Some products, like Vitamin Water, are entirely creations of marketing. Others have intrinsic properties that determine whether they will succeed or fail and no amount of marketing can overcome those qualities.
In this context I was struck by a new "James Bond phone" from Sony Ericsson. The company is doing a push for the C902 "Cybershot" in conjunction with the new Bond movie. Sony Ericsson posted a dramatic Q2 loss amid weaking demand for its phones.
From what I can tell, the otherwise unremarkeable C902 "Cybershot" is not going to be helped by association with James Bond or other clever marketing.
Plus, the title of the new film, Quantum of Solace, is one of the worst in recent memory. Perhaps Sony Ericsson should take a page from Nokia and try product placement with fantasy phones that are cool but, which haven't been produced.
In the U.S., carriers have been like ISPs only stronger, controlling users' access to content and being "kingmakers" of third parties seeking to reach mobile consumers. The carrier "deck" has been a kind of alpha and omega experience for most mobile users -- until recently.
The NY Times writes today how that's changing in a variety of ways. The article talks about the OpenMoko phone, LiMo's new phones, how the iPhone has impacted the market, the FCC's call for more openness and a range of other developments.
The U.S. carriers that "open up" faster and give consumers ways to personalize their devices and gain access to the types of content they want will win, those that resist will not. Sprint Web is a step in that direction.
Carriers also need to actively facilitate development of mobile applications for their handsets and make it easier for developers to "write once, publish many times." This even suggests industry wide cooperation, which is unlikely.
Carriers have a role to play, but not as "gate keepers" and "kingmakers." To the extent they recognize it they will benefit and help accelerate the development of mobile advertising and the mobile Internet.
As all rumors are these days, it's probably partly true and largely inaccurate. Yet, the UK's Daily Mail reports:
Apple is about to launch a 'nano' version of the hugely successful iPhone. It is expected to be in the shops in time for Christmas.
The product will be launched in the UK at up to £150 for pay-as-you-go customers by O2, the mobile phone group owned by Spain's Telefonica. 'This will be a big one,' said an industry source.
There's no detail generally beyond this and no identification of sources. It's intriguing to consider what an iPhone Nano might look like or how close it would be to the iPhone itself in terms of features, etc. Right now, however, it's just fun speculation.
Text messaging is a medium that many in technology and advertising are looking "beyond" to a time when the mobile Internet is hits true critical mass. That's a mistake. Other than voice, it's where the bulk of mobile data usage is today. Text messaging is today a "mainstream channel." Take these statistics for example:
From the Mobiya blog:
The Mobile Data Association report that Britons are sending 1.4 billion text messages every week, according to the latest figures. MDA said the figure was 30 per cent higher than a year ago. Picture and video messaging is also 30 per cent higher than a year ago, with 10 million picture messages sent every week.
Verizon reported in February that there were 20 billion SMS messages sent/received on its US network in a single month:
Seven years after the launch of basic text messaging, Verizon Wireless customers sent and received more than 10 billion messages in a single month -- June 2007. Eight short months later, the number of text messages on the Verizon Wireless network in a month (Feb. 2008) doubled to nearly 20 billion.
According to CTIA, in 2007 there were 363 billion text messages exchanged in the U.S. Compare that to about 120 to 160+ billion annual search queries in the U.S. While that's not exactly an apples to apples comparison it gives you a sense of the massive scale of this medium.
At a WhitePages.com-sponsored “blogger day” last week, I and LMS colleague Pete Headrick, had a chance to hear about where the company’s been and where it’s going: interesting places. It was preceded by a Mike Arrington-moderated discussion about the iPhone and several iPhone apps (Urbanspoon, Jott, and WhitePages). The demos and initial discussion were interesting but the conversation ultimately devolved into an iPhone vs. Android debate. The Seattle PI covered it here.
WhitePages.com is a terrifically successful business, selling (mostly display) advertising against its huge traffic and network — the company has relationships with most U.S. yellow pages publishers and a range of others, including MSN. It also owns a range of brands/destinations in the U.S. and Canada, including Address.com, PhoneNumber.com and 411.com.
The company also claims roughly 40 million monthly uniques. The most recent comScore “Top 50″ U.S. sites shows WhitePages.com at 42. But comScore likely counts traffic to WhitePages lookups on partner sites as belonging to those partners (e.g., Superpages). WhitePages’ database of people listings (collected through various methodologies) now is roughly 180 million according to the company. WhitePages says this is orders of magnitude larger than anyone else.
If my notes are correct, CEO Alex Algard said the site made something approaching $70 million in 2007. It’s a very profitable but not too sexy businesses. Part of the reason for the blogger day was to announce the company’s new direction. Consistent with that new direction WhitePages recently bought voice platform Snapvine.
What was most interesting to me, beyond the impressive metrics was this conceptual shift from directory to what the company is calling a “connectory.” What does that mean? It means a medium or hub for direct communications between people. As opposed to simply looking up names — the company cited a range of data on usage frequency — soon users will be able to leave voicemail messages for one another or send text messages to registered users’ cellphones, all via the site.
The rest of this post is on Screenwerk.
Sprint's recently announced "Sprint Web" combination of personalized homepage/home screen, Google search and other services is conceptually a model that other carriers will need to follow if they hope to remain relevant, amid smartphone growth and mobile Internet adoption. Carriers should reconceptualize their decks as "start pages" for the mobile Internet, which can be heavily customized by users. While customization of sites like MyYahoo! has historically been limited online my bet is that consumers will be much more willing do so in mobile, provided it's a relatively intuitive process.
Carriers need to provide consumers with access to the content and services they want or risk losing them as AOL lost its users over time. Verizon's pseudo openness moves are also something of a model. Carriers need to create or help facilitate software developer ecosystems like Apple, Blackberry and Android are doing or trying to do in an effort to built software that attracts their consumers.
Take the Samsung Instinct for example. The Instinct is a fine phone -- though no iPhone -- but it lacks software that would make it truly competitive. An Apple-like apps store of desireable software for the Instinct would make it "good enough" to compete effectively for those consumers who want to remain with Sprint. Right now, however, it's just a pretty good touch-screen piece of hardware with limited software. It has been selling relatively well as a kind of "poor-man's iPhone."
On the advertising side, Motricity's Brendan Benzing and I discussed the need for standards and metrics that help media buyers justify mobile ad buys, and how the carriers might participate in that process. Collectively they offer the greatest mobile ad reach in the US. However there's no easy way for marketers to buy across networks. And there are other problems with the execution of campaigns. However, the carriers can play a significant role in helping develop the mobile advertising ecosystem if they recognize the opportunity and can work together.
All these things will require cultural shifts at the carriers. They clearly need to make more money from data services as voice revenues growth flattens. But they also can diversify into other areas (mobile payments and commerce) and also help grow data revenues by making the mobile Internet more compelling and attractive for consumers to adopt. But that's not about the "walled garden."
What role the carriers are going to play and whether they're going to embrace the "mobile Internet" or remain quasi-walled gardens is the difference between being relevant to the future of mobile or simply being the ISP that provides access and little more.
In posting in its official blog promising "greater transparancy", Google provides some insight into how it will let searchers know when it is localizing or personalizing responses to queries. The company is very open to disclosing what it has inferred about your location and your interests based on past search activity. It will indicate as much with a notation that appears up-and-to-the-right on a response page.
Searchers can then receive more detail on the factors that are being taken into account as Google tailors its search results for each individual. In response to the drill-down, Google serves up a page that illustrates the last known location, the most recent search and what is known about the Web history. It also grants the ability for visitors to change their location and erase their Web history if they so desire.
This is a new feature and part of the company's "Commitment to Transparency." It is too early to know how many visitors will avail themselves of the service. It is also difficult to picture how it will be incorporated into mobile applications, but it seems like a ready made tool for individuals to refine their local searches.
Already available to Blackberry users, Google has extended its public transit information and directions to the Symbian and Windows Mobile platforms. The information is available via the Google Maps for Mobile client.
However, these advanced features and content are generally not available over WAP. But this is where the majority of the audience is (other than SMS). Metrics firm comScore recently reported that 73% of mobile subscribers accessing maps are doing so via the browser in the U.S. In Europe it's 57 percent. (Most people aren’t downloading mapping clients like Google Maps for Mobile or Live Search.)
Here's comScore data on mobile navigation and mapping market share in the U.S.:
Source: comScore (July, 2008)
IDC, which tracks global shipments of mobile handsets, said that smartphone growth was 40% YoY compared with 10% growth for so-called feature phones. But even feature phones are getting better and becoming more viable as mobile Internet access devices.
According to IDC here were the Q2 numbers for the top five global handset makers:
For those interested, here are the Motorola Q2 earnings.
Unprofitable Palm is selling its $99 Centro phone, despite a big consumer push by Blackberry and the iPhone. The company reported (via Bloomberg) the sale of more than 2 million units in little under a year. The Centro is available from Verizon, Sprint and AT&T.
Consumers are responding to the price of the full-featured phone, which is essentially a Palm Treo 755 with much lower margins. The company also just released an updated Treo, the 800.
Smartphone adoption drives much more data plan and mobile Internet usage. There's a direct correlation:
Source: comScore/M:Metrics (2008)