This year saw unseasonably cold weather in Barcelona along with a new location (Fira de Barcelona, 2km west of the previous venue, Fira de Montjuic), which spread the event over a much larger area.
A reported 72,000 people attended on Day 2 (traditionally the busiest), with a mood that was generally positive. The big themes for this year were 4G, smartphones (due to the increase from 1.5 billion devices to 1.9 billion by the year end), regulation, multiple screen experiences and new revenue streams.
A report from the GSMA for the mobile industry over the next five years can be found here.
Developing markets appeared full of opportunity (admittedly at reduced ARPU) with mobile connections globally having grown from 4.05 billlion connections in 2008 to a latest reported 7.4 billion, with the biggest growth in Africa (which a recent Economist report suggested had 75% mobile penetration matching India and a GDP rising 6% annually).
The big question for the industry and therefore of the show was who will win the third place in the operating system war. Currently, Apple and Android together represent 92% of the smartphone market.
The big news for the event was the announcement by Mozilla for the introduction of their Mobile operating system, enabling the world’s first Open Web Devices.
Mozilla announced deals with four manufacturers Alcatel (TCL), Huawei, LG and ZTE to build the first Firefox OS devices, all powered by the Qualcomm Snapdragon™ chipset. It also announced the 18 operators that will take Mozilla devices.
NTT Docomo and Orange announced plans to ‘commercialise Tizen devices in the second half of 2013’, with Samsung confirming that it plans to offer smartphones powered by the OS this year.
NFC was being heavily pushed again this year. The reality is that there are highly effective low-cost systems in place and NFC on mobile devices appears to be a technology looking for a solution.
While mobile money and payments appeared to be in the mainstream of conversation at the show, it has yet to gain clear direction as the market is too fragmented; no signs of this being fixed in the short term.
The inexorable rise in penetration of Smartphone’s was a focus. IDC stated that more smartphones will ship in 2013 than feature phones, marking the first time this has happened over a 12-month period. The company said that vendors will ship 918.6 million smartphones this year, or ‘50.1%’ of total mobile phone shipments worldwide.
In order to drive smartphone take-up globally price will be key, the need for low cost devices to enable deployment into developing markets was clear. Nokia launched a sub 100Euro Lumina device, however Haewai trumped it with the launch of their P1 device at a sub 80 Euro price tag.
Huawei had a full range of devices, and this year allowed the public to their stand when previously they have been rather more secretive. As mentioned above the P1 started at a very competitive £50 and the P2, launched to a huge fanfare at a Barcelona venue as the world’s fastest phone looks to be very competitive.
HTC demonstrated their One device which can replace the function of the TV remote control in the home.
The ‘Phablet’ category of smartphone (in excess of 5”) is growing with several new devices on show at the event. This steady size ‘inflation’ observed at the event is driven by a decline in voice calling and a demand to use smartphones as primary Internet access devices.
Also present was the 7-inch Asus Fonepad, a 7-inch tablet that also makes calls. Tablet phones are the latest ‘techy thing’, even though holding it up to your head would look rather silly. Returning to more traditional devices the Xperia Z series from Sony this Thursday. It is water resistant to 1m for 30 mins and has a Full HD 1080p screen
The first keynote on Monday morning was a call for reduced regulation. The MNO’s have huge costs which are not being shared by the OTT players who at the same time are taking value from their position in the chain.
The GSMA forecast that global mobile data demand will rise from 0.9 Exabytes a month in 2012 to 11.2 Exabyte’s a month by 2017. (1 Exabyte = 1 billion Gigabytes). This will put a real squeeze on the operators as they look to carry this burgeoning demand.
Meanwhile the need to supply the returns required for future investment in the 4G/LTE networks construction of which is now well underway in many countries is clear.
Applications and Advertising
Mobile Advertising appears to have now ‘arrived’ at the event. The next stage of development for the industry is the growth of real time bidding (currently 10-15% of the market) and the need for data to improve targeting efficiency.
This is an opportunity for the operators to make available the rich data sources of their subscribers. According to ‘First Partner’ Their UK mobile ad market Forecast has been increased to £511.4 million for 2012.
They have also revised their long term forecast up to £1.6 billion for 2016. Developers were talking about the opportunity that the Mozilla announcement would generate, although they are now wiser to the lead times required before significant numbers of devices are in the market.
The current economic status has ensured that the MNOs focus on areas with the best revenue/cash flow opportunities. However, the landscape is changing and there is rather less scepticism about new revenues within the telco community.
There is a recognition that while there is no silver bullet for their businesses there will need to have a number of revenues lines if they are to remain profitable in the future. The next 12 months promise to be another fascinating year for the industry.