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March 28, 2012

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vladkr

The fact Nokia will (maybe) release two devices running Meego is a good news, though the way it will be done is a bit strange; that's like putting Porsche's flat six in a Tata Nano (we like car analogies here) : it will work well, it will do the job, certainly better than expected, but the OS is able of so much more.

In another hand, what I understand, is that Nokia is kind of splitting, with Microsoft supporters at one side, and Symbian/Meego resistance at the other. The latter refusing to surrender, maybe S.Elop has no other choice but making some concessions, leaving to Nokia's dissidents bits and pieces (Developing countries, which actually used to be the most profitable market to Nokia). Will all that lead in a real split of Nokia ?

I don't know... you certainly know better than me.

Then, if it's true, there is another mystery to me : Why did Nokia acquire Smarterphone of Norway earlier this year ?

To me, it looks like a beheaded chicken that runs in every direction.

peter

@tomi, I want you to replace criminal Elop as new CEO of nokia.

Tomi T Ahonen

Haha vladkr

Hilarious. Beheaded chicken. Love that analogy, it is most apt. We have that saying in Finnish too 'kuin paaton kana' (like the headless chicken).

Seriously, I live now here in Hong Kong and most of my good pals at Nokia have left or retired years ago, so I really don't know even as well as the experts who live in Finland and observe Nokia from near.

But the internal split seems rather clear. I think there were hints of that split in the Board as well, Ollila often seemed to signal the Microsoft option was not as 'final' and 'the only path' to the degree Elop would try to communicate.

The story of 2 MeeGo devices is not yet officially confirmed by Nokia, so we need to take it as a rumor, even as reported in the media. But it can very well be some kind of hybrid/confusion in the rough space of 'MeeGo Lite' and/or Meltemi and/or Smarterphone. It may also be just a ruse, to calm the fears before the Shareholders Meeting, to promise the low cost MeeGo devices under development, which if Elop gets another year to continue, he can easily kill 3 months later haha.. I really don't trust his management style and he as an executive seems to have no relation whatsoever with his words and the facts and the actions he will do. He truly sounds like he belonged more in the Dick Cheney Donald Rumsfeld team to spin lies about the Iraq war, than to run a 'Finnish' company that has a hundred year reputation of being supremely truthful haha...

I can see a split coming. I think if Nokia internally decides that Lumia will not succeed (the sudden appearance of the 808 PureView on Symbian and now stories of 'there will never be more MeeGo devices even if the N9 will be a huge hit product' more MeeGo phones - suggest that Nokia's management itself is shifting its position) - Microsoft will not want Lumia to die. It would make sense to sell the Lumia unit to Microsoft. (That will utterly piss off the remaining Windows Phone partners haha)

And obviously Microsoft would have nothing to gain out of Symbian or MeeGo, so those would then remain with Nokia and we would kind of go back to January 2011, with the change that all brand love and loyalty has been ruined in the interim haha.

Tomi Ahonen :-)

vladkr

I'm sorry I'm writing two comments instead of just one message, but I read again the article and I wanted to react on the Apple part as well.

Bigger screen ? That's a double sided sword; big screen is cool, but big screen means bigger phone, which doesn't fit in a pocket, and that can be even uncomfortable to use if it's too big.

Then the Qwerty keypad; Apparently, Apple seems to see future without keyboards, that's why they don't put one in their iPhones. In some way, it's understandable.

There are so many different keyboard layers that getting rid of them and having only touch screens makes sense, unless Apple (or any competitor) can make a compact version of Art Lebedev's Optimus OLED keyboard for smartphones ( http://www.artlebedev.com/everything/optimus/maximus/ ).

I really think that evolution of mobile industry in the next decade will be quite interesting and quite difficult to foresee.

Tomi T Ahonen

Hi peter and vladkr

peter - haha.. thanks.

vladkr - about the screen size. If you take the current iPhone 4S form factor, the screen does not extend all the way to the edge of the device. So you could expand the screen size considerably, probably to about 4 inches, without increasing the overall length/width of the iPhone. But yes, approaching 5 inches would mean a far larger device

about keyboard. Its a fundamental lack of understanding by Apple about mobile consumers. I wrote about it before the iPhone launched in early 2007 and have written every year at least once, that there is a significant heavy-user (often youth) segment who need the ability to send SMS text messages single-handed and blind (ie with phone hidden in pocket etc). They will NEVER abandon that power, it is a superpower communication ability, if you can send secret messages directly from your pocket, without looking. You can't do that on a pure touch-screen phone

If Apple refuses to do a proper QWERTY, then they will never have this super-connected super-influential customer segment. They may be their 'second' phone, but not the primary phone. And Apple is abandoning this market to rivals.

Obviously I don't mind. As long as Apple doesn't take this segment leadership, others can fight for it fair and square. But I would argue, it is the single most valuable consumer segment of mobile. Why would Apple voluntarily abandon it. I tell you why, its because Apple thinks it has the segment - because many of them DO buy iPhones, as their second phone. That is far from optimal. If Apple did a QWERTY variant, many of them would own both types of iPhones haha..

But like I've written many times, its an unlikely scenario, Apple might never release a QWERTY iPhone. But also, I so love Apple (but need my messaging) that I'd stand in line for the QWERTY iPhone totally irrespective of what it costs haha..

Tomi Ahonen :-)

Anton

I've Been reading your posts and they are very interesting and long haha but well worth the read. You really have a deep understanding of the mobile markets. Taught me a lot.

If nokia carries on with their current path do you see them going the way of palm eventually? Or maybe microsoft will buy them?

Baron95

Tomi, I'm not sure why you insist on claiming that we saw the end of Motorola. Quite the contrary. Motorola Mobility is a successful leaner company, that got rid of its Network Equip business and spin off its gvmt unit to focus on converged experiences.

It has a market cap that is 50% larger than RIM (and 2/3 that of Nokia) and will soon be acquired by Google to continue to operate as a top 10 Smartphone provider.

I can't understand by what standards you can claim we "saw the end of Motorola". Unless you are against corporations adapting to reward investors. Being prettied up for an acquisition is not a defeat. It is a rewarding outcome for investors.

Would you claim that "we saw the end of Porsche" because they are being acquired by VW? That is ridiculous.

Baron95

And LOL claiming that Qt is an ecosystem. Qt is a development environment, not an ecosystem.

An ecosystem is the iOS/iTunes/iCloud/iBooks/AppleTV/iPad/iPod/iMessage/Siri/etc combo.

Or the Android/GooglePlay/GoogleVoice/etc combo.

Claiming Qt is an ecosystem is like claiming that Apple Cocoa is an ecostem. Laughable.

And if you were to claim that Qt is an ecosystem, then what is that Java - 5-10 times larger than Qt is not on the list.

The lenghts to wich you go to try to pretend that Nokia had a good pre-Elop strategy are unbelievable.

You are going to lose all your credibility if you keep this up.

Manish

Your analysis on Apple's market share is incomplete without mentioning their profit share. They have 60% of the worldwide mobile handset business profit with just 6% market share. Isn't that a better position to be in than 60% market share and 60% profit?

ChrisD

@Baron95, have to agree with you on this one - Qt is not an ecosystem, it is more of a development environment. Also, just to add, I think Google's ecosystem is much bigger than you mention. You are leaving out their online users, who may not have an Android phone, but still use Gmail, and are potential customers for movies, music, books, etc. Unfortunately only when they manage to sell those outside the US haha...

About the 50-60% market share... Generally, I have to agree, but take into account that many of the cheaper smartphones for emerging markets will run Android (though they may not run it well ;-) ). Considering this, it may even be more, but we will see.

For Windows Phone, what I see is currently Microsoft and Nokia flexing their marketing muscle - but sadly, MS has never been known for good marketing. I find their investment for AT&T to have the Nokia sold as a featured phone interesting, as is their push into the Chinese market. It is clear they are trying hard, including giving away free Xbox etc, but the lack of success so far leaves little hope... I would say your 5-6% market share (of newly sold phones) is possible. If it is still on the 2% by end of the year, I would not even be surprised if MS lets the OS die quietly. Also, keep in mind, that with Nokia as the big Elephant in the WP7 space, other manufacturers may be even more reluctant than before in producing windows phones. (Their heart clearly is not in it so far.)

What is clear is that MS is pushing unbelievably hard in online comments - considering the low adoption rate, the amount of WP7 "fanboys" is simply amazing. It is hard to believe that the majority of them are genuine, and not just MS employees or paid commenters. (Other companies have done that before, too, so while it sounds "evil", it is nothing new.)

As for Windows 8 - I am still unsure as to whether it will be a success, or whether it will be another "flop" like Vista, or even worse, ME. I personally have a very negative opinion of the new interface, and from the business side, I smell disaster. While they are also trying to market it, they do not try as hard as with WP7, so there are a lot of negative comments on this one too - many from experience people from the corporate IT side!

Peter

@Baron95, Qt is an ecosystem and are multiple ecosystems. it all depends how you look at it from which angle. your argument is more like a single mind idiot like Steven Elop who is not suitable for any task except taking WS criminals order to dismantle nokia from inside.

Richard

Very interesting, as usual - just one specific thing to pull you up on...

[for the next iPhone release] "Many other tech specs are hoped for or expected by fans, from WiMax '4G' "

I think you meant to say LTE here... WiMax has clearly hit a dead end in the US, and never really achieved anything anywhere else apart from South Korea, while LTE is hitting critical mass globally - even if Apple managed to screw up by releasing a US-only iPad '4G'!

Right?

factoring

great post thanks for such share

Yuri

I also disagree about Qt, but more in the direction of how it is counted. Qt is a development platform/ecosystem, and this was the kind of ecosystem Tomi was referring to.

But it is incorrect to count Android and Blackberry as part of it. Why not count Windows as part of Qt also - after all Qt apps work just fine across Windows, Mac OS and Linux too.
And then what about Java - it does run on most dumbphones, Windows, Android, BlackBerry, etc. Its by far the biggest ecosystem if we go that way.

In really, its only fair to count towards a development ecosystem, the OSs and devices that directly support a development platform.
If a development platform is not explicitly supported by the OS / device maker, then it will always be a second class citizen and provide sub-par results.
For example we can count the new BlackBerry OS towards the Android ecosystem, because RIM is itself providing an Android-compatible runtime.

apollo_dev_team

and you guys are all idiot.

cycnus

@Tomi

I was wondering if you keep following the RIM news very closely. I think RIM were in worse condition than you stated here.

Here is one of the source from THE GLOBE and MAIL from Canada:
http://www.theglobeandmail.com/news/world/worldview/will-obama-dump-his-blackberry-for-the-iphone/article2369944/

Quoted from that article:
"On Capitol Hill, where BlackBerrys were in the hands of 93 per cent of staffers in 2009, a significant majority – 77 per cent – still thumb the tiny keyboards......
......iPhone use was up to 41 per cent among Capitol Hill staffers this year; more than triple the level of three years ago......
.....The really grim news – at least for BlackBerry – is that less than one per cent of respondents said they planned to buy another BlackBerry."

The US government is one of the last BB stronghold in the US, loosing them would make their brand tarnish...

Then this one also from THE GLOBE and MAIL:
http://www.theglobeandmail.com/news/technology/business-technology/are-blackberry-sales-weaker-than-thought/article2367711/
Basically it said that sales for BB in Q1 2012 is weaker than thought.

I also wondering if you aware that the BB sales number in Q4 2011 & Q1 2012 were on steroid.
RIM spend an enormous amount of marketing to gain that number, and while it manage to make the Q4 2011 number about the same level as their Q2 2011 number which is 14 million (the 33% increase from Q3 2011 you talk about). The Q1 2012 number is back on 11 million again WHILE STILL ON STEROID. I believe this is a sign that BB have peak, and the downward spiral is surprisingly bigger than we thought.

Sander van der Wal

Installed base computations are very tricky, especially when you use them to evaluate the money-making possibilities of a platform.

And when you look at the profitability of an app store, you need to look at the numbers per platform and per content category. AFAIK, these figures are not posted for Nokia's App Store, but I could be wrong.

Qt is a platform. MeeGo is not a platform, because Qt is MeeGo's API. Qt on Android is not a separate platform. Given that in mobile Qt's two native hosts are dead, Qt on Android is dead too.

Symbian/Qt might be able to resurrect, but it will be incredibly hard for Nokia to pull that stunt. The opportunity costs for developers will be huge, and the target market consists of people not willing or able to spend cash of hardware, which makes it unlikely they will spend it on apps.

Dan

Sorry, but the times of physical QWERTY keyboards is definitely over - except for some die-hards. Once accustomed to swype or any other decent touch-keyboard a physical keyboard does not make sense at all. Typing one-handedly with swype is faster and more accurate than most other keyboards. Isn't having a bigger display much more sensible? I have been using physical keyboards a lot, but today I would not trade display space for keys anymore - and I believe many others feel the same.
I also do not type while my phone is in my pocket - what would that look like???

vladkr

When I see all teenagers messaging all days along, I understand that QWERTY (AZERTY/йцуке/...) keyboards have their market, but one has to admit that there are other people who for different reasons, prefer touch-screens or even dial-phones.

For instance, I like touch-screens because I often text in English, in French and in Russian, and I can change easily keyboard layouts without guessing where keys are (it's not automatic to me in all languages yet). That's my own experience, you have yours...

So there is room for any kind of phones. Nokia used to understand it, Samsung understands it very well, Apple keeps on doing only one model. It seems to work for them, so I don't judge them.

After all, Porsche could make brilliant little cars, but they prefer make what they know well, sport-cars... mmm... wait a minute... Porsche does SUVs and sedans too, so it's a bad example...

Or maybe you just right and diversification is a good thing and Apple should wake up before it's too late.

anobserver

"The fact Nokia will (maybe) release two devices running Meego is a good news"

There are at least three legitimate interpretations that imply this rumor to be very bad news for Nokia.

1) Commercial desperation. Symbian is crashing because of the absurd (lack of) migration strategy initiated one year ago, WP is not catching up; N9 had some good reviews, so Nokia is clutching at this straw to keep the head above water.

2) Corporate infighting. Somebody mentioned it already: this may be the result of a strong push-back by Meego/Symbian holdouts within Nokia. Which means that Elop has not been able to tame the fiefdoms within the company, and he (or anybody else) will have all the more difficulties succeeding in a turnaround.

3) Technical muck-up. Meltemi was supposed to be the OS for the low-end range. If Nokia is harking back to an OS it has already officially abandoned, then the conclusion is that Meltemi development has hit a snag and is very late.

It would have been considerably more comforting tidings to hear a rumor that a forthcoming WP device will have PureView in it, for example.

F.OO

One more reason why Microsoft needed Nokia desperately:

Windows PCs to decline as Android, Apple devices rise
Windows is going to be eclipsed by Android in 2016, according to market researcher IDC

Source: http://news.cnet.com/8301-13924_3-57406190-64/windows-pcs-to-decline-as-android-apple-devices-rise/

That shows (again and again) that Nokia didn't need Microsoft; Microsoft needed Nokia desperately.

I only see two situations in which Nokia could have accepted the Microsoft deal:

a) if Nokia could proceed with other smartphone OSs (Android, for instance). This would help to mitigate the risk, and give much more room for differentiation (plus a huge market to compete on).

b) if Microsoft gave 100% exclusivity to Nokia.

But Elop made the worst imaginable deal, adopting the smallest (and shrinking) platform, and inviting other manufacturers to join the party!!! Is he insane or what??? No... he's doing what's best for Microsoft... er... the "ecosystem".

Evan

You are clueless...

cycnus

Hi again,

Remember when Elop crash the nokia with 2/11, elop than said that the crash in sales because the distributor have to clear their inventory because they were have lots of nokia in their inventory.

Back then, I was said bullshit, because I know most electronic store didn't like to put lots of inventory in their store because they don't want to take the risk. All the electronic store mostly put around 1 week - 2 week inventory and will have an order around 4-6 times per month.

Back there, I don't have an article to support this, but now i have.
It turn out that HP, RIM, Motorola have inventory for around 1 month supply.
So, I guess this could be use as a proof that Steven Elop lie.
Here is the source: http://www.fool.com/investing/general/2012/03/23/apple-lesson-of-the-day-inventory-is-evil.aspx

SK

As usual Tomi insists without evidence that Apple delayed iPhone 4S.

I believe that they deliberately released for the Christmas season AND do that they have 6 months between iPad and iPhone launch.

We will see this year but I expect a September/October 2012 launch. I expect it to be called the new IPhone.

Tomi: if I am right will you agree that likelihood is that the 4S was not delayed.

Regarding QWERY I believe Apple won't do it.

However I think Tomi is right that Apple needs and wants a portfolio strategy. They are in a bind that they don't want to dilute the iconic iPhone brand. Whether they come out with a low cost device called iPhone Nano or iPhone Air or something else entirely they DO have to do something.

cycnus

@SK

Tomi see things differently than Apple.
Tomi thinks that in order to concure the market certain things have to be taken, for example if Apple do the Apple iphone Nano and Apple iphone QWERTY, Apple market share than maybe could kick android.

But Apple, don't want to do it because Steve Jobs already outline the company fate by saying QWERTY is for looser, and as for iphone Nano, because apple want profit, not sales number. Apple believe that iphone Nano could bring more user, but apple don't want that more user. Because:
1. that user might lower the profit. They were affraid some of the non-nano user might run into the cheaper model.
2. If that the cheapskate, than it won't bring more revenue, they will jailbreak, and use cydia/big-boss to download apps.
3. the prestige of having an iphone will be less

So, it's not because apple is wrong, or tomi is wrong
but because the two of them have different idea on how to manage the company

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    Tomi Ahonen is a bestselling author whose twelve books on mobile have already been referenced in over 100 books by his peers. Rated the most influential expert in mobile by Forbes in December 2011, Tomi speaks regularly at conferences doing about 20 public speakerships annually. With over 250 public speaking engagements, Tomi been seen by a cumulative audience of over 100,000 people on all six inhabited continents. The former Nokia executive has run a consulting practise on digital convergence, interactive media, engagement marketing, high tech and next generation mobile. Tomi is currently based out of Hong Kong but supports Fortune 500 sized companies across the globe. His reference client list includes Axiata, Bank of America, BBC, BNP Paribas, China Mobile, Emap, Ericsson, Google, Hewlett-Packard, HSBC, IBM, Intel, LG, MTS, Nokia, NTT DoCoMo, Ogilvy, Orange, RIM, Sanomamedia, Telenor, TeliaSonera, Three, Tigo, Vodafone, etc. To see his full bio and his books, visit www.tomiahonen.com Tomi Ahonen lectures at Oxford University's short courses on next generation mobile and digital convergence. Follow him on Twitter as @tomiahonen. Tomi also has a Facebook and Linked In page under his own name. He is available for consulting, speaking engagements and as expert witness, please write to tomi (at) tomiahonen (dot) com

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