Europe

Holy Crap: 1.7 Million iPhones Out the Door

Apple announced this morning that last week's launch of the iPhone 4 generated sales of 1.7 million, higher than the most bullish estimates:

Apple today announced that it has sold over 1.7 million of its iPhone® 4 through Saturday, June 26, just three days after its launch on June 24. The new iPhone 4 features FaceTime, which makes video calling as easy as one tap, and Apple’s new Retina display, the highest resolution display ever built into a phone, resulting in stunning text, images and video. 

According to survey data, however, more than three-fourths of these early sales (at least in the US) are from existing iPhone owners upgrading:

  • 77% of the iPhone 4 buyers were upgrading from a previous version vs 56% in 2009
  • Only 16% of buyers were switchers to AT&T from another carrier, down from the previous year 

If the device were available from other carriers sales volume might have been 2X this.

There are many surveys that indicate pent up demand in the US for an iPhone from carriers other than AT&T. Accordingly, a new online survey (n=4,000 adults in the US, Canada and UK) about features that iPhone owners would like to see revealed the following: 

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Among current and potential future smartphone users, 39% of US respondents indicated they wanted other carrier choices. It's not clear how many of these respondents are current iPhone owners. But it confirms the point I made above that Apple continues to lose sales by remaining faithful to AT&T in the US.

Opera: 'Nighttime is Prime-Time' for Mobile

Opera has released its most recent State of the Mobile Web report. In addition to the usual country specific data, Opera also examined usage patterns to see when usage was heaviest. The company found that it was roughly the evening hours from 8 p.m. to midnight. However it would false to draw the conclusion that other hours saw little or no usage.

According to Opera: 

  • The highest level of Opera Mini use is at the tail end of the day – from 8 p.m. to midnight. That said, users in the United Kingdom are just as likely to browse on their phones between 8 a.m. and noon.
  • There is little difference in data consumption between weekdays and weekends.
  • The least amount of mobile browsing is done in the early morning (when most people are asleep), between midnight and 8 a.m.
  • In general, evening browsing (between 4 p.m. and midnight) is more common than daytime browsing (between 8 a.m. and 4 p.m.), except perhaps in China and the United Kingdom where daytime/evening usage is about even.

A recent report from ad agency Interpublic subsidiary Initiaitve shows some trends that are parallel but distinct in some respects. Based on a consumer survey (n=8,000) in multiple countries the agency found: 

  • 60% of mobile Internet access/usage is happening in the home and, in general, mobile Internet use happens throughout the day
  • Giving new meaning to the phrase "mobile first," 30% of smartphone users start their day with mobile internet and 45% end with it. 
  • The heaviest smartphone-driven Internet usage happens in the evening (for 64% of respondents) -- at home
  • Consumers are also using the mobile Internet while they're doing other things: TV, radio, PC, print media.

(emphasis added.)

Here are the "top" charts from Opera for the UK, US and China. The iPhone is the top device for Opera in the UK and US and Google is the top site in both countries according to Opera.

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Interestingly Google.cn is still on the list despite Google having "pulled out" of China officially. 

Is RIM the New Nokia?

What I mean by that headline is the following: Is RIM, the dominant smartphone vendor in the US market, about to see its fortunes decline as it fails to compete with the leaders and innovators in the segment?

Despite a very strong first fiscal quarter, there's a perception that BlackBerry is lagging and will have trouble regaining momentum. According to the company's quarterly results, released yesterday, Q1 sales increased approximately 24%, but still missed analysts' consensus estimates. The company had revenues of $4.24 billion but analysts wanted more. The company announced a stock repurchase program to keep share prices stable. 

RIM co-Chief Executive Jim Balsillie has said that the company will be introducing new devices that will make it more competitive with the iPhone and Android handsets. These include a potential tablet and the forthcoming "Torch," which will have both a touch-screen and slide-out keyboard.

Reportedly BlackBerry App World is now seeing roughly a million downloads daily. However, RIM lags both the iPhone and Android and has the most expensive apps. It's also a platform that less than 40% of developers are focused on.

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Let's be clear RIM is unlikely to be able to produce an "iPhone killer."

What it needs to aim for is a "good enough" alternative to the iPhone -- a version of its current phones that offer the beloved keyboard functionality and a better Web experience that what's currently available. (RIM has vowed to develop a better browser.) The company needs to focus on loyalty and retention. Indeed, BlackBerry user loyalty lags Android but especially the iPhone.

If the company moves too much in the direction of aping the iPhone it's unlikely to best the Apple device and will suffer for the comparison. But because it has won in the enterprise it needs to maintain and strengthen those features that make the handset appealing to corporate IT decision makers as well as building out enough consumer functionality to keep it generally competitive.

Ironically many younger, heavy SMS users, like RIM's handsets because of the keyboard. As they move "up market" and seek mobile-Internet enabled devices they are likely to abandon RIM unless the company can create a better mobile Web experience. 

iPhone Mania Goes Global

From Tokyo to San Francisco, there are lines aplenty on iPhone 4 launch day. Here is some of the coverage and video:

  • TechCrunch with live video from the line in San Francisco.
  • An account of being online in London last night from CNet UK.
  • Business Insider has photos from different Apple stores around the world. 

In Paris at the Louvre Apple store:

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Credit: SAI

Video from New York and London:

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More coverage:

Google Brings Nav to More Countries, Maps to GM, Upstart App Offers Free Nav to iPhone

Google is making its mobile Navigation app available in more countries, throughout Europe: Austria, Belgium, Canada, Denmark, France, Germany, Italy, the Netherlands, Portugal, Spain, and Switzerland. It's voice guided and offers voice search. In a related development, Google expanded the number of European languages for Google Voice Search. 

Google's free Navigation (which works well) has not yet come to the iPhone, whether for technical or competitive reasons. However a new free app from Berlin-Germany based Skobbler offers free turn by turn navigation on the iPhone. I haven't used it so can't comment on its quality. It uses OpenStreetMap for base data. 

Finally, Google Maps are now a part of GM's OnStar functionality. Users can email directions from PC-based Google Maps to select GM cars. Ford has also integrated Google Maps into its Sync system and will allow users to send directions to Sync from the PC or smartphones. Sync was co-developed with Microsoft so I would expect comparable functionality for Bing. 

Will Microsoft Tag Mainstream 2D Barcodes?

In Japan and elsewhere in Asia 2D barcodes (QR codes) are widely used. They also have momentum in Europe. However, despite a range of efforts, they're largely unknown to mobile users in the US. I suspect that within two or three years, however, they will be mainstream in this country.

The virtue of QR codes is that they can connect "the real world" to dynamic information and the Internet. Magazines, outdoor ads, websites, real-estate signage and other marketing can use barcodes to provide offers, additional information and so on. The can also track performance of those media. It's very similar to how SMS can connect traditional media and marketing with the digital world. However QR codes only require that users capture an image of the code graphic. Yet they also require a software download. 

Consumers with smartphones are getting accustomed to scanning conventional UPC codes in stores for product information. It's just a hop, skip and a jump to QR codes (or some version of them). And Microsoft Tag could become the driver of that mainstream scenario.

Last week Microsoft said it was making the Tag technology available to anyone that wanted to utilize it for free:

Today we’re announcing that Tag is coming out of beta and that basic use of Tags will be free of charge. This means you will be able to generate and use Tags that link to our standard scenarios, such as linking directly to webpages, and use the reader application at no cost. By simply going to Tag.Microsoft.com, you can create Tags and deliver rich interactive experiences on mobile phones, track your Tags, and read about how companies such as Conde Nast and others are using Tag. 

An interesting use case explained in the Microsoft blog post I quote from above describes how Tags are being placed on public monuments in Amsterdam:

Amsterdam became the second world city with a Tag-led tour, with Tags on monuments, museums, restaurants, bars, and other landmarks. The Mall of America, in Minnesota, has announced plans to use Tag to help enhance customer engagement and give retailers an interactive tool to promote their products. 

The challenge to 2D barcode adoption in the US is the lack of standardization; there's no single universal code in use and not enough installed users. It's a bit of the old "chicken and egg problem." Microsoft hopes to popularize Tags and overcome that problem by making them free, as well as the consumer software necessary to read them. 

Facebook is also potentially going to introduce QR codes (although the use cases aren't yet clear). But if any site has the capacity to educate users about a technology it's problem them. 

Opera Receives an iBoost

Late last week Opera released its lastest State of the Mobile Web report, showing just how much of a boost the browser has received from being on the iPhone:

  • In April 2010, there were over 2.6 million unique users of Opera Mini on the iPhone.
  • Most likely due to the interest generated by Opera Mini’s new availability on the iPhone, the United States jumped from #8 to #6 in the top 10 countries list.
  • The United States is ranked #1 in terms of Opera Mini users on the iPhone, and the iPhone is the #1 handset used by Opera Mini users in the United States, well ahead of BlackBerry (which previously occupied the top spot).
  • The United Kingdom is ranked #4 in terms of Opera Mini users on the iPhone, and the iPhone is the 5th most popular handset used by Opera Mini users in the United Kingdom.

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Nokia & Yahoo! Announce Strategic Alliance

As expected today Yahoo! and Nokia announced a strategic alliance. As part of that the two will incorporate selected services into each other's offerings:

  • Nokia will be the exclusive, global provider of Yahoo!’s maps and navigation services, integrating Ovi Maps across Yahoo! properties, branded as “powered by Ovi.”
  • Yahoo! will become the exclusive, global provider of Nokia’s Ovi Mail and Ovi Chat services branded as “Ovi Mail / Ovi Chat powered by Yahoo!”
  • Nokia and Yahoo! plan to work on ID federation between their services, beginning by making it easy for people to use their Ovi user IDs across select Yahoo! properties to easily access the online content and services they need.

The integration will begin later this year and roll out globally in 2011. Ads and search, interestingly, don't appear to be part of the deal. The deal does, however, offer Yahoo! a solution for its mapping product -- a product that had led the market initially but has now fallen way behind Google and Microsoft. Nokia gets additional credibility and reach for its Ovi Maps, powered by subsidiary Navteq. 

It's curious to me that the press release and related materials are silent on the question of search and advertising.

Navteq has built/is building its own ad network. Does Navteq get to put ads on Ovi Maps on Yahoo!? And one would think that Yahoo! would have sought to be the "default" search engine for Nokia handsets.

I'm trying to find out more about these areas and will update this post if I get more information from Yahoo! 

Update: I just got this from a Yahoo! spokesperson:

Search is not part of the initial agreement announced today. The two companies will work on future collaborations.  The companies plan to monetize the services in the future. 

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Let's consider what might be the most intriguing mobile aspect of this deal from a Yahoo! perspective: Yahoo! branded turn-by-turn navigation. Google Navigation is a terrific app. Ovi Maps has tried to match it and claims better data and routing (vis-a-vis Navteq). Yahoo! could potentially just co-brand Ovi Maps and throw in some additional Yahoo! Local content along the way. 

I would be surprised if Yahoo! didn't see this opportunity and want to develop it. That, combined with the chance to make Yahoo! (PC) Maps better probably justifies this entire deal. 

Report: Yahoo in Deal with Nokia

Wall Street Journal blog AllThingsD is reporting that on Monday Yahoo! will announce a partnership with Nokia:

And, according to sources, that will be a deal with Finland-based mobile phone giant Nokia (NOK) to build Yahoo (YHOO) email, search and other applications and services into a range of its devices.

While the pair had once discussed Nokia making a Yahoo-centric phone, sources said that is unlikely to be part of this deal.

Nokia remains the largest handset maker in the world, with the dominant smartphone share -- though mostly outside the US. According to the latest Gartner numbers, Nokia has a 44% share of the global smartphone market. 

Obviously then if such a deal is confirmed, it would represent a huge boost for Yahoo!'s mobile efforts and network, which is considerable and global but has lost mindshare and coverage vs. Apple and Google's mobile initiatives. 

Asked for a response to the rumor a Yahoo! spokesman said "We can't comment on rumor or speculation." That generally means some aspect of the rumor is correct. 

New Facebook Mobile Site Will Cement Dominance

Facebook already has 100 million active daily mobile users. With the introduction of a new, faster and free mobile site it will likely double that number in six months. Here are the details on the new 0.Facebook.com:

Collaborating with operators from around the world, we developed this new mobile site with two main attributes:

  • It's fast: 0.facebook.com includes all the key features of our standard mobile site m.facebook.com. Users can update their status, view their News Feed, like or comment on posts, send and reply to messages, or write on their friends' Wall just as they do on Facebook.com. Rather than making photos viewable on 0.facebook.com, we put the photos one click away so they don't slow down the experience. You can still view any photos on Facebook if you want but your regular data fees will apply.

  • It's free: Thanks to the help of mobile operators we collaborated with, people can access 0.facebook.com without any data charges. Using 0.facebook.com is completely free. People will only pay for data charges when they view photos or when they leave 0.facebook.com to browse other mobile sites. When they click to view a photo or browse another mobile site a notification page will appear to confirm that they will be charged if they want to leave 0.facebook.com

I've argued that it's only a matter of time before Facebook becomes a mobile ad network. When the company introduces location, together with all the data being collected via the distribution of Like buttons there will be many possibilities associated with mobile marketing and advertising. There's also a fairly massive coupons/deals opportunity for Facebook in mobile (as well as on the PC).

One way to think of Foursquare right now is as a mobile loyalty platform. The Like buttons and fan pages also make that a possibility for Facebook as well. 

More Handset Share Numbers & How Many Apps Is Enough?

Android and the iPhone are the rising stars in Gartner's new handset figures -- especially Android. RIM has also made gains internationally. Once again smartphone sales are driving the market in Q1. Awaiting the launch of Windows (7) Phones later this year Microsoft-powered handsets continue to lose ground. 

Smartphones now represent between 22% and 24% of all handsets in the US market. As these figures grow so will mobile Internet usage. In Europe several markets are in a comparable position.

Below are the Gartner global share figures, by overall handset sales and then smartphones. For reference, you can compare Q1 hardware numbers from IDC and comScore

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In the US market right now it has become a three-way race between RIM, Apple and Google. Outside the US Nokia remains dominant.

One of Apple's competitive differentiators, the size of its app store, is going away at least vs. Android. Right now Apple has more than 200K iPhone apps to Android's 50K or so. But 50K is probably sufficient for most consumers and the relative size of the app stores will cease to matter. Furthermore most iPhone developers are building Android versions of their apps. 

I've noticed that Verizon is also advertising the fact of Android apps to try and close the perception of a competitive gap between the iPhone and Android.

What's also interesting to see develop is advertising around particular Android handsets. In one TV commercial for the Moment or Behold (I can't remember which) Samsung is seeking to differentiate via the handset's screen as well as seeking to create an image of mystery or sophistication around the device. By constrast the Verizon/Motorola Droid remains targeted toward males with a kind of "kick ass" attitude. This kind of image building will be both challenging and critical for the various Android OEMs in an effort to build sub-brands within the Android universe. 

Accordingly, how these Android hardware OEMs seek to both emphasize and de-emphasize Android in their marketing and TV campaigns will be fascinating to watch. They need to communicate to interested prospects that these handsets are Android devices but then quickly move on to focus on other features: better cameras, screens, proprietary UIs, etc. as principle points of differentiation from other Android devices. 

Putting aside the operating system fragmentation issues, the dozens of Android OEMs and the evolving hardware ecosystem is both a strength and a weakness for the platform. 

Yahoo!: 10% of iPad Traffic from Outside US

Yahoo! released some analysis and insights regarding iPad usage of its sites and network. Most of the analysis is demographic in nature and is as might be expected in terms of affluence, gender and age. However one point made in the past is that 10% of the iPad-related traffic Yahoo! is seeing is coming from outside the US.

How's that? The iPad is only available in the US right now. It appears people are buying iPads in the US and shipping them (or carrying them) back to their homes in Europe and Asia. Here's what Yahoo! says:

One surprising data point is the non-U.S. IP traffic on the iPad that’s coming to Yahoo! During the measurement period, the iPad has only been available for purchase in the U.S. market; however, we observe approximately 10% of IP traffic coming from Europe and Asia Pacific. Specifically, the U.K., France, and Germany are the top countries in Europe, and Taiwan and Hong Kong make up the most traffic in Asia Pacific.

Here are some graphical representations of the data released by Yahoo!:

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Update: I was wrong about non-US tourists or business travelers; it appears the answer to the "how did they get them overseas?" question is eBay.

Google Goggles as Language Translation Tool

Google Goggles (visual search) is a product that doesn't yet live up to its promise. But if Google can continue to improve it it may turn out to be much more useful than conventional search in mobile. To that end Google recently acquired startup Plink to improve the product.

Now Google is offering a potentially compelling new use case for Goggles: language translation. According to the Google Mobile Blog:

  • Point your phone at a word or phrase. Use the region of interest button to draw a box around specific words
  • Press the shutter button
  • If Goggles recognizes the text, it will give you the option to translate
  • Press the translate button to select the source and destination languages.

Today Goggles can read English, French, Italian, German and Spanish and can translate to many more languages. We are hard at work extending our recognition capabilities to other Latin-based languages. Our goal is to eventually read non-Latin languages (such as Chinese, Hindi and Arabic) as well.

This functionality builds on Google Translate. It uses image-text recognition to get the desired phrases into Google Translate and then the native language of the user. I assume this also works for signs on the street, in addition to text on mobile Web pages. 

The use cases and value of this are obvious. 

Like Google Navigation Goggles should eventually make its way onto the iPhone and other smartphone platforms. For now, however, Google is keeping Goggles for Android exclusively. 

IDC: RIM Bounces Moto from Top 5 OEMs

IDC has released mobile handset estimates for Q1, saying that the market is rebounding from last year with almost 22% growth. Smartphones lead the way:

Growing demand for smartphones also helped Research In Motion (RIM) move into the top 5 vendor rankings for the first time. RIM, which replaced Motorola in the top 5, tied Sony Ericsson for the number 4 position in IDC's 1Q10 vendor rankings. RIM shipped 10.6 million units in the first quarter while Motorola, which had been a top 5 vendor since the inception of IDC's Worldwide Quarterly Mobile Phone Tracker in 2004, shipped 8.5 million units. Motorola, the number 2 overall vendor in 2004, registered a fifth place finish last year by virtue of its overall strength in the lower-growth traditional mobile phone category. Motorola has steadily lost share since 2004 when the market started its shift toward higher-end feature phones and smartphones. The ongoing shift has given rise to converged mobile device vendors such as RIM and Apple.

 Here's the global Q1 handset OEM hierarchy according to IDC (unfortunately there are no smartphone figures here):

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As mentioned Motorola was bounded from the top 5 by RIM.

AR Browser Maker Launches 'Paid Layer'

Netherlands-based Layar has launched an "app store" of its own -- a "paid layer" on Layar. The augmented reality (AR) browser says it has 1.6 million users. In a bid for more usage and a business model, the company has announced that it will offer users the ability to unlock paid apps or content that can then be viewed within the AR browser environment:

The Layar Payment Platform is setup to support multiple payment providers and multiple currencies, ready to serve the different local markets. Layar deals with legal, administrative and tax rules enabling the publisher to focus on their core activities: creating valuable experiences. The first payment provider is PayPal, supporting payments to residents of United States, United Kingdom, Canada and Australia. More countries, currencies, payment methods and payment providers will be added regularly . . .

The first publishers to seize the opportunity include among others:

Berlitz City Guides: Berlitz helps people experience the city’s highlights: the best attractions, coziest restaurants, most comfortable hotels, coolest places to shop and most fashionable nightlife.
Mouse Reality for Disney World and Disneyland: Helps find and navigate all attractions, shows, shops, dinning, transportation, and more in Disneyland and Disney World.
EyeTour: Explore Puerto Rico’s natural beauty and rich cultural heritage through exclusive video content of historical sites, museums, restaurants, parks and more.
UK sold prices: ‘Sold House Price Data 2010′ – Check the latest UK residential Sold Price information as recorded by the Land Registry while on the move.

Here are a couple of screens from the Berlitz city guide app within an app:

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This makes great sense for the company and may help it offer something different vs. competitor Wikitude and eventual competitor Google (Goggles). The challenge here is to have high quality, unique and/or branded content that is not readily available otherwise. Otherwise, free content and local information on other apps will prevent this from really taking off.

AR will have a future as a quick way to get access to more information or content about a place, product, person or object (e.g., a painting or building in front of me) vs. keying in or speaking a query. But today it remains mostly a novelty and not a daily utility. 

Vodafone to Offer Nexus One, Not Verizon

Vodafone the minority partner in Verizon Wireless will begin offering the Google-branded HTC-built Nexus One this Friday. Across the pond, Verizon has pulled the plug. The carrier was originally supposed to offer the device but has decided against it for unspecified reasons. According to Bloomberg:

Verizon Wireless, the largest U.S. mobile-phone company, retreated from plans to offer service for Google Inc.’s Nexus One phone, saying it will focus on other Android-powered handsets instead.

Until this morning, Google’s Web site showed that the Nexus One would be available through Verizon in spring of 2010. The site now points Verizon users seeking phones that run Google’s Android operating system to HTC Corp.’s Incredible model.

Now for the speculation about why Verizon made this decision. The article cites financial analysts who conjecture that Verizon may see Google as a competitor and not a partner in this context. I think this speculation is incorrect because why would Verizon have associated itself with the device from the outset?

Instead, the sudden reversal it may have to do with potentially unhappy camper Motorola, which has bet the farm on Android and doesn't like the idea that Google is creating its own handsets. Verizon has spent millions marketing the Droid handset against the iPhone only to have the Nexus One show up and "one up" Droid in several ways.

Motorola clearly didn't like that and Verizon may have made a concession to the company in deciding now to no longer offer the phone. 

Glympse Enables Mo-Lo Sharing on Facebook

Glympse is a simple and elegant mobile app that allows "real-time location sharing" via mobile devices. Users who receive a "Glympse" (via email or otherwise) can see the movements of the person in real time on a map, as he or she travels to a destination. We wrote about it when the company launched a year ago. It has versions that work on the iPhone/iPod Touch, Android, Windows Mobile and of course now the iPad. Glympse continues to build out its offering and service and today announced real-time location sharing on Facebook:

Glympse goes beyond static "check-ins" or a simple map showing your location, and allows iPhone™ and Android users to quickly update their status via their mobile phone so their Facebook friends can follow their real-time movements on a dynamic map, for a set period of time.

It also works via Twitter too (although you only get the link via Twitter and must click away for the rich media experience). 

The person receiving the "Glympse" doesn't need any software online or on a handset to see the map and movement. That functionality has now been extended to the Facebook news feed so that Glympse user movements and the related map can be viewed in the Facebook news feed like you might view a video in-line.

Here's a screenshot: 

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Glympse users can share their location and subsequent movement with one person or many depending on whom they choose to notify. (What's not entirely clear to me is whether, when I send a Glympse to my wife or friend, all their Facebook contacts get to see my movements too. I supsect there are controls and that's not the case.)

The video below shows a demonstration of how it works and how it operates on Facebook:

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Glympse has lots of privacy controls so its not a stalker app. Even if someone forgets that Glympse is on -- it requires multitasking support to work "in the background" so won't work continuously on the iPhone until OS 4 -- it will expire after a limited duration. 

I also find it interesting that, from a positioning standpoint, the company is now trying to ride the "check in" wave, which makes sense: "Glympse . . . goes beyond static "check-ins" or a simple map showing your location . . . "

I think the Facebook application and integration will drive considerable awareness and growth for Glympse. There's tremendous utility here for people, but the new Facebook integration adds a novel and "fun" dimension as people can now post their movements to their networks (e.g., trip across the country, etc.).

Meeker: Mobile Will Dominate by 2014

When I first saw this GigaOM post about Morgan Stanley's Mary Meeker's mobile data I thought it was simply a rehash of the Q4 discussion she put out about the mobile Internet. But it's apparently based on some updated projections in a new "Internet Trends" slide presentation.

Below is the "money slide," showing that the global crossover point for the PC and mobile Internet is 2014 in the firm's estimation. In other words, when the two switch places -- when more people (on a global basis) will access the Internet via mobile devices than on PCs. 

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Given that in some developing countries this is already the case, it's quite a safe prediction to make. In the US or EU the crossover is unlikely to happen quite as soon, though it likely will happen at some point in the next decade and maybe earlier rather than later.

Right now companies like Google say that mobile devices complement and don't cannibalize desktop PC usage: night and weekends vs. during the day. In addition the iPad has emerged as something of a "weekend" device, at least at this early stage. (I use mine daily.) It might be more accurate to say it's something of a "lesiure" device, at least more so than smartphones and PCs. 

We agree however with Meeker's conclusion that mobile devices will be primary and PC devices will become secondary over the next decade. And, as faster networks kick in, that will only accelerate the trend. 

Palm for Sale: Now It Gets Interesting

Bloomberg reports this morning that Palm is putting itself up for sale and seeking bids "as early as this week":

The company is working with Goldman Sachs Group Inc. and Frank Quattrone’s Qatalyst Partners to find a buyer, said the people, who declined to be identified because a sale hasn’t been announced. Taiwan’s HTC Corp. and China’s Lenovo Group Ltd. have looked at the company and may make offers, said the people. 

The venerable company's market capitalization is less than $1 billion though the company has almost $600 million in cash on hand. So I'm guessing a purchase price would be in the $2 to $4 billion range. Keeping the price down is the fact that the company's real asset is WebOS, which itself isn't worth billions. It's sad in a way that the company that pioneered mobile computing is meeting this fate. Whether the Palm brand survives will depend on the particular buyer and its position in the market: a mobile OEM will kill the brand a PC hardware OEM will likely keep it.

As I mentioned this weekend, it's been quite clear to us from almost the launch of the Pre that the company would ultimately be sold to a larger player. As suggested, the list of potential buyers includes all the major computer hardware OEMs (with Dell and Lenovo as lead candidates), Nokia and Microsoft as possibilities. Microsoft is less likely to bid today given Windows Mobile 7 and Nokia may feel with MeeGo (Intel + Maemo) that it doesn't need a new (third) mobile OS to work with. In my view Nokia would be smart to grab Palm. 

Chief Executive Officer Jon Rubinstein has been quoted several times saying that the market has room for five smartphone players. That may be true on a global basis, but in the US it's really more like three or four (maybe). Right now those three are Apple, RIM and Android.

A company with greater financial muscle could help propel WebOS into that list of successful smartphone contenders. HTC is really interesting to consider here; the company has been seeking to establish its own brand but remains overshadowed to some degree by Android. While it's probably not going to be the ultimate buyer it would shake up the market and might impact Android, as the leading Android OEM. 

However if I had Nokia CEO Olli-Pekka Kallasvuo's ear I'd say: dump Symbian, buy Palm and shift 2011 smartphones to WebOS. 

Orange Launches Ad Exchange in Europe

The CTIA show in Las Vegas was primarily a showcase for carriers, handset OEMs and "infrastructure" providers. It made me think a great deal about the future of the carriers. Obviously they will continue to collect voice revenue and growing data revenue for some time. (Although as VoIP gains voice revenues will decline.) They will also subsidize handsets and try and offer exclusive deals of one sort or another. But the era of the operator is largely over.

Handsets, apps and the mobile Internet have replaced voice and carrier centrality. Now the carriers are scrambling to figure out a) how to maintain relationships with their subscribers as other than commodity providers of network access ("dump pipes") as smartphone adoption grows and b) how to develop new revenue streams. 

I believe that the US carrier app stores and efforts will largely fail, except potentially when it comes to feature phones. There's still a fairly significant opportunity there and that's where there's likely to be the greatest return on their app store efforts. 

However mobile advertising is an area where the carriers can potentially play to varying degrees, and most are in one form or another. But as the "deck" increasingly becomes obsolete (absent some radical changes), they need to figure out viable "off deck" strategies. At one end of the spectrum is Orange with its announcement about a partnership with OpenX to create a digital advertising exchange in Europe: 

Orange and OpenX Technologies, Inc. (OpenX) today announced a partnership to launch Orange Ad Market, a new online advertising exchange model designed to lead the evolution of online exchanges in Europe. Orange Ad Market will increase the value of display advertising by helping publishers maximize revenue and helping advertisers much more easily reach their target audiences across large numbers of publishers.

The Orange and OpenX exclusive multi-year, multi-country partnership will see Orange bring the benefits of OpenX's proven global marketplace to European users at a local level. The initial launch will take place in the second quarter of 2010 in the UK and France with planned launches following elsewhere in Orange's European footprint.

This relationship is focused on the PC market but could extend into mobile potentially. Regardless, this move represents an operator/ISP's aggressive effort to build a marketplace for advertising. In mobile, carriers can do a version of this too. More modestly, operators can provide their subscriber data (with privacy controls) to existing ad networks or exchanges to improve targeting capabilities.

Operators could also buy ad networks. Why wouldn't Verizon or AT&T, for example, look to buy Millennial or JumpTap? Sprint at one point tried to create its own ad network unsuccessfully. However an acquisition would be a quick way to do so.

A time is also coming with there will be viable alternatives to traditional carrier calling and data plans: WiFi/MiFi white spaces, 4G networks that blanket entire municipalities. As those networks become accessible and trustworthy, people may abadon traditional mobile phone plans for data + VoIP alternatives. But that's still a few years away at least. Regardless, the disruption has begun and carriers will need to reinvent themselves to some degree if they hope to continue to grow revenues over time and remain "relevant."