Thursday, June 15, 2006

Dumb World No Place For Smart Phones

Just read an interesting article on falling smartphone software sales from an interesting blog (his experiences as a Sprint Ambassador should be compulsory reading for operators). I particularly liked the smartphone shipments graph aggregating the different analyst's sales figures which shows that, outside of the Symbian and Blackberry world, smartphone shipments are flat. Blackberry own a niche (suits) and Symbian through Series 60 is being pushed into the mainstream to users who didn't want a smartphone, and will probably get a rude awakening when they realise how much extra work they have to do to write an SMS (smartphone: a handset where phone functions are hard to initiate, but you theoretically could download lots of apps and you get to reflash the firmware regularly?).

Unfortunately, the major flaw here is that all software houses are talked of annonymously - what kind of software are they selling? Is it mainstream? Most customers won't want an SSH client or a Task Manager for their phone, so if these vendors are selling niche nerdy software they are going to struggle once the geeks have all bought it and the only market growth is into the mainstream, where people don't understand and wouldn't care if they did. It's impossible to say if this is the case, but I'd love to know.

Tantalisingly, after discussing a market which only covers 8% of handsets shipped in 2006 Q1 (18.9m of 229m), and therefore a significantly lower proportion of handsets in consumer's hands (4.9% in 2005?), Michael ends on this note:
"As a couple of mobile developers told me recently, 'we need a new platform.' I'll write about what I think that means, and the prospects for it, next week."

What could he mean? Shurely not a platform supported on all those smartphones and a large proportion of the other 92% handsets as well?

The risk to the smartphone platforms is that the consumer phone OSs will just overtake them, if they can retain the ease of use of a conventional phone whilst organically growing the features people actually want from a smartphone (something Michael broadly appears to agree with); the Betamax kids can stick with their 'technically superior' bricks whilst the world moves on around them.

This market shift has seen Nokia's Series 40 fall from the top of the usability tree to be replaced by Sony-Ericsson, who after the flawed T610 have come on leaps and bounds and have done an excellent job in integrating advanced multimedia etc into a snappy usable phone-centric OS. Even better, the grid menu hilights move very sexily and the JVM is rock solid and Jazelle fast.

With the 7210 Nokia did an excellent job transferring their market leading OS into the brave new colour screen world, retaining the simplicity of two soft key control and the tried and tested menu system. Then they just hung in there with some trully hideous skins (UI and hardware) as the rest of the market got sexier, before introducing a central soft key - no bad thing in itself, but they produced counter-intuitive rules for soft key layout that destroyed the UI's earlier simplicity. Poor keypad decisions on the phenominally successful 6230 didn't help. At the same time feature creep started to introduce confusion to the menu structure, and it's taken them a long time to overcome this (and there's still some way to go).

The sad truth is that most people don't buy phones on the quality of the UI - they may be put off by bad experiences in the past, but when upgrading they are more often bothered about price and looks (seem to have lost all my links on recent research about that topic, anyone?). Equally, to nominally tie this all back in to the title and start of the post, they don't tend to buy phones because of their smartphone features - they may want an MP3 player and they may want an OK camera, but normally this is a secondary requirement and normally it is to supplement existing single purpose gadgets and not to replace them. This will change over time as handsets diversify and start to fill these niches more snugly, but the all conquering smartphone will forever occupy the smallest niche of tecnonerds, jack of all trades and master of none.


Anonymous Anonymous said...

Is part of the smartphone platform idea that the platform will push down into devices that are not considered smartphones at the moment. Its about the creation of p

Michael's original post Dean Bubley also makes the point smartness is as much about manufacturer / operator benefits. I think thats well made. In some way it is the creation of a platform that is the important thing. That can be a platform for native apps or Java. (although lets face even the open OS platforms are fragmented).

Sony Ericson realise this too. You only need to look at the Java platform they are creating. But will a standardised Java platform )of just one manufacturer) be able to compete with a commoditised open OS platform?

11:32 pm

Anonymous Anonymous said...

Sorry looks like Blogger ate my comment (apologies for spelling / structure too).

Also: I'm not sure JME is any more viable as a platform thanks to fragmentation. JME running on an Open OS platform ins interesting though.

11:36 pm

Anonymous Anonymous said...

I saw your comment on Michael Mace's blog site and I'd like to share with you MY perspective on why app sales are nosediving. Furthermore, things are only going to get worse, since smartphones like the Treo 650/700 won't survive long now that so-called "featurephones" like the Sony Ericsson models ALREADY perform several "smartphone" functions better than the smartphones do. Microsoft was smart enough to try and move Windows downmarket towards the featurephone level, but Palm failed to release any inexpensive phones running PalmOS. Now Palm will soon be helpless, with featurephones ready to completely cannibalize the smartphone market:


PalmOS and Windows Mobile's first dirty little secret is that when you get right down to it, the average user has no need (or desire) to purchase commercial apps. They use only a fraction of the abilites of their devices (often just contacts, datebook , email and a few games) and will never bother to hunt for and experiment with a number of new apps. It's still far too difficult for a non-geek to find out about + install third party apps. I've said for years that every PDA should ship with a couple of CDs filled with hundreds of trial versions of third party applications - arranged by category - in addition to a DVD walking new users through ALL the features of the devices + how to look for and install new applications. Including these CDs/DVDs would cost manufacturers next-to-nothing, especially if featured developers piad a nominal fee (e.g. $1000) for the right to be included.

The second dirty little secret is the fact that featurephones have become so sophisticated that many potential PDA users are finding their needs met with these devices. The remaining customers that buy PalmOS and Windows Mobile devices are likely primarily upgraders - who likely already have all the apps they need carried over from previous devices.

The third dirty little secret is the lack of true advances in PalmOS (especially) as well as Windows Mobile in recent years. The spectacular failure of PalmSource to get PalmOS 6 ("Cobalt") used on any shipping devices really hurt the Palm economy. This meant a loss of sales to potentially hundreds of thousands of users who would have likely upgraded their apps to new versions taking advantage of Cobalt's new features. Similarly Windows Mobile's incremental OS upgrades have presented few resons for longtime users to upgrade their software.

The fourth dirty little secret is that Palm is now shipping more and more apps with its devices that compete with apps from third party vendors. Rather hypocritical decision from a company who used to tout how it left supplying advanced apps up to third party vendors and gleefully mocked the way Microft traditionally absorbed applications into the Windows OS collective. I'm not criticizing Palm's decision - in fact I believe they should have decided many years ago to stab the developer community in the back by licensing several best of breed apps for PalmOS and shipping them with every new device. (Backup program, security program, tabbed launcher, photo viewer, file manager, video player, etc.) Palm first changed their tune when they bought out MultiMail, then opened the floodgates with the likes of Desktop To Go, Pocket Tunes, etc. For the adventurous MINORITY of users that bother to actually add on any aplications there are THOUSANDS of FREEWARE applications available to choose from, and some of these are even BETTER than commercial competitors (e.g. TCPMP, a superb video player).

The fifth dirty little secret (and possibly the most important) is the proliferation of warez. As you know, far more applications are "cracked"/"patched" every year than are sold. PalmOS has been especially susceptible to theft due to the extremely weak protection schemes employed. More and more developers are now ceasing to release PalmOS applications and the loss of sales due to the MASSIVE warez movement is a significant reason why developers give up trying to make a living. I've been tracking the PalmOS (and to a lesser degree the Windows Mobile) warez community for a decade and it never ceases to amaze me how many people use stolen software. In fact, most of the people I've met/talked to that are Palm's biggest advocates (administrators/moderators of Palm OS websites, power users, etc.) regularly use warez.

Bottom line is that current trends suggest that it is becoming impossible for the average developer to make enough from mobile device software sales to make it worth the hassle of coding + supporting applications. I expect that in the near future our main options will be running apps that came with our devices and a few freeware apps coded by hobby coders.

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