U$80 (wholesale price) and the adoption of ARM’s Cortex A5 should allow smartphone costs to fall to around US$50, they’ll still have some way to fall to catch up with the cost of 3G feature phones that are already reaching price points of below $30.

via » #MWC11 Day 3 – Same old song. (Informa)

The ubiquity of smartphones is inevitable.

The certainty of unforeseeable growth: The rise of ZTE and Huawei

  • According to rumors, Huawei shipped 30 million phones last year. The target for this year is 60 million of which 15 will be smartphones.
  • According to IDC ZTE is now the fourth largest mobile phone vendor with 51.8 million units in 2010. Assuming 70% for 2011, ZTE could ship 88 million units in 2011, 25 million of which would be smartphones.
  • These data imply that ZTE and Huawei will ship nearly 150 million phones in 2011 of which 40 million would be smartphones.
  • That would imply approximately 7% share of the global smartphone market for these two companies together.

Continue reading “The certainty of unforeseeable growth: The rise of ZTE and Huawei”

Who will buy the next 150 million Symbian smartphones?

Stephen Elop stated that Nokia expects to sell approximately 150 million more Symbian devices before the transition to Windows Phone is complete. Assuming that figure is achievable (which is far from certain) I tried to understand how that figure will affect the volume and share numbers for Nokia in the coming years.

It’s very likely that the first WP phones will not ship in large volumes until 2012. Product development cycles being what they are, unless there is an ODM rebranding (i.e. taking an HTC phone and gluing a Nokia sticker on it) the minimum development time is at least 12 months. Keep in mind that Nokia does not have engineers to build such a product today and hiring them alone can take months.

The following two charts show what a two year forecast that adds up to 150 million Symbian devices looks like. I assumed Windows Phones begin to ship in 2012 and, keeping in mind that WP7 is designed for a higher hardware specification than the current Symbian phones, I show a modest ramp for a total of 15 million units in the first year. Continue reading “Who will buy the next 150 million Symbian smartphones?”

In memoriam: Microsoft's previous strategic mobile partners

Microsoft’s new “strategic partnership” with Nokia is not its first. For a decade the software company has courted and consummated relationships with a variety of companies in mobile and telecom. Here are the ones I can remember:

  • LG. In February 2009 Microsoft Corp. signed a multiyear agreement for Windows Mobile to be included on devices from LG Electronics Inc. LG would use Windows Mobile as its “primary platform” for smartphones and produce about 50 models running the software.

What happened? Continue reading “In memoriam: Microsoft's previous strategic mobile partners”