Year 2012 will be a even more active year than 2011 for the mobile sector. There will be more services and applications coming on board in the coming year than before. Businesses and services are adopting a stronger mobile strategy in reaching out to the consumers. it will be an exciting and tough year for the industry as 2012 is earmarked to be a slow, arduous and uncertain global economical outlook. The following are some significant expectations or predictions that can be foresee in 2012
1. Apple was last year. It will be the year of Android
Apple hanged on well on 2011 with the launch of iPad2 and iPhone 4S. Comparing the 2 major smartphone OS, android has performed much better with the improvements of its OS in 2011 and is on the way to steal the lead from Apple in 2012. The total smartphones shipped using android has overtook apple position and the costs of producing an android phone has reduced significantly in 2011. Apple is still struggling to come out with a low cost phone which is suppose to be out in 2011. On the other hand, Android volume will increase by leaps and bounds with the strong backing of handset manufacturers behind its back while Apple is still a lone ranger and not much significant rise in 2012. Android handsets will capture a bigger market share (slightly over 50% of Smartphone Global share) with its penetration into emerging markets faster than Apple. Maybe this will start to mark the down turn of apple’s fortune.
Moreover, Apple rigid OS as compare to Android OS will start to see some toll due to the inflexibility. Open source versus tight control. No major changes is expected to come from iOS but the development of android will be fascinating as there are much more to come out of it. The OS development may mature for apple and android in 2012 as they have done almost what they can do in 2011. Also, check out china’s OEM development on android (http://www.insidemobileapps.com/2011/09/02/china-chinese-smartphone-ios-android-market).
One thing for sure, Google will be looking at ways to improve the monetization means on android. this is a lucrative business which Apple has shown to the world. there will be great improvements in the billing and extension beyond credit card payment could be in the works. (direct bank or operator billing)
How about the other OS? RIM is out of the race as the inability to turn around and capitalize on the current users is a major issue that needs to be resolved. Furthermore their ongoing hassle with mobile operators dampens their business outlook if bans kicks in. They will be struggling and rumors of takeover has surfaced recently.
Windows Mobile + Nokia, they will be searching for the right mix and pitch to try to increase their market share. They have done well with the recent launch but needs to do more. The need to open up their app store to developers with more incentives is one way of success. A weak app store means lower take up by consumers. we have seen it in RIM, hope that they will learn from this lesson. More to come from them, watch out as they are still a formidable force.
A silent player in the market although with the highest market share is always a relative unknown to the rest of the world. MTK or Mediateck (http://www.mediatek.com) is shipped with most of the featured phones and low end “smartphones”. In 2011, they have improved their OS and is gearing it to be a “smartphone” OS. They may start to may some noise but will not be a major concern as they don’t have a store that can appeal to mobile consumer yet.
2. Smartphones or Featured Phones? Which will Fly?
Currently the smartphones global market share still accounts (http://www.bloomberg.com/news/2011-11-15/global-mobile-phone-sales-and-market-share-summary-table-.html) less than 20% of the total phones shipped in 2011. if we take into consideration the existing phones and the new phones, Smartphones could be just 8% of the world’s total phone population. Nokia and Featured Phones has dominated for a long time but things will not be going their way in 2012 onwards. Manufacturers in China are adopting smartphone OS in their production (be it android or MTK) and is shipping non stop to global destinations.
This turn of tide will see smartphones percentage of global handset share grow at an amazing rate. Maybe it will be able to double the market share by end of 2012. Note that china’s shipped few hundred millions of phones per year and if we look back what was shipped 3 to 4 years back, it is will be a high time for those consumers to change their phone in 2012. Mobile Operators will not be offering lower end phones on their racks if smartphones are able to meet the low cost expectation as of a featured phone. Developers will be betting their development on smartphones in years to come.
3. Social on Mobile?
Social will still be a big thing as there are still many people that are not connected or have not start to connect. The influx of smartphones easily enables this process for the consumers in the emerging countries. Facebook will still be the number 1 and Google will be playing catchup. Something interesting may be cooking in Microsoft as their alliance with Nokia is gearing to move.
The growth on social on mobile will be greater than 2011 with thanks to the handset. We will see more localization on mobile and changes on the social networks in ways that people expresses themselves. Sharing, Discovery, Communication & Entertainment will be the stuffs that consumers will go after on social.
Also, we will see competition coming from the East to capture a slice of the social market. Tencent’s QQ from China, GREE & DeNa from Japan which are very successful social networks in their own countries has stepped out and is embarking on a globalization journey. The 3 of them has been active in different parts of the world in 2011 in their preparation for their expansion. Tencent (QQ) is making headways with mobile operators in asia pacific, GREE are moving into localization in Asia and DeNa has just setup to go office in asia but not sure of their direction. Those from Japan, it will be hard for them to bring their networks to asia but their ability to change and localize makes it a potential threat to facebook dominance. They will work with facebook and google but sidelining them will be a strategy in order to capture the local users.
Oops, forgot about twitter. do not see them making much impact in 2012. Also, Amazon will be growing well just outside the social networks.
4. Gaming, Mobile or Social?
Everyone play games on mobile and it is the best revenue earner on app stores. be it a 1 time off purchase or in app purchases, this is a cash cow that everyone is going after. More games will be out in 2012 and more games will be free. we will see influx of small developers that will create interesting hits on the smartphones. Most of the games will be geared towards single player game and social gaming will not dominate in 2012. Zynga will have more titles on mobile, same for other bigger publishers but there will be more success for games like Angry Birds or Fruit Slashing type of games on mobile. User’s behavior is a major concern as they still prefer to play it alone than with others (especially if it involved waiting for things to grow). Multiplayer social games will need to wait a while more with the need to change consumer behavior.
Games will be working hard on “gamification” as player retention rate is going to be low and churn will be high. it will be a concern for games provider in figuring out ways to keep the players especially those on the freemium model. Alternatively, more ads can be build into the game to cover the revenue loss due to churn but still, direct purchase is still the best option. Consumer spending on games will reach record high in 2012 due to more smartphones in the market.
5. What about Apps and Tools?
Not just gaming will see a boom, apps and tools are becoming part of the mobile user daily life essential. communication tools or apps will lead the pack. mobile users will make use more of such tools to communicate as it offers better stuffs compare to sms. Social, location and discovery apps will be next that will form a part of the mobile user daily life. However, monetization will still be an issue and reliance could still be on mobile ads. Non game apps providers will need to crack their head on this in the coming year.
6. Mobile Operators, which way will they go?
Mobile operators has been wickedly bashed by social networks and mobile OS companies in 2011. Traditionally, mobile operators are known to be slow and steady where they will not be quick to make decisions in adopting of service or technology and steady in believing that they are still the masters on mobile.
Mobile operators is still doomed to become a data pipe provider but not in 2012. they still will be trying to salvage their relationship with their mobile subscribers. in 2010 and 2011, their ignorance has caused them to lose the mindshare of the mobile subscribers to social networks. Initially, their thoughts was that Mobile OS and Social Networks will bow to their demands and will just because they own the network and mobile subscribers. things changed and very fast, mobile operators are really caught off guard and is having a hard time to adjust to the new reality (Although many of them are still in their own fantasy world). They have lost the users to social networks and mobile OS providers, their position has been replaced and to consumers, they are just an infrastructure providers.
Will they be content to be a pipe or do they want to go against (which is very unlikely) or find a middle ground where they are able to integrate and localize services with social networks and mobile OS. it is very unsure but cooperating to localize and integration of services seems like a better option. Mobile Operators, let me know if you want to hear of this strategy. (firstname.lastname@example.org)
7. Mobile Consumers, the bane of the mobile industry
they are the backbone of the whole industry, without them, we are nothing. this group of users has advanced a lot in technological expectation especially with the introduction of smart phones. their consumer habits has changed and is ever changing and improving. the needs to cater to their taste has created a lot of opportunities and heartbreaks. 2012 will see a rise in emerging market consumers and this will be the wave that the mobile industry should catch on. they are a new group with demands and desires where their world is opened up through the mobile device. it is high time for them to replace their own featured phones and nokias and move on to the new phones. Catering content and services to this sector will see some good returns for developers and manufacturers. Luckily, the emerging markets is big and has much to share for all. localization, discover and sharing will be important factors to move into these markets.
Overall, it will be a better year for the mobile sector or industry compare to 2011. even with a bleak economical outlook, strangely, mobile sector may not be affected that much. emerging markets will play a big role in substantiating and sustaining the mobile sector. their high demands for mobile handsets and services may grow and overtake the developed markets. Nothing is confirmed and let’s see how it goes.
Written by :
Robin Sagacious Ng
(the above written are purely based on personal opinion and views)