The rumor that Amazon was going to build a smartphone has been around for some time. However it has returned and gained new momentum of late, with the recent acquisition of 3-D mapping service UpNext. And an article last night from Bloomberg seems to confirm that Amazon will introduce a handset or handsets -- made by Foxconn, the company that makes the iPhone and iPad:
Foxconn International Holdings Ltd., the Chinese mobile- phone maker, is working with Amazon on the device, said one of the people, who asked not to be identified because the plans are private. Amazon is seeking to complement the smartphone strategy by acquiring patents that cover wireless technology and would help it defend against allegations of infringement, other people with knowledge of the matter said
Let's now assume that Amazon is making a smartphone -- a Kindle smartphone -- what is the outlook for such a device? One would assume, like Kindle Fire, that it will be built on a highly customized version of Android, with the same type of Amazon content integration as seen on the Amazon tablet.
The Kindle Fire was a sales success because of the strength of the Amazon brand and channel and the inexpensive price tag ($199). Amazon's brand won't be as much of a factor in the smartphone arena. An Amazon smartphone will have to compete on the strength of its features and on price. It's hard to imagine that Amazon will be able to compete on price because many Android phones are already very cheap or free (carrier subsidized).
Content (as in Amazon books, movies and music) also doesn't factor as significantly as a differentiator on smartphones it as potentially does on a 7-inch tablet. What matters on smartphones is the availability of apps. There's already a Kindle app for iPhone and Android; so users already have access to much of Amazon's content (though not cloud-based music or movies). And the Amazon app store is an incomplete version of Google Play (the Android market). In other words, the competitive advantages that helped drive Kindle Fire sales don't exist at all or won't exist to the same degree in a smartphone context.
The only way I could see an Amazon smartphone succeeding vs. other Android phones or the iPhone is if the phone were absolutely top-of-the-line and Amazon were practically giving it away (sub-$100). Otherwise I think we'll see a tepid response by consumers.
Beyond this, depending on what kind of finally shows up, I'm sure Amazon will be pulled into the maelstrom of mobile patent litigation.
Last week mobile ad network inMobi released tablet survey findings, drawn from 9,600 respondents in seven international markets. US responses were just under 1,000 (904). The company asserts that "tablet use has risen quickly to 29.5 million U.S. users, 11% of the total U.S. population."
By comparison, in January of this year the Pew Internet Project released survey data that showed 19% of US adults owned tablets (mostly iPads). And comScore released data showing that roughly 24% of smartphone owners also have tablets. If we extrapolate these numbers, the Pew data suggest that there are roughly 42 million tablet owners in the US (as of January 2012). The comScore data argue the number is closer to 56 million.
The inMobi number is too small, while the comScore number is probably too large. Pew is likely closer to the actual number of tablet users in the US at this point. However, by the end of the year it could be closing in on 70 million.
The inMobi survey data are from a report entitled, The Role of Connected Devices in the Consumer Sales Journey. Below are some of the top-level findings:
General consumption habits
Shopping and e-commerce
According to the survey data, "tablets have become the preferred device at home and smartphones are preferred on the go." These devices play different roles in the "purchase consideration cycle." Tablets are used in a "lean back" mode in the evenings and on weekends, almost exclusively at home.
A recent tablet-centric e-commerce report from Monetate also observed that tablets are used primarily at home, as a PC substitute, and offered the following advice:
With increases in website traffic from devices such as the iPad and Kindle Fire, e-commerce businesses must treat customers using tablets as a unique audience segment. Tablet users expect a different experience that takes advantage of their devices’ features, such as touch/swipe functionality and screen rotation.
Accordingly it's not enough to simply assume the PC site will translate onto tablets. While non-flash PC sites often render relatively well on tablets they typically fail to take full advantage of the tablet opportunity.
E-commerce optimization firm Monetate has published its latest "E-commerce Quarterly" report. The report addresses a number of issues including social commerce. For purposes of this post, I'll focus on the mobile and tablet findings.
The data in the report are drawn from "analyzing a random sample from over 100 million online shopping sessions on 100-plus major e-commerce websites." Here are some of the major findings:
Website Traffic Sources
Q1 2012 Conversion Rates by Device Category
Compare similar data from Marin Software. Directionally they're almost identical to the Monetate findings.
What both the Marin and Monetate conversion findings lack, however, is data about offline conversions. If those were tracked and factored in I suspect we'd see mobile conversion figures outstrip the PC and potentially tablets.
Monetate's focus is strictly on e-commerce conversions. But most people don't buy conventional products on their smartphone, though they may do things like banking transactions or buy apps or rent movies.
The use cases for smartphone are different than PCs and tablets, which are mostly used at home and often as a substitute for the PC. According to Monetate's report:
It seems clear that smartphone users are either doing more comparison shopping or are dissatisfied with the user experience. In fact, a recent study from comScore Inc., Shop.org, and The Partnering Group revealed that 43% of smartphone owners have used their mobile device while in a store for a shopping purpose.
Monetate also argues, despite that at-home usage of tablets, that there's a different user expectation vs. the PC experience:
With increases in website traffic from devices such as the iPad and Kindle Fire, e-commerce businesses must treat customers using tablets as a unique audience segment. Tablet users expect a different experience that takes advantage of their devices’ features, such as touch/swipe functionality and screen rotation.
This argues in favor of tablet apps as well as a tablet-optimized HTML5 site. Finally, the firm predicts that at current growth rates, "website traffic from PC users will dip below 75% in less than one year" -- meaning that smartphones and tablets will represent 25% of site traffic.
Almost nobody in the mobile handset business is making money right now except Samsung and Apple. Nokia and RIM, the former smartphone leaders, have almost seen the bottom drop out of their businesses over the past year or so. RIM hired bankers recently to consider its options. The company is almost in free fall.
Nokia had hoped that Microsoft would save it but that's not happened. The most optimistic discussions of Lumia sales indicate they're "mixed." Furthermore, existing Nokia Lumia phones won't be getting Windows Phone 8 upgrades. They'll have to settle with Windows Phone 7.8.
This fact, once made known to the general public, will essentially kill sales of current Lumia smartphones (unless carriers give them away). People will want the new and improved version of Windows Phones -- which won't be coming out until much later this year. That leaves two more quarters of weak sales for Nokia. Moreover, Nokia will be just one of several OEMs to be releasing Windows Phone 8 smartphones.
It doesn't look good.
The Sunday Times in the UK reported that RIM was contemplating either selling its handset business or seeking an outside investor such as Microsoft. Nokia also looks like a takeover target as its fortunes continue to decline. And with both of these companies struggling the likelihood that Microsoft will own at least a part of a hardware OEM grows more and more likely. Amazon is also a potential investor or acquirer mentioned in the article.
One now has to wonder whether, if Nokia had gone with Android, things would be any different at this point.
There were discussions between Google and Nokia before the latter went with Windows. According to a source I spoke with, Google was unwilling to agree to a co-mingling of Google Maps and Nokia Maps or substitution of Nokia Maps on the back end. It's unclear whether that was the dealbreaker or one of several issues that prevented a Nokia-Android deal. Microsoft did agree to use Nokia Maps and in fact Nokia does replace Bing Maps in the new Windows Phone 8 OS.
It is likely that Nokia would have sold more Lumia phones to date if they were powered by Android. That probably wouldn't have fundamentally altered the company's predicament but it would have made it marginally better. Yet HTC is building some very nice Android devices but being overwhelmed by the Samsung Android juggernaut all the same. The Taiwan-based company is struggling to remain profitable and recently abandoned the Brazilian market.
If that continues HTC could be another takeover candidate by early 2013. And if that's so it will dilute the value of Nokia and RIM as they seek "strategic options" to survive.
The long-anticipated Google (Nexus) tablet is set to debut this week at Google's developer conference, Google I/O. Gizmodo Australia has specs and apparent pictures of the device. CNET has additional information.
Gizmodo reports an 8GB model will cost $199, matching Kindle Fire, and a 16GB model will carry a $249 price tag.
Google's tablet announcement comes on the heels of the Microsoft Surface announcement last week. However Surface pricing wasn't disclosed. Rumors argue that the lower-end RT model will not come in below $599, with the higher end Pro costing at least $700.
Unless Microsoft can get the RT price down to $499, as I and others have argued, Surface is unlikely to compete with or impact the iPad very much. Rather it will likely affect competing Windows laptop sales.
The new Google Nexus tablet will probably have an immediate -- and potentially dramatic -- impact on Kindle Fire sales. The Kindle Fire is a nice upgrade from regular Kindle reading devices but a lousy tablet overall for other than accessing Amazon's content universe. The Nexus tablet is likely to be a much better device for Internet browsing with a larger app library. Android non-tablet apps will look better on a 7-inch device than they did on the 10.1-inch Android Galaxy Tab.
Those not loyal to Amazon will be inclined to choose Google's tablet over the Kindle Fire -- all things being equal. However we may see Amazon respond with a price cut, which would be very interesting since the company already looses money on every Kindle Fire sold (but makes it back on content and other sales).
No doubt you've already read a great deal about Microsoft's new hybrid tablet-PC, Surface. It's being described as Microsoft's challenge to the iPad. Some have already called it a "game-changer." But that remains to be seen. It's also probably more of a challenge to Microsoft's own hardware partners than to the iPad.
Surface is a "new family of PCs." There will be at least three versions of the computing device, sporting slightly different specs and features. The screens apparently will all be 10.6 inches. All will come with a version of Windows 8. Perhaps the most compelling feature of the device is a "smart cover" that also operates as a keyboard.
Unfortunately at yesterday's press conference, which I was not present for, the company provided no release date or pricing information. The latter is critical. However Microsoft said that Surface devices would be competitively priced. In the case of Surface for Windows 8 Pro, the company said it would be priced “on par with Ultrabook-class PCs." Right now Ultrabooks run from about $700 to $1,000.
If Microsoft hopes to compete with the iPad, the lesser Windows RT version will have to start at $499.
There are some who believe that Microsoft took the bull by the horns in creating Surface, frustrated that its partners were not building compelling hardware while the iPad increasingly stole PC sales. It may well be that this will be the "kick in the pants" that Dell, HP, Acer and the rest need to start developing sexier machines.
However it's more likely that this device -- provided it works well and delivers against its promise -- will compete with those same hardware partners. It could well capture sales that might have gone to Ultrabooks. I would also imagine that enterprises will adopt these machines, it's not as clear that consumers will. That's where price comes in.
Another factor is Windows 8 and the public response to the new OS and UI. Microsoft is no longer in the position it has enjoyed for the last 15 years: when it released an OS update people bought it (until Vista). Now Android tablets and iPads do provide a viable alternative for those not doing heavy duty Office-oriented PC content creation.
Windows 8 has so far received mixed to negative reviews. While its Windows Phone OS has been critically praised, the devices aren't selling. This is partly because the UI and OS are unfamiliar to smartphone owners who've already become accustomed to the look/operation of iOS and Android. There are also too many competing options. Android has taken Microsoft's place in the smartphone world; it has become the alternative-to-Apple software supplier.
If consumers find Windows 8 jarring they may delay buying or avoid it. That's why price is so important. Surface is a sexy little device that must be priced very aggressively to get consumer attention. Otherwise, Surface could go the way of the Zune or the even shorter-lived Kin.
We can now say that the Microsoft-Nokia partnership isn't working for either company. Nokia's woes are well documented: more job cuts, more losses, more deterioration in the core business. Lumia sales are weak on a global basis, especially in North America where Nokia was plotting its comeback. The company is in an accelerating state of decline, much like RIM now.
For Microsoft, which gave Nokia preferential treatment and established a special relationship, Nokia's fall has to be particularly disconcerting. Redmond is already providing billions to Nokia in support and marketing help. Just like the struggling economies of Europe, Nokia needs a bailout. The company is now a takeover target.
That raises the question: Will Microsoft be forced to buy Nokia, defensively? Most of the Asian handset makers have favored Android over Windows Phones. Indeed, Nokia should consider adding Android phones to its lineup -- unless precluded by its agreement with Microsoft. And that's probably the case.
Right now Nokia has about $12 billion in cash in the bank. Absent a takeover, that cash will prevent the company from disappearing any time soon. But it can't continue to operate in the current manner. Its exclusive relationship with Windows/Microsoft simply hasn't worked. Enough time has passed to make that statement.
There's almost no chance, given the current state of things, that Windows Phones will become the number two smartphone OS, as predicted by Gartner and IDC. Those forecasts were largely based on the reach and perceived brand strength of Nokia. That brand strength doesn't exist in North American and it's declining in other markets.
The chances are growing that someone will bid for Nokia. Rumors are circulating that it could be Samsung (denied by the company) or China's ZTE. However Microsoft will probably be forced to buy Nokia if it comes to that. By default the company would then be following the advice of several tech bloggers who suggested the same to compete with Apple with a more holistically integrated device.
Microsoft's Bing Maps also rely increasingly on Nokia's data and backend, another reason Microsoft may want to acquire the company. Nokia also holds valuable patents that enhance the takeover value of the Finnish company (and Android licensing value for Microsoft).
There will likely be some radical change to Nokia (sale or replacement of CEO Elop) by Q4 of this year if sales don't dramatically improve -- and they're not likely to with the iPhone 5 and Galaxy S III coming.
In January of this year the Pew Internet Project released survey data that showed 19% of US adults owning tablets (iPads). That was up from just 10% only a month before in December. Now comScore has released data showing that roughly 24% of smartphone owners also have tablets.
If we extrapolate these numbers, the Pew data suggest that there are roughly 42 million tablet owners in the US (as of January 2012). The comScore data argue the number is now 55 million. These figures seem entirely reasonable. Apple CEO Tim Cook reported 55 million iPads sold to date in February.
People use the term "tablet" but the market remains largely about the iPad. The only other two models with any traction are the Kindle Fire and the Samsung Galaxy Tab. According to Gartner Apple's share of the tablet market will be 61.4% at the end of the year. IDC says Apple had a 68% share of the global tablet market in Q1 2012.
Both of these figures are incorrect and largely based on shipment estimates. Shipments don't equal sales to consumers.
Perhaps I should say instead that people may be buying other devices but it still doesn't matter. According to ad network Chitika, based on an analysis of millions of impressions in the US, the iPad "accounted for 94.64% of all tablet based traffic." By contrast Chitika said that the nearest competitor, the Samsung Galaxy tablet, "boasts a lack luster market share of 1.22%."
Late last week ad network InMobi released its own tablet data, showing gains by the Kindle Fire and total Android tablet ad-impression share of 28%. That argues the iPad controls a 72% share of the total tablet market.
We're likely to hear an update of tablet numbers this morning from Tim Cook during the Apple WWDC keynote.
Back to the comScore tablet data: the company says that just over half of tablet owners are watching video on the device, while nearly 10% are doing so every day.
A year ago in March AdMob found, based on a survey, that 77% of tablet owners were using their PCs less. In addition 28% of respondents said that the tablet had become their "primary computer." Clearly tablet ownership does cannibalize PC usage, while smartphone ownership may complement it. Roughly 80% to 90% of tablets are used mainly at home.
Once Microsoft puts Office on the iPad it will become a true PC substitute.
Earlier today we got a refreshed device forecast from IDC. The firm believes that Android's market share will peak this year globally at 61% and decline to 52.9% by 2016. It sees Apple basically maintaining its current market share, while the company is bullish on Windows Phones.
Reiterating the notion that Windows Phones will dramatically gain share, IDC says they will surpass the iPhone by 2016 and ascend to a 19.2% market share. Here's how IDC justifies that prediction:
Windows Phone 7/Windows Mobile will gain share despite a slow start. Windows Phone 7/Windows Mobile will be aided by Nokia's strength in key emerging markets. IDC expects it to be the number 2 OS with more than 19% share in 2016, assuming Nokia's foothold in emerging markets is maintained.
Source: IDC, June 2012
The idea is that low-cost Windows Phones, made by Nokia, will do well in China, India and other developing markets. Yet so far there's really no indication that prediction will come to pass. Sales have been "mixed" at best. I have long believed that Nokia Windows Phones would enjoy modest success but not become the breakout product that both companies need.
Today ZDNet columnist Matthew Miller encouraged Microsoft to buy Nokia and pursue an Apple-like approach to the smartphone market. Indeed, Nokia as we know it today is quite unlikely to exist in 2016 let alone capture 20% of the smartphone market.
There have been rumors of a "Facebook phone" for at least two or three years. Facebook clearly needs to figure out mobile, so it's logical that Facebook would be talking again about a branded device. According to the New York Times over the weekend:
One engineer who formerly worked at Apple and worked on the iPhone said he had met with Mark Zuckerberg, Facebook’s chief executive, who then peppered him with questions about the inner workings of smartphones. It did not sound like idle intellectual curiosity, the engineer said; Mr. Zuckerberg asked about intricate details, including the types of chips used, he said. Another former Apple hardware engineer was recruited by a Facebook executive and was told about the company’s hardware explorations.
It's worth mentioning that there have already been quasi-facebook phones, from INQ and HTC (Status). The Status had the distinction of being the first phone with a "dedicated share button." By most accounts these phones are not huge successes. The Status appears to be an outright failure.
Presumably the model for any coming Facebook phone is the Kindle Fire, a highly customized version of Android. Facebook could then have an app store, develop mobile advertising, have a mobile browser and so on. The logic is clear.
The problem is that a Facebook phone is likely to fail. Most people would not want to "commit" that fully to Facebook and would likely be concerned about privacy and how their contacts and other data were being used or exploited by the software. By the same token, the availability of Facebook apps on major smartphone platforms is going to be sufficient for the overwhelming majority of people.
There will be a small slice of the population that would appreciate deep integration of Facebook into a handset (those might be younger users). But it will be a minority.
We may ultimately see a "Facebook phone" but I don't think it would be competitive with the iPhone and other Android handsets -- at least not in North America.
Yesterday AdAge reported that Amazon was in talks to buy mobile ad network Jumptap. However the report was speculative and the deal might just as easily not take place. Based in Boston, Jumptap holds 25 mobile advertising patents.
Beyond Jumptap's intrinsic appeal as leading ad network, the IP portfolio represents an added incentive to buy the company vs. one of its rivals. Yet the Jumptap overture appears to be part of a larger effort that Amazon is making to evaluate multiple ad networks for acquisition:
Amazon has kicked the tires on a few mobile-ad companies, including mobile-ad network Jumptap, according to two people familiar with the talks. Amazon and Jumptap declined to comment.
Amazon has also hired a former Microsoft executive (Jamie Wells) to build a mobile ad sales team, according to the AdAge article.
Jumptap began life as a mobile search company intended to provide white-label services to carriers and others that wanted to compete with Google. However the company was forced to "pivot" a few years later as that business proved limited at best. It has since found much more success as a display ad network.
In the recent ad network comparison we did for the report Finding the “L” Spot: The Importance of Localization to Mobile Ad Performance, I was surprised to see that Jumptap had much greater reach (in the three test cities) than the other networks, including Millennial and AdMob.
Even if it's not Jumptap, it's quite likely that Amazon will acquire an ad network, given its burgeoning mobile business -- though Kindle Fire sales have slowed dramatically.
I have also speculated that Facebook is another one that is likely to acquire a mobile ad network. However if the company does wind up buying Opera it would get the benefit of Opera's earlier acquisition of "ad mediator" AdMarvel.
In January I predicted that Amazon would buy a mobile ad network. Jumptap was one of the potential companies.
Here's a selection of our previous coverage of Jumptap:
Millennial Media puts out regular data about activity on its large ad network. However that data typically lacks historical context. It's a snapshot or a moment in time. It's more interesting to examine movement and trends over time.
This morning the Q1 Mobile Mix report came out. I've gone back to the equivalent report a year ago to compare metrics. In one instance the current report does compare smartphone and tablet penetration vs. a year ago. The most striking thing is that feature phone share on Millennial's network has declined from 23% to 7% since last year. By Q3 or Q4 it's likely to be below 5%.
In terms of operating system share, iOS and Windows have gained share relative to their positions a year ago. Apple's operating system is bolstered by the iPad. In Q1 2011 the top two tablets were the iPad and the Samsung Galaxy Tab. In Q1 2012 the top three tablets are the iPad, Galaxy Tab and Kindle Fire. Unfortunately, however, the report doesn't indicate volume of impressions by tablet.
Top app categories haven't changed that much in a year. Weather has fallen somewhat and Travel has appeared in the top 10.
Finally (though it may be hard to read) the list of Millennial's top 20 devices is pretty similar to last year. The iPhone is the top device and the rest are mostly Android devices. However, very surprisingly, several more RIM devices appear in the 2012 list vs. the one from last year. Given the continued delcine in RIM's sales there's no clear explanation for why RIM has gained positions.
Despite growing to 3% of Millennial's network overall impression share, no Windows Phones appear on the 2012 list.
According to NPD, Apple remains the top "PC" manufacturer globally, largely because of the iPad. According to the NPD shipments (not sales) data, Apple had a 22.5% share of the PC market. Overall NPD said "PC" shipments (including tablets) grew 30% year over year.
However Dell reported earnings this week and missed analysts' estimates because of slumping PC sales. Dell was hurt by smartphone and iPad sales, which have taken the place of PC replacements for many consumers.
Among tablet makers, NPD said that Apple had a 62.8% share. However these estimates -- based on shipments, not sales -- are undermined by various analytics firms that report well over 90% of tablet-generated traffic is coming from the iPad.
Below are the NPD charts showing PC and tablet shipments.
Source: NPD Group
While tablets increasingly can function as PCs it's a mistake to include them in the conventional PC counts. It's part of a different category of devices. By including tablets into PC forecasts and estimates it obscures the true state of the PC market.
The University of Michigan's American Consumer Satisfaction Index for May is out. I've pulled two categories: wireless carriers and mobile handsets. The chart immediately below reflects that of the four major US mobile carriers Sprint beats Verizon by a single satisfaction point. They're all clustered very closely together however.
The next chart is more interesting. It shows consumer satisfaction with smartphone brands.
Apple comes out on top (83), followed by Nokia, LG and HTC (75). HTC and Motorola are two points behind them. Interestingly, Samsung -- which is now the largest handset maker in the world -- is 12 points behind Apple (71). The only company to score more poorly than Samsung is RIM.
People at the ACSI say that these numbers are predictive of future consumer behavior. A low score implies declining future sales. By the same token a high score should predict positive sales activity.
Certainly Apple is doing well and RIM is in decline. But Samsung is an anomaly. It continues to see massive sales and would thus appear to defy the predictive wisdom of the ACSI scores.
IDC and Gartner both released revised tablet projections in the past month. According to Gartner Apple will control 61.4% of the tablet market in 2012. IDC says Apple had a 68% share of the global tablet market in Q1 2012. Gartner is counting projected sales, while IDC is measuring shipments.
Shipments have been definitively shown to be an inaccurate metric in the past. Shipments do not equal sales.
Yet late last week ad network Chitika found, based on millions of impressions on its US-based network, "that the iPad accounted for 94.64% of all tablet based traffic." By contrast Chitika said that the nearest competitor, the Samsung Galaxy tablet, "boasts a lack luster market share of 1.22%."
The ad network found that for every 100 iPads there were just over 1 Samsung Galaxy Tabs, as measured by traffic generated. For every 100 iPads there were 0.8% Kindle Fires. As an aside Kindle Fire sales have dramatically slowed this past quarter.
While Chitika's network is not synonymous with the entire Internet it's going to be generally representative of traffic trends. In Q3 2011 comScore reported that "iPads delivered 97.2 percent of all tablet traffic in the US."
There's something really out of alignment between what IDC, Gartner, NPD and several others are reporting in terms of tablet market share and what's actually happening "on the ground" in terms of usage.
AT&T has said that Lumia 900 sales have "exceeded expectations." Gizmodo checks seem to confirm brisk sales (with some qualifications). The Lumia appears to be selling well on Amazon in the US. Yet reports from Europe suggest carriers have soured on the device:
Skeptics among operators say the sleek, neon-coloured phones are overpriced for what is not an innovative product, cite a lack of marketing dollars put behind the phones, and image problems caused by glitches in the battery and software of the early models . . .
"No one comes into the store and asks for a Windows phone," said an executive in charge of mobile devices at a European operator, which has sold the Lumia 800 and 710 since December.
The other day on the WP Central blog there was a poll of readers indicating some iPhone and Android users were abandoning their handsets for Lumia. That poll inspired me to create one myself on Google Consumer Surveys.
I asked "What will be your next mobile phone?" The survey had just over 1,500 US adult respondents. The responses (below), which are allegedly statistically significant, suggest very limited demand for the Lumia handset and Windows Phones in general in this market.
What will be your next mobile phone?
N=1,504 (Opus Research using Google Surveys)
The survey respondents were drawn from news and reference sites and almost evenly divided between men and women and across age groups. The questions were randomized so as to not bias the results.
In terms of the "Other" responses (33%), some are probably intended Android buyers that aren't looking at Samsung models. They may also be non-smartphone buyers as well. This is suggested by the fact that when segmented by age, "Other" is the top category for those over 45.
Those in the 35-44 age group were much more interested in the Windows/Lumia handset than other age groups (5.4% vs. 3.5% overall). Demand was strongest for Windows/Lumia phones in the South and US Midwest. Demand for BlackBerry phones was strongest in the Northeast.
Interestingly Windows/Lumia demand was stronger than the norm among those earning at least $75,000 per year. This is a bit counter-intuitive because the phone is aggressively priced at $99, presumably to generate demand at all income levels. However, among those making less than $75,000 per year demand for Windows/Lumia was less than the survey norm above. These findings suggest that Nokia may not have needed to target the phone below $150 or $199 (with contract).
We'll find out definitely over the next two quarters, as Nokia discloses sales figures, whether the Lumia handsets are selling well or not. But the survey I conducted appears to confirm my earlier prediction that they'll see only modest adoption in the US.
Ahead of Apple's quarterly earnings call next week, Fortune has rounded up analysts estimates regarding Q1 2012 iPhone sales. The consensus range is 30 to 35 million units:
The average among the Wall Street analysts is 30.5 million . . . To hedge our bets, we've singled out the six analysts who have turned in the most accurate estimates over the past five quarters. Their consensus: nearly 35.1 million units, an increase of 88.5% year over year.
Apple was the insurgent and Nokia the market leader. Now the roles have been reversed.
Nokia will report a loss later this week and expects a similar result in Q2. The bottom has fallen out of Symbian phone sales. However the company said it had sold 2 million Lumia handsets (globally) to date:
In the first quarter 2012, Nokia sold more than 2 million Lumia devices at an average selling price of approximately EUR 220 (reported within the Smart Devices business unit). Furthermore, Nokia has seen sequential growth in Lumia device activations every month since starting sales of Lumia devices in November 2011. Lumia has gained market share with both distribution partners and consumers. The Windows Phone ecosystem is also attracting developers and has expanded rapidly with more than 80,000 applications available.
Dpending on whether you think "it's still very early" or whether the company should have sold more units to date, you either conclude that the device is off to a good start or failing to take off. My view is in-between. I think it will sell moderately well to people interested in an inexpensive handset and not loyal to either Apple or Google.
The phone is apparently selling well on Amazon with overwhelmingly positive reviews, leading one person to question whether the reviews had been faked. I do believe that some of the reviews are fake; though many if not most are probably genuine. Nokia, AT&T and Microsoft have a great deal riding on the success of the handset, creating incentives for people to generate positive reviews.
I have used Windows Phones and found them to be good but not great. The chief problem is a lack of apps. I also don't favor the homescreen UI.
If Lumia is as great as the reviews suggest then sales should pick up considerably in the next quarter. This is the make or break year for both Windows Phone and Nokia as a company.
There's plenty of data that shows people are on mobile devices while watching TV. Many Superbowl ads assumed and tried to play off this, largely without success earlier this year. But it may turn out that tablets (iPads) become the primary "second screen" during TV viewing.
According to a Q4 multi-country survey from Nielsen, "88% of US of tablet owners and 86% of smartphone owners said they used their device while watching TV at least once during a 30-day period." In addition Nielsen found that 45% of tablet owners used their devices along with TV "on a daily basis and 26% said they did this several times a day."
While checking email during commercials was a primary activity of the second screeners, the survey also found that there was engagement with TV content and products:
The most frequent tablet or smartphone activity across all countries while also watching TV was checking email — either during a commercial break or during the show. Yet device owners also seem to engage with content related to the TV as well, either by looking up information related to the show or looking for deals and general information on products advertised on TV.
While shows like QVC, American Idol and The Voice are already doing things with simultaneous TV-mobile use, we should see more formal incorporation of mobile devices into shows. (I'm sure there will be lots of interesting and creative implementations to come.) In a more mundane vein, advertisers may start to direct people to e-commerce sites or offer flash sale incentives to mobile users on the couch. It should be a very interesting trend to watch.
Tablets are much more likely, however, than smartphones to generate e-commerce sales. This is why they will be preferred by marketers. They'll be preferred by consumers because of their larger screens.
Make no mistake Google's augmented reality goggles are fascinating and "cool." I applaud Google for developing them (if they have actually been developed; I suspect there's no working prototype yet) but I also wonder if anyone would actually buy and wear them. Of course some people would; but could the product break out of cult status?
The effort, called Project Glass, is an initiative of Google's advanced products team ("Google X"). It represents a form of "wearable computing" and it's very interesting as an extension of the Internet beyond more conventional devices like smartphones.
Putting aside the fashion dimension, which I think is awkward in the images shared by Google, AR glasses might be useful while driving, shopping or in an art museum. However they might equally be distracting and annoying, removing you from the experience of being in the "real world."
There's already a backlash building against living your life with your nose in your smartphone. This would take the smartphone obsession one step further.
Pricing is uncertain. If they were expensive (more than $199) they wouldn't see much uptake I would imagine. And what about advertising? Imagine ads literally popping up in front of your eyes. That would be highly undesirable to say the least. Other issues include battery size and life, as well as data plans and costs.
Glasses are a logical place to put a wearable computer and at some point we will see wearable computers. However I'm skeptical that this product has mainstream appeal. But prove me wrong; I'd love to see it in action.
Fortune's Philip Elmer-DeWitt reports on the results of the latest teen survey by investment firm Piper Jaffray. The survey polled 5,600 American teens, evenly divided between genders. The average age was 16.
The following are a couple of the questions and answers from the survey:
While the sample is very large, the question is: how representative of all US teens is this survey?
There are somewhere between 25 and 30 million teenagers in the US, depending on how "teen" is defined, according to the US Census Bureau. Thirty four percent of 25 million would be 8.5 million teens with iPhones. That seems plausible. Another 8.5 million teens have tablets/iPads by the same extrapolation.
According to comScore's most recent figures 13.5% of US mobile subscribers own iPhones (or roughly 14.04 million people out of a total smartphone population of 104 million). These data points are from different sources but the numbers suggest that more US teens than adults own iPhones. That doesn't seem correct.
What's not exposed is the degree to which teens aspire to ownership of any other type of smartphone. Also not discussed is whether the tablet 34% of teens claim to "own" is actually theirs or owned by a parent. It would be interesting to know whether there are multiple iPads/tablets in the house.