Milepost: 500,000,000 iPhones

Apple sold its 500 millionth iPhone recently.

When introduced in 2007, Steve Jobs predicted sales of 10 million by the end of 2008, and one senior financial analysts forecast that Apple would have "a difficult time" making it, pointing out that at that time, Nokia was selling more cellphones a week than Apple had sold iPhones.  And thereby joining the gallery of famously bad predictions.  In fact, Apple sold 13.8 million iPhones in 2008, and is currently selling a million iPhones a month, just in China.

While Apple is losing market share to Android in terms of mobile operating systems, their history of build quality, integration of components, and innovation suggests that iPhone's future remains positive.  At the current rate, they should hit a billion units sold sometime in the next three-four years.

Source -  Without Much Fanfare, Apple Has Sold Its 500 Millionth iPhone, Forbes

Viva la Revolution Mobile

From CIO Insight - 10 Awesome Facts About the Mobile Revolution slideshow.

Several highlight the scale and scope of mobile, mobile data, and mobile broadband

• There are more than 6.7 global mobile subscriptions, 30% for smartphones
• Global subscriptions for mobile broadband will pass 2 billion this year, projected to hit 8 billion by end of 2019
• Subscriptions for mobile PCs, tablets, and mobile routers are projected to grow from 300 million currently, to 750 million by 2019
• In 2009, there was more voice traffic on the mobile network than data traffic.  Today, data traffic is more than 9 times higher than voice traffic.
• Data traffic per smartphone currently averages 600 MB per month, expected to hit 2200 MB per month by 2019
• Data traffic per tablet currently averages 1000 MB/mo; will hit 4500 MB/mo  by 2019.  Mobile PC data traffic currently averages 3300 MB/mo, projected to reach 13,000 MB/mo in 2019
• By 2019, 95% of North American will have LTE (mobile broadband) coverage.  Globally, about 2/3 of the world's population will have LTE access.

A significant contributor to the mobile revolution is the growth of online video options and services, social media, and various entertainment/gaming options

• By 2019, half of mobile data traffic will derive from video.
• Smartphone owners spend, on average, 13 hours monthly on social networking, 8 hours on entertainment, and 6 hours gaming.

The impact may be greatest in Asia, where the growth of mobile broadband provides quick and relatively cheap access to the Net and its content and services to some of the world's most populous countries.

• China alone has 1.2 mobile subscriptions, and India 742 million.  The rest of the Asia-Pacific region includes a further 1.3 billion subscriptions.  In contrast, Africa accounts for 803 million subscriptions, and Latin America 697 million.

The numbers and forecasts come from the most recent Ericsson Mobility Report.

Source -   10 Awesome Facts About the Mobile Revolution,  CIO Insight
Ericsson Mobility Report - November 2013

Tablets to top PCs by 2015

A new report from IDC (International Data Corp.) says that the  number of tablets shipped globally will pass the number of PCs shipped in the final quarter of this year.  In 2013, they call for tablet sales to gain 27%, while PC sales fall 10%.  IDC research analyst Megha Saini indicated that the emergence of lower-priced devices and trade-in programs will be a major game changer in the connected devices marketplace.  The report also indicated that the smartphone market rebounded in 2013 after a slowdown in growth rates last year, and that new larger smartphones, or 'phablets', is likely to eat into small tablet sales over the next couple of years, slowing the rate of growth in that sub-market.

Source -  IDC: Tablet Shipments Will Top Total PC Shipments Annually By 2015,  MSPMentor

Radio goes mobile

An agreement between Sprint and a group of leading radio broadcasters has taken radio mobile (again).  This time, its on/through your smartphone.  Sprint will offer the NextRadio app on those devices that are FM-enabled (includes an FM receiver on a chip integrated into device hardware). 

  The NextRadio app will allow enabled smartphones to receive and play local radio station signals.  Those stations that register with the system can have logos and other information displayed, and related social media links displayed on the phone while listening to the station.  Eventually, the app hopes to be able to match listener habits with highly targeted advertising delivered to the phone.  A promo for the app and service can be seen here.

  The advantage that NextRadio will have over traditional streaming radio (though iHeart, Pandora, and others) is that the radio signal will not count against your service plan, as it uses regular radio broadcast signals rather than data streams.  That is, if your smartphone is FM-enabled.  So far, only two recently-released smartphones from HTC include the FM chip and NextRadio app.

Source  -  Radio Industry Delivers FM-enabled Smartphone App to Consumers,  Broadcast Newsroom

Global Digital Radio on a Chip

The radio industry has been pushing Congress to require receivers be included in all mobile devices.  But for a global industry and market, the problem is dealing with all of the various broadcasting standards and systems in use.  Thankfully, digital offers a solution - in this case the announcement by Silicon Labs that they have developed a single chip that can receive all current global digital  radio standards - a global radio receiver on a chip, if you will.
  I remember when the first digital global TV on a chip came out in 1994, and basically transformed the multistandard consumer electronics market - and made translating programs from one standard to another simple and easy.
  I don't know if this chip will do the same for digital radio, which has had a slower-than expected growth rate, in large part due to the relatively high cost of digital radio receivers.   A cheap chip that can be integrated into a wide range of consumer electronics can help speed up diffusion and adoption around the world.

Source -  Silicon Labs Announces Single IC Supporting Global Digital Radio Standards,  Radio TechCheck

Smartphone Carrier Data Usage

A new study of smartphone data usage through wireless carriers (not including data transfers using WiFi) shows some interesting trends.  One is that data usage among iPhone users (dotted lines) is generally higher than among Android smartphone users (solid lines).  Another is the drop-off in data usage last December. iPhone data usage seems to be quite volatile, with large shifts from one month to the next. Finally, that Android smartphone carrier data usage by Verizon subscribers is consistently the lowest. 

The results are based on a sample of 1500 smartphone users with installed data tracking apps.  For those who noticed that there's no dotted line for T-Mobile, the research firm noted that there were too few T-Mobile iPhone users in the sample to provide reliable measures.

Source - Average Android, iOS smartphone data use across Tier 1 wireless carriers, through December,  FierceWireless

Smartphones rely on Wifi for data

A new study of smartphone use in the UK finds that almost 80% of data traffic to Android phones is carried over Wifi.  The Nielsen study used an app that recorded how data was received, on a sample of 1500 Android smartphone users.

“Wifi is on average three-and-a-half times more dominant than 3G when it comes to delivering mobile internet data services,” said David Gosen, managing director for digital at Nielsen Europe.  “It peaks around midnight as users gravitate towards social networks, driven by their desire to stay connected through all waking hours."

The big difference is pricing, I suspect.

Source - Wifi carries 78% of UK Android data,  telecoms.com

edit - added headline

Milestone: Most US Adults have smartphones

Various studies in the last few months have suggested that about half of US adults have and use smartphones.  Nielsen reported passing the 50% penetration level in March, while Pew had penetration at 45% in a September report.  Both of those numbers were based on projections of survey responses.  ComScore, on the other hand, bases its projections on actual online activity metrics - so it should be a better measure of actual use.  The most recent comScore report has smartphone penetration among US adults at 51%.  That's also supported by the number of people making use of key mobile activities.  comScore puts SMS use at 75.8% (although not a smartphone-only activity), use of mobile apps at 54%, and mobile Web browsing at 52%. They found that two more targeted mobile activities (ones not all smartphone owners are likely to use) were used by more than a third of adults - social networking at 39.6% and mobile gameplaying at 34.4%.

  Some analysts also noted that the growth rate in smartphone adoption has slowed somewhat - but that's something that' diffusion of innovations theory suggests will happen in the latter stages of diffusion.

Sources - comScore: Smartphone Penetration Hits 51%, MobileMarketingDaily
comScore Reports September 2012 U.S. Mobile Subscriber Market Share, press release, comScore

Mobiles and Work

A research study in Great Britain suggests that office workers spend an average of two extra hours a day dealing with office matters via smartphones and tablets.  The survey found that 90% of office workers have a mobile device capable of handling emails, and that a third of them report using their mobile devices more than 20 times a daily - and not only during office hours.
  Ninety percent of office workers say they take work-related calls and/or respond to work-related emails outside of their normal working hours.  Two thirds say they regularly check for work emails before going to bed and as soon as they work up.  One third admitted responding to work calls or emails in the middle of the night.

Ghadi Hobeika, marketing director of Pixmania (sponsor of the study), said: ‘The ability to access literally millions of apps, keep in contact via social networks and take photos and video as well as text and call has made smartphones invaluable for many people.
‘However, there are drawbacks. Many companies expect their employees to be on call 24 hours a day, seven days a week, and smartphones mean that people literally cannot get away from work.
‘The more constantly in contact we become, the more is expected of us in a work capacity.’

Travel website TripAdvisor recently conducted a similar study, found that many people take work with them on vacation.  More than half of their sample indicated that they checked work emails daily while on vacation, and more than a third take calls from the office, or call into the office, during vacations.

  Critics suggest that mobile devices have contributed to "work addiction" fed by fears of losing one's job in these tough economic times.  Certainly, technological advances - particularly mobile telecommunications - are making it easier to stay connected to the world away from the workplace and home.  But by assigning a single motivation principal to these reported patterns of mobile usage, these critics seem to be suggesting that no other motivation might exist; that no one wants to work, never dealt with work issues while away from the office before smartphones, or finds personal value in staying connected.  There's a lot of reasons people want to stay connected, and lots of reasons why they occasionally want not to.  These studies report behaviors, but do not go into examining the motivations for those behaviors - and from a research perspective, we shouldn't try to claim knowing more than what the studies examine - use of specific devices during specific times.

Source -  Smartphones and tablets add two hours to the working day,  The Telegraph

US Mobile Market Still Growing

The latest report out of ComScores MobiLens service indicates that mobile device ownership and use continues to grow - 234 million American aged 13 or older used mobile devices (that's more than 90% of that age group).  They also show smartphone penetration growing to 116.5 million in August, a 6% gain from last May.  As a result, smartphones are used by about half of all mobile users, and around 37% of the U.S. population.
  Looking at what mobile users do (other than make calls) - 75.6% sent text messages to other phones, 53.4% used downloaded apps, 52.0% used a browser, 38.7% accessed social networking sites or blogs, 34.0% played games, and 28.3% listened to music on their mobile device.
  On the hardware side, Samsung remained as the top mobile device OEM, but a surge in Apple device ownership moved it into a close third (behind LG).  Android maintained the dominant OS, growing slightly to 52.6% of the U.S. smartphone market. Apple's iOS also showed some growth in market share, being used by more than a third of devices (34.6%).  Those gains primarily came at the expense of RIM's Blackberry system, whose market share dropped precipitously to 8.3% (down from 11.5% share in May).  Microsoft and Symbian also saw their share of the OS market drop.

Source - comScore Reports August 2012 U.S. Mobile Subscriber Market Share, comScore press release

Goin' Mobile - Adoption Expands (even before iPhone 5)

  There's no question that the use of smartphones and mobile devices is growing rapidly and becoming mainstream.  There's some question, though, as to the precise level of adoption.
  Recently released Pew Research Center's Internet & American Life research indicates that close to half of U.S. adults now use smartphones (45%, in fact).  Another third own "feature phones" (cell phones with added features, but not full internet accessibility), and 5% aren't sure what type of cellphone they have.  That leaves only 15% with no cell phone.  Last year, Pew reported that 35% of U.S. adults had smartphones.
  On the other hand, a Nielsen report indicates that 55.5% of mobile users have a smartphone. The discrepancy isn't that bad, however, as the Pew number translates to about 53% of "mobile users".
  Adoption of smartphones continues to be differentiated.  The Pew study indicates that more than two-thirds of young adults (18-29) have smartphones, as do two-thirds of adults in households earning more than $75000 annually.  In addition, Blacks (47%) and Hispanics (49%) remain slightly more likely than Whites (42%) to have smartphones.
  The Nielsen results also have younger users leading the charge, with 58% of teens (13-17) having smartphones (up from 36% the previous year), as did three-quarters of those in the 25-34 age group.  The Nielsen report also shows the Android OS continuing to lead, with over half of smartphone users using Android OS phones, and a slight drop in the last quarter in Apple's share.  Many analysts felt that the slowdown in Apple iOS growth was at least partially due to expectations for a new iPhone release delaying purchase decisions (with Apple's share of the market increasing again after the release).
   And it looks like those expectations will be met with the iPhone 5.  Apple reported getting 2 million pre-orders for their upgraded device within the first 24 hours they were available, with demand already outstripping supply (the iPhone 5 won't be officially launched until this Friday, Sept. 21).  With a global launch, some analysts are predicting Apple will sell 100 million iPhone 5s by the end of December, if manufacturing can keep up.

Sources -  Smartphones Ring Up Popularity Stats,  OnlineMediaDaily
Young Adults and Teens Lead Growth Among Smartphone Owners, NielsenWire press release
Apple's iPhone 5: 2 million preorders, 24 hours and a unique upgrade cycle,  ZDNet
Smartphone Ownership Update: September 2012, report from Pew Research Center's Internet & American Life Project

Update - Research from Frank N. Magid indicates that half of U.S. Internet users have also downloaded an app to a mobile device.  Looking deeper, only one in four app users have paid for an app, but one third of those who haven't used an app feel that they are likely to start doing so within the next three months.

Source -  Survey finds half of U.S. online users have downloaded mobile apps, Fierce Mobile Content

Winning News on the Apple Front

First off, congratulations to Apple for becoming the sort of richest company on Earth, sort of.  When Apple set a new high stock price on the morning of Aug. 20, it surpassed the market cap of Microsoft before the dot.com bubble burst - making it the most valuable company ever (using that metric).  However, if you adjust Microsoft's previous high cap evaluation in 1999 for inflation, it still comes out on top.
  And if Apple's not yet on top, many analysts think it will soon be.  There are predictions that the iPhone 5 release will be the "biggest handset launch in history" (see below) - and with a new iPad Mini rumored to be in production, and predictions of iTV, a smart TV with gesture controls and content deals with AT&T and Verizon.  And then there's the Apple-Samsung patent fight over smartphone features and services.

The other big win of the day was in US Court, where Apple won its patent infringement suit against Samsung over various "look & feel" patents for smartphones.  The jury found that Samsung had infringed on four design patents and three utility ("use") patents held by Apple, and rejected Samsung's counterclaim that Apple had infringed on five patents owned by Samsung.  Apple was awarded $1.05 billion in damages - but had been seeking between $2.5 and $2.75 billion.

"This is a resounding victory, not for only Apple and its intellectual property portfolio, but also designers and design rights in general. This verdict strengthens strengthens Apple's design identity, which has arguably has been watered down as each new Apple-like device hit the market," said attorney Christopher Carani, chairman of the American Bar Association's design rights committee.
Rather than face the prospect of another Apple suit, rival phone makers will give the iPhone design a wide berth--yielding more space around its design elements than perhaps necessary, Carani predicted.

The case considered a total of 24 smartphone models from Samsung - and only three models escaped some or all of the infringement claims (the Galaxy Ace, the Intercept, and the Replenish).  The hot-selling Galaxy S models were found to have infringed the most, and Apple is said to be asking the court for an injunction that would prevent Samsung from selling infringing models in the U.S.  With Samsung a leader in the booming Android-OS smartphone marketplace, the case is expected to significantly impact on smartphone markets in the near term.

In the meantime, the IT rumor mills have been flourishing with talk of the iPhone 5 (expected to be released next month) and how it would stack up against the Samsung Galaxy S III.  With the patent case settled, the point may be moot - that is, there may be no Galaxy S III to compete with in the U.S.
   Anyway, various analysts expect the next iPhone to have:  a thinner, larger, screen - reportedly a 4 inch screen instead of the current 3.5 inch; a different docking pin (thinner and narrower); support for LTE (4G variant) networks on AT&T, and later Sprint (who's just now building out their LTE network); possible extension to T-Mobile networks; and NFC (near field communications) - which allows for services like digital wallets and sharing files between nearby iPhones or other devices.

Sources -   Apple becomes most valuable company in history - sort of,  SNL Marketweek
Apple Wins $1.05 Billion in Samsung Patent Case,  Information Week Mobile.
The top 5 iPhone 5 rumours: From plausible to outlandish,  FierceWireless

Legislative Moves by Broadcasters

American broadcasters and their trade group, the National Association of Broadcasters (NAB) are actively lobbying Congress and the FCC on two current issues with possible economic impact.
  In one case, radio broadcasters are lobbying against some possible changes in intellectual property law.  Recorded music embodies several separate intellectual property rights - copyright, which covers the authors/composers of music, performance rights, which covers the artist's performance of that music, and mechanical reproduction rights, which address the right to make and sell copies of performances.  The last, mechanical reproduction, are held by the record companies.  And broadcasting has always had to pay for copyright permissions.  However, in the early days of radio, there was an informal quid pro quo on performance rights and radio that became formalized in copyright law - since radio was (and still remains) the ore-eminant promotional tool for music, artists and labels waived performance rights fees to maximize radio's capabillity to play new artists.  The logic behind this is solid - adding performance rights fees to copyright fees raises the costs of music to stations.  This may be less of a problem with music that has an established value, as long as that value is higher than the rights costs - but it will discourage playing of lower valued (special interest or limited interest) recordings, whose value is less than the costs of rights fees, and new music whose value is uncertain.  Positive costs in terms of rights fees will discourage broadcasters from serving minority tastes, and reduce stations' interest in airing new music from new artists (where the value of that music is unknown and uncertain. 
   On the other media, most other media channels, where music is often more peripheral to their main service value, has been paying performance rights.
  The music industry, who short-sightly sees this as a new revenue stream for existing music catalogs, has been pushing Congress to overturn what amounts to radio's waiver from paying performance rights.  It may be "fair" to treat all media the same, but not all media have served as a primary (and free) promotional tool for the industry.  Adding costs through adding rights fees may generate more revenues for the performances that artists have already recorded.  However the vast bulk of revenues for music companies and artists comes from reproduction rights, not copyright or performance rights.  And the added costs of performance rights will likely have a negative impact on the demand for new performances and recordings - as radio outlets reduce the amount of new recordings played, and as artists and labels would likely have to pay more to get new music out in front of potential audiences and consumers.
  There are two competing bills circulating in the House. A draft of the proposed "Interim FIRST Act" authored by Democrat Jerrold Nadler was released this week, and would force cable and satellite radio stations to pay performance rights, and would require online streams from broadcast radio stations and other Internet radio services to pay performance rights at an even higher rate.  While proclaiming that it would level the playing field and treat all players equitably, it would embody three different sets of rates - broadcast radio, which would still be exempt; cable and satellite radio, which would pay one rate for performance rights, and online and Internet radio (including streams of broadcast stations) which would have to pay a still higher rate.  Republican Jason Chaffetz is working on a bill that would impose the same performance rights fees on all digital music sources - cable and satellite radio, Internet radio stations, and music streaming services.  It would also call for the rates to be negotiated between music outlets and the music industry, rather than being set by a Federal tribunal.
  While broadcasters would prefer to avoid paying performance rights fees altogether, they are more supportive of the Chaffetz approach rather than the Interim FIRST Act - and the latter's attempt to make broadcast radio stations pay more for their digital streams that other digital music outlets.

  The NAB and broadcasters are simultaneously continuing to lobby for legislation that would require smartphones to be capable of receiving and playing FM radio broadcasts.  Most smartphones already have a chip built into their devices that would do that, but that application is turned off by virtually all U.S. wireless operators.  The initial arguments were phrased as a trade-off for reintroducing performance rights fees.  Broadcasters are adding a new argument - public safety.  They point to the role that radio plays as the primary means of distributing information to the public during natural disasters or other emergencies, when normal information services are interrupted.  In filings to the FCC, the NAB argued that most broadcasters have built-in redundancy in case of emergency, and that the broadcast nature of their service and the widespread availability of receivers make radio particularly well-suited for emergency communications.  Besides, it's already the designated government Emergency Broadcast System.

"It is time to seriously consider steps needed to improve consumer access to free, over-the-air radio via smartphones and other mobile devices,"  (the) NAB said.

While analysts generally doubt that activating FM chips in smartphones will dramatically change radio and music listening behavior, it at least expands the options for consumers.  And its likely that it could prove useful when traditional communication channels (and wireless service in particular) is interrupted.

Sources -  Nadler circulates draft legislation on music royalties,  The Hill
NAB: Broadcasters Are Answering Call for Reliable Emergency Info,  Broadcasting & Cable

More on Tablets and Media Use Habits

  A new study by Gartner of the media use habits of early tablet adopters suggests that the tablet is quickly becoming users' medium of choice.  The study of 500 early adopters in the U.S., U.K., and Australia used an online 7-day diary to track media and information activities. They found that tablet users are not merely supplementing their use of other media formats, but that tablets are quickly becoming the preferred mechanism for a number of media and information uses.

“The ongoing convergence of previously distinct devices seems to be turning the market for consumer devices from hardware-centric to usage-centric,” said (Gartner principal research analyst) Meike Escherich. “Other than their tablets, most respondents also owned PCs, TVs and mobile phones. The respondents, early adopters of media tablets, said they use their multiple devices interchangeably, rather than substituting one device for another. They seek to use whichever device is at hand — or the most convenient to use at a particular time and for a specific task.

  The survey and diaries showed that more than half of tablet owners preferred to read news, magazines, and books on screens rather than paper.  One in three tablet users reported reading books on their devices, a level of use much higher than for mobile PCs (13%) or smartphones (7%).  Tablets were the dominant connected medium used in homes, with users noting their use in living rooms (87%), bedrooms (65%), and kitchens (47%).  The top activities shifting from PC to tablet included checking email (81%), reading news (69%), checking weather forecasts (63%), social networking (62%), and gaming (60%). 
  In contrast, the smartphones portability and basic phone services kept it as the most widely used device outside the home and throughout the day.  Almost 80% of respondents reported using their phones in the living room, while almost two-thirds use them while in transit and at the workplace.  Smartphones are also the connected devices most used for tasks requiring a Web connection, averaging 8 tasks per day compared to two separate tasks a day for tablets, and three tasks a day for mobile PCs (laptops and netbooks).

  From my perspective, the most interesting finding is the interchangeability of devices - the result that audiences are shifting from going to a specific medium/source for information or entertainment, to using whatever devices are relevant and handy for getting the content they desire.  This is further evidence of what I think is one of the transformative trends of modern digital media - a shift from a habitual use of a particular media form, to a more active, focused, consumption of information or other media content independent of any specific delivery system.

Sources - Tablets Favored Device At Home,  Online Media Daily
Gartner Survey Highlights Top Five Daily Activities on Media Tablets, Gartner press release

Are Smartphones addictive?

  A new book suggests that smartphones are addictive.  Are they?

  According to one article in LiveScience blog, various research results suggest the possibility. 

• smartphones are regularly cited as the first thing people reach for in the morning, and the last thing checked at night
• some people report spending more time with their phones that in personal relationships
• surveys suggest that the majority of young people check their phones hourly
• another survey suggests most people feel "panicked" when they've misplaced their phones

The social researcher in me doesn't find these anecdotes compelling causal evidence of "smartphone addition" any more than similar findings about police or military attitudes about their guns would be evidence of "firearms addiction".  Particularly since many of the research "results" are about cellphones and not smartphones. In addition, I could dig up similar research results from the past talking about the Internet, TV, and even newspapers.
  There are people with addictive personalities that may settle on phones or smartphones as their preferred focus. There are people who will focus on phones or smartphones as their primary medium for information and communication as they find those media more useful or valuable than other more traditional sources (media dependency). And there are people who will develop new habitual patterns in their use of media as a result of access to new forms of media devices.  But those aren't evidence of addiction in the clinical, psychological, sense.
  But "addiction" isn't the main point for the Harvard Business professor who wrote the book - the supposed "addiction" is provided in support of the argument that new habits of use are becoming associated with mobile devices - habits that aren't necessarily efficient or productive within a corporate environment.  The focus of the book is then on how to "break" those habits.
  There is mounting evidence that smartphone and tablet owners are shifting their media use habits.  For example, rather than going to TV or radio to check news and weather in the morning, many go online through mobile devices for that information.  And these habits will have impacts in a competitive media environment, and arguably in the broader social environment as well. In addition, personal habits may not be the most efficient work habits; and eventually people recognize that and develop situational habits and behaviors.  But habits are not addictions in any reasonable or meaningful sense
  So please, let's avoid terms like "addiction" that suggest an illness to be cured, rather than recognizing that for most people, these emerging behaviors are logical and reasonable responses to newer ways of communication, information-seeking, and content use that offer better personal value to the user than the old habits offered.  Crying "addiction" is not the way of reason or science - it's scaremongering.
  If you really want to talk about addicts in that sense, look at those who are unwilling to abandon past habits in changing circumstances.  Doing something that you know is not as useful or beneficial when you have better options (and manufacturing false justifications for those behaviors) is much closer to evidence of addiction than simply doing something a lot.

Source -  Smartphone Addition Is Real... and Rampant,  LiveScience

Planned Obsolescene at Apple?

There's a serious marketing decision when implementing innovations - do you try to maintain backwards compatibility with earlier versions, or do focus on maximizing the new, at the cost of limiting compatibility.  There are advantages in just moving forward - it can open up new opportunities, and allow for maximizing the impact of the innovation, and usually helps to keep the direct costs of innovation low.  On the other hand, abandoning backwards compatibility means that all of the ancillary devices or products designed for the earlier systems are no longer usable with the new.  This can impose additional costs for innovation, as shifting to the new version also means that you need to replace some or all of the related products that are no longer compatible with the new version.  And that can also backfire somewhat on the innovator, as making adoption more costly will slow adoption. 
  More problematic is when the innovator purposely makes the new version of the technology incompatible with existing standards, or with their prior standards.  Then you have something called planned obsolesence.
  Apple has a long history of choosing to push their own standards rather than adopting more general industry standards.  As an equipment manufacturer, they've designed hardware that requires Apple operating systems to operate, and major upgrades in their operating systems are often incompatible with earlier versions of software (and in some cases hardware).  Sometimes, when Apple is an early and dominant innovator in the field, they can establish their standard as an industry standard - for example, the iPod/iPhone/iPad docking connector.  That's become a default component of associated hardware and accessories like speaker systems.  One of the aspects of Apple's success in that market is that myriad Apple mobile devices (and latter upgrades) all used the same connector, making the purchase of related equipment or upgraded devices relatively simple - consumers knew that they would also work with prior accessories.
  However, several recent announcements by Apple suggest that the company is planning for some major obsolesence.
  First came the announcement that Apple was closing its MobileMe webhosting service, in favor of its new iCloud service.  One of the main values of MobileMe was its ability to backup and synchronize contact and calendar files across multiple user devices.  Those same features will work in iCloud - but only if you have the newer Apple OS, and the new OS won't work on many older devices, so you might also have to buy new hardware if you want to continue keeping your contacts list and calendar in the iCloud.
  Then came the news that the newest iPhone5 (to be introduced later this year) will abandon the old 30-pin connector and replace it with a new 19-pin version.  For Apple, the stated concern is that as they seek to make smaller and sleeker devices, the old connector just takes up too much space.  Anyway, the consequence is that the iPhone5 won't be able to directly dock with any current accessory or power source that uses the 30-pin dock, and it's quite likely that the same change in docking connectors will likely occur with subsequent major upgrades in other mobile devices.  And that means that newer accessories are likely to start including the new docking connector as well, and most will replace the older with the new rather than try to engineer multiple docking options - meaning that newer accessories won't work with older devices.  Making things worse, or at least more expensive, are the reports that the new docking connector will include a proprietary chip that will prevent its use with unlicensed accessories.
  Some analysts wonder if this is the time to make such a move - raising the costs of switching to the newer devices just as Android OS based smartphones are becoming increasingly competitive (some arguably better and cheaper than the current iPhone).  If you're going to have to replace all accessories anyway, consumers might chose to shift to an Android-based device rather than stick with Apple.  As one analyst concluded:

You feel that, Apple? Those are the winds of change. It may be temporarily profitable for you to force your customers into spending on upgrades, but a little thing that we call customer lifetime value means that it's stupid to annoy your customers in an increasingly competitive marketplace.

Sources -  iPhone5: Every iPhone Accessory You Own Just Became Obsolete,  Forbes
Apple's Planned Obsolescence: Customer Revolt Brews,  InformationWeek
 

Mobile changing media habits

A report from Edison Research on the Smartphone Consumer looked at how and where smartphone owners used their devices, and more interesting for the future of media, looked at the differences between smartphone owners and those without.  With cell phone ownership now approaching 90%, and evenly split between those with smartphones and those with more basic cellphones, media usage differences are likely to start impacting overage media use metrics.  Here's some highlights -

• When listening to the radio at work, more than half of smartphone owners report listening to the radio on their smartphone.  Overall they are more likely to listen to the radio at work through their smartphones than listen over their computers (listening via regular radio still dominates, accounting for 59% of listening)
• Smartphone owners are much more likely than non-smartphone cell phone owners to frequently (several times a day or more) engage in the following media behaviors: browse the internet (46% v. 5%); use social networking sites (34% v. 4%); listen to downloaded music (25% v 3%); listen to online radio (12% v 1%); and watch videos (11% v. 1 %).
• Compared to non-Smartphone owners, those with smartphones: watch less TV (3:20 hrs/day v. 4:05 hrs/day); spend much more time on the internet (3:24 hrs/day v 1:38 hrs/day) - in fact, they spend more time on the internet than they do watching TV.
• Smartphone owners spend more time listening to the radio (2:26 vs 1:52) and less time reading newspapers (0:19 vs 0:26) than those who do not own smartphones.
• 29% of smartphone owners report listening to Internet radio streamed from a cell phone through their car's stereo

While legacy media are likely to initially see this as a negative. a loss in audience, I'd interpret these findings more as a warning.  As mobile devices and broadband capacity improve, people are likely to shift some of their media usage to those devices - the message that legacy media should take from this is that they need to make sure their content is available for those new devices and delivery mechanisms.

Source - The Smartphone Consumer 2012,  Edison Research press release.
Presentation slides accompanying the report

A future for RIM?

With reports that RIM (makers of the Blackberry and operators of its OS and system) floating the possibility of splitting its hardware business (the Blackberry devices) from its network and messaging business (the OS and messaging network), several big Net/Mobile players have reportedly expressed interest in the various pieces.
  According to press reports, Amazon and Facebook are potential suitors, and RIM might approach Apple and Google about helping them get into the networking business.  Still, these are rumors, and nothing solid is likely to occur until after RIM launches the BlackBerry 10 operating platform later this year.  How this ends will likely depend on whether the new OS is innovative enough for RIM to win back some of the market share its lost over the last few years.


Source -  Report: Facebook, Amazon interested in RIM's handset unit,  FierceWireless

Flexible Display Screens

Post contributed by Margo Lipscomb -

Forget touch screens, hello convenience!  Samsung plans to release new OLED technology in late 2012, with new flexible screen cellular phones.  The phone will be approximately a 7-inch screen, but will be able to roll up when you are not using it.

This technology was first addressed at the CES tech show last year by Samsung.  The new OLED technology will introduce a new era of cell phone convenience, in that the phone will be bendable, minimizing the risk for phone damage.  Some examples demonstrated were folding the phone into a bracelet to wear or a media stand.  Not only will cracked and broken screens be avoided, but this reduces the risk for cell phone damage that usually occurs when one drops their device.  Samsung said the new phone could be out as early as the end of 2012.  

Source -  The Next Big Thing(s) in Tech,  PC World   

BJB - I changed the attached graphic to one from the original source article (for technical reasons).

New Research on Mobile

There have been several studies on the growth and impact of mobile devices that have come out in the last few weeks.
  Nielsen released it's State of the Media: U.S. Digital Consumer Report covering the last half of 2011, Among the basic findings: 274 million Americans have Internet Access, almost two-thirds of mobile phone time is spent on apps, there are more laptops than desktop computers in US TV households, and 42% of tablet owners use them daily while watching TV.  The last is one consequence of the increasing media options that people have; the report indicates that 44% of cell subscribers have a smartphone, 41% of TV homes have a DVR, 67% have HDTV, and that almost as many people watched video on a computer (165.9 million) as visited social networks or blogs (169.6 million). 
  The report also suggested that mobile use is impacting traditional media behaviors.  Online video viewing (in terms of time) grew by 7%, while TV viewing in the home increased slightly (0.9%).  Highest levels of online viewing were among younger people, and minorities. When using mobile devices while watching TV, the most frequently given uses were for checking email (57%), checking social media sites (44%), using downloaded apps (45%), general web surfing (44%).  Seeking for information related to what they were watching was a less frequent use - 29% reported looking for info related to the TV program, 19% for information related to an ad, and 16% looked up coupons or deals related to ads.  The study suggested that among mobile device users, tablets had a greater impact than smartphones in a variety of marketing applications.  As for higher quality video streaming, 33% of consumers reported streaming a movie or TV show through a subscription services (Netflix, Hulu+), and women were likely to watch more often (64% of all the time spent watching streamed content).  Interestingly, Nielsen found that Hispanics were much more likely to use Netflix for their streamed viewing, while Asians used Hulu+ more often.  In addition to subscription services, the report looked at Video-on-Demand use - 18% of consumers reported they had paid for a rental download, and 14% had paid for a download to own.
  An earlier Nielsen Cross-Platform Report had also provided some insights into the evolving media environment.  They reported that three-quarters of US TV households currently subscribe to broadband internet access.  The continued expansion of broadband access is one factor leading to the growing in watching video over the internet - a 21.7% gain in the number of users, and an almost 80% gain in time spent viewing, from 2008 to 2011.  The study showed several ongoing shifts in viewer behavior last year, with cable subscriptions down (-4.1%), satellite up (+2.1%), and telco video subscriptions booming (+21.1%).  The number of people watching timeshifted TV increased 65.9% from 2008-2011, as did the time spent viewing timeshifted TV (66.1%).  Even though there was a slight increase in traditional TV viewing, there was much greater growth in more active-viewing, or VOD, behaviors - timeshifted viewing, VOD and streaming use, watching TV on mobile and other personal media players, and online video use.  The greater growth in these areas suggests the beginning of a more fundamental shift in TV audience behaviors, to watching what they want, when they want, and where they want, rather than selecting from among the viewing options offered at that time.  This might partially explain the much higher levels of online and mobile video viewing among minorities - those seeking minority-focused programming have limited options among traditional TV programming choices.
  And it looks like tablet's impact is likely to be felt sooner, and with a broader impact.  A new Forrester report projects that by 2016, more than one in three adults in the U.S. will have a tablet.  The 112 million adult users they now project for 2016 is not just slightly up, it's an jump of 37% from previous estimates.  Forrester predicts that this year's expected annual tablet sales of 38 million units will grow to over 60 million units sold in 2016.  In looking at the factors driving adoption, while price was important, knowing (and valuing) what you can do with tablets is most important - one reason why Apple, Amazon, and Barnes & Noble's tablet offerings have succeeded while "pure hardware plays" have failed.
  One study of the impact of mobile devices on TV viewing behavior by Chadwick Martin Bailey found that 63% of respondents who had watched TV content on a tablet device had done so even when a big-screen TV with access to the same content was available nearby.  This suggests that use of tablets for TV viewing is not seen as the last alternative, but is increasingly being seen as a close substitute to watching on the traditional TV set-up.  The study also found that more than half (54%) of their total sample had explored various OTT (Over-The-Top) alternatives to pay TV.  With OTT alternatives (like Netflix, AppleTV, Hulu+, Amazon, GooglePlay) available, 15% of the total sample said that they were likely going to reduce their pay-TV spending within the next year.

“These findings show every part of the consumer TV and movie watching experience is up for grabs,” says Jon Giegengack, director at Chadwick Martin Bailey. “In the digital music revolution, the primary shift was in how music was bought and stored. When it comes to TV and movies, everything has the potential to change: whom consumers buy from; how much they pay (if they pay at all); and the range of times and places offering viewing opportunities.”

 Another report by Nielsen suggests that families with tablets often allow their children to use tablets (70%).  Parents reported that the most common use of tablets by their kids was playing games (77%), followed by educational use (57%).  Keeping kids entertained at certain times was also common - parents often used tablets to keep kids entertained while traveling (55%), or at a restaurant or other event (41%).  Tablets were also frequently used (43%) to let children watch TV shows or movies.  Interestingly, only 15% of parents said that their children used tablets to communicate with family or friends.
 ComScore's Digital Omnivores study also looked at the impact of mobile and connected devices on media consumption habits in the U.S.  That report indicated that half of the total U.S. mobile population are using them for mobile media applications.  Among the tablet owners they surveyed, 58% reported using tablets for getting news or information, with a quarter of tablet users doing so on a daily basis. 

  Mobile devices are also used for other types of media content - while 51% reported reading print magazines, 30% reported reading magazines through computers, 16% via tablets, and 13% on mobile phones.  As for streaming music, almost half reported doing so on their desktops or laptops, and about a quarter streaming music on mobile phones (23%) and tablets (24%).  The study also reported that tablets were used for playing games (~67%),  listening to downloaded music (62%) and reading eBooks (56%).  Tablets were also widely used to watch both short videos (85% at least monthly, 19% daily), watching on-demand video or TV episodes (49% monthly, 16% daily), movies (48% monthly, 17% daily), and live broadcast TV programs (48% monthly, 16% daily).

 Nielsen is also tracking the exploding blogosphere for advertisers and market researchers.  At the end of 2011, they were tracking more than 181 million active blogs around the world, up from 38 million in 2006.  While many blogs are published by companies, their tracking pool includes almost 9 million individuals blogging on major blogging websites, and another 12 million who blog through their social networks.  They report that most bloggers are women, half are in the 18-34 age group, and more than two-thirds have at least some college education.  More than half of bloggers are parents (mostly moms).  Their research also suggests that bloggers are more active participants in social media generally.

  The common theme running through these reports is that we're adopting mobile, connected, devices at an increasing rate, and using them not only for basic communication, but for consumption of all types of digital media content.  In addition, that consumers are also using devices and consuming media in new ways - and these new uses are not only impacting traditional media, but enabling consumers to be more active and involved in their media consumption behaviors.  While many traditional media may see this initially as a threat, there is also significant opportunities for traditional media to adapt to, and take advantage, of the new opportunities mobile provides.

Sources - State of the Media: U.S. Digital Consumer Report, Nielsen
The Cross-Platform Report, Nielsen
Digital Omnivores: How Tablets, Smartphones and Connected Devices are Changing U. S. Digital Media Consumption Habits, ComScore (available through ComScore website)
2012 Mobile Future in Focus, ComScore (available through ComScore website)
Tablet Demand Explodes, Creates Global Phenomenon, Online Media Daily
Study: 63% Who Watch Video on Tablet Did So With TV available,   HomeMedia Magazine
American Families See Tablets as Playmate, Teacher, and Babysitter,  Nielsenwire
Buzz in the Blogosphere: Millions More Bloggers and Blog Readers,  Nielsenwire