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January 08, 2010

Comments

cycnus

@david

seeing your comment, made me must comment your comment. :)

First,
Yes, most user doesn't care about CPU speed and OS. Because that is irrelevant to them. I believe anyone who comment on this forum should be categorize as geek (count me in). But ordinary user (my mom, dad, wife, cousin, etc) doesn't really care if their phone CPU is Arm Cortex A8, or Snapdragon, or 600MHz Arm 11. They also don't care about Windows, Symbian, etc. They wouldn't even want to know the max speed of their car because they won't drive that fast. They just wanna use the phone. The looks and silly specs such as MP and color and brand/quality is what really mean a lot for them. and that's the way the market works.

Now,
when you said IT department doesn't want to support new tech and also phone carrier..... I believe you were american who lives in American. If you ever go to asia, you would know that the IT department and phone carrier is really EAGER when seeing new devices. My company have a bussiness with HK, Singapore, China, Taiwan, and most IT department in this country very eager to support new technologies such as new computer OS and new cell phone OS.

apple polished OS is only a skin deep, and their lack over meaningless tech specs is an anomaly/bubble and will cost them fortune, whereas nokia/SE/samsung did great with their digital camera and will set a mark on the history.

I also believe that iPhone will lost a great battle in the long run. phone is not just a beauty OS. the competitor will catch up with it. When it happened apple will really have a hard time maintaining their elites because at that time (that time is NOW) the real capability of the OS is what really matter.

Now, you saying that iphone and android were the innovator pack. It's a sad things, but only american really say this. In other part of the world, the 93%, Symbian is THE INNOVATOR. symbian innovate the easy of use and the one that bring most the first smartphone experience for mankind. Nokia seems loosing the battle if you read a lot of american journalist review on cell phone. But, nokia now laying the BEST foundation for their phone by acquiring QT trooltech. They made the it easy for linux program made with QT to be ported to Symbian/Maemo. This is priceless in term of computer software will be able to run on phone.

OK, that is a geek stuff, no real user will care about it. But nokia is not stand still to their competitor. They know, they've been lazy in the past 3 year, and they catch up in the gimmick (beautifull os). and competitor should also notice that nokia own the MOST stable OS with the RICHEST feature on this planet gaia.

1 more things.... my sister have an iphone, and she really hate while she's using skype and have an incoming call, the skype apps will be closed. This is the OS that you just categorized as innovators, while SymbianOS that can trully multitask doesn't have this problem. This is the underlaying strong OS that nokia have. The multitouch and good looking gimmick is easier to make rather than good/strong OS.


Alex Birkhead

Superb market primer for 2010, though I think a few areas could be reconsidered, at least for the medium-term:

Nokia appears now to be actively re-segmenting the top-end of the market around mobile computers. This could be a very smart move to sideline Apple in a fight with Maemo (which looks off to a promising start). This relegates smartphones and Symbian to featurephone-successors in the mid-market -- not a bad spot to be, if only Series 60 wasn't such a buggy beast (this weakness also endangers the enterprise credentials). I appreciate NOK is revamping the Symbian interface, presumably partly to address this, but this is going to be hard work as software problems have recently seemed endemic and non-enterprise developers appear now to avoid Symbian like the plague (Symbian hardware is nice, though, and that wasn't always the case in the past when it seemed systematically under-specified -- which shows NOK can fix weaknesses). If the market is segmented like this, Android straddles the segments, and I'm not sure if this is good or bad for it. BlackBerry looks like a featurephone (or 'netphone'), in this context, as do nearly all shipments from other players (excepting HTC and Palm).

Apps may be very important, at least at the top-end of the market, i.e. in the mobile computing segment (also, in the cross-over smartbook and other emerging segments). Also for end-user experience (but not much in revenue-terms for vendors or operators) -- Apps are key to the iPhone's success, despite the very low investment/income for Apple. Operators and Apple's rivals would be wise to chuck some sizeable sums at developers to neutralise the App Store as a competitive advantage (tens, if not hundreds, of millions of dollars). Longer-term, however, is there a battle between apps and web services, i.e. Google v Apple approach, or will they just co-exist? In the mass market, I would place Nokia more in the web camp, although its history and recently expanding ties with Microsoft give it pragmatic balance. Smartphones and featurephones could be perfectly happy with web services, as power/efficiency/connectivity continues to improve, especially if web browsers become more standardised and capable (big mobile operators want this...) -- this also nicely opens up cloud/web and device-independent computing.

Android -- someone has to make this prettier and more usable for ordinary folk...and I suspect they will soon. HTC or Sony-Ericsson, perhaps? If Google merges its Android and Chrome OS forks, as has been suggested, it could create the basis for a defacto mass-market consumer electronics OS, heralding an age of pile-it-high, sell-it-cheap (sub-$50/$100), WalMart-style computing across pretty much all imaginable formats. This could be very dangerous for other mass market mobile platforms. Sidetrack: I think Nokia should actively support Android in Maemo devices, if only for developers and hardcore users to retrofit, to demonstrate open-source Maemo hardware's power/potential, provide a Plan C, and give some internal competition (might freak out Google and others a bit, too!).

badu -- early information suggests this is severely limited, possibly crippled so that it can be overlaid across as many devices as possible, making it more of a traditional featurephone than smartphone platform. In part, I think Samsung has belatedly woken up to Nokia's strength in emerging markets where S40 plays to its strength as a terrific featurephone platform (but Samsung could now be caught out again, as NOK ditches the beloved S40 for an enhanced Symbian to reinvent the featurephone segment). Nokia also looks impressive in the emerging markets VAS space -- Microsoft and Google watch out, imo. Samsung is probably also sick of supporting, and paying for, other smartphone OS that don't really work out for it (PalmOS, Symbian, Windows Mobile. Linux, etc.).

RIM -- yes, they are doing better than expected, and partly for the reasons you outline, but probably mainly because the even more impressive/disruptive iPhone took them off the radar at rivals and mobile network operators; suddenly RIM didn't seem quite so greedy/dangerous after all; just as RIM succeeded Nokia as the operator's bogeyman before it. While short-term, I agree with you that RIM is doing remarkably well; mid-term, where is their mobile computing platform (in stealth, for all I know)? Additionally, their strength in enterprise is more to do with rivals weakness -- my bet is that Android will take them on fairly soon (backed by IT companies some of which you you flag), to support Google's Apps enterprise drive (BlackBerry is reliant on Microsoft's Exchange in the enterprise space). Maemo could also strengthen Nokia in the enterprise space. A shift to cloud/web computing might also change the game (possibly to RIM, Maemo and others' advantage).

Microsoft -- badly wrong-footed, indeed, but I think they are seriously attempting a comeback. Consider Vista > Windows 7, in terms of what they can do when they put their minds to it (Azure and Xbox are other recent examples). A bit of an outside bet, but how about a fundamental shake-up around Windows 8, converging their mobile, desktop, server, cloud, and other OSs (I've lost track of how many they have...). Late to the party, sure, but much more in tune with what Android, iPhone OS, Maemo are doing (all UNIX heritage, not coincidentally, with BSD/Linux and proprietary ingredients thrown in ...). Also, don't forget that LG is supposed to have a big batch of WinMo devices in the pipeline -- this doesn't fully make sense to me unless a stop-gap for WinMo 7 or even WinMo 8, and LG presumably has more incentive to play along than just a big co-marketing and R&D sweetener. Strange to say, but the market may need MS to offset the rise of Google...

Totally agree about the danger of US-myopia, but don't get too Europe-centric! Emerging markets are developing at remarkable pace. China is astonishing, while India, South-East Asia, and LatAm are also fascinating, and Africa very interesting. Your list of players pretty much overlooks China-specific and lesser-known Taiwanese players; they may be relatively small/invisible but they are also very busy and ambitious. Much of this action is VAS- and featurephone-oriented (plus Android in China), but this could actually be a grey area if smartphones are becoming the new featurephones, and with Nokia already a strong player on both these levels (its hidden jewel, imo, totally overlooked by iPhone/Android/US/Euro obsessives).

And, of course, there's also the fairly real possibilities that Palm and/or RIM get snapped up (MS rearguard?), plus Sony Ericsson and Motorola need to get fixed or subsumed.

@Hyoun Park

Totally agree that usability needs to be at the forefront, but I think Nokia is well aware of this, and could well be making 2010 its 'year of usability' for Symbian developers.

cycnus

@Alex Birkhead

I don't agree that Nokia should support Android. If Nokia support Android or Palm WebOS (as most US analyst suggest), it would DESTROY the symbian foundation. The enemy will spread more FUD to bring down nokia. It's a bad move/decision. What nokia did right now for the Symbian/Maemo is already the best. It's a pity that nokia symbian phone hardware is such a laughing matter. SE symbian and samsung symbian already use Arm cortex A8, but nokia N series top of the line only use 434MHz Arm 11 CPU, and E series top of the line only have 320x240 resolution. Not to mention the low C-drive problem on ALL nokia devices. This is like having a ferari with 140R13 tyre.

Furthermore, Nokia Maemo is **BETTER** than Google android. Many US analyst point out that android is the next big things because android seems cool. Somewhere in the web I read there were 2 ways to develop car. from inside out, or from outside in. Android were build from outside in, whereas Maemo is carefully build from Debian platform and have a better compatibility with Linux source than Android.

From my point of view, nokia build maemo foundation very strong, like building a 200 meter building but with a room to grow to 2000 meter. Whereas Android, they just randomly picking linux source code and change it here and there to be android. I bet my money on nokia/maemo, but this would be a very interesting things to be watch which one that would really work.

Tomi Ahonen

Wow, lots of comments over the weekend. As usual I will reply to each of you indivudally. I will split this reply posting into about 3 parts. So from my previous reply, here the first comments after that:

Hi Romain (before my reply), Jason, Richard, Philipp, mico and cygnus

Romain - I apparently missed you when we must have posted about at the same time. Sorry about that but happy you commented. We agree obviously and thank you Romain for answering Richard Spence directly. I agree with all of your points. I would add that yes, the N95 from Nokia prior to the original iPhone allowed unlimited access to the real internet yes, but the first mobile phone to do so was literally a decade earlier, also by Nokia the 9000 Communicator. Full unrestricted internet, except at snail-speeds of the early cellular 2G networks at that time. And Nokia brought WiFi connectivity to cellular mobile phones on a mass market phone with the N9500 Communicator around 2004, many many years prior to the iPhone. And you can't say that 9600 Communicator was not used as an internet browsing phone - on the real internet, not WAP - as it had the wide screen internet-optimized screen and certainly with WiFi was very capable as a high speed internet device.

Jason - great point about RIM, yes I would expect that aspect of browing stats also to keep growing with RIM. Note also, that their latest quarter they said that 80% of their new subscribers now come from residential users, not business users, so that also means more of the 'frivolous' surfing to pages that have advertising, so expect a continuous increasing use of Blackberries at those pages that the ad server networks support.

Richard (second posting) - Thank you for coming back. About first the role of the iPhone. Richard, I have written a very widely reported blog - 3 years ago - that the iPhone will so dramatically re-invent the whole mobile industry, that we will talk of two eras, the era before the iPhone and the era after the iPhone. So first, we agree on that point. Second, I have ALREADY said so, in a very long and detailed posting explaining why, and this posting of 2010 smartphones is long enough to double its length on what the iPhone has meant to the industry. But most importantly, that change has HAPPENED, it happened in 2007, it is not 'newsworthy' now in 2010. In 2010 Apple is not driving the industry. That change came out of 2007 and the App Store in 2008 but now we have nothing spectacular from them in nearly two years. The iPhone keeps getting better yes, but its now incremental changes not radical innovation.

Then of that focus you have on the apps and why they are so good with the iPhone and you claim nobody installs apps on other devices. Obviously there are a million downloads every day at the Nokia Ovi store, so obviously millions of people would disagree with you. But I want to also point out a specific point of detail. Most of the paid content on the iPhone are games (and second most downloaded content are now ebooks). So very concretely the iPhone is a 'toy' it is used for 'gaming' and by far the most of the money made by the iPhone to any developers is for 'videogaming'. I do not mean to dismiss the iPhone, but point out that its not some aeronautics calculations for the rocket engineers that the iPhone 'smartphone' is used for. It is used primarily as a gaming platform. Its nearest rival in terms of apps and an eco-system is the Sony PlayStation Portable (PSP). There would be many 'real' developers of software who might disagree with the iPhone being a 'serious' platform if most of its paid apps are in fact games. That then its more of a small Xbox or Wii than a replacement of a Lenovo or HP or Dell computer. But lets go with teh gaming.

Gaming content is fair game, eh? So what was the first smartphone - a purely consumer smartphone not used by any enterprises? Not the iPhone, it was the Nokia N-Gage. While it only sold a couple of million units and was deemed a market failure, it did introduce a whole eco-system of game developers, and the games had to be installed by users, so anyone who bought an N-Gage would then go and buy many games. And there was an independent Nokia N-Gage store where you could buy the games and download them (or side-load them). Certainly the same model as the iPhone App Store but years before it. If we want to give credit for creating a new eco-system for developer to launch games to phones, then that goes to Nokia not Apple.

Lastly on the 'real internet' access. You also seem to suggest Richard that if a phone is used to access the 'real internet' it is - or should be - considered a smartphone. That is not at all true. All modern Japanese phones can access the real internet, and over 80% of them do so. Most fo those are not smartphones. And access to the real internet preceedes the iPhone by ten years literally, as first enabled by the Nokia 9000 Communicator. There are over 2 Billion phones in use that have some kind of browser that can access the real internet (and almost twice that number if we count WAP browsers). But only 450 million smartphones. So if you want to look at the phones being used to access the internet - where the modern smartphone in the USA was often the first phone used this way - that is old tech for most of the world and nothing uniquely belonging to the domain of smartphones. Lets not bring 'internet enabled' phones into this picture to muddle it more. No major definition of smartphones includes this aspect. Sorry.

But most of all, Richard, I told you that 'my' definition of smarthponess is the one used by all the major analysts, and all of the major makers of smartphones (including Apple). Why would you not accept this commonly accepted definition. Richard, if you cannot answer me, why would I bother to answer your new complaints. Please address my point first. Thanks.

Philipp - good point and thank you. So you've read the blog before haha... No seriously, yes, that 'IT departments hate change' is indeed an element that will prolong Windows Mobile's lifespan. I think its a major reason why WinMo still sells in its modest levels today. But I do have to think WinMo is near its death. Not all operating systems can survive. Symbian, RIM and Apple are big enough to guarantee major markets for their developers into many years in the future. Android, Maemo and Bada all have good new aspects, suggesting they are the growth and future option. So the other older players which are also small - Palm, WinMo are easiest to face death. I do think they can't survive, not in this ever more competitve space.

mico - thanks. Good point also about OTA upgrades to OS.

cygnus - thank you for the detailed coment and very insightful details about the Indonesia market. I was not aware that there has recently been bad press with the Blackberry and in particular its roaming. Also yes, the arrogance of a company that has recently been growing strongly, is a dangerous habit and can turn many customers away. Meanwhile about Nokia, I hear you, and yes many have been saying the same about the internal memory fo the top end phones. Its a bit of a game for the developers, in optimizing the price points of declining cost of memory, and the present market requirements. You may be surprised to know, that in terms of usage, Indonesia is certainly among the world leaders, so you will be experiencing the limits of top end phones far more quickly than many other even European countries. So you are witnessing the limitations very early and I hope the Nokia designers are keeping close attention to the market there in INdonesia to help design better phones in the future.

I will return to give more comments to the rest of you soon. Thank you all for writing and please keep up the intelligent discussions here, I myself am learning a lot from the comments here.

Tomi Ahonen :-)

haydn

Tomi - full of great data. here's one quibble with the interpretation. There is a lot of pent up pressure for rapid change in the business market with major enterprise apps vendors persuading IT departments to let staff use their own phones. Part of the reasoning behind that is, as one of the vendors told me, the iPhone is causing an Y2K effect in business. That remark was made about the UK market. The fascination there I believe is that IT departments will not determine phone types and will take on a different role - to secure networks against a variety of risks in a variety of handsets. It could make the business market far more volatile.

Tomi Ahonen

Ok, more of my replies..

Hi James M, Brendan, Mr Swiss, Freem, Jason, Alexandre and JB. I will reply to each of you individually

James M - thanks. Good point about developers, Nokia has a history of hundreds of thousands of them from early in the decade so yes, thats very true. About the Symbian Foundation, yes good point, but I feel - perhaps am wrong - that the move by Nokia to spend one billion dollars and to buy out the partners, then to release Symbian on its Foundation, was to get it to be single-minded and be without influence (of Nokia's rivals). I think the 'desertion' of non-Nokia handset makers has clearly spoken this in loud volume, that increasingly Symbian is starting to be same as Nokia branded smartphone. It is not that yet, but essentially all of Symbian owners present or past have shifted smartphone production to other OS's. So while yes, in terms of exact ownershp and degree of control you are right, its a Foundation, I believe that Symbian is more now a Nokia OS than ever before, if perhaps a 'de facto' Nokia OS rather than 'de jure' one. I am sorry for not making another discussion about Symbian, so I did take some liberties on that part in the blog. I don't think it matters in who wins or loses... Fair? I grant you you're right, I just decided the blog was long enough to not go into the politics of it...

Brendan - thanks, and yes, same goes for you as James in the above, I did decide not to discuss the ownership issues of Symbian, as I don't think it really matters in who wins and who loses, and as it is nearing the moment when Symbian = A Nokia branded smartphone. Not there yet, but is nearing that already. Today less than 10% of Symbian phones are on all other brands combined and I expect that to diminish to about 5% by mid year of this year..

Mr Swiss - thanks for the hmmm colorful comments.. Lets not get too much upset in Richard Spence's case, he has a valid view and lets be tolerant of differing views here. But yes, thank you Mr Swiss for several great examples and historical cases, I totally agree with you on all of those of course.

Freem - so you think Nokia's current smartphones are all bad and their apps are bad. Fine, that is a fair evaluation in your opinion and there is supoort to many of your positions by others in the industry. It is however, that you are perhaps picking on tidbits of not real impact (in most cases). So if the QWERTY keyboard on the N97 is only 3 lines not four or five, and its space key is a bit weird - that is still MORE than you get on any full-touch screen phone. And even if its not the 'same' as real QWERTY, it is significantly better than T9 - meaning, that the user can both type on it 'blind' (not looking at the phone, ie with the phone hidden underneath the table or inside your pocket - and is better than either full touch screen phones or T9 phones. Only 'true' QWERTY phones would be better. This is not a 'bad' solution, it is only 'not the best' possible keyboard. It is significantly better than most rivals. Same of the calendar issues you identify on some Nokia business phones. Again, that is not anywhere near the majority of Nokia's smartphones and it is also something Nokia can relatively easily remedy into both existing phones and future phones. It is very typical Nokia philosophy to improve its existing software, so the next edition is a bit better, and the following one again a bit better. Like early cases of GPS discovery of the device. The first GPS were very slow but soon got much faster, etc.

I am not disagreeing with you that Nokia has a lot of individual issues in individual cases, but they have a broad range of phones and there will inevitably be better and less well developed phones. Same is true of RIM and Samsung etc etc etc. Some will be good, others not so good. But when you say that Nokia 'is in decline because they overslept the industry' then I think that is too harsh. Nokia saw all of these matters coming long before there was an iPhone. Nokia had touch screen phones, had an apps store etc long before June 2007. But they were not all perfectly implemented. As to the pricing, that is a tight rope that Nokia needs to walk very carefully, to be sure it generates some income, but that it won't infuriate its primary reseller chain - the operators/carriers. So there are times they charge quite high prices for services but I would say that is 'healthier' to have a paid business model, than giving everything for free and hoping for ad income... But yes, I agree with you there are problems and I would say Nokia has a good history of fixing them over time. So this is not something I would see as in any way crippling to Nokia, its 'business as usual' ie any given phone may have some issues upon launch, and then those should be addressed and fixed in subsequent versions.

Jason - I am not competent to comment on what you said, expressly because I don't personally value touch screens over QWERTY phones (am totally SMS addicted, I have had at least one QWERTY phone since 1999 and currently both of my phones are QWERTY phones). You may be right, and certainly all who compare the iPhone to any Nokia touch screen will usually start by exclaiming how much worse any Nokia touch screen is compared to the iPhone. But - so are most other touch screens by most other phone makers. I would ask you Jason, do you think there are any makers whose touch screens are as good as the iPhone? Then it becomes both an optimization game and a pricing game. If a customer can truly afford a 600 dollar phone and considers the iPhone 3GS or the Google Nexus or Nokia N97 or Blackberry Bold etc, they will pick based on what particular feature issues they like. If a good camera and flash are more important than the touch screen - sorry, they go N97 and not the iPhone. If the QWERTY is necesary, they go Bold without question. And so forth. And Nokia can certainly make its touch screens better and its UI better, but honestly, I do believe that Apple will always hold an unbreachable lead in this part of the UI - it is Apple's core competence and they have been so much better than any rivals in the PC space since 1984 when the first Mac was released, and in the MP3 player space since 2001 when the first iPod was released. This will continue to be Apple's core competence.

But having the best touch screen will not give you the world. In high-end phones there are many other features and abilities that customers expect and demand and Apple is only medicore in many of the other aspects (like the camera, flash and QWERTY as I mentioned). But more than that, the average smartphone sold in the world costs only 300 dollars, a price point where Apple has nothing to offer but Nokia has a range of smartphones including touch screens. If your budget can only get you 300 dollars, you won't be able to consider the iPhone. Its like looking at cars, sure you'd like the Ferrari but can't afford it, so you forget about supercars and go to the Toyota dealer instead... And while it is CERTAINLY not as good in touch screens as Apple, Nokia does offer very low cost smartphones, increasingly low cost touch screen smartphones. Apple can't enter that fight unless they do an 'iPhone Nano' for example..

Alexandre - very good points, thanks. On the point that Apple innovated with a 3G phone not capable of video calls, here I have to disagree, remember Nokia's first 3G mass market phone, the sad 7600 (the phone where the keyboard was on both sides of the display). That had no video calls and it was out I think around 2003. So this is not something Apple brought us haha... But otherwise, very good points, including hte issues with web browsing.

JB - you make a great point and yes, we could measure smartphone market by other criteria and get a different result. That is true. But having the best technology is no guarantee of market success, look at the Concorde and the 747 - launched at the same time and the Concorde was far superior in technology but sold only 14 copies, while the 747 has dominated the skies and sold over 1,000 planes. Same of the Betamax vs VHS, the Betamax video recorders were at every generation technically better than VHS rivals, yet Beta lost and VHS won the VCR wars. What I have done in this analysis is to focus expressly on that carrier/operator and market angle, because it is decisive in the sales of phones. You need to understand this, that two thirds of the global smartphone market is totally NOT open to free competition.

And then you suggest that if we ask consumers, they will not prefer Nokia and Samsung.. Well, in those markets where there is totally free competition, in smartphones, Apple says itself that they struggle while Nokia often has half of the total market share - plus a strong resale value (yes, there is a resale market in many countries for used phones). As to Samsung, I honestly don't know how popular their smartphones are because they have been such a small player so far, but their mainstream phones are very popular in these markets. So if we take your point, that we should let free markets decide, and the consumers will pick the best phones - sorry, the truth is out there, the evidence is overwhelming, that 'regular customers' in those markets that are not distorted, will prefer Nokia branded smartphones far above any others. Part is branding, part is pricing, part is distribution and tech support, part is design and usability (remember nearly half of Asians use MMS and iPhones for example did not do MMS until now), and part is marketing communications ie advertisingn and promotion. Regular marketing competence. Nokia totally rules on this and their ace is the distribution channel dominance. Even in villages in Africa where Coca Cola does not ship drinks - because there is no electricity - you find Nokia phones. So by your criterion, Nokia (and Samsung) still win. And I'd argue, so does RIM now.

Thank you all for writing. Will respond to the rest soon.

Tomi Ahonen :-)


cycnus

@Tomi

Thanks for replying, your blog is really great, it seems that most people that post here is an expert in mobile industry. :)

I wanna to make another comment again. I know that average user don't want to care about what inside the phone. I believe it would be safe to say 90% buy the phone because of 3 things: looks (size, color, model, weight), brand, price (prestige, budget consideration). But I don't think that nokia should make an excuse to fill their top of the line device with second grade or third grade material. It's like a ferari selling their car with a 3000cc engine because most of the buyer is a women who doesn't care about the engine power and won't drive more than 100mph and just care about the looks.

So, nokia should fill their N86/N97/N97mini/E72/X6 with the best CPU as of when it launched (at that time is Arm Cortex A8). These device have the same price as N900, why can't it have the same CPU and memory/RAM? After all, if someone would throw money to buy the MOST expensive phone in nokia lineup, one would expect the best of the best inside that phone.

What nokia did right now is like what the american car company did. I just hope nokia would realize this before it's going the motorola way.

Davide Rota

@ cycnus

Here I am! :-)

I would like to clarify two things:
First the "let me sum it up" part of my post was not my view of things but what I read and very roughly summarized of Tomi's blog posts.
Second I'm form Italy, born in Italy and I've never been to USA :-)

Now about IT departments and how people value features, as I said, it was not my vision but a discouraging vision (and I'm really happy you bring me proof that is not always that way)

About Symbian... a little of background: I used WinMobile when it was first called PcoketPC, then changed for Palm (Tungsten T1 and T3) because it was a great OS, simple snappy and with good quality apps. WinMo in comparison was slow, its interface was a smaller scale desktop interface, NOT a mobile interface, and quality of apps was very low.
Then I bought a Symbian S60 phone and fall in love! It had multitasking, lots of apps, a browser (webkit) and a mail client, all in a small package with the phone. It was limited by ram, cpu and some poor OS choices but it was good. Had some different Symbian phone, the last being the N95 8Gb, but in the end Nokia remained static for years without polishing the OS and the result was that the first iPhone (still limited in many ways) was way better!
Then Nokia continued to do nothing, and the iPhone got Apps and then became the 3GS.
Now Nokia is starting to react and I really hope they can make some great devices, competition is very welcome, but I feel that the Innovators of the last 2 years are Apple and Google-Android (also Palm with WebOS, but it's marketshare is tiny!).
N97 in my opinion, is another error: another pricey S60 phone, with a resistive touch screen??

I'm well aware (and not happy) of some of the stupid locks apple puts in their devices, like being unable to multitask 3rd party apps and I accept them because there's nothing better still. I played with Android out of curiosity and I think it's great for geeks to explore, I love it's notification system, but it's beta software next to iphoneOS!
Anyway, like me, a lot of iphone users think it could use some tweaks ( http://www.tuaw.com/2010/01/10/dear-apple-what-we-want-to-see-for-iphone-4-0-part-1/ ).

Also about Symbian I still remember my 6630 always shutting down Agile Messenger in the background to recover some RAM while I was using the browser! :-)

cycnus

@Davide

It seems that we were in the same boat :). Love the symbian & hate what nokia did in the last 2-3 years. They could do it better, but somehow, they do nothing :(

Android is cool to play, and it would surely dominate the market in the short term. It would be very interesting to see this device in the long term. I also anxious to know the real N900 number.

It seems to me that Asian like to play around with new gadget more than other part of the world :). Maybe this is a reason that Akihabara is well known for a place to see new gadget.

Tin Brezicevic

@Richard Spence
In regards to your comment about Nokia not producing a smartphone currently. What would you call the N900, then? According to your definition of a smartphone, considering it has a superior browser than the iPhone (flash capabilities) and an easier way to upgrade firmware (dont even have to connect the device to a pc), your comment seems quite silly - and thats not even touching the capabilities of a Linux OS on a mobile device, or the physical improvements.

@Tomi
First time reading your words, very interesting read.

antonio

So, iPhone only sells on the US? You know what was the best selling phone on France this Christmas. Hint: not a Nokia.

Also, the way you blatantly ignore the iPod Touch is a BIG piece in this equation is appaling. iPhone sales figures should ALWAYS be added with iPod touch sales, to realize the true dimention of this platform

You also say Apple is limited by only launching hardware in June. Well, please stay tunned to the 27th: iPhone OS 4.0 + yet another device for the iPhone + iPod touch ecosystem. What will you say after?

Some nice point though. If ever SE launches a PSP phone, they could be back in the game. And they do well in going full force with Android instead of s60, that i absolutely hate. SE killed the BEST symbian UI (UIQ3), and they will go nowhere with the current symbian

Bala

Hi Tomi T Ahonen,

I do agree with you that 2010 would be a tough year for smart phone makers.
I expect Nokia to be on the top of others because their strategy of low priced smart phones with rich features is going to work out.
All they have to do is to revamp their symbian series OS which I hope they will do.
I accept the fact that Touch Screen is no match to the normal QWERTY.
I have used several nokia phones in this decade : 8290, 6610, 3120b, 3320,5130, 5310, E61 & now 5800.
Only phones I used outside nokia territory is BB Curve 8320 & Samsung R225.
I realized after my experience with BB & Samsung,I can say Nokia phones are the far best, even though there is nothing wrong with BB (except some small glitches in web browsing) & Samsung phones.

At the end of the day , it is not the app stores going to do the wonder.
It is the quality/reliability/durability of the phone which satisfies or eases the needs of everyday work - NOKIA is the best in doing that successfully I believe.

My opinion may seem biased towards nokia but I am writing this based on my experience and everybody has their own story to tell.

-Bala.

Tomi Ahonen

(Am adding more replies..)

Hi Hyoun, Davide, cygnus (again), Alex, cygnus (yet again) and haydn

thank you all. will reply to each

Hyoun - good points. First about RIM / enterprise. I am not in any way doubting that there aren't 'rogue' handsets out there. That is not the point - yes, there will be the random non-standard business phone. It is the bulk purchase. The enterprises won't go out buying Android or iPhone devices. The 'approved' platforms and devices will be the ones that sell thousands - even tens of thousands of units per enterprise per year. That is why RIM has such a solid 'lock' in units sold. It won't be 100% ever, and it is likely to gradually decline in market share in the USA but equally, because RIM is now the clear quality leader in enterprise phones, it will also mean that RIM will grow by far the strongest in non-American markets.

I do agree with you that all handset makers focused too much on the hardware and not enough on the UI, that was a huge contribution of Apple among many they made in 2007. Totally agree. And now the major handset makers are all attempting to improve their UI, some do it better, some not that well haha...

On HTC, I also agree and think that perhaps part of the reason they had to take more of a pro-active role in the UI and look-and-feel of the handset was because WinMo was so often delayed and under-delivered what had been promised. So HTC kind of 'had to' do 'something'. But they have certainly been the best of the rest, behind the three big brands of smartphones.

Davide - I hear your pain. I sense in you the typical 'perfectionist' approach to technology - please don't be offended Davide, I don't mean to accuse you, but often perfectionist technologists feel that because one tech is superior, it has to then dominate the market. And it never does. Concorde was the far superior technology to the basic boring 747, yet the Jumbo Jet took over the world and the Concorde never even broke even in operation nor as an aircraft to its manufactures. The betamax was for every generation a better VCR than the VHS family of video cassette recorders, yet Betamax lost and VHS won. Apple sees this in the Macintosh which has been for every generation the best operating system yet Microsoft's Windows a far worse OS rules the world and the Mac never had over 10% of the global PC market.

I do not disagree with you Davide at all, that there is passion and excellence in the iPhone (and all things Apple). I am not so sure about Android, I do think it has now the darling moment in its life, when everybody can wish it is the perfect OS before they have used it for a while, but it certainly may be one as well. And certainly most other OS's are not - and probably never will be - of such high quality especially in usability (as the iPhone specifically).

The sad truth in economics is, that having the best quality will not get you the world. BMW or Mercedes Benz or Audi or Cadillac in the US or Lexus brands sell far less cars than Fiat, Toyota, VW, Ford, Renault, Nissan etc. Quality will not bring you the world. But Apple know this, and are quite happy to not try to win the world (with the Mac) and know they can be far more profitable if they keep focusing on the excellence rather than total market domination. So I hear you, but I think you are hoping in vain... It will still be the market economics which will determine which smartphone sell in large numbers and which sell in 'niche' levels..

cygnus - thanks again, good stuff, we agree.. Good point about multitasking.

Alex - thank you very much. First, good point about the re-organizing of the market segmentation. Nokia seems definitely to be doing that with Maemo - I would argue that Google branding its Nexus as 'a superphone' plays into this game as well. And the more Nokia can isolate the iPhone only to the top end, it leaves the 'vulnerable' Symbian mid range phones more free to seek their customers. This comes back to my call for Apple to release its iPhone Nano soon, they can't let one model per year cycle to continue...

Good thinking on the apps/services angle. I do feel myself that the apps enthusiasm is short-lived, it is now particularly driven by Apple because the iPod Touch is a new generation PDA (a form factor that was all apps and no services back when we had no cellular connectivity and almost no WiFi). And the iPhone very happily borrows from that business model. As I have argued in my apps store rant, the apps stores are over-hyped and already today services earn what was it 800 times more (yes, nearly 1,000 times more) in revenues in 2009 than all apps sold to all smartphones not just Apple's App Store. So the services side utterly dominates, elephants to ants - and this is likely to expand as we go more to the cloud..

On Android I think you're a bit optimistic. Remember that the mobile phone biz is not an open competition, it is severely controlled by the distribution chain. Just making a nice cheap device will not get you any sales. You have to convince the carriers/operators of the world to carry your device. They are quite happy to take a 'sexy' brand like an Apple or Google (or perhaps Lenovo even or Dell) but they have to support all the phones and are very risk-averse. They will go for mass market phones from Samsung and Nokia and LG, not from newcomers. Not in a long while. So Android cheapo-devices, I don't see becoming relevant for many years to come (but eventually, all prices do come down thanks to Moore's law..).

And as to Nokia doing Android - I am sure that won't happen. No, as long as Nokia owns two of its own OS's (yeah yeah, Symbian Foundation, ok they 'control' two) they won't adopt another run by a competitor. Won't happen. If will be those makers who don't have their own OS's who will jump on Android and those like Samsung who support several OS's won't do more than a token Android device because they have their own Bada to support. No, the business strategy and market message would be suicide to their own OS. Won't happen.

On Bada - I've often said that Samsung has taken a 'we will defeat market number 1 by being better at everything than number 1' strategy. It could be simplified to say that with phones its 'Nokia envy'. Whatever Nokia has, Samsung will do or have. And if you look at their moves the past decade, very much of it can be said to be Nokia envy. Bada fits in that pattern.

Then on RIM, again you make a great observation that RIM was indeed treated with doubt by the operators/carriers, but as Apple came along with somewhat 'outrageous' demands (initially wanting to get part of traffic revenues, which they did extort out of AT&T and apparently a couple of their first European deals but now have abandoned) so yes, RIM was no longer feared as so 'dangerous'. But then what you suggest that it would lose to Android at the enterprise, here you are really totally wrong. I have worked there selling telecoms services for a carrier, to the large corporate accounts and it is totally not an open competition and I've been in those conversations where the IT guy just decides he does not want the hassle. Then the purchasing department has absolutely no clout to try to bargain in the internal politics. Won't happen. It took RIM five years to hit their first one million enterprise customers - this with the world's clearly best enterprise oriented solution. Android's solution won't be anywhere nearly 'superior' to RIM's and they definitley won't hit one million enterprise subscribers in five years. Won't happen. The dynamics of the market place totally inhibit that. Only WinMo or E-Series has the chance to cut into RIM, not Apple not Android. No way.

On Microsoft, yeah, anything is possible but they are so badly in trouble, really I see strong parallels to Motorola in basic phones. But specifically you mentioned LG. They have just announced at CES that while they support 4 OS's for smartphones, half of their smartphones this year will be Android devices. Again another nail into the coffin of WinMo.

I did not discuss the emerging markets much for the good reason that they form such a small portion of the total smartphones (new sales) market today. There is a big after market in particular of Nokia smartphones. But yes, even like you say, its featurephones more in China, India etc, not smartphones. So with the topic of this long blog, did not discuss featurephones..

cygnus once again - thanks for posting so many comments cygnus. You are almost doing my job for me haha.

haydn - again, you make a valid point but it is really miniscule in its effect. If we 'allow' employees to use their own phones, those will not suddeinly all be magically iPhones or Androids. They will conform to the overall market size - with a lag - of that country. But that won't stop the employers still giving employee phones - which will predominantly be Blackberries - to their staff. You don't have to accept it. But the only phones that get bought in the thousands and tens of thousands as emnployee phones (on a global scale) are RIM and E-series devices. Some misc Palm, WinMo, SonyEricsson etc random smartphones of established platforms will also be in the mix. But the bulk sale is what helps rule that segment, individual few employees bringing their own phones won't rock that boat meaningfully, not for many years to come.

Thank you all for writing. I will return to answer more comments for hte others who have left comments

Tomi Ahonen :-)

haydn

Tomi - I am no advocate of the iPhone or RIm but I think you are underestimating the surge behind the iPhone as an enterprise device and the extent to which enterprises are and will opt for employee self-use policies.

Jason Bowers

Tomi - Your preference for phones with keyboards it the exact opposite of mine. I can't imaging having to live with a phone festooned with buttons. The wide expanse of a screen with soft buttons is the only acceptable format. I think the majority of people new to smartphones will prefer more screen over buttons as they don't have a need for buttons already. A big screen is more appealing than a small one or a fat phone.

Tomi Ahonen

More replies..

Hi Davide (welcome back), Cygnus, Tin, Piot, Antonio, Bala, haydn and Jason. I will reply to each individually

Davide - good points thanks. About that point, that 'innovation has shifted to iPhone and Android' - here I beg to differ. It is true that the iPhone was a transformational phone, the single most important mobile phone handset ever, even more important than the Motorola first handheld. And Google has recently been in the news with various Android phones. They have held the global IT media hype cycles for most of the past three years since the iPhone was announced in January 2007.

The iPhone had one major innovation, its user interface. Arguably that included or were separate items of multitouch screen and the accelerometers (for a phone). But the rest of what Apple did, was to do things better or more user-friendly over the past 3 years, not truly innovate. It has not been an innovator phone in terms of technology or contributoin to the industry, it has been a laggard phone with severely under-performing and often obsolete concepts that Apple has since gradually and often begrudgingly fixed like MMS now.

Now, for the US market, definitely the iPhone has woken up the industry and for many it showed amazing abilities. But the truth is that all the cool stuff of the iPhone such as touch screen, 3.5 inch screen, slim design, the app store etc - had existed long before the iPhone. We can't credit Apple for bringing those innovations. In most cases it was the Japanese who did it first.

Same for the Android now. I don't honestly see amazing contributions on Android devices, do you? I mean something that hadn't existed before. The Nexus is very much a Google clone of the iPhone, and many Android devices with QWERTY keyboards and touch screens seem copies of equivalent earlier Nokia phones etc. While not necessarily always best implemented, and at other times (the E90 Communicator for example) hideously over-priced, nonetheless, Nokia and the Japanese and Koreans have done most of the innovation in this industry and currently the iPhone and Android have not given me anything really to consider a valuable addition. So they do have the hype and thus the attention of the press but they did not come with the honest creativity and inventions for the industry.

cygnus - good point about Asians and gadgets

Tin - thank you very much. I hope you will return from time to time and find more value here

Piot - thanks, you've clearly been reading the blog for a while haha. Many points. First on Apple 43% in US vs Blackberry in US. Yes good point, except that BB was focused first only on enterprise and only North American market (and as I explain, it now gives them a 'lock' on that market). What Blackberry needs to grow is to break out of both the US market and the enterprise market. Their CEO said that 80% of their phones sold in the fourth quarter were to consumers. I do believe - but haven't now read the report to be totally sure - that the number you referred to was 'subscribers' not Blackberry smartphone sales. The subscribers will be far more enterprise than consumer obviously and their subscriber total count far lags the total phones shipped count suggesting many get the phone without being subscribers. So BB is executing a very difficult maneouver and doing it incredibly well. To me RIM has 'correctly' adjusted their product line to not lose US customers but to become desirable with overseas customers.

But Apple left US shores in 2007 with the aim of replicating the world success what they had in the US, and as Europe is twice the size of the US, that two years later they don't have more sales out of Europe, and then add another US sized smartphone market out of advanced parts of Asia - that is to me worrysome. To me it says that Apple is severely underperforming in the rest of the world, as it is a consumer device. It is far too 'American' for European and Asian tastes and still needs to 'grow up' a lot. And Apple's distribution strategy has been another poorly executed aspect which they now are addressing. Make sense?

On LG Prada - I was not talking of the Prada which was LG's commercial product but the industrial design winner. There were many phones in that rough form factor already in Japan and Korea at the time, long before the iPhone was announced. I did not suggest that Apple cloned the Prada in four weeks, but rather that its looks that so amazed the US media were actually not unusual in Asia. Maybe I was not clear.

On Samsung Bada, you are totally right, except that so too was the iPhone OS/X a new entry to phones as has since been Android. Its 'easier' to do a fresh new OS for smartphones today, knowing that they'll be used for video sharing rather than videocalling, for Picture Messaging rather than email etc etc etc. But yes, Samsung Bada success depends on execution and I'd put my money on the Koreans. Have you any idea how incredibly demanding are Korean domestic customers with the world' most advanced broadband digital internet and wireless society? Today 100 Megabit/s speed is standard and Gigabit broadband is the normal upgrade; the nation has the world's first nation-wide WiMax network; both CDMA2000 and WCDMA 3G networks go nationwide and Seoul has the world's largest WiFi cloud. How incredibly demanding are those customers? I would certainly put my bet on Samsung delivering a 'good' OS not a bad one haha..

The you say 'don't forget that it's North American companies that have been carving up the smart phone (OS) market.' Actually no. Only RIM and Apple have grown significant market share past 2 year and they have not carved up the world's market, they have cut up the market of Windows Mobile. Sorry you are patently wrong.

The Canalys numbers are generally good for the current period(s) and the recent trend has been growth in the US. How they predict is another story. The EU said that Europe will have 50% of all phones smartphones this year. Lets see how it turns out. But regardless, for smartphones, US is the small pond, the World is the big pond. And to be a global winner you have to succeed in the big pond not the small pond.

Then you make some nasty claims about me saying 'Market share figures appear to get mixed and matched to support your own arguments; There is the occasional bit of history revisionism' - now on these points, Piot - serious claims - you better back them up. Where have I done history revisionism without clearly stating I have changed my mind for X reason (the facts for example have come out on a previous hypothesis).

You also say 'You may display a little Nokia bias. Perhaps a little anti-Apple sentiment.,, but that's not the point. Despite claiming that there is a definite "after iPhone" era, your conclusions often appear to be based on "before iPhone" thinking.' I am sure I have bias in cases of knowledge vs not having knowledge. I do know Nokia well because I was employed by them, am a Finn so my Finnish news sources will regularly feature the company, I have a lot of info constantly coming in from past colleagues there etc. I do not know for example HTC very well, so I cannot always tell very accurately what they are up to, because I do not know. So if you mean by bias, that I talk a lot about them, certainly. If you mean that I try to color the stories in favor of Nokia, on that I have to disagree vehemently. I am openly critical of anyone who does dumb things in the industry. And while Nokia has done many things right they are not perfect. Just this past Autumn I was very critical of them with the announced netbooks project. I have also been openly critical of many of my other long-standing customers like Vodafone's entry to fixed landline business (was proven right) and Motorola's desperation move into smartphones.

The line about pre-iPhone thinking is cute. I would challenge you to find me evidence of it - where was I in any way 'more' of a pre-iPhone thinker than any of my contemporaries at that time. I would argue that I've foreseen this change in the industry very early and very well. But it is change that is happening, so you cannot accuse me of having said something 'obsolete' two years ago, if all others of my peers also said so at the time.

antonio - we agree on some points (PSP etc) and disagree on others. The one point I have to address is the iPod Touch. No, you CANNOT cont the iPod Touch in any discussion about 'smartphones' because it is not a smartphone. It is a PDA. Now, if you are a software developer for apps, then yes, the OS/X of the iPhone and Touch are the same, so that platform has more users. But smartphones, you cannot count those non-cellular PDAs. They are not smartphones. By nobody's definition are they smart 'phones' because they do not have cellular connectivity.

Bala - thank you for your views. It is part of the beauty of this industry now, that we all can have individually appealing devices.

haydn - Totally not true. The enterprise 'surge' of iPhones cannot be huge, because 1, many iPhones are with non enterprise type of consumers, housewives, kids etc who do not have a 'corporate job'. Of the business users, some will have iPhone they do not want their company IT department to 'mess with'. And of the rest, yes, some will then go fight for the right to have the iPhone as their company phone, and yes, if you are reasonably high up in the organization like a VP, you can get it. Most who ask will not get permission.

We are looking at a tiny fraction of one percent of all phones now. A tiny tiny fraction. Meanwhile RIM sells tens of thousands of phones to corporate clients per client per year. Its totally a non-contest. There will be some - but Apple's own numbers said less than one percent of ALL iPhones in use are with enterprise customers. This is totally not happening. They are the rare exception, in some media industries in America, thats it. Don't kid yourself haydn.

Jason - you write a bit like you came from a North American market (that kind of view is common there). If yes, your first smartphone is now in 2009 or 2010, and you are not addicted to SMS, then you find no real value out of the QWERTY. But did you know Jason that in the Philippines they average 25 SMS sent per person per day. Average. Heavy users in South Korea and Britain send 100 SMS per day on average. If you are addicted to SMS - 3.4 Billion people on the planet already use it and Americans have discovered it recently - even Punxetawny Phil will send his weather forecast via SMS - then the game changes.

If you are not addicted to messaging on the phone, then you have no issue with it, and thats fine. The majority fo the world is not like you. The Australian and Belgian studies on SMS addiction said SMS is as addictive as cigarrette smoking - and far more addictive than internet browsing. Others are like me on this, they can't consider a phone without a QWERTY.. But not everybody is like that, for sure.

Thank you all for writing. We should be up-to-date now with all replies up to this one.

Tomi Ahonen :-)

Davide Rota

@Tomi
Thank you for your reply, as always very complete and with good points.

I agree that Iphone is nothing new when you consider form-factor or hardware specs but my view is that hardware per-se is not an innovation: everyone can buy the latest ARM chip or oled display and build a phone/pda/tablet. Thus having only the hardware is useless. HTC HD2 for example is beautiful technology brick wrapped in a nice package (sense interface).

Innovation is to use a known technology in a new way or market: for example the iphone was the first important device to use a capacitive TS and doing so it made all resistive TS obsolete (stylus included)! Another example is the unibody design in Macbooks, they used decades old CNC machining technology to carve a notebook, where competitor used only crap plastic.
Also important is design that makes devices with similar HW specs feel completely different.

And last but even more important (and you know very well) is the software that moves the hardware: the best example is the safari browser. We had tens of mobile browsers but I think that the Apple one is so much more snappy, usable and complete that it just stands in another class. On my nokia I never really tried to open an un-optimized page because it was so awkard it just wasn't worth the hassle. SafariMobile gave us the full internet, meaning it was not desktop experience but at least was acceptable.
Apps are a similar example: sure there were mobile apps, but the price was absurd, the quality very low and the number of good software houses even lower.

So to sum up I think you're right when you say that iPhone was no revolution hardware-wise, even lacked some old features (like MMS, that I never used BTW), but Apple innovated where there was more need to: control paradigm (multi-touch, finger, gestures etc..), UI and software.
Android was the first and still only mobile player to acknowledge this and to try to catch up with comparable quality OS, UI, browser etc.. They are not doing nothing revolutionary, but are innovating with some Google services (g.voice, maps+navigation, mail). Also they are pushing the limits software-wise (multi-tasking) and hardware-wise (snapdragon CPU, highres OLED display). Some competition for Apple!

In comparison I feel that RIM, Microsoft and Nokia are ignoring these changes (see N97 or BB 9700) and this is incredible after 3 years. I'm beginning to think that Steve Jobs was right when he told us that iPhone was 5 years ahead of competition! :-D

Ok this reply is long enough! It's always good to speak with educate and knowledgeable people!

JB

Tomi, I'd argue that the majority of global SMS is done on T9 so a transistion to soft keys will not be a deal breaker. I also know you'll tell me if I'm wrong. I admit to suffering through the US cellular system but I truly believe screens will beat buttons.

cycnus

@David Rota

I think what I'm gonna said here might be categorize into the 3rd world vs. USA using pattern on cellphone. We (the person in the 3rd world) is really care about MMS. I'm more on the e-mail than MMS, but my service provider give me 1000 free MMS each month last year, so I use it anyway. But my domestic helper that who's salary were bellow US$80/month were onto MMS (and SMS) in a big way. It's the only way she could sent her photo to her family in her village easily because none on her family could operate computer thus can't use email.

2nd. I believe the web browser in Nokia were also based on the same webkit that iPhone have. Therefore web pages optimize on iphone would also benefit for Nokia. Furthermore, nokia have the flash plugin supported on their phone. I can see youtube, and hundreds of youtube like pages right from the phone. Where's on the iphone I could only watch youtube with a dedicated player, and not a homepage with embedded youtube video in it.

@JB
If you live in the SMS addiction society, you would now that the veteran user of texter don't look at the phone nor using T9 just like a good secretary when typing on the keyboard. Therefore having a soft keyboard might slow down typing speed.

Davide Rota

@cycnus

Here in Italy sending mail from the iphone is free (within the data bundle) while MMS can cost as much as 0,7 - 1,4 USD so it was a technology doomed to fail due to its high price. I can fully understand that if the price is lower or even free it can be quite useful: non everyone reads email and few read email on the phone.

Yes Nokia browser is also based on webkit and I don't know why but as fare as my experience browsing full pages on my N80 or N95 is just so bad it's worthless trying.
It's true that flash isn't supported and there are some flash-only sites but it's also true that flash on mobile is again so slow that it's useless, as good as not having it at all (Again tried on Nokia phones).
Regarding youtube and similar flash based video sites I think Apple solution is best: instead of letting unoptimized flash engine decode the video we get a fullscreen streaming video that is decoded in hardware by an optimized engine.
Also I don't see the advantage of watching a video embedded in a web page on a small mobile screen: everything will be small!

Just as a Atom netbook: if you watch a HD video decoded with HW acceleration it's fluid and perfect, if you watch the same video in youtube HD (flash) the CPU will go to 100% and video will stutter!
Even on a full MAC/PC computer the HD flash video (Youtube, Vimeo etc..) will use hte CPU much much more than a properly decoded MP4/AVC stream.

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