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2010: Year of the smartphone

01 Aug 2010

There is still a fair chunk of 2010 left and yet already, it will go down as one of the most remarkable years in the rapidly evolving history of the hand-held device – the ‘smartphone’ and its cousin, the ‘tablet’.Cloud computer offerings are becoming all the more ubiquitous.

Social networking, instant messaging and wireless email continue gradually melding together, and wireless email becomes ever-more commoditised. It follows that increasingly, the smartphone is becoming less an exclusive toy of the enterprise executive than it is an ever-more indispensible business tool for SMB executives. It isn’t going to slow either – Gartner’s research estimates tell us that wireless email users will hit 1 billion by 2014 (currently 80 million).

Unquestionably, (by way of both hype and metrics) the market this year for portable electronic devices has already belonged to Apple. Earlier this year was the much-touted, first generation iPad which has recently become available in NZ, and the controversial iPhone 4, about to come our way.

The iPhone 4 offers features demanded by users in 2010: crystal-clear high-resolution display, quality camera and HD video-recording capability, plus multiple and easily accessible software applications. Even though Apple has been dogged by controversy surrounding an apparent design flaw in the aerial, this is likely not enough to derail the phenomenal success of the product. Other smartphones may well function better, yet can only dream of the loyalty the iPhone receives.

Apple has sold more than 51 million iPhones since they hit the market in 2007. It is important to note that Nokia still dominates the global smartphone market with over 40% of the pie, but this market share has slipped and continues to fade. RIM’s BlackBerry is second, but only gained three percent growth in the past year.

Apple (remember – three years ago not a player in this market at all) is already third, with a phenomenal doubling of its global market share in the last 12 months to 15% of global market share. Add to this the equally (if not more) important statistic that Apple dominated global mobile web traffic over the past year, thanks in no small part to the iTunes download facility unique to Apple devices.

In the crucial US market, interest in smartphones continues to accelerate. Apple is undisputed heavyweight champion. In a June 2010 survey, 52% of those surveyed planned to buy an iPhone. HTC smartphones, which are powered by Google’s Android platform (at the expense of Motorola, who also use Android) were a very distant second and the notable loser was the BlackBerry, which appears to have lost its ‘cool’ factor.

Palm, once a smartphone trail-blazer, is dead and buried. Interestingly, HP has recently won a bidding war to purchase Palm for $US1.2 billion in heated competition with Google, RIM and Apple. The company’s huge IP and patents arsenal provided the key drive for acquisition. Oh – and there is no sign of Ericsson, who along with Nokia received the lowest customer satisfaction response in the same survey.

None of this matched the Zeppelin-esque crash of the most unmitigated smartphone disaster in history: the ill-conceived launch earlier this year by Microsoft of the ‘Kin’ smartphone, aimed at ‘Generation Social Network’ (read: 15-30 years). Despite a billion-dollar investment and several years’ R&D, the product suffered from fatal key feature omissions (try: no access to instant messaging) and was pulled from market after 40-odd humiliating days. It may have more success sticking to its knitting in the market with its Windows 7 mobile platform, which is garnering positive reviews thus far.

Perhaps more unfortunate was the speedy demise of Google’s foray into the smartphone market, the Nexus One, despite having a favourably-reviewed feature set.There are, however, some fascinating new product releases occurring, and still to follow this year. Motorola is determined to win ‘the Android war’ and has made a bold statement of intent with the new Droid 2 smartphone.

Meanwhile RIM will be desperately pinning the highest hopes on its soon to- be-launched BlackBerry Bold 9800.

All this offers clear indication that the smartphone market is set to continue on its fascinatingly lucrative vertical trajectory, and in New Zealand the smartphone will increasingly be an option for a larger number of businesses at both enterprise and SMB level