Hardware

HTC Projects 600K G1 Sales, Not 1.5 Million

Many folks, including me, unfortunately, repeated the rumor that T-Mobile had pre-sold a million and a half G1s. Apparently that number was pure fiction or wishful thinking on somebody's part.

In an interview with the San Jose Mercury News, HTC CEO Peter Chou declared that he expects to sell "more than" 600K G1s in 2008:

We are very excited about this new Android (Google's mobile operating system) approach. This will give us more opportunities for growth. Of course, we are not de-prioritizing Windows Mobile by any means. However, with Android we can do more. We should be doing good numbers, but I can't disclose the details. It will be more than what we originally planned. I'm saying we will ship more than 600,000.

The CEO doth protest too much, methinks . . . Reading between the lines, HTC seems far more excited about the opportunity with Android than with its long-time OS staple Windows Mobile. 

Will 'Smartphones' Threaten Laptops?

The Wall Street Journal has an interesting piece today that imagines a future where fewer business travelers bring their laptops along and rely instead on their increasingly powerful smartphones or netbooks. In addition, hosted services and software applications (SaaS) accessible via the Internet make it possible to leave laptops behind in many cases.

Laptops are generally outselling desktops because of their portability. At some point the next generation of smartphones and/or new Internet access devices with WiFi connectivity may eat into laptop sales or will replace laptops in some use cases. 

Dell, for its part, just released a new 12 inch mini-laptop/netbook called the Inspiron Mini 12, initially available only in Japan. 

Everything in computing is increasingly geared toward mobility. We're entering an era of "the Internet in your pocket," where smaller devices are going to be preferred to larger ones -- by both business users and younger consumers. 

See also: Consumers Prefer Mobile Devices to PC Internet

 

Consumers Prefer Mobile Devices to PC Internet

There's really no question that the mobile Internet and, eventually, search on mobile devices will overtake the desktop PC at some point in the next 7 years -- maybe sooner. In many developing countries the mobile Internet is the only Internet.

And then there's this well worn (by me) Pew data point, from March 2008, about mobile being the last device that people would give up:

Pew mobile vs. other tech

Now comes an IBM survey (n=600 consumers in China, US and the UK) that says more than 50% of consumers would substitute their Internet usage on a PC for a mobile device.

Here's another set of findings:

71% of respondents acknowledged that they expect to increase their usage of communication services such as obtaining maps and directions, instant messaging, social networking, emailing and reading the news from their mobile device. 

As with the Internet before it, marketers will be unable to avoid mobile as it becomes more integrated into consumers' daily lives. The only question is how quickly mobile Internet growth occurs -- and it can only accelarate in response to the iPhone and G1 (and other Android phones to follow), among other efforts going on on other platforms (e.g., Opera, Skyfire on Windows Mobile, etc.). 

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Clients see: Consumers Lead, Advertisers Lag: Recent Mobile Survey Findings

T-Mobile G1 Ad Promotes Mobile Internet, Not Voice

The first TV spot for the G1 is quite effective (in my view) and promotes the phones' mobile Internet capabilities for both practical and whimsical purposes. One of the bits in the commercial shows someone asking in a store whether the price of a lawnmower is "cheaper somewhere else."

Shopping is a clear emerging use case for mobile, with two Android apps (so far) directed at in-store price comparisons, as well as finding local store inventory: Compare Everywhere and GoCart/ShopSavvy (see demo video)

T-Mobile CMO Denny Marie Post calls out the ShopSavvy application in particular in remarks to the Wall Street Journal about the G1's value to consumers in a recession:

You’ll see in the campaign it’s a way of bringing the applications to life, ultimately, some of the star applications. Google Maps with street view, and ShopSavvy are two that we’re very excited about, among many, but those two in particular because they have real impact for the customer. Particularly ShopSavvy in this economy. 

TheFind and Slifter bring these same capabilities (though not barcode scanning) to the iPhone. 

Google Promoting G1 on the Homepage

To say that Google's homepage is the equivalent of a giant billboard in NY's Times Square is a gross understatement. It's the leading site on the Internet, with more than 144 million monthly visitors in the US alone according to comScore.

Simply putting a line of text on the homepage is a better awareness building tool than a 30 second TV ad during the Super Bowl. That's why this little promotion is huge for T-Mobile (and for Android):

G1 promotion

G1

As more Android phones roll out over the next 12-18 months Google is unlikely to give the newer handsets this same kind of treatment. More likely there will be a gallery where the various phones can be seen with links to carriers and store locators. 

Android Market Arrives

The T-Mobile G1 has officially arrived and so has the Android (apps) Market. I've posted about it on the Search Engine Land blog. But to recap here, there are just over 50 apps in there now, with many more to come. All are now free; paid apps will be available in Q1.

There are a range of location-aware apps in the mix and I'll take a closer look at those later. But there should be a veritable flood of new apps that emerge when Google allows developers to upload their apps next week (starting Monday). 

Google is relying on the community to rate and review apps rather than exercising a quality control function, in the way that Apple plays gatekeeper with iPhone developers. 

For fun CNET does a speed test comparing the G1 and the iPhone, the G1 beat the iPhone by eight seconds, which reflects not on the hardware so much as the respective carrier 3G networks. 

RIM: Applications Storefront Coming in March, 2009

RIM announced this afternoon that the BlackBerry "Applications Storefront" would launch in Q1 2009:

RIM plans to launch the application storefront in March 2009 and BlackBerry application developers can begin submitting their applications and content for inclusion in the storefront in December 2008. The storefront will allow developers to set their own prices for applications and developers will retain 80 percent of the revenue generated from their applications. RIM is working with PayPal, a leading global online payment service, to provide consumers with a convenient and trusted way to pay for applications within the new application storefront, right from their BlackBerry smartphone.

By early next year then we'll have the iTunes Apps Store from Apple, the Android Marketplace and the BlackBerry Applications Storefront. Microsoft is also considering a Windows Mobile store (which it's now all but compelled to do). 

Win Smartphones Aplenty: Palm Treo Pro & HP iPaqs

Infoworld gives a favorable review to the relatively new Palm Treo Pro. Palm, which used to be the favored smartphone of enterprises, has faded and now in danger of being marginalized by RIM for business users. The low-priced Centro sold very well with consumers but the company will need to do more than produce decent Windows Mobile phones in order to compete longer term.

That's because there are a plethora of new Windows Mobile devices on the market, including several by HTC. Speaking of which, HP has rolled out two new Windows Mobile iPaq devices -- the data manager and voice messenger. Gizmodo has an overview and screenshots. The data manager is a touch-screen device that looks very much like the HTC Touch Pro (also Windows Mobile).

The HP devices, so far only available in Europe, are targeted to "prosumers" (awful term). 

HP iPaq

Until Windows 7 comes out (and improves upon 6.1), touch-screen phones like the HP iPaq data messenger (pictured above) are simply iPhone clones, however elegant the hardware. 

Details Emerge about Motorola's Android Phone

One of the things I've wondered is how the various Android phones -- and the OEMs that make them -- will seek to differentiate from one another once multiple phones are in the market. BusinessWeek has some interesting details about the forthcoming Motorola Android phone, which is apparently not scheduled to ship until mid-2009:

Like the world's first Android phone, from HTC, Motorola's Android-based device will offer a slide-out Qwerty keyboard. People who've seen the pictures and spec sheets for the device say it looks like a higher-end version of the HTC phone, called the T-Mobile G1. But it's expected to sell for less, at prices similar to the Krave, which is available for $150 with a two-year contract. After carrier subsidies, the G1 will retail for $180 with a two-year contract.

Also interesting is the fact that it will seek to differenatiate as a "social smartphone," building in features that will reportedly make it easier to access and use social networking sites like MySpace and Facebook -- both of which dominate "mobile social networking" in its very nascent state. 

Another interesting angle here is price. The article excerpt above suggests some price competition between the G1 and forthcoming Motorola Android phone. Along those lines syndicated tech commentator offers some interesting thoughts about how Android might increase price competition among smartphone OEMs and drive the price of handsets down. 

Indeed, notwithstanding the built-in social networking elements, price may be a more effective differentiator for the Motorola Android phone. If there is price competition among the various Android vendors, how might that affect BlackBerry and the iPhone? Both have some insulation against price competition: BlackBerry owns the enterprise market today and the iPhone the high-end consumer market. Yet both could be forced to respond if multiple Android handsets are priced closer to $100 than $200.

And the more prices come down for smartphones, the more that segment of the market will grow. Three of the top five selling phones in the US are smartphones (two BlackBerry phones and the iPhone). That in turn benefits the mobile Internet as we've repeatedly seen:

TMP mobile data

Source: TMP-comScore (9/08), n=3,000

AdMob September Mobile Metrics: Shifting Handset Market Share

AdMob released its September metrics report, which covers a wide range of things pertaining to ad serving volumes and handset market share. The data are collected from more than 6,000 mobile sites and applications, which constitute the AdMob network. Here are a few excerpts and highlights:

AdMob Sept Data 6 AdMob Sept Data 8 AdMob Sept Data 7 AdMob Sept Data 4 AdMob Sept Data 5 AdMob Sept Data 3 AdMob Sept Data 2

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For fun take a look at AdMob's live ad monitor, which tracks ad requests in real time on a global basis. 

 

 

Now Come the BlackBerry Developer Challenge Finalists

In the world of smartphones, the richness of the apps ecosystem surrounding the device will be a significant contributing factor to overall competitive success over time (this is why Sprint's Instinct will likely fizzle).

Apple of course has the iTunes apps store with a well established and growing ecosystem. Coming up behind the iPhone is Google's Android device, which appears to have a pretty extensive library of apps itself.

Now BlackBerry (or the BlackBerry Partners Fund [$150M] more precisely) is announcing finalists for its own apps developer challenge:

Personal Productivity and Lifestyle

  • Finalist: AP News Mobile by Associated Press and FreeRange Communications
  • Finalist: PaperIQ Digital Flipchart by DevelopIQ
  • Finalist: Poynt by Multiplied Media

Multimedia

  • Finalist: Flycast Mobile Broadcast Network by Flycast
  • Finalist: Nobex Radio Companion by Nobex Technologies, Inc.
  • Finalist: Strands Social Player by Strands Inc.

Web

  • Finalist: Billing Revolution Merchant Account Tool by Billing Revolution
  • Finalist: Gym Technik by TSR Gym Technik Ltd.
  • Finalist: MLB.com Gameday by Major League Baseball Advanced Media

Game

  • Finalist: Astraware Platypus by Handmark
  • Finalist: Hard Rock Casino 2 by EA Mobile
  • Finalist: Nintaii by Mobigloo LLC

Enterprise

  • Finalist: B*Nator Remote Control for BlackBerry by ISEC7 GmbH
  • Finalist: Bridge for Highrise by Metova, Inc.
  • Finalist: Optimii by Outerin Limited

The fund is awarding two investments of $150K in the winners. Not nearly as generous as the Google grants to Android developer winners, which awarded 10 companies $275K each, another 10 split an additional pot of money.

Here there only appears to be one location-aware application (Poynt from Multiplied Media), whereas in the Android Developer Challenge, six of the top 10 applications had location as a core or significant element.

Mixed Reviews for Android G1

Over at Search Engine Land I round up most of the major reviews of the T-Mobile G1, the first Android phone. If you want to see all of them for yourself, you can find them on Techmeme.

The bottom line is that the device is compared at every turn to the iPhone. The reviews are all mixed but mostly positive about the phone's usability and the software. Om Malik compares the G1 to Honda vs. the iPhone's BMW. But Honda probably sells more vehicles overall than BMW. Google would probably take that comparison accordingly. 

Here's what I said about the marketplace and my general observations about the entry of the device into the mobile ecosystem:

Android co-founders Andy Rubin and Rich Miner started developing their OS/platform before their startup was acquired in 2005 by Google and before the iPhone was out. The device isn’t a response to the iPhone. However it turns out to be similar to the iPhone in some significant respects.

Had Android and the G1 come out before the iPhone, the reviews would certainly have been almost entirely positive. It would have been much more groundbreaking than it is in the wake of the iPhone (now it has to sell “openness” of the Android software marketplace and the keyboard).

Had the reviews used Windows Mobile 6.1 and/or Nokia’s Symbian OS (now going open-source) as the comparative frame of reference, Android would have been the hands-down winner (as Malik suggests). The G1 and subsequent Android devices — probably now being fast tracked in the wake of the G1’s pre-order sales success — may compete most aggressively against the rest of the market (i.e., Palm, WinMo, Symbian/Nokia, feature phones) than it does the iPhone. That dynamic will emerge and play out over time.

Smartphones represent the future of the market; three of the top five selling phones in the US are smartphones, including two BlackBerry phones and the iPhone. According to NPD Group, smartphones now represent 19% of all new handset sales in the US. We should see that number climb even higher over the next 12-18 months.

According to recent data from TMP Directional Marketing and comScore, more than 50 percent of smartphone users have conducted searches using their devices (vs. 16 percent of feature phone users). Google clearly understands that getting more smartphones — more usable devices — in people’s hands will mean more mobile search. That’s what Android is ultimately about.

 

ChangeWave: Apple Gaining in Enterprise

ChangeWave issued a new report on corporate IT spending trends, including enterprise smartphone adoption. The firm found that RIM maintained its huge lead in the segment, but the iPhone is making gains:

ChangeWave IT data

Will Android Boost Motorola?

Motorola has the top-selling phone in the US (the Razr V3). According to the NPD group the top five are:

  1. Razr
  2. iPhone
  3. BlackBerry Curve
  4. LG Chocholate
  5. BlackBerry Pearl

Note that three of these are smartphones. Indeed, smartphones now represent almost 20% of new phone sales (NPD). Motorola isn't really a player in the smartphone segment but a new smartphone based on the Android OS will seek to change that. 

Motorola has a 350 person team developing Android-based handsets. The Android Guys report on another job posting for the Android team within Motorola:

As a Senior Staff Interaction Designer, you will be responsible for leading and actively participating in the concept, design, documentation and development of user interfaces for our mobile products including our new Android Social Networking SmartPhone. You’ll lead brainstorming and work sessions, usability and innovation reviews and other forums of design development. In addition to your primary responsibility in the delivery of great design, you will also be expected to mentor other designers, bringing your personal strengths to the rest of the team.

Note: "Social Networking SmartPhone." That's interesting . . .

Nonetheless, creating a nicely designed Android smartphone could boost Motorola's position in the now critical segment. Especially if it's adopted by multiple carriers, as the Razr is today.

A year from now we're likely to have a range of Android-based phone in the market (US and EU), available from multiple carriers. There are two potential outcomes: they help their respective carriers defend against the iPhone and boost data-plan revenues at the same time (Android is less of a threat to the RIM enterprise market). Alternatively, and paradoxically, multiple Android phones may improve the position of the iPhone because it will be perceived as unique (multiple Android phones from multiple OEMs may dilute its "Google Phone" brand value). 

Not 400K, 1.5 Million Android Pre-Orders Sold

When the stories first came out that T-Mobile had sold out of the first batch of of Android G1 phones, that sold-out number was assumed to be several hundred thousand units. Android phones were expected to sell approximately 400,000 units in Q4 this year. But now comes word that the actual number of pre-orders sold by T-Mobile is 1.5 million.

That's a dramatic and impressive figure, more than 3x the Q4 forecast. The iPhone has paved the way for the G1 but the G1 and its successors at other carriers may wind up cutting into iPhone sales -- or they could simply grow the overall market for better smartphones. The G1 actually arrives on October 22. 

Microsoft Mobile Solution: Buy RIM?

Reuters is speculating that the decline in RIM's market capitalization makes it a potential takeover target for Microsoft. There's additional speculation in the piece that Microsoft has a "standing offer" to buy RIM at $50 per share. Right now the company is trading at just over $54 per share (market cap: $30M):

Picture 4

BlackBerry is the dominant smartphone maker in the US with more than 50% of Q2 smartphone sales.

Although Microsoft CEO Steve Ballmer dismissed RIM/BlackBerry as a "niche" player in mobile, an acqusition of RIM by Microsoft would be very smart for multiple reasons. As it stands, Microsoft is probably the one that's in danger of becoming a marginal player as it delays plans for Windows Mobile 7. RIM, Apple and now Android/Google are putting more pressure on Windows Mobile and threaten to relegate the OS to second tier status. 

Acquiring BlackBerry would give Microsoft the dominant smartphone marketshare with an emphasis on Microsoft's sweetspot: enterprises. It would make Redmond a bona fide competitor with Apple and Android in an instant. And there are no anti-trust implications really.

It would however create additional problems and challenges with Microsoft handset partners who would see the company as a competitor. 

Kids Want iPhones Too

Piper Jaffray recently conducted a study of just under 800 high school students in the US and found something interesting things about their mobile habits and preferences (reported by Fortune):

  • 8% own iPhones, up from from 6% in Spring 2008.
  • 22% of students surveyed expect to buy an iPhone in the next 6 months, up from 9% in Spring 2008.
  • Of students expecting to buy a mobile phone, 33% specified an iPhone.
  • iPod market share rose to 84% from 82% in Fall 2007.
  • Of the 40% of students who legally purchase music online, 93% said they use iTunes (up from 79% in Fall 2007).

Whether or not teens ultimately purchase an iPhone it shows the demand for more functional, Internet-enabled mobile devices. And it points to continued smartphone growth in the US.

 

BlackBerry Storm Makes Landfall

It looks very much like the US smartphone market is shaping up to be a battle between RIM, Apple and probably Google/Android. Nokia is a wild card; and if Windows Mobile 7 makes a big splash, Microsoft will be back in the hunt. But for the time being the future of US smartphone competition is primarily about the three aforementioned companies.

The iPhone 3G was a shot across RIM's corporate bow and the company has been reacting ever since, developing a range of more consumer-friendly handsets. The BlackBerry Bold isn't even available in the US yet and now comes the Storm -- a very iPhone-like all-touch-screen handset.

The Storm will apparently be available from Verizon in the US and Vodafone abroad. There's no price yet. My guess is that it will have to come in around $200 to be compeitive with the subsidized iPhone and T-Mobile G1.

The reviews are starting to come in and they're generally positive, though mixed. From Engadget:

Carrier (Verizon) and budget (unknown) constraints aside, what it's probably going to boil down to is whether or not the BlackBerry OS is your style. RIM hasn't done an overhaul to make touchscreen viable, instead banking on its navigation / execution paradigm to make the transition to touch -- which for the most part it does brilliantly. RIM hasn't in any way made the phone unattractive to its traditional corporate loyalists, and might just manage to snag other users looking for a flashy phone with decent email, but when it comes to browsing, media playback and other forms of consumer-friendliness, RIM still has a ways to go.

Beyond its installed base of corporate users the thing that will make this next generation of RIM phones competitive is the growing body of software applications for BlackBerrys, which will be aggregated into an iTunes Apps Store-like experience. Android equally has a "marketplace" and Microsoft is going to build a similar offering for Windows Mobile apps. 

G1 Sells Out, iPhone Hits 10 Million Units?

T-Mobile reported yesterday that the company, due to "overwhelming demand," had pre-sold all the G1s it had initially ordered from handset maker HTC. Perceived as the first worthy competitor to the iPhone, the suggestion is that it could sell half a million units by the end of the year. The phone officially goes on sale October 22. 

I was in Google's NY offices today and tried to get my hands on one to no avail.

Meanwhile, several sources are reporting the unverified estimate that Apple may have sold its 10 millionth iPhone. (However, it may be more accurately that 10 have been produced.) Separately, CNET cites NPD Group figures that claim 30% of US smartphone buyers switched to AT&T to get the iPhone.

Here's where NPD says the defectors came from (6/08-8/08):

  • Verizon 47%
  • T-Mobile 24%
  • Sprint 19%

Given this, the G1 emerges as a defensive strategy against the iPhone as much as it is a bid for new customers. Still it may attract some new customers to T-Mobile until other carriers begin to offer their own Android-based phones (probably at least six months away).  

What these data above reflect is the growing demand for better mobile user experiences. 

HP to Introduce Touchscreen Consumer Smartphone

HP is going to introduce a touch-screen consumer smartphone that will utilize Windows Mobile 6.1, according to the Wall Street Journal. The company sells PDAs, PNDs and smartphones (mostly to business users) predominantly in Europe. The new iPhone-inspired touch-screen device will be marketed initially in Europe and eventually make it to the US. 

As I've argued several times over the past week, both the consumer and enteprise smartphone markets are quite competitive in the US. The decision to use Windows Mobile 6.1 is smart from an enterprise standpoint but not likely to help the new device gain adoption in its target consumer market -- unless the price is extremely aggressive and attractive.

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Related: BusinessWeek profiles the very iPhone-like Nokia 5800 (this is apparently what was known as the Tube previously). And here's an interesting new concept all touch-screen device from Nokia.