The decline and fall of HTC

Over the last week a number of people have been speculating on the future of HTC saying that it is at risk of disappearing.  The problem is that having climbed the mountain of volume sales of phones to number three it has failed to ascend to the top and rather has slipped back as a result of poor sales for the flagship HTC One (M9).

The problem for HTC is that the "upgrade" to the M9 was judged by most not to be significant enough from the M8 and so growth stopped.

The creation of the mobile phone mass market was achieved by a few manufacturers who offered a range of handsets.  The manufacturers of my early days in mobile are now consigned to museums rather than still major players, Motorola, Erricson and Nokia.  But then others older than me will say the same about car manufacturers of the early 20th century and we still have cars.

The global dominance of Nokia was achieved not on a single handset but rather on a platform of devices that were conceived thanks to long term analysis and developed not just internally but also using the skills of the IDEO Group.  This meant that both hardware and software evolved dependent on the markets that the handsets were sold in to.

The Android Ecosystem leaves very little room for customisation by manufacturers and contract manufacture means that common components leave devices looking very similar.

The shame is that the early days of HTC saw it make a range of handsets that made use of touch AND keyboard. Why then now are we faced with a single form factor in just two sizes? Perhaps we can expect contract manufacturing will give HTC some space to recover rather than it fail but it is more likely that it will pass into history.  

So where are we going in Mobile?

I look at the mobile ecosystem in Europe and fear that rather than making progress it is regressing, people are not innovating rather they are controlling costs in order to offer some kind of financial return for the shareholders.

Back in 2008 the former Strategy Director of Orange and I were telling everyone that if the Mobile Networks were to have a future as well as building out networks they needed to invest in improving Voice services or they would end up hollowing out the core business. Well I guess they were not listening.  My own family fear making telephone calls on the basis that they are too expensive regardless of the fact that I have told them that the tariff they are on means that they have unlimited to calls to fixed and mobile numbers in the UK. Asked to say how much a call costs they appear like a Government Politician asked the price of a pint of milk and a loaf of bread.

Meeting with others involved in Futurology and they have moved on from evangelising Apps to now push the rise of Wearables/Internet of Things/Big Data.  I am reminded of the Early Days of Imagineering at Orange  where they worked with Charles Church and Microsoft to build a House of the Future in Commuter Belt Hertfordshire.  People were asked to come and live in the house and then observed in an effort to understand what was possible and what was not.  The biggest issue I have with the Automation of the House is just how do we propose to install the technology into the millions of houses that we have already built because at 150-200K new homes a year it's going to take a very long time before the market is of significant scale without such.  I look outside my window at home and less than one in fifty houses where I live have a solar panel despite financial incentives. I know that I am due another round of renovations as it has been nearly ten years since I replaced the bathrooms and lighting. But I don't think that many others would say right now is the time to invest in enabling my house to be run by the Internet.

If I were to make the investment in enabling my house to be part of the next wave of technology what guarantee do I have that I have invested in the VHS solution rather than Betamax?  Worse still will my investment be that of MiniDisk proportions and in a few short months the novelty of the new has faded and I no longer wish to use Nest to control my heating system or who ever supplies my lighting system.  Worse still now will my connect fridge work if I persist in shopping at the Farmers Market rather than Whole Food Market? My artisan Butcher, Baker, Brewer and Cheese maker will not sully their products with smart tags and life is too short for me to inventory everything that comes into the house.

The fate of Nike's Fuel Band is something we can expect to see with Google's Glass and an number of current trendy fitness bands. Am I going to have another shoe box of tech junk that will only be fit for my own personal technology museum because they were once mass market and are now obsolete?

Perhaps now is the moment for the Mobile Networks to take greater control of there assets and whilst installing 4G technologies also adapt the API's that are used by Internet Firms to enable Apps and Internet of Things?  In doing so they can once again price the value of connectivity this time using terms such as Quality of Service, Security and Enhanced Bandwidth to get extra payment above that of basic utility prices.

We are at the very early stages of 4G in Europe, it will be another 2-3 years before the service is deployed to cover the majority of the Landmass in most countries and then the speeds available will slowly be increased and new services/businesses will come to the fore.  I do not expect that the companies that will dominate 4G are know yet just as Apple, Android and Apps were not on the tip of everyones tongue in 2003.        

Some thoughts about the recent developments in the handset space

Well the summer has been an eventful one for Handset Manufacturers.  We have had the expected refresh of the benchmark for smartphone from Apple and whilst they have managed to break sales records thanks to clever marketing and management of supply they didn't in my opinion retake leadership of the sector. Samsung continues to drive ahead with the expansion of the Galaxy brand thanks to a refresh of the Note and the introduction of a wristwatch form factor as remote control/2nd Screen. The car crashes have been spectacular with Nokia exiting the market via a fire sale to Microsoft quickly bettered by the offer for BlackBerry by Fairfax. Have not started analysis of the performance of HTC, LG, Sony who seem to have become casualties in the OS wars of recent years not server enough to kill them but bad enough to make them marginal players.

On the Apple front I was pleased to see just like others in the fashion industry they have given up trying to make size zero yet slimmer. I just hope that they and others will take note of the reviews of the two new iPhones side by side that report the 5c feels better in the hand and start adding curves. But please don't go over the top with a Kim Kardashian inspired monster, if that were to happen it would be on a par with the Pink Motorola V3 razr and signal that innovation had died and marketing was going to kill the business. On a negative front the changes seen with iO7 seem to be cosmetic rather than a genuine shift that takes into account that a 4G handset is a very different device to one that spends most of its time on Wifi. Perhaps next year the designers will rock up with a new OS that moves the world forward rather than paint lipstick on a fading star?

Samsung is a company that always surprises me when ever I interface with it. It's old school centralised command and control structure and long term planning seems inflexible yet surprises in getting the market right.  Unlike any of the other Handset Guys it still seems to value it's channel partners and has strong relationships with the mobile networks who after all will sell the majority of its handsets. Yet design by committee does seem to be throwing up some strange selections. The Mobile Phone business has spent twenty years telling people that don't need to wear a device on the wrist to tell the time and yet they come out and launch such a device.  Looking at the functionality I would have hoped that they would have followed Polar and combined fitness applications alongside the ability to be a second screen for a tablet/phone.

What can I say about Nokia without sounding like Tomi Ahonen? I would point out that when Nokia overtook Motorola to become Number 1 in the world it did so working with the Network Operators and up until the arrival of Elop maintained strong links.  The business was not in bad shape until it started listening to those say they need to get like Apple and so they put all their eggs in the Microsoft basket.

Until last week I was sure that Nokia would be the Business School case study in the decline and fall of mobile phone businesses but then we had BlackBerry!  Just WOW when will the lawyers start filing claims against the Board for mismanagement? When will the regulators start asking questions about financial mismanagement? When will the stockholders realise that Fairfax are the undertakers rather than saviours for the business and the body has greater value to others and seek better offers?  I don't think that we have heard the last on BlackBerry and would not be surprised to see Microsoft own the business once the dust has settled.

I think that we need a decent competitor to Google when it comes to Mobile OS and Apple is not it because it is focused just on the high end. I stronger better Microsoft that uses features from BES/BIS and can manufacture low cost devices that are sold via partners is just the kind of business that would scare the Californian Tech set and in doing so might force them to innovate and develop for a world based on 4G connectivity rather than the patch work networks we see today.

What I'd like to hear in Barcelona next week

Have been thinking about the upcoming MWC2012 and rather than looking at what shinny new handsets will be shown and how the GSMA will be "helping" the industry move forwards through strategic alliances I have written a wish list of what would help the mobile industry move forward.

As we make major strides toward the fourth generation of mobile networks I would like to see the head of Ericsson lead the industry forwards with an honest assessment of the current state of deployment of 2G, 3G and 4G networks what they are capable of doing and how they need to be melded together to deliver quality of service and best speed possible. The need for better chip design and roadmap to LTE terminals capable of using the high-speed network. What networks need to do to match services with capability.

I want the CTO of a Major Mobile Network to stand up and talk about Security, Security, Security as the cornerstone for the business if we are to move towards cloud based services and leave behind the world of Apps. I am looking for a CTO who can tell me how his Network is secure, my Device is secure and finally my Data is secure. Once he can tell that all three are secure then we can start to talk about the quality of the network in terms of bandwidth and coverage to enable me to do stuff via the Cloud rather than solid state.

I would like a Politician to start talking about how the consumer needs to pay for the use of the resources they consume, how spectrum is a key resource and in an effort to stop people wasting it people need to understand the present model of billing is no longer fit for purpose. In an effort to aid the consumer his Government has stopped selling spectrum but rather is now licensing blocks to Networks and the effectively regulating them for poor services, once the network is built and running effectively they intend to tax the Networks on profits made. The Regulation of New Mobile Networks will be done of the basis of coverage and speed in relation to the population and to assist in the quick and effect build out of networks planning permission has been revised to allow replacement of old equipment with the latest without needing a new permit.

Can we have an evangelist from the Silicon designers who is capable of explaining why System on a Chip designs are a compromise whilst we await better batteries, how the new Wifi and Fixed Wireless Broadband standards will impact on the development of GSM standards and how at this moment there are no chips capable of covering all the available spectrum and thus Software Defined Radio is once again stalled. Will the industry representative also take a stick to the current trend towards smaller smartphones and point out that what is needed are designs that will get teens, blue collar and emerging markets doing more with mobiles?

Finally can Martin Sorrell talk about how marketing is killing mobile as only an idiot would expect advertising to generate the revenues needed to give someone a free phone. As we become more aware of the way data on our habits is sold what kind of fool would allow themselves to be ripped off? What Brand would coupon customers to such a level that they make no money, once to get someone in the shop fine but if you have to keep doing it then they are parasites not customers because they will never afford what you are selling. Effective marketing is about getting people with money to pay as much as possible for stuff, when they stops the business starts to die and finally goes bankrupt. Consumers use of mobile is different from fixed and so don't just think that it is a new media on which to send junk mail.

The above are my hopes, my expectation is that we will be talking about a few new handsets that will keep Android out in front of the iPhone, RIM still has not got what it takes to compete with Apple and Google and Nokia can still make great hardware. The GSMA will talk about m-Health being the next big market for mobile and Machine-2-Machine is going to be massive (it's not as big as they think because lots of smart-meters will use powerline technology rather than 3G) and look at the success of M-Banking.

Thinking about Mobile Handsets

Over the last few weeks I have been looking at upgrading the handsets of my three daughters and so have reviewed what is on the market and what they wish to do with there phones.

This will be the fourth handset that my Twins have owned. At the moment they are happy users of a Blackberry Bold which are starting to show signs of age. They are not heavy users of either text or voice but they use BBM and Facebook with a little email. They are thus happy with the QWERTY form factor and when asked if they wanted a Blackberry Touch they declined as the find the lack of keyboard slows them down. They are looking for something that is robust enough to live with the knocks of life in a teenage girl’s pocket and bag that means it has to bounce before it breaks.

The youngest wants her second mobile phone to have a few more features that the basic candy bar she currently has. She does not want an iPhone as “the girls who have one at school are bullies and they all seem to be broken within a few weeks.” I have been looking at a number of Android handsets but she seems to like the Nokia Lumina 800 I have been playing with because it does not look girlie, has a good camera and the battery lasts.

When you look at the shelves in a phone retailer at the moment if you take the Blackberries away what you see is a Smartphone format that is almost uniform. It reminds me of the mid 1990s just as the industry was about to under go massive expansion and all you could have was a black brick, then Nokia launched the 5110i with snap on covers and Motorola and Samsung decided that we might like silver clamshells.

Perhaps we can pause for breath on the development of Operating systems and start to look at form factors? For a number of years I have thought that mobile users are unlikely to carry just one mobile phone when they are able to purchase devices and looking at fellow travellers on the train it does now seem that time has come. Not everyone wishes to carry a device with a 3½ to 4½ inch screen as a phone, so why not have some devices that don’t have a touch screen but rather a simple keyboard?

The interesting thing is that none of the three seem to be demanding a wide range of Apps with which to “personalize” their handset. The number of people they “chat” with on Facebook is a subset of their “Friends” with whom they are social both in the real and virtual world. They do want a device that gives access to YouTube. A VPN which would give access to catch up TV from both the UK and US would be very welcomed. But if that was not available no problem as they can do so via Laptop or Tablet.

When it comes to an upgrade of my handset, something that I can quickly synchronise with my car, laptop and headset would make life easy. As I tend to use my phone whilst driving something with very good voice command would be welcomed. I would love to get rid of the touch screen as too often I put my current phone in my pocket after use and the discover that because it was still active I have played audio books, surfed the web and changed the keyboard, theme etc. . Over the last 14 months my favorite handset has been my Vertu Ascent because it does what I want it to do and when I need something I just use the Concierge service.

So where in the centre of the mobile universe?

Spent an enjoyable couple of hours today putting the world to rights with some guys I respect in the mobile ecosystem. After joking about now nothing can work unless it's invented by Steve Jobs and comes via an App we turned to trends developing now. Both said that they are considering relocating to San Francisco as at this moment it seems to be the centre of influence as to where Mobile is going. They say that at this moment it is where the money and brains are.

But wait is that true?

I fear that they may be drinking the wrong type of Kool-aid. Whilst at this moment in time everyone feels that the mobile industry rotates around planets Apple and Google these are bubbles similar to the property and internet hype. The risk is that the centring of focus in the Valley will limit the view of demand.

When it comes to adoption has the rise of the App been as successful as SMS, Voice Mail or Ring Back? Will history judge the iPhone and Android as nothing more than a ringtone?

If I were to start a new venture then my investment would be in machine-to-machine and/or mobile healthcare. Given that I would want to develop relationships that enable me to build and exit a business is the Valley the best hub? Should I chose to relocate could I cope with Americans claiming that they rule the mobile industry when they have no understanding of the global standards, have yet to come to terms with the pre paid market because of the idiosyncratic payment system in the US of receiver pays and coverage of mobile networks is patchwork?

But where would I set up?

Europe is fragmented with many small sites offering expertise when it comes to hardware/software/services but does not have the access to finance needed to develop start-ups.

India has lots of Engineers but does not seem to have the ethnographers needed to offer a usable interface. It would be like returning to a Motorola Razr, wonderful to look at but a disappointment to use on a daily basis.

Japan offers money, wonderful networks and engineers looking to develop things people will use. However very few make call on a phone and so what we see is pocket computers as we head towards the cloud.

Where would you set up to have the best chance of success?

What would I rather pick up my phone or my keys as I leave my house?

Today Nokia launch their first NFC enabled handset.

With one of these phones can I replace my Oyster card? How about my NFC car fob? What about the Garage Door? An my Bank Card has NFC so can I replace that?

The answer to all these questions is at this moment in time is NO. Therein lies the problem with standalone development and the current fixation that the App Store is the answer.

Nokia has over the last four years been working with a number of stakeholders in the NFC ecosystems. Trials that I know of include a trial of season tickets at Manchester City Football Club, replacement of Oyster Cards in London, cash replacement trials in France. They have worked hard on the development of a technology standard that will replace card readers over time, they have studied hard the ethnology around the change in behaviour.

Why then is the launch of the new handset inhibited? Because the other stakeholders in the NFC space fear that they will become locked into a walled garden controlled by Nokia perhaps? How about the fact that the innovation required for such a service now faces a lag because too much resource is directed to the needs of Apple and Android development?

If the mobile is no more than hardware and as a User I have an expectation that just like an MP3 player I should be able to fill it with the content that I want. The launch of new technology such as NFC into the mass market needs to be Federated more. That is when Nokia launch such a phone it needs to be reported by my Bank, Carmaker and Transportation provider who all tell me that I can now use it to access their services. Lets face it no Call Centre Assistant you talk to so far would be able of facilitating the firmware upgrades needed to install new services.

Sorry I have been quite

It has been some time since I have posted anything.

The reason is that I have become more and more frustrated with the fixation that the answer is the iPhone for all things that are wrong with the mobile phone market. Just as Motorola got it wrong with placing all its eggs in one basket trusting everything to Apple is flawed.

Those that ask, what about Android? Have to understand that Google is just another walled garden and it to is flawed for other reasons.

The fact that both of these handset developers see the future as about the power of the App store highlights the failure to understand the ecosystem that is the Mobile Phone Industry. Observe the clamour of Vodafone Shareholders looking for the fire sale of minority equity assets to see the bonfire of the vanities.

Google does not seem to understand the timeframes the Industry operates under.

Apple sees life in a binary format of winners and loser which risks seeing the foundations crumble under them. As a futurologist I read the tea leaves for Apple as potentially pulling out of the phone market. Recent developments with the iPad, iPod and Apple TV could all point to no iPhone6. If the App store was the answer look for the BBC News app on the OVI and ANDROID stores it will not be the same one developed by Fjord for the iPad.

Nokia have replaced the CEO as he was unable to develop a handset that would kill the iPhone. As Apple is a very small rival and the real fight is with Blackberry his focus was on the right place. Yes fire him because he did not stop the rise of RIM but not for the lack of a high end handset that fails to complement the ecosystem.

If you fail to understand the need to support the ecosystem what you face is failure of the infrastructure. If Vodafone cannot see a return on the investment for new base stations why are they going to build them?

Once Mobile Networks employed anthropologists and sociologists to understand customer needs and develop products. Now they live on Internet Time which works on open development with Darwinian evolution. Evolution is difficult when the search methodology is a top ten list rather than accurate indexation with a standard taxonomy.

This post is me letting off steam. I might come back and develop some of the observations above or I might lie in a dark room and listen to whale music.

Confussion over the Handset market

I know that we are in a quite period as the holiday season starts to end with one last public holiday before the children return to school but if you take both the Observer and The Sunday Times you might be a little confused as to the progress of Android.

The Observer reports that the iPhone faces a threat, whilst the Times tells us that Google is failing in the smartphone market.

This week I have been talking to a number of clients about the OS battle that is taking place in the mobile phones space. In preparation for a workshop on Smartphones OS I decided that I would put aside my opinion formed by being a user for the last twenty plus years and get one of everything and use them for a few weeks. So I have started carrying a small gadget bag with something others than Nikons in. As well as the Nokia E71 I have a G1, Apple 3G, Blackberry Storm and I still carry my Sony Ericsson C905i.

I do not think that the mobile industry is in a battle for one single OS but rather the current EIGHT competing OS will be consolidated down to just three.

Talking with others who use Smartphones has been interesting. One current iPhone users told me that he was going to pass on an upgrade of his iPhone to the 3GS but rather he was moving to an Android handset and upgrading to Paid Google Apps so that he could work on the Cloud. Another told me that he keeps being surprised by RIM and has noticed how many women are using one to surf and network with rather than an iPhone. The Nokia users cannot see why they should jump ship and are hopeful that the divergence into Linux and Windows devices are little more than a distraction.

I have noticed that my iPhone seems to prefer WiFi to the poor O2 network when ever I want to use facebook, twitter, Yahoo, Shozu. The experience is no different from my iPod Touch and thus if I have an iPod why do I need the Phone element because I'm not using the phone network and payment is taken via my iTunes account. I am now using pictures in Twitter but is that worth the expense?

I seem to be having problems with the Android App Store and Installing software like Opera. The mail client seems good but the browser needs work. For me the mixture of touch and QWERTY keyboard is a pain. Might be a better experience on Vodafone than it is on T-Mobile but I am underwhelmed at present.

The Storm is an interesting experience. The device has attracted a lot of attention from my teenage twins who would both love to find in their bag for the new school year. The messaging is excellent especially BB to BB user and Facebook and Twitter are as good as on the iPhone.

I am starting to get the hang of the E71 and Ovi alongside Google Apps does make it a productive device. The battery life is far better than that of the other smartphones however I still find that I need to switch to Opera to work as quickly as I can with either my PC or MacBook. In switching to Opera a number of sites ask we to "use the browser installed by the phone manufacturer" what is this 1999 all over again?

When I am off out for a walk with my camera what do I put in my pocket? It is still the C905i it has a better camera and the battery does not die on me. Should I need it I have GPS and Opera takes care of the browsing.

From conversations and observation I feel that RIM and Linux will be two of the three that are left standing the other one is any ones guess. Mr Jobs has been at the phone thing for two years now and he still has not hit the target he set himself for sales outside of the US. If he were to launch the tablet / iPod Touch MAX and it was a success would he kill the iPhone? Most people I observe when I travel seem to have two mobile phones and they carry these in a bag rather than in a pocket and so a larger form factor will not be an issue providing that it is A5 in size rather than A4.

What ever handset OS wins the distribution model will have to change. Two year contracts will see handsets looking like they have been cared for by Vandals if my Twins handsets are anything to go by. One friend has changed his iPhone five times in the last year as it was starting to look used and the Apple Store guys let him. What is need is more Handset Vendor stores so that some may buy a handset and then buy connectivity separately. After all we know that the guy in Carphone Warehouse is not going to give us the best deal.

What about the other handset vendors?

Samsung OMNIA HD

LG Watch Phone

Sony Ericsson Idou

Having considered my opinion overnight and today taken a second walk around the stands I wish to say that in a time when the consumer is expected to part fund the handset upfront the rivals to Nokia do not seem to have taken up the challenge.

The Sony Ericsson stand this year did not have the excitement of last, the "new" handset on show was a Symbian S60 concept device.  When when demonstrated came with more caveats than the new Facebook TOS. What we saw was excellent however after the failure of the Xeperia what hope for this device?  The key display was the accessories that you can now get for your Cybershot or Walkman handset rather than new handsets.  Perhaps SE should have made its redundancies in a more effective manner and kept most of the product developers on?  Its showing in Barcelona says that after three good years the company may now face a downward move that might be difficult to arrest.  

Samsung were showing off their latest smartphone with OLED screen and Samsung's own OS.  The industrial design and display on the device is a delight the fact that it is running Samsung's software rather than Symbian or Windows Mobile is I think a mistake.  A survey  amongst those I know that have had a Samsung reveals that most hate the menus and software to a level that means they would not recommend the Brand to anyone or get a replacement Samsung.  The Company has relationships with both Nokia and Microsoft so why not accept the extra cost and buy the software from them?

LG had a stand that was interesting in that it held both the Prada branded devices and their own handsets.  The cabinet that had the largest crowd was the one with the watch phones.  Talking to gadget fans all were once again returned to childhood and wanted a device so that to could be a special agent. The shrinking of   handset into a simple device that does just voice and text has to be the ultimate second device for all those with an iPhone to complain of its poor performance as a phone.

The Motorola offering when it comes to handsets is best left unsaid lets say that it was only on my third trip the their stand that I saw the handsets.

ZTE was interesting in that they have a range of handsets that in terms of form factor look like those that we see here in Europe.  However they are running Linux and operate on the CDMA network.  They did seem to be busy talking with potential customers from the emerging markets as well as those in the west looking for low cost mobile broadband dongles.

Android had a busy stand next to Microsoft's in Hall 1 but whilst Google had booked a meeting room they like Apple seem to have taken the decision that business is best done away from the public eye.

The strangest demonstration over the last two days of a handset was of the Palm Pre.  The Palm employee kept to his script better than a soap opera star showing the Pebble like industrial design and the off screen gesture technology The ability to source contact email and calendar data from multiple sources was interesting the demonstration however was let down by the lack of information as to the build for GSM networks or the exact chipsets to be used in the production models.