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« iPhone Q2 Results in Smartphone Bloodbath, very bad: Apple barely growing and bleeding market share (while making big profits yes) | Main | Bloodbath update Q2 Results: LG has strong quarter, Microsoft's Nokia unit flat and still unprofitable »

July 23, 2014


Aryan Ameri

The total disregard for Chromebooks and ChromeOS is interesting.

I think laptops' decline won't be anywhere as steep as you expect, if there is a decline at all. But I expect a good portion of the laptop category, as well as educational and some corporate PCs to shift to ChromeOS.

And that is the only thing I disagree with. The rest, I mostly agree with.

Tomi T Ahonen

Hi Aryan

I am sorry, I was not clear, I have to go edit the story - I count ChromeOS and Chromebooks as part of Android (And various MAC OS as part of iOS family)

Of the laptop migration, the early evidence is very clear most of tablet sales growth now coming at expense of laptops....


Tomi Ahonen :-)


What I do not understand is the prediction that mobile phone sales will remain over 2 Billion devices per year:

As the commodization of smartphones continues, I predict rather declining sales (as armchair analyst). I see two reasons for this:

- Contracts where you automatically get a new phone every two years seem to be declining. Instead more and more contracts factor in the phone separately (e.g. you pay €25/month for two years for your SGS5 or iPhone 5s, but afterwards you only pay the fee for the mobile contract - if you do not buy a new phone)

- Smartphones are becoming 'good enough':

- If you are not a gamer, you do not need more horsepower
- Screen sizes should remain roughly the same
- LTE with 50Mbit/s is good enough for most people, you hardly notice a difference with LTE 100

Honestly I do not see new 'killer features' on the horizon - bigger screens, more power and LTE were important during the last few years, but we have all of this now.

When I look at Samsung, I clearly see a pattern here:

- SGS: Was a very good phone in its days, but still seemed slow sometimes, e.g. when surfing
- SGSII: Dual core, bigger screen, higher resolution, ==> felt faster and better overall
- SGS3: Quad core, higher resolution, LTE ==> made really a difference when surfing, no big difference anymore for most apps
- SGS4: Faster quad core, higher resolution ==> the difference is not very noticable (tried it out for myself)
- SGS5: Slightly faster quad core, same resolution, a few gimmicks like fingerprint scanner ==> hardly a difference anymore

Now cheap Huawei phones are as good as the SGS3 meanwhile.

So my question: Why shouldn't people keep their phones longer? If they do so, sales will slow down I guess...

Tomi T Ahonen


Great question and argument. Yes, if people were to start to hold onto their phones longer, yes the cycle would become longer and annual sales numbers slow down and decline. However, every single year the average replacement cycle has been shrinking or holding, not increasing. What you observe is probably from US market where still most phones sold on contract (most other countries have long since shifted so that majority of mobile accounts are prepaid, with a few exceptions like Japan). Those still, even with 2 year contracts, the trend is towards multiple handset ownership so the owners will then balance two accounts so, that every alternate year they get a new phone on one network or the other. As the Industrialized World has passed the point where more than half of us have now 2 or more accounts most of us also thus carry two phones (not all). That again helps accelerate the replacement cycle overall.

But yeah, in most markets, there is no connection between contract type and replacement cycle. So regardless of prepaid or postpaid, both types of customers see a regular decline in the replacement cycle (shorter cycle, faster replacement of phones).

I was the first to report on this bizarre trend in the world as we first observed it in Finland at the time. I also have the most accurate models calculating that rate and am monitoring it keenly. If the replacement cycle slows down, I will be the first to report it here haha...

But great observation and argument. It may still go that way towards the end of the decade if the handset evolution kind of 'stalls' - but there is really no sign of that when I look at advanced phones like we have here in Asia, and as they even spread to laggard markets like the USA haha...

Tomi Ahonen :-)


I believe Chromebooks should count as Linux more than Android. Linux has 1.37% market share according to Stats Counter
I can't believe you didn't even mention Linux. I thought you were a Finn.
On a side note, I watched a documentary about the Winter War. What an amazing story.


Tomi I just can not agree with turn rate for PC and tablet PC.

~50% of those are corporate, and however I look at those I can not see tablets replacing those in corpo environment. While thin client is not ready to be usefull for using tablet as terminal.

And there are also gamers, who wont do without their 300+Wats monsters-instead-of-GPU.

So only tech that would allow such feat would be ability of plugging those tablets to power supply, big 19'+ monitor and full keyboard. Like some current corpo notebooks are used.

But even with this, its improbable, as tech (performance) is not there still.

And for gamer niche. Well its still very big, and mouse & keyboard & big screen & big power supply are too important. Mobile gaming should decrease that number, but even consoles could not at their best kill off PC gaming.

So I think that those numbers a too extreme, because of those two groups, who are not gonna switch so suddenly.


So #1 player will be Korean. After that number 2 and number 3 rivals who should ship more phones than Apple by then, the strongest candidates now are Chinese and Chinese but Korean, Chinese, Chinese and Chinese would also all be in the running for the second and third largest (smart)phone makers by 2020."

What's wrong with this picture? Where's the rest of the world?

abdul muis


first, the pc versus tablet number. I was surprised you think that it will be like 25% PC/notebook vs. 75% tablet. I think since tablet is new right now, so the person who doesn't owned a tablet, but own a PC/notebook will prioritize to get tablet. But once it's saturated, the tablet percentage will going down little by little, while pc/notebook percentage going up little by little and find it's equilibrium point. I don't know what it will be, but 25% PC vs. 75% tablet is kind of surprising number to me. Because I think tablet only good for media consumption, and PC still better for media creation. Do you think tablet will replace PC/notebook as media creation device at the office? Do you think you will be able or feel better writing / managing this blog on tablet instead of pc/notebook?

2nd, I agree with @aryan, a couple of days back, Chromebook might be the next big things for desktop/notebook. and chromebook is not a tablet, so it should be count in PC/notebook.

abdul muis


first, the pc versus tablet number. I was surprised you think that it will be like 25% PC/notebook vs. 75% tablet. I think since tablet is new right now, so the person who doesn't owned a tablet, but own a PC/notebook will prioritize to get tablet. But once it's saturated, the tablet percentage will going down little by little, while pc/notebook percentage going up little by little and find it's equilibrium point. I don't know what it will be, but 25% PC vs. 75% tablet is kind of surprising number to me. Because I think tablet only good for media consumption, and PC still better for media creation. Do you think tablet will replace PC/notebook as media creation device at the office? Do you think you will be able or feel better writing / managing this blog on tablet instead of pc/notebook now or in the future?

2nd, I agree with @aryan, a couple of days back, Chromebook might be the next big things for desktop/notebook. and chromebook is not a tablet, so it should be count in PC/notebook.

3rd, BB market share. 1% out of 2 billion is equal 20 million phone / year. right now BB is struggling to sell 10 million phone / year. is it a round up?

4th, (a question) So apple peak out, but will survive in 8%-9% market share?


Samsung and Apple still numbers 1 & 2 in 2020? Mmm...

Watch out for Huawei, their own Kirin processor already outperforms Apple's A7 and Samsung's Exynos in the Antutu benchmark, not bad for the new kid on the block. On top of that they don't have the baggage of 'greedy, short-termist' shareholders to deal with.

Huawei is an extremely ambitious company that is already producing high quality hardware at a very reasonable price and they're growing fast. I think it will be squeaky bum time for both Samsung and Apple long before 2020.


I was also surprised to see tablets overtaking desktops and notebooks so forcefully in your projections. I couldn't imagine my life without a big screen and a keyboard at my desk to get real work done.

I'm quite happy with my recently purchased BB Z10. It's a workhorse and an email beast, but I would never write any lengthy emails or do any editing on it if I didn't have to. There's also my web surfing habits. I currently have over 200 tabs open in firefox on a 24in monitor. I don't see any phone or tablet in the foreseeable future being able to come close to matching that experience.

It's a shame about BB, Jolla, and now Tizen even. It seemed like they were all (well BB and Tizen at least) so close to securing a sizable minority of the market but have sputtered out. I wish Jolla would have come out with a very expensive super phone (which I would have bought had it worked properly) and carved out a real niche for themselves. It was too good an opportunity to waste on mediocrity.

Aryan Ameri

In Tomi's defence of his laptop/desktop/tablet projections, let me say that the distinction between these will blur even more, and I could see a scenario where the majority of them are tablets, but hooked up to a big keyboard and monitor (perhaps all wirelessly) "to get work done".

If that scenario comes to pass, the vast majority will be fine with tablets as their main computing device (coupled with a smartphone of course). They can just take the tablet near the monitor/keyboard and it all wirelessly "magically" syncs with each other and the display shows up on the monitor, perhaps a slightly different UI more suited to precision pointing devices (like a mouse).

But keyboards and big screens are not going anywhere. Too many people rely on them to get work done.


I get your underlying angst with MS/Nokia... and it is there we both know that.

I think the real issue is just apps - its that perception that the consumer is fed on a regular basis.

Is that changing? yes

when will that change affect WP?
Thats hard to say as it more about consumers coming to terms with smartphones perceived value and the actual value they personally achieve.

I think the thing that no-one can fairly estimate is, is that the market has been technologically driven (apps/HW) and this is coming to an end. Its the maturity of the market and consumers will start to look at phones as well phones again.

Also the free windows paradigm( sub 9.1") now coming its hard to say what that will do ( obviously better) but right now MS is the only one changing their model.
ie 14 new WP manufacturers
and a bunch of new budget windows devices.

I think Googles bi-polar disorder; the holistic services company with a disfunctional platform exclusivity will just fracture Android so far people just won't know what they are buying... a android device means exactly what? (ie aosp or Googles)

I think the way forward is less clear today than in the past 4-5 years.

Tomi T Ahonen

Hi Everybody

Excellent disucssion here and many questions and commments. I'll respond to you all now. But first just in general, this is a mid-length forecast and at the longer end of the range that I usually do forecasts (most of my forecasts are for less than 5 years, often less than a year). So with longer time horizons, there is also more chance for error in the forecast. With that, I will of course be here on the blog and monitor these numbers as they start to pan out, and point out if and when any one element on the forecast starts to veer off the path I had anticipated.

There are many good comments in the discussion - and Jonas Lind at Mobile Foresight has already posted a set of comments at his blog about my forecast, agreeing with some aspects and arguing others. His very well reasoned blog is at this link

I warmly welcome the discussions and will happily engage with as many as I can on the blog here now. As I am on summer vacation, I happen to have better time now haha, so at least the first people will all get responses now...

Tomi Ahonen :-)

Tomi T Ahonen

Hi cornelius and przemo

cornelius - haha, yeah the Winter War story is astonishing and is now even more striking with recent Russian empire revivalism. Chromebooks yeah are also Linux based but so is Android. So in some way Linus Torvalds wins the ultimate war without actually gaining anything from it, though. On Linux on the computing side, yes it is a small percentage now but in the big picture shift away from desktops, then 'pure' Linux will be in that 'other OS' group and very slight in numbers.

przemo - you make very good points both on corporate and gaming PCs. Here the recent numbers are critical. On the business use of personal computers we passed the point already late in the past decade that the majority of PCs are now sold to consumers, not businesses. So their proportion once was as you describe but that is no longer true today. The majority of PCs sold are now laptops and majority of PCs are sold to residential users not business users. But out of those business/corporate users, there is some use where a tablet is about as convenient as a laptop and in other cases - like say retail uses by store staff - the tablet is actually more convenient than a laptop or definitely a desktop. That doesn't mean that the desktops at the calling center etc will be gone. No, they won't. There is a pretty reliable basic business/corporate need for desktop basic computing that does not need to be moved from that office and even a laptop would be wasting costs. Also there are some uses of laptops where they are clearly better than tablets - me writing my next book, I won't do that on a touch-screen device haha... But the majority of PCs sold today went to consumers and most of that was to facebook etc type of uses. Then the far lower costs of the tablet come into play allowing the convenience of ultraportability but without the hassles of a keyboard... So I am assuming the vast majority of existing household PC users will migrate to tablets, plus a smaller portion of business/corporate users. And I am assuming most of the growth of computer sales goes to tablets rather than laptops or desktops. But the final percentage could be 67/33 or 80/20... we have to see how it goes, but I am quite confident tablets will clearly take the vast majority of new PC sales.

The gaming side is more interesting and one I do not know that well. I am sure you are correct that there are plenty of heavy gamers who need their horsepower and will get high-performance PCs for that. I did not model their proportion out of the total desktop PC market (where I am guessing the majority is, not in laptops while I know there are also laptops optimized for gaming) but I recall that the PC side of gaming has been relatively flat or only modest growth in user numbers for quite some time as the mobile side of gaming has continued to grow strong. I am guessing that out of total desktops and laptopts in use, not more than 10% would be to the heavy gamer segment with gaming-optimized computers. I have no data to prove this now, I am just remembering recent visits to computer stores and that their focus was not strongly in this segment. If its 10% or even twice that, the gamer numbers alone are too small to make a significant change to the forecast. So if we say 32 million personal computers (desktops and laptops) today are sold for gamers annually, my forecast allows for that to remain flat until 2020 and they still will not be the majority of desktops or laptops sold at that time. An ever increasing proportion of the shrinking overall slice, yes, but still not even half of all desktops, nor half of laptops sold by 2020.

Tomi Ahonen :-)

Tomi T Ahonen

AndThis and abdul

AndThis - China is the manufacturing base for the world and as the mobile industry is the fastest-moving industry (most volatile) it experienced the total shift from other countries to China, first. 80% of all handsets sold in the world including the iPhone and even African brands like MiFone and Solo - are manufactured in China.

abdul - good point about split between Desktops/Laptops vs Tablets. I am observing early trends and consumer behavior. The traditional PC market (desktops and laptops) had shifted from majority-sold-to-business, to consumer sales in the previous decade. So the significant majority of all PCs sold today go to homes, not offices. For home users, the tablet is a compelling change now, when they consider an upgrade to their slowly-growing-obsolete home PC. Very clear trends show that consumers today are switching from home desktops and home laptops to tablets. That is the primary driver of my forecast. The second part is business use. Some business use is shifting from leptops there to tablets. Sometimes driven by covenience like in retail sales situations or warehouse staff or factory supervisors etc. But in other cases its also driven by the accountants, if for 'minor' convenience significant cost savings are achieved downgrading from laptops to tablets, the accountants will drive this shift.

Tomi Ahonen :-)

Tomi T Ahonen

Hi Won, Ben and Aryan

Won - good point about Huawei. My regular readers will remember that last year I was calling Huawei the strongest of the bunch chasing Samsung and said it was slightly ahead of the rivals as the challenger who might become number 2. They were growing fastest and with most steady pace. But then their rival Lenovo just leapfrogged them in the race by buying more market share by acquiring the Motorola handset business. Some of the growth in this industry will come from consolidation and we may well see some players like HTC and Blackberry sold (as possibly Microsoft may sell parts or all of its Nokia unit as well). Those buyers will tend to be the most hungry/aggressive Chinese players but there is an outside chance that a Micromax or Karbonn or Lava from India might make that kind of move too and suddenly jump into the middle of the Top 10 squabble.

Ben - about screens and keyboards. Very valid point but please don't make the mistake of assuming regular consumers are like you, reading this blog. We are geeks here. Normal consumers are not like us. So yes, I will always prioritize a large clear high-definition screen on my laptop not least because I travel enormously and often watch my DVD collection (on several terabyte size hard drives) on my travels. Same with not just a keyboard, but I need a laptop keyboard with full-size keys, as I have learned to touch-type long ago in the time of the manual typewriter, and I type very fast and I cannot type efficiently with keyboards with smaller keys than those that are spaced out like a classic 101 key keyboard ie like a classic typewriter. As I visit various PC stores, I see that the light-weight ultraportable laptops with still full-size keyboards are a gradually diminishing breed haha...

Yes, there are lots of - millions and millions - of people like you and me who do want high performance screens and keyboards and real mice on their computers but that is not the mass market majority. Most people want to access facebook and see a video on YouTube and just maybe do a bit of their banking online. For that a tablet is perfectly fine and the tablet works particularly well in the home as its so convenient both at the sofa and the bedroom. That is the mass market

Aryan - excellent point about the tablet becoming the portable center of computing with separate keyboards and large screens in the homes/offices. Something that some geeks are already doing. I tried doing that with the Nokia E7 but after a couple of weeks fumbling with that setup, I was back to my separate laptop and using the E7 more like a PDA than the center of my computing haha... but the scenario is ever more compelling with tablets and ever more powerful smartphones (I tried it briefly again last year with a 7 inch tablet running Android BTW and very quickly tired of the fact that nothing was as fast or well connectable as on this Samsung 900X notebook still running the OS I hate the most, Windows haha). But yes, I totally agree that soon homes with offices will have the peripherals arrayed for office use, keyboard, screens, printer etc, and the actual computing 'CPU' will be the portable device be it a tablet, smartphone or laptop. Increasingly that will be tablet for heavy users but probably also growing slice will be pure smartphones with enough horsepower and storage etc..

Tomi Ahonen :-)

Tomi T Ahonen


Your comment is dangerously close to being Microsoft astroturfing but let me assume you are not a troll and lets deal with your points on the assumtion you are making a genuine argument here, not just trying to push Microsoft propaganda.

You say the real issue is apps. If that was the case, then in the past Apple would have easily towered over all Android makers and Nokia could not have outsold Apple's iPhone in 2010. So historically that wasn't the driving issue and all consumer surveys tell that apps come far down on the list of what consumers ask for when buying a new mobile phone (screen size and camera usually come at the top).

But you also say that apps are now changing and we shift from a tech-driven era to consumer-driven era. Yes. I agree that kind of shift is happening although it had been going on for years already. Nonetheless, if that is the case, then Windows Phone is spectacularly poorly poised now to 'capitalize' on any apps-driven interest as most app developers have quit on Windows Phone, the existing apps are mostly developed for older incompatible versions of Windows Phone and Microsoft has to now resort to bribing developers to do WP versions of popular apps. The consumer surveys say consistently that consumers find Windows Phone apps to be the worst versions of any popular apps too, that they are cheap 'me too' copies and not offering advanced abilities. If what you say is true, then Nokia Lumia and Microsoft Windows smartphones had some chance in this say 2 years ago but by now the opportunity is truly rotten.

Then you say the consumer tastest and preferences will create uncertainty into the market. That is true. BUT, the handset market is different from all other consumer electronics markets in that the carriers/operators are gatekeepers who decide which phone manufacturers and which of their models are approved for their market. This is what Elop said was his biggest lesson he learned as Nokia CEO, how much the carriers/operators control the market. (And we know, Elop essentially torpedoed Nokia's industry-leading best carrier relations). So creating even the most desirable phone ever will not matter if the carriers block that phone. We saw this with the original Google Nexus. We saw it again with the Microsoft Kin phones. We saw it for years now with the boycotts against both Windows based smartphones of all manufacturers as well as another boycott against all Nokia smartphones. Elop himself admitted these boycotts when talking to Nokia shareholders at the annual shareholder meeting. Yes, its possible consumer preferences change the game. It will cause changes to other players. It cannot help Microsoft and Windows Phone and Nokia Lumia as they have alredy been put on the black list by the carrier community (because Microsoft owns Skype, something that Elop also explained in great detail, this was when even Nokia's own Lumia phones did not have Skype on them). Your point has some merit, but it cannot help Microsoft. It may bring more volatility to the market with the other brands.

The 14 handset makers propaganda is mere propaganda. Did you know Owen, that there are over 2,000 handset brands globally. Yes over 2,000 brands. Microsoft Windows based smartphones have been sold by 9 out of the 12 largest smartphone makers of 2013 (at some point in their history) ie Samsung, Sony, LG, Huawei, ZTE, Nokia, Lenovo, HTC and Motorola. But 5 out of those 9 have already QUIT the Windows smartphone business as not commercially viable. So that silly propaganda of 14 newcomers to Windows who all have combined less than 1% market share is silly, where these 9 brands controlled 59% of the planet's smartphone sales last year. If there was any COMMERCIAL opportunity out of Windows Phone today, then Samsung, LG, Huawei, Sony, Lenovo etc would all RUSH to introduce Windows Phone based smartphones. That Microsoft has to discover 12 brand that nobody has ever heard of to 'promise' smarpthones - some of which will never materialize - that is pretty pathetic by Microsoft. But the ignorant tech press in America who don't understand mobile globally, have fallen for some Microsoft propaganda and are now peddling a myth. If you are a genuine person Owen, you consider this paragraph and its relevance and reconsider Microsoft's chances (ie that they are utterly doomed if most of its EXISTING or past partners have rejected it). if you are a troll, I know this won't matter as you won't even read my response..

The free windows paradigm is 5 years too late. Microsoft owned 12% of the smartphone market late in the past decade. THAT is when it should have done this free bit. Not now when they have 3%. As it is only a 'me too' strategy and other OS platforms are also free, it gives nothing in a competitive advantage but brings all the Microsoft and Windows baggage in a non-compelling offering. This all before we take into account that carriers/operators are telling their manufacturers clearly that they don't want Windows versions of smartphones in their stores. So Android (or Firefox etc) versions appear instead.

Lastly on Google confusion. Maybe. I think Google has very clear purpose of vision and single-minded focus on winning the race to the pocket which they won, and now expanding that to take the remaining digital OS space from PCs to wearables to TVs to cars. But you say the next years are more volatile than the past few years. In the past 5 years we saw Windows go from 70% of all computing devices sold to 20%. We saw Android go from 20% of all smartphones sold to 80%. We saw iOS go from 90% of tablets sold to 40%. There has never been as volatile period in the tech industry as the past 5 years and I am old enogh to remember the OS wars of Windows and Macitosh and DOS. You say the next years will be more volatile. I don't see any signs of that. Maybe you exaggerated, now thinking with hindsight, is there any tablet OS rival that has any chance to suddenly displace Android (Surface haha). Or any smartphone OS to replace Android (even Tizen is now pretty well dead). Or anyone who could possibly replace Microsoft Windows on the desktop in the next few years? No. I think the tech space is now exceptionally STABLE for the fore-seeable future and the disruption will come more from outside the tech industry (cars, TVs, wearables) etc than from within it.

That all assuming you Owen were sincere in that comment haha... Else this was a waste of a good cup of cappuchino here at Pacific Coffee in Hong Kong

Tomi Ahonen :-)

abdul muis


I was wondering if you already calculating ANDROID ONE as a disrupting factor when you do the calculation.

ANDROID ONE is a google initiative of a low cost (bellow US$100) but well supported android device. Google co-operating with 3 India android maker (micromax, carbon, spice) as a start. With android one, google create an engineering sample board and supply it to any company who want to create an android one device. then any company can use the board, and create an android device without changing the board/design. Google will be the one that giving the OS update/support. Google believe this will solve the problem of cheap android device that were not really supported by it's brand maker, and will accelerate android adoption at a higher rate.

The problem with android one is, once the low end is getting better by a wide margin, it will drag the middle and upper solution. So, this will change the equilibrium of phone pricing as we know it today. I believe this will hurt apple business more than anybody realize when reading that announcement. So, I think apple will hardly be able to maintain their 8% out of 2 billion (160 million) unit/year.

BB and WP will also be devastated with this android one movement. Right now WP is well known for cheap but fluid device, when Android one is comming, WP will be hit. But I think the one will be hit more is BB. So, I was surprised when you put BB number as 1% out of 2 billion (20 million unit) / year. Because in developing country, BB is not corporate device, but it just a cheap device with cheap messaging platform.

Giacomo Di Giacomo

I disagree with your forecast about tablets. Tablets are useless toys that can do little more than surfing the Web and watching videos. The reason for less desktop and laptop PC sales is not that they are being abandoned, but that the installed base is already very large, since the run to higher performance has ended some years ago. My idea is that tablets will peak in some years and then decline, when the number of new users drops and the market turns into a replacement one.

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