Lets Understand the Mobile Phone Market, installed base and smartphones vs dumbphones

I have been doing a long-running series of annual reviews of the overall mobile telecoms market here on this blog. In it I have touched upon the handsets side of the industry (but most of the industry is in the services side of voice calls, SMS text messages, mobile internet services, etc). As this year heated up with the 'Smartphones Bloodbath' - many of my readers have asked for more details and analysis about the handsets market itself. I do track those stats too and my consultancy is used from time to time to analyze the handsets market (and smartphones and their operating systems). So I decided to put my best insights into the TomiAhonen Phone Book that I just announced earlier today, a 171 page statistical review of the handsets market, with over 90 charts and tables.

As is the style here on this blog, we then want to give you, our loyal readers, as much of that for free as is reasonable in a longish posting about that topic. So here we go. This is the 'definitive' blog posting about the handsets industry. And if this is of interest to you, please note, there will be a new free gift for you in it too, so read carefully haha.

MARKET SIZE 2010

The mobile phone handset market returned from the economic downturn, and grew strongly in 2010. A particularly hot area of the handset market in 2010 was smartphones. But first, we need to understand how exceptional this market is.

The PC industry sells a little over 300 million PCs this year. That includes all desktops, laptops, notebooks, netbooks and the tablet PCs like the iPad and Kindle. A little over 300 million sold per year. Similarly television sets sell in that scale, about 300 million per year. And DVD players sell in the 250 million range annually. These are the global giants in electronics, the others of our favorite gadgets, like videogaming consoles or digital cameras or MP3 players like the iPod, sell in far smaller numbers per year. Except for one gadget. The mobile phone. The world sees sales of 1.37 Billion mobile phones sold in just this past year! You see why I am so excited about this industry? Just smartphones alone will sell very close to 300 million units this year, and yes, next year more smartphones will be sold than all types of personal computers, combined.

While we are on those smartphones, this is a big milestone year for the smartphone. For the first time, in 2010, the total value of the smartphones sold, exceeded the value of dumbphones sold. And the market is tipping very lop-sidedly to the smartphones, due to both the incredible growth in smartphones this year - while the overall handset industry grew by 10% in units sold, the smartphone market sector grew by 71%. So today 60% of all handset sales revenues come from smartphones. yes, you have to sell more than 4 dumbphones to earn about the same as one smartphone.

But you do not need to have a smartphone to have a powerful gadget in your pocket. Only 22% of all phones sold this year were smartphones. The other 78% were what now is a bit dismissively grouped as 'dumbphones', which includes anything from very high-end featurephones (many non-smartphone featurephones in Japan and South Korea have more features and abilities than the best smartphones known in the rest of the world) to mid-priced phones to the ultra-cheap basic 'Africa phones'. Even the most simple basic phones do SMS text messaging, meaning every phone sold worldwide is capable of mobile messaging, and can be used for anything from advertising and coupons to news and games to TV-interactivity to mobile banking.

FEATURES OF INSTALLED BASE

While many developers obsess about the iPhone and its App Store, and think that the Android OS may be the next big thing to achieve mobile data success, the reality of the dumbphone installed base can be astonishing. Most phones in use worldwide today have a full HTML browser - even in the Emerging World, seven out of ten phones in use has an HTML browser. And if the developer can offer the intended service on a basic browsing experience, the more basic WAP browser is on more than nine phones out of ten worldwide.

Similarly MMS, not just a 'picture messaging' ability but a true 'multimedia messaging' platform, MMS allows pictures, videos, sounds and longer text content to be delivered to mobile phones. If you put your internet service on the PC based internet, you can reach 1.7 Billion people. But if you put that multimedia content on MMS, the world's installed base of MMS capable phones in use is 3.4 Billion handsets! Yes, twice as big as the total internet and yes, twice as many MMS capable handsets are in use globally, than television sets! No wonder MMS is growing so strongly, and being embraced by major media brands.

I want to mention a few other features. Memory cards. Two thirds of all phones in use worldwide now have a memory card slot. That is a lot of capability to swap data without worrying about cellular network charges. And yes, while WiFi is spreading (18% of all phones in use have WiFi), the far bigger wireless connectivity is of course Bluetooth - 64% of all phones in use have that ability. If you want to listen to music on a phone, or watch a video, you don't need a smartphone. Six out of ten phones globally has a media player. And of those apps? Try Java/Brew - more than half of the installed base of mobile phones support either Java or Brew (try 2.5 Billion handsets as an installed base today). Wow, these are huge numbers.

INPUTS BY TYPE

The battle of QWERTY and Touch-screen phone inputs is at the tipping point this year, with the Touch-screen phones now selling more than QWERTY phones, but the installed base still has more QWERTY inputs. 14% of the total installed base of mobile phones has some kind of special input, like QWERTY, Touch screen or hybrid input.

And on the camera resolutions, VGA cameras still are the biggest category, but 1 megapixel cameras are rapidly catching up, and almost one out of five phones in use has a camera resolution of 3 megapixels or better. How many is that? Try 800 million cameraphones, thats nearly 12% of the planet's population, who have such a good phone in their pocket, that it has a 3 megapixel camera on it, or better..

MARKET SHARES

First a few quick preliminary look at how the full year of 2010 will pan out for the Top 6 biggest handset makers in all phones, in smartphones, and in smartphone operating systems. Note, that this is a short-term projection by my company, based on the first 3 quarters of 2010, and making a projection for Q4 sales, We will know the final numbers during January and February (and will report here on this blog). So this is what it looks like:

Total handsets Top 6 for 2010
1 Nokia 32%
2 Samsung 21%
3 LG 9%
4-5-6 very close race between Apple, RIM and ZTE about 4% each

Smartphones Top 6 for 2010
1 Nokia 35%
2-3 very close race between RIM and Apple, about 15% each
4 Samsung 9%
5 HTC 6%
6 Motorola 5%

Smartphone OS's Top 6 for 2010
1 Nokia Symbian 39%
2 Google Android 21%
3-4 very close race between RIM/Blackberry and Apple iOS, about 15% each
5 Microsoft Windows Mobile and Phone 7 4%
6 Samsung Bada 2%

So then lets look at who are the big boys of this industry. The market shares are regularly reported - as units sold, so we know Nokia is the biggest dumbphone manufacturer and the biggest smartphone manufacturer. But selling tons of cheap phones does not make you a big company. The average price of the phones sold will determine who are the really big players, and by revenues, the big five of the handsets market are (as I reported earlier on this blog) - Nokia, Samsung, Apple, RIM and Motorola in that order.

Then it becomes interesting to see who is focusing on what region (I divide the world into 8 regions in my analysis, like I do in the Almanac, so its North America, West Europe, East Europe, Asia-Pacific Advanced, Asia Developing, Middle East, Africa and Latin America). The biggest region by far in unit volumes and revenues is Asia Developing (as it includes China, India and Indonesia 3 of the 4 most populous countries in the world). The West Europe and North America are running neck-to-neck.

Nokia's top 3 market regions (by unit sales) are Asia Developing, West Europe and Middle East
Samsung's top 3 market regions are Asia Developing, North America and West Europe
Apple's top 3 market regions are North America, West Europe and APAC-Advanced
RIM's top 3 market regions are North America, West Europe and Latin America
Motorola's top 3 market regions are North America, Latin America and East Europe

OS WARS

And then those OS wars for smartphones. While Android got most of the news in 2010, and it had very strong gains in North America, the world giant has been, is, and continues to be Symbian, powering Nokia smartphones and about half of smartphones in Japan (being the OS of preference for NTT DoCoMo, Japan's biggest mobile operator/carrier). A regional analysis of smartphone OS's is more revealing.

In North America the installed base of smartphone OS's reflects the recent rapid growth of smartphones, so while Microsoft's Windows Mobile and Hewlett-Packard's Palm used to have major shares in North America, the battle is now between three OS's of almost identical market share - RIM/Blackberry, Apple iPhone iOS and Google Android.

In Western Europe, Nokia's Symbian has a dominant role, and interestingly, the second biggest OS, Apple's iOS, has not taken significant market share from Symbian, but has decimated that of Windows Mobile. RIM runs a distant third with Android rising.

In the Advanced Asia-Pacific market, Symbian's strong market dominance is very stable, the battle on the fringes has seen iOS and Android eating into Windows Mobile and Linux Mobile.

In the Asia Developing market, Symbian rules, with RIM a distant second and Android rising.

In Latin America the battle is between Symbian and RIM, both gobbling up what share Windows Mobile and Palm used to have.

In Eastern Europe not surprisingly Symbian dominates but RIM is growing strong as a distant number two.

Africa is almost exclusively Symbian with some Blackberry. The Middle East has more Blackberry but is also strong dominance by Symbian.

While the pundits love spinning the fable that the iPhone is stealing Nokia's market, the truth is, that when examining the eight regions, Symbian has been very stable and most gains that Apple has been able to make, have been at the expense of Windows Mobile and Palm, not Symbian. Where Symbian has taken major losses, has been more at the expense of Blackberry and now Android. What confuses the pundits, is that North America is both the worst market for Nokia and for Symbian, so the analysts there do not see the real performance of the world's biggest handset maker, smartphone maker and smartphone OS.

I do want to make a mention about Bada (something I have said on this blog before, but it bears repeating). If you are impressed by how strongly Apple has grown from never having made a mobile phone to now challenging for 4th biggest mobile phone maker globally, or how strongly Google's Android has stormed the market, today selling on one out of every five smartphones sold worldwide - consider Bada. In its first 6 months of sales this year, Samsung's Bada has sold more smartphones than Apple iPhone managed in its first 6 months, or how many smartphones were sold in the first 6 months of Google's Android. Do not discount Bada. It achieved 2% smartphone market share in only 6 months. That is a world record. Expect Samsung's Bada to be one of the big stories of 2011.

PRICE PYRAMID

What else can I tell you? The average sales price of dumbphones sold in 2010 was 61 dollars, and for smartphones was 332 dollars. That is of course the 'unsubsidised' or 'SIM-free' price (so don't think the iPhone 4 offered by AT&T for the nominal price of 199 dollars, is really a 199 dollar phone - Apple tells us they are paid 600 dollars for it - so AT&t hides the remaining 401 dollar price into your 2 year contract..)

I calculated the price pyramid for the global phone market and found the following price breaks:

Premium smartphones costing over $450 = 5%
Standard smartphones costing between $250 - $449 = 9%
Low-cost smartphones and premium featurephones costing $100 - $249 = 17%
Low-cost featurephones costing between $50 - $99 = 24%
Ultra low-cost basic phones costing under $50 = 45%

There you go, that is a view into the market of mobile phone handsets, the most prevalent technology on the planet, yes more people today have a mobile phone than have a wristwatch or even a basic FM radio. Now about that freebie surprise gift I promised? Yes, if you would like a two-page pdf document with all the major stats and facts about the handset industry, I have that for you! If you send me an email to tomi (at) tomiahonen (dot) com, I will send you the brand-new two-page 'Cheat Sheet' about the handset Industry by return email. Please write into the email header 'Cheat Sheet' for rapid delivery of the pdf file.

And for those who already know they need more data, if you liked this blog story, but would want to see more than 90 tables, charts and diagrams about the mobile handset industry, including all of the above, but obviously many many more, I now have my 11th book, the TomiAhonen Phone Book 2010, which runs 171 pages and is formated for the small screen so you can save it to your smartphone and have all the handset industry stats and facts in your pocket with you every day. The eBook costs only 9.99 Euros. There are free sample pages from the TomiAhonen Phone Book both at the ordering page, and in the new Insider's Guide to Mobile. So take a look and for under ten Euros, this is the best bargain in stats and facts about the global handset and smartphones industry. See more at TomiAhonen Phone Book 2010. 

Comments

[Andraz]

Impressive as always

from a startup point of view, the iPhone market does matter the most, due to:
- iPhone market does pay for content
- AppStore is the most polished of them all
- AppStore managers do a very good job at advertising new and interesting apps
- revenues are clear
- development environment is good
- PR machine behind apps for iPhone is enormous

Otherwise it seems that MS, Samsung, HP and Nokia will be spending the lots of dineros in 2011 to attract new developers. And that is good news for app making companies.

[Tomi Ahonen]

Andraz - thank you for the comment, but it also reflects the SEVERE mis-understanding of the mobile opportunity by most new companies who now are entering it, especially start-ups. An app on the iPhone app store will be lost among 250,000 apps. It has no chance whatsoever (an app from a start-up that is) of reaching any kind of success whatsoever. None whatsoever. It is utterly a fool's errand. But the costs to develop a simple mobile web site, on WAP and HTML using 'Dot Mobi' guidelines costs one TENTH what it costs to do a standard paid app for the iPhone and reaches... a 50x bigger potential audience. This is the reality that is lost to most who do not bother to study the real opportunity and just go with the hype around apps. And what kind of money is there in apps? This year about 6 Billion dollars in smartphone apps. That is not app store money, that is all apps, the majority (67%) is business apps to enterprise/corporate customers, only about 2B dollars is app store apps across all app stores globally. Compare that with 125 Billion dollars of 'premium' mobile data revenues - ie non-messaging mobile data revenues, most of which runs on WAP billing mobile internet.. I understand what you say, and I know there must be tens of thousands of developes and executives and owners who act like you mention, because they believe what they have read, and they honestly think that there is a real opportunity (today) in apps on the iPhone. There isn't. That opportunity may come, and whatever it may be on the iPhone, will be far bigger on Android and Ovi, but those all pale in comparison to the opportunity today on the mobile web and premium mobile SERVICES, many on such basic and 'boring' platforms as SMS and MMS...

But thank you for the comment and yes, there are of course many things that Apple does well, its best asset currently is how much the Apple brand alone will distort reality. I love Apple, but I deal with reality here on this blog. Thanks.

Tomi Ahonen :-)

[James Pearce]

I am sure you know that Symbian, your 'world giant', shut down its developer web site (http://symbian.org/) earlier this month, and that Nokia has hardly rushed to get an equivalent up and running (http://symbian.nokia.com/).

Your statistics are correct, and tell a compelling factual story. But when it comes to winning the hearts and minds of developers who are building the future of this '7th medium', it becomes emotional - and Apple are hard to beat.

I believe 2011 will be the year where we will start to think about 'smart phones' being a right, not a privilege. (It was already a daft, relative adjective for the industry to use!). For example, presumably we will see the Android brand bleeding down into the mid- and then lower-end of many manufacturer's portfolios, and also into the developing world. And you're right that Bada is a dark horse.

Nevertheless, I fully agree with your overall assertion about the mobile web. There are so many reasons why developers will get discouraged from writing native apps-per-platform when the capabilities of web technologies and frameworks are catching up so fast. (Disclosure! This is why I came to work for Sencha ;-) )

I hope we look back on native app stores as being a temporary blip in the inexorable rise of the (mobile) web, much as we look back at the AOL CD-ROMs and operator walled gardens of 16 and 8 years ago respectively.

[Andraz]

Hi Tomi

you are of course correct. But :)

If there is an opportunity for mobile app developers, then that opportunity currently lies predominately in apples AppStore. The competition just does not provide the environment that would generate results. Even though the competition on AppStore is enormous. That is why AppStore still dominates with startup ideas and will stay that way until Android picks up the paying clientele, or until Ovi store gets better, easier and more convenient end user and developer.

I do agree that certain content can be done in a much easier, cheaper and more rational way on wap, mobile web, etc... But! The majority of revenue on mobile app stores comes from games. And games can not be easily ported or developed using wap/web. So, if you are targeting the majority of the App market, you are probably developing games. So, you have to do it natively.

[Mark]

I remember at the turn of the millennium there was a lot of excitement around web opportunities and how fortunes could be made. Lots of venture capital money was thrown at start ups focusing on the commercial opportunities that might arise. Of course we all know now that the vast majority of these start ups utterly failed causing a stock market crash and ruining a lot of investors.

Fast forward a decade and it's apps this time. Unfortunately the scenario's the same, very few revenue opportunities and only a handful will succeed.

Plus ce change, plus c'est la meme chose.

[Romain]

Hi Tomi,

You often mention the widespread HTML, WAP and Java capabilities of low end phones in order to illustrate the size of the "dumbphone" opportunity, in particular in developing country.

However, the phone capabilities are not the only factor that define the adressable market: you need to take into account whether the user has subscribed for data services or not, because without an Internet access you can't take advantage of a mobile browser or Java VM.

And in developing countries, where people massively use basic pre-paid subscription, very few people actually have a data subscription...

Also regarding handset market shares in developing countries, I'd be interested in knowing if you account for the "grey market" that exists in those countries for consumer electronics.

In Morocco for instance, many phones are purchased on the street, in informal shops, including phones that are not officially imported there, like the iPhone for instance.

Don't you think that the real maket shares, taking into account "informal" sales, differ significantly from "official" market shares that only account for devices sold through legitimate channels ?

Oh and BTW thanks for the freebie, as always !

[Hoi]

Some good factual data in terms of start-up app developers its useful to look at these stats and determine which markets and focus you want to develop for.

e.g. Apple probably has the easiest onboarding/polished tools and process for app developers, but that comes with huge competition. Therefore, for a start-up who is still attempting to build reputation for their products, is this actually an easier way to gain traction? Would it make more sense to develop into an alternative large market (e.g. Android or Qt) attempt to gain traction vs less competition and then port over to Apple with a competitive advantage through reputation?

Secondly, even though some of those numbers are big (MMS installed base etc.) what are the actual usage statistics and what are the opportunities in accessing the paying use base (i.e. is it a case of doing deals directly with carriers?)

And of course, there is the revenue model, if we look at the 5%, 9%, 17% segments of the smartphone market share, which revenue model and pricing model is most appropriate for an app developer? Are the 17% as likely to spend money purchasing apps as those in the 5% , will the 17% click through more ads, purchase more virtual goods? It comes down to an ARPU per segment to strategically select which OS to develop for.

[kdt]

And when you talk about the "mobile market", looking at just phones is like the blind men feeling around on the Elephant. You can't ignore the iPod Touch or to a lesser extent the iPad.

[Timo Koola]

Tomi: About the start-ups and their opportunities in mobile. I accept that developing an app takes more money and yes chance of breaking to the front row are slim even when your product is sound. BUT. Is it really any easier for a startup to go the mobile-HTML/SMS/MMS route? How is it any easier to get noticed in the sea of gazillion web services or get any kind of visibility in the world where operators hold the absolute power? Furthermore, whatever you save on development you need to spend on marketing just to get to people trying your service. On app store you get at least thousands of people downloading and trying your app out and you MIGHT get traction started that way. And if your plans are to go global what share of revenue you expect to get from hundreds of operators that you need to talk to get the billing going? 70-30 revenue split of app stores seems overly generous if you have ever implemented SMS services.

How do you tell 1 billion people about the next coolest thing on their mobile browser? Or even 50000? How do you start the traction?

I can see the value for a "dumbphone" service for existing brands (Tescos and Coca-Colas of the world). You can use your existing marketing channels for getting the message across about your service. For startups you need to start with minimal marketing budget and zero brand awareness.

[Tim Harrap]

As ever the CDB blog feed is an important source of information on the mobile world courtesy of Tomi. As an aside Tomi/Alan I think the blog should add in a "Like" button for comments or the main article that prove interesting but one doesn't feel moved to comment further.

[Stephanie Rieger]

Hi Tomi,
Can you clarify how you define "a 'full' internet HTML browser" (pg 40 in your book)? The chart above on that page mentions XHTML browser but the sentence below mentions "full HTML". Then in this blog article you go on to say:

"Most phones in use worldwide today have a full HTML browser - even in the Emerging World, seven out of ten phones in use has an HTML browser. "

Are you counting XHTML MP (e.g. what you would find on all Nokia S40 before 2009) *and* HTML 4.01+ (Nokia S60 from ~2005 onwards, most S40 from 2009 onwards) many Samsung, most Blackberry, all Android and iPhone) in those calculations, or just HTML 4.01+?

Also, is the Opera Mini install-base accounted for?

Thanks!

[Alex Kerr]

@James Pearce (and others supporting the anti-Symbian, pro-iPhone view):

> "I am sure you know that Symbian, your 'world giant', shut down its developer web site (http://symbian.org/) earlier this month, and that Nokia has hardly rushed to get an equivalent up and running (http://symbian.nokia.com/)."

Hang on a minute James, I assume you don't know that all the developer focus for the Symbian platform (and in a future sense, MeeGo) has shifted to QT, right?

Plenty of developers are indeed realising the opportunity Ovi represents. Not just the market opportunity, but the quality of SDK tools (better than any other platform by multiple accounts from multi-platform developers) and the ease of developing software, or indeed porting (I keep hearing testimonies ranging from 2 days to 2 weeks to port full iOS apps to Qt/Symbian, complete).

Stats from 18th November were "At present, 92 developers have reached the 1-million+ download milestone each for their apps. (We were really hoping it was going to be 100 by the time we wrote this! Oh well – it will be next week). You can find out who they are here ( http://blogs.forum.nokia.com/blog/nokia-developer-news/2010/11/18/92-developers-over-1-million-ovi-store-downloads ).

And there’s strong evidence of considerable fresh developer interest in the platform. Over 2010, there have been more than 1.5 million downloads of the Qt SDK and more than 400,000 new developers have signed up with Forum Nokia over the last year. The move to Qt, which speeds up development and seriously reduces the amount of fragmentation developing for different devices, together with free app signing and an improved revenue share for developers are some of the key reasons behind this surge in popularity. There’s some great videos on Forum Nokia from developers converting to the platform here ( http://blogs.forum.nokia.com/blog/nokia-developer-news/2010/11/18/devs-share-experience-using-qt )."

As for Ovi Store itself, and thus the market opportunity: "The total number of users of Ovi now exceeds 165 million people, across more than 190 countries. And it’s growing at the new rate of 250,000 new users every day. Ninety per cent of visits to the Store lead to an app download – on average each registered visitor downloads 2.6 apps."

From: http://conversations.nokia.com/2010/11/18/ovi-store-3-million-downloads-a-day/

It also has in excess of 3.5 million downloads a day.

Now, any developer with more than a single brain cell, should go on iPhone App Store and look at the vast wealth of apps, games etc. And then go on Ovi Store, and see most of those missing from there. And then consider the above stats. And then consider putting two and two together and making four, and getting down to populating the Ovi Store and making shedloads of money. And the more intelligent developers will obtain stats about what apps and games are most popular on iPhone App Store and recreate the same, or similar for Ovi because you then already know what will work and make money.

I'd have said Ovi Store right now, is more or less as close as you're going to ever get to the development equivalent of shooting fish in a barrel. Yes, you still need to make a decent app with a decent idea, but given all the above, conditions are about as great as they're likely to be on any mobile platform.

Of course there will be those developers who cannot overcome their anti-Nokia and/or pro-iPhone or Android zeal and bias, and those developers will miss out, and chances are remain poor and disappointed and angry.

Nokia has done an incredible job (but not perfect, but who's is?) at setting up a great environment for developers to earn from. I'd say their main missing piece right now is advertising more fully the financial successes that existing developers have had.

[red bull hats]

Dear Tomi,
Lets Understand the Mobile Phone Market, installed base and smartphones vs dumbphones.That is a good article,thank you for your post,i have learned a lot,thanks.

[ameerh]

http://mobilephonemodelshub.blogspot.com

[Krishnan]

Tomi, Thanks for a good analysis as always.

Point I would like to also cover is the Meditek chipset based no brand/ no name / local brand phones. This is not accounted for in your statsitics.

I believe that there is a huge chunk of meditek based phones which are taking a huge bite out of the established dumbphone manufacturers especially in India, East Asia & Middile East and now perhaps even Africa.

[Brian S Hall]

Great work! Thanks.

[Tim Johnson]

Android users, G(.)(.)gle is watching you...

[karen millen dresses]

We will not be beaten on price

[karen millen coats]

Best choice and best discounts

[Tomi Ahonen]

Hi all, will respond in series

Hi James, Andraz, Mark, Romain, Hoi

James - good comments, thanks. And I agree the facts will pale with the perception game and Apple and Android have the hearts and minds for now. Lets see if Mr Elop over at Nokia can turn the marketing spin up a bit at the new 'Big Blue' haha (as a joke about IBM the original Big Blue of computers)

Andraz - good points and on games I do agree, in most cases a game works much better as a stand-alone app or as an app with connectivity, rather than a web service. Good point. What bugs me is the massive stampede by all sorts of media and consumer brands rushing to launch their iPhone app, like Boris Bikes in London for example. Talk about the ultimate in elitism haha, where most who would need a free bike can not afford an iPhone and most who have iPhones in London will have their own cars (some with chauffeurs, some with their own helicopters haha) and they would rather be seen riding their super-luxury carbon fibre bikes than a Boris Bike. And to help find where the nearest bike is? This is the concept of Kizoom for London Underground - done award-winningly on WAP what, 10 years ago. Argghhh

Mark - excellent point. And yes, I have been warning, that if the app hysteria doesn't calm down, we might be headed to a bubble. Not for all of mobile but yes, for apps. I don't think we're there yet but its looking bad

Romain - good points, but remember, for prepaid users and users in emerging markets, the PC penetration rate is very low. For those who need occasional web access, the phone, even very basic (and expensive data) is a reasonable compromise and often far cheaper than going to the internet cafe.

On the grey market phones, yes, I have been tracking them and account for them in my stats.

Hoi - good points. Let me just address the MMS issue here. The number I quoted is active users. These are people who send MMS (or pay to receive them). So if the user already is familiar with MMS (and has MMS capable handset, correctly configured etc) then for the company considering app or MMS, they are 'trained' users who are instantly ready to consume ALL you send at them via MMS. Meanwhile NONE of the smartphone owners are all ready. So the installed base of smartphones is overcounting the supposed opporunity. Some smartphone owners do not install apps - these will never be accessable. and of those who do, the brand has to convince them to do so. Very few apps pass the 1 million user level. So 100 million iPhones shipped, maybe 80 million in use today, maybe 70 million use apps, and of those a couple of million downloaded an Angry birds. But there are billions of active users of MMS.. The scale difference is massive.

Thank you all for writing

Tomi Ahonen :-)