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« Android Won. Windows Lost. Now what? The Battle of the Century is Decided. Microsoft relegated to ever smaller PC corner as Google conquers the world | Main | Latest Mobile Numbers for End of Year 2012 - This is getting humongous.. »

December 14, 2012

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Winter

A nice comparison:
"That would mean, that in the first month or so of its sales, Lumia 920 has achieved adoption by about 900,000 users globally."

"In Kenya for example Huawei's lowest cost Android smartphones have sold 300,000 units."

Yes, Huawei can get 30% of the worldwide handset sales of the WP8 Lumia 920 in KENYA alone. Huawei has still another billion to go in Africa.

CN

@Tomi

Something I don't understand and I guess you may have a typo there as the reason.

"Remember the USA accounts nowadays for only in in 5 smartphones sold (China is 50% bigger as a market than the USA) and this is Microsoft's backyard." The TREND is again WRONG WAY for Windows Phone. Do not expect Windows Phone miracles if its best market sees an erosion of demand as the new Windows Phone 8 devices appear on the market. This is not a good sign."

Even though USA can be seen as MS backyard but that it would be the best market for WP, is debatable, I guess. It is well known that China is today the largest single market for WP and if you look at what's been made available there, I feel the right choices are made: HTC's available for all three operators, 920T available for China Mobile and 920 for China Unicom, 620 coming soon (donät know to whom), MS partnership with China Unicom.

Could you Tomi please open up what's behind the statement. Thanks.

John Phamlore

The biggest change the past ten years is that Nokia went from owning all of the IP that went into making baseband chips to owning none of it, first blundering supporting WiMAX in its failed alliance with Intel, falling behind on LTE, and then selling off that part of its business. This year we see further consequences of this most disastrous failure of technological investment as Texas Instruments has pulled out of competing in the higher-end mobile ARM SoC business. It's fascinating how outsourcing risks has backfired for Nokia just as Sun's trying to outsource investment risk to TI backfired when TI decided it did not care to compete with Intel in the contract foundry business, resulting in Sun's being unable to timely introduce the massively multithreaded machines that were supposed to be the ultimate hardware fit for all of the investment Sun had made in Java.

Qualcomm completed in 2012 an almost unprecedented recovery from a position where misinformed analysts in 2008 had speculated that Qualcomm's IP would slowly lose all significence to where Qualcomm designed chips have replaced established suppliers at Apple and soon to be at RIM, let alone having a monopoly on Windows Phone and having full support on Android.

What Google did with Android was to very carefully separate out the interfaces to the Linux kernel so that hardware manufacturers, particularly in China, could safely bundle proprietary binary blobs without having to release source code. Anyone requesting source code to the software on their electronics can thus be pointed to stock Android source code and be told to pound sand about getting further information about the binary blobs.

We are about to enter an era of industry warfare whose sides are determined not by software as many believe, but by the hardware of the baseband chipsets. Samsung has their own LTE chipset, and not coincidentally they will be one of the longterm suppliers, whereas Nokia does not, and they will not survive. Right now Qualcomm is running wild, but what China wants to do is force a stalemate and then make their move the next generation of LTE deployment.

So what we are seeing is that the Chinese, just as their perceive the Americans as having done with Qualcomm and CDMA, are trying to leverage their own version of standards such as TD-LTE to give advantage to their own domestic companies such as Huawei. What the Chinese are doing is using their large market size to force industry leading companies such as Ericsson to give away their expertise to the Chinese in joint projects.

The recently launched Jolla's Sailfish OS claims to support "multiple chipset technologies," but what the one actual chipset I have read that will be in actual phones is an LTE chipset from ST-Ericsson, launched in of course China.

vladkr

Yota would be cool with Jolla... besides the phonetic near-match, it would be a new device with a new OS

foo

"interest in all Windows Phone based smartphones in Microsoft's strongest market, the USA, is down almost a quarter from 8.7% of smartphone buyers interested in it in September to 6.5% now."

Considering (optimistically) that 50% of the people "interested" in Windows Phone will buy one, that means we can expect Windows Phone to reach 3%.

"AdDuplex finds 7 out of the top 10 devices in use today to be made by Nokia"

If Windows Phone reaches 3% of market share, that means Lumia will have 2% -- in Microsoft's strongest market.

Way to go, Elop!

chithanh

@CN
Take for example gaming consoles: North America is where Microsoft is more successful than elsewhere, while Japan has seen Nintendo and Sony do better. Europe is mixed.

Other markets may be larger, but your backyard is where you should not fail. If you are beaten and insignificant on your home turf, what message will that send to your customers (both domestic and overseas)?

CN

@chithanh

"Do not expect Windows Phone miracles if its best market sees an erosion of demand as the new Windows Phone 8 devices appear on the market."

USA the best market of WP? That part I don't get.

John Waclawsky

Even the Microsoft astroturfers have to admit that based on Tomi's statistics of sales and interest that the Truth is: NO ONE WANTS A WINDOWS PHONE!

A great post, Thanks Tomi

chithanh

@CN
The best market means where Microsoft is strongest in comparison to the competition.

Global market share of Windows Phone in 2012Q3 was around 2%, while in the US it has been 3.3% according to Forbes.

Felipe

Hi from Brazil, Tomi.
About your PS, not going to happen.

Brazil does not have a strong consumer electronics background, we have no big in house TV/PC company.
People in Brazil do not like electronics from Brazilians companies, they are historically unreliable.
Brazil's high tax makes very hard for any company start against overseas companies.

We develop a few tablets though (that are unreliable, of course), because tablet industry has a tax break to incentivize production and consumption of those devices (we had it for PCs also). This tax break is the reason iPads are manufactured here, but not iPhones.

Vernon

"Remember the USA accounts nowadays for only in in 5 smartphones sold"

Probably should be
"Remember the USA accounts nowadays for only ONE in 5 smartphones sold"

Otherwise, really enjoy all your posts.

cycnus

Hi Tomi,

I was re-reading your article a couple year back, and I found that you state that in order for one company to success they must build their own OS.

1. I was wondering if you still considering this is a need to survive in year 2013 and so on.
2. Do you think that google/android have play they part very good that phone manufacture don't need to build their own OS? (i.e Yota able to create a dual screen phone with android, and no need their own OS, and maybe if nokia use android, they could also create a pureview phone easily compared to using WP8 as their platform), do you see any flaw in google/android execution?
3. Do you think RIM/BB will be better if they use android as their platform compared on continuing using QNX?

I also have one comment on iphone Mini. In the past you were suggesting that iphone should do the mini version. It seems to me that the gigantic 4.7"-5" screen now is a trend, do you think that apple should do iphone Max (with big screen) instead of iphone Mini now?

chithanh

There is one more data point from ZDNet Germany now:
http://www.zdnet.de/88136184/marktanteil-2012-windows-verliert-android-gewinnt/

Android now has 28.42% of their total page impressions, up from 2.4% in January. (This is not a typo.)
In the same time, iOS went from 4.89% to 8.13%, however it had a peak of 11.26% and is declining since.
Windows Phone is at 0.25%, up from 0.18%, but it is basically flat since March.

Altogether, the mobile OSes account for 36.85% of page impressions (up from 7.62%) while Desktops declined to 63.15% (from 92.38%). All in just one year.

ZDNet has a rather technical audience so the absolute numbers cannot be transferred to other sites. The trends however can be.

John Waclawsky

More on the shrinking Microsoft market share in the link below. You nailed it Tomi! ...but it appears, you might be a tad late declaring Android the winner. It seems we are way past the tipping point. Note the article thinks that Microsoft needs to "appeal to knowledge workers" for future success. I don't see how that helps Microsoft. Anyone in the computing business knows what an abusive monopolist Microsoft has been and has probably been screwed by Microsoft in one way or another over the years. And now they will "help" Microsoft? I don't think so and that is a laughable statement. NO it won't happen and the "knowledge workers" I know are actively rooting for Microsoft demise. The consumer market has been repeatedly rejecting Microsoft crappy products. And now it appears that NO ONE WANTS A WINDOWS PHONE OR TABLET ...which doesn't surprise me.

http://www.theregister.co.uk/2012/12/13/windows_market_share_just_20percent/

John Waclawsky

Also Tomi, I have known for a long time the depth of resentment toward Microsoft in the market totally driven by fear NOT respect. But that fear is ending rapidly. Also it seems you have failed to mention the depth of ill will towards Microsoft in the Market. For a refresher, I would suggest you read the lengthy post in the comment section of the reference below.

http://www.theregister.co.uk/2012/12/13/windows_market_share_just_20percent/

The post is from someone with the id: "Trevor_Pott" It is the second on the list (and you need to expand the comment) and it is a extremely powerful statement of what is going on in the Market. One paragraph from the middle of the post...

"For the first time in 30 some odd years Microsoft is actually being forced to compete on merit. They are ill equipped to do so. They have institutionalised mistreatment of their customer base to such an extent that they are corporately incapable of rising to the challenge of getting end users excited about their offerings."

and another paragraph...

"Browser compatibility is more important than operating system compatibility for the overwhelming majority of users and that given the plethora of options this puts users in a position where they can make choices based on those intangibles like "does the company I'm buying from treat me with respect, listen to my gripes and play ridiculous profit maximisation licensing games that make me feel like I'm dealing with an American cell phone company?"

and one more

"This is not a world Microsoft can live in. Microsoft's corporate culture of treating us like substance-addicted prostitutes won't fly in a commoditised world. PCs aren't dead, but Microsoft's dominance is.

In case you missed it, 2012 was the year of Linux on the endpoint. The endpoint just happened to be in our collective pockets, not on our desk."

I would suggest you read the entire post. It is a remarkable statement. Based on my research (that also senses this general sentiment in the market) and the pathetic persistent "desperation" of the trolls (such as Baron95 - although he is not the only one and not just this blog) leads me to think that Tomi has seriously underestimated the rapid decline of Microsoft.

And for the trolls. When there are alternatives consumers reject Microsoft products and therefore NO ONE WANTS A WINDOWS PHONE OR TABLET! ...This is clearly TRUE!

newbie reader

Among the current Apple iPhone 4/4S users, /in china/ only 12% said they will buy the iPhone 5

http://www.valuewalk.com/2012/12/apple-inc-aapl-iphone-5-not-popular-in-china-beijing-firm/

newbie reader

@chithanh

Very impressive graphs in your link.

Windoze lost about 25% this year, and most of it went to Android.

Kenny

This is the real Lumia sales outlook:
http://www.valuewalk.com/2012/12/nokia-corporation-adr-nysenok-lumia-sales-poor-pacific-crest/

KenAdams

To add insult to injury Google has also announced that it does not plan to build apps for Windows Phone or Windows 8:

"We are very careful about where we invest and will go where the users are but they are not on Windows Phone or Windows 8," says Google Apps product management director Clay Bavor.

http://www.theverge.com/2012/12/14/3768274/google-gmail-activesync-windows-phone

cycnus

@KenAdams,

It seems the battle between Google and Microsoft at public is just start...
Microsoft start it with their Scroogled campaign

http://www.nytimes.com/2012/12/15/technology/microsoft-battles-google-by-hiring-political-brawler-mark-penn.html?_r=0

"........ Microsoft has long attacked Google from the shadows, whispering to regulators, journalists and anyone else who would listen that Google was a privacy-violating, anticompetitive bully. The fruits of its recent work in this area could come next week, when the Federal Trade Commission is expected to announce the results of its antitrust investigation of Google, a case that echoes Microsoft’s own antitrust suit in the 1990s. A similar investigation by the European Union is also wrapping up. A bad outcome for Google in either one would be a victory for Microsoft. .............."

Here is Google ending support for Microsoft Exchange Server
http://support.google.com/a/bin/answer.py?hl=en&answer=2716936
With this move, Google will save money. Because they don't have to pay for Microsoft product anymore, and user still able to use Google mail because they use open standard (POP3, IMAP) and CalDav for address book.

KenAdams

@cycnus, you are right. Nothing new in MS' dirty and salient war on competition. Here is a good article about MS vs. Google. Gates saw what was gonna happen and left, Ballmer is just a crazy monkey who does not know how to behave in a market not monopolistically ruled by MS. http://techstew.blogspot.com/2012/10/why-windows-8-will-not-save-microsoft.html

cycnus

(apparently, i cut and paste the wrong part of article in the previous post)
it should be this
"........ The campaigns by Mr. Penn, 58, a longtime political operative known for his brusque personality and scorched-earth tactics, are part of a broader effort at Microsoft to give its marketing the nimbleness of a political campaign, where a candidate can turn an opponent’s gaffe into a damaging commercial within hours. They are also a sign of the company’s mounting frustration with Google after losing billions of dollars a year on its search efforts, while losing ground to Google in the browser and smartphones markets and other areas. ......."


talking about crazy monkey...
here is balmer the salesman
http://www.youtube.com/watch?v=tGvHNNOLnCk
http://www.youtube.com/watch?v=8To-6VIJZRE

Spawn

@Kenny

500.000 sold Lumia 920 in December only? That is the month after lunch of the new product-line, with huge marketing $ investment, initial run and all the buze created? Au, that's far more worse then any of my worst predictions. Can we calculate how much quarters Nokia has left till its done based on this number? More then Q1 and Q2 2013?

Kenny

@Spawn, actually the article said 500,000 units expected to sell in December quarter, not the month of Dec.

"Pacific Crest Securities note that their recent channel checks in North America and Western Europe indicate Nokia Corporation (ADR) (NYSE:NOK) (HEL:NOK1V) (BIT:NOK1V) sales volumes that are quite low, while initial shipment volumes are similarly low. They estimate that the company is tracking toward shipping roughly 1 million new Windows 8 products in the December quarter, while it looks likely to sell through roughly half of those units, based on current run rates."

Peter

How did you arrive at 900.000 with 3% of the installed base? According to your own report on Q3 there was an installed base of 17 million for WP. Let it be now 20 million - that would giv Lumia 920 only 600.000 sold???

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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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