As an industry, we have debated about SmartPhones for quite some time. What really constitutes a SmartPhone. What makes it a dumb phone? If you go way back to basic devices and just started getting into Blackberry, Windows Mobile and Palm.. those made sense. They were head and shoulders above the majority of the basic class of devices. It was easier to define SmartPhone back around 2001/2002. RIM had released their second big version of the Blackberry, taking it beyond a pager style device.. and Windows Mobile was getting out of it’s first rev of the OS to release Windows Mobile 2002. Seems like forever ago.

If you look at what devices are out on the market today, compare them to the differences in the past.  Things are starting to blend.  Before you could say a device with a keyboard and PIM (Personal Information Manger) applications was smart.  Then it started to move into the OS discussion, could you run additional applications on them?  What about the device power?  Did it have a Strongarm processor that could be used in more powerful office type applications and extend desktop capabilities beyond the desktop?  It started to get muddy real quick.

If you look now at the devices in the market, MOST devices are considered SMART in their own right.  They are far more capable as a whole than we’d ever thought possible back 10 years ago.  Heck, even on Google trends the idea of SmartPhone is not that exciting.  It has been trending downward since Christmas 2004.  At that point, devices could support portrait and landscape modes, higher resolutions, they had keyboards and even WiFi.

While search volumes have consistently risen, the general interest compared to other searching activities is weakening.  The public is immune to the marketing hype of the “SmartPhone”.  It is not selling devices.  It is not understood.  It is not a relevant term.

If you look even at major media companies (I’ll make the leap that CNET is still regarded as knowledgeable here).  If you look at what CNET calls SmartPhones, the list is varied beyond comprehension.  There appears to be no standard they are applying at all.

The Blackberry Bold is a Smartphone in their list.  Sure, I get that.  Makes sense.  The Garmin NuviPhone is in the list despite the fact that it lacks ANY real Email or Calendaring functionality.  It is VERY smart with regards to GPS applications though. Maybe that made it smart. It also has a touch screen.. but no real keyboard. How about the Nokia 5130?  Standard looking “dumb phone” style, but very good with music.  It is more of a hybrid portable music device and phone secondary.  It does not do well with email, no calendaring functionality to speak of, no keyboard, low-res screen and small screen compared to others.  Hmm.. how does this make sense?

I am trying to work through in my head what I think the right terminology is.  I know some co-workers and I have had this debate many times.  Nobody has a clear answer, yet we all agree that SmartPhone is wrong.  So.. I am just going to lay it out there while we think about it.

What is the new mobile device segmentation we care about?

Phone vs. Netbook?
Proprietary OS vs. Open Development Platforms?  (i.e. LG vs. RIM, Apple and Android)
Device Capabilities such as Screen Size, touch screen, keyboard (physical or virtual)
Memory/Storage?
Extensibility?
App Stores Availability?
Browser Capabilities?
Cost?

How about the network?  3G vs. 4G?  as Wi-Max and LTE come on board more mainstream, what does this do for us?  Bring mobile computing into the realm of REAL possibility for rapid growth?

I will continue to ponder this.. but would love to hear input on what your thoughts are.

LTE is to Wi-Max as VHS was to BetaMax.  OK, I could go on here but you get the picture.  I am not really seeing a future for Wi-Max beyond 3-5 years at best.

If I look at the demise of both Betamax and HD-DVD, it really came down to who had backing from not only the consumer market, but where did hardware manufacturers choose to place bets.  Recently you all remember Blue-Ray starting to succeed due to backing from the Movie Industry for a format to support, then large companies like Best Buy placed bets on Blue-Ray for stock and finally hardware manufacturers started placing their bets to follow.  Betamax was a very similar story.  In both cases there was a good competing technology yet someone had to win.

Fast Forward to 2009.. We are starting to see early decisions around two competing technologies for the next generation of wireless data transfer.  Verizon is making progress in getting out specs for it’s LTE network and plan to have 25-30 markets by next year..  Vodafone and AT&T are two other big players who are pushing for versions of LTE as the standard, even as far back as April of last year.  Even small carriers like MetroPCS are pushing for LTE to be the standard and planning on releasing phones based on this technology.  Fred Wright, who is an exec for Motorola on 4G networks has stated that not only are  80% of the carriers world wide moving to adopt LTE as a standard, Motorola is also pushing to make 70-80% of the work they are doing on supporting Wi-Max today  re-usable by LTE in 2012.

Wi-Max is supported heavily by Clearwire Wireless.  Nokia and Intel have also put some backing into support for devices through the chipset, or embedded support as in Nokia’s case.  I won’t call this level of support insignificant however; when you see stories like Alcatel Lucent making a clear stand on re-focusing all Wi-Max resource over to support LTE it makes you question the long-term viability of Wi-Max.  Alcatel-Lucent even goes on to state they don’t believe the market can afford to support two competing standards. (I agree)

Some people think that the “sibling rivalry” will bode well for both technologies. I can’t help but go back to the earlier analogies I was mentioning with VHS and Blue-Ray winning out.  Their competitors were not horrible technologies, as a matter of fact they had some actual backing in the industry.  The problem is once the balance starts shifting to one or another technology, companies are less and less likely to place bets on the “underdog”, and almost nobody today has the budget to fund two technologies.

Sure the two technologies are relatively close, some even believe at some point they could work together and devices could switch between them.  The reason I think Wi-Max is doomed in a few years is this.  History shows that technologies DO end up having clear winners when it comes to a Battle Royale.  As technology pushes wireless to faster speeds, the lack of need to attach physical lines to a house for Broadband connection.. where am I going to go for this type of technology?  I have already given up my land line for a Cellular only household.  I know some people who already use Air Cards from Sprint, Verizon or AT&T for their PRIMARY internet access.  Why would I want to pay yet ANOTHER bill to someone?  The market will mature, price pressure will occur and at some point I will have my carrier wanting my Cellular Voice traffic, My Cellular phone Data traffic as well as a tethered primary home connection, All for one low price.. and at speeds faster than I have now!

The question in my mind really is around how Comcast, DirecTV, Verizon DSL/Cable, etc.. are going to compete with my new found wireless, ultra fast and bundled play with my cell provider?  How can they compete to get all of the rural customers with the capital expense of running cables when LTE will get that “last mile” customer at no additional cost!    If I were a “wired” broadband provider these days, I’d be concerned about my business model and what the 5-7 year revenue charts are going to start looking like.  I don’t think “Down and to the right” is the chart you want to be showing your board.

As for me?  I am waiting for that AT&T bundle for my LTE based iPhone/Tethered connection that is with me at ALL times.  I can throw my Dell Mini9 running OSX online anywhere and forget the fact I live rural and had issues in the past even getting  cable operator to call me back.  Hulu over my Cellular connection is working just fine in 2011 for me thanks and I am thankful for the geniuses behind 4G and beyond!

- Jeff Torgerson

Photo Courtesy of AlicePopKorn

OK, so over the past couple days there have been many rumors about Verizon and what they may bring to market to compete with AT&T and the iPhone.  Stay with me here as this post is going to be a little bit all over the map with the info I am reading.. just trying to catch up!

CNN Money has a post about Verizon and the possible iPhone Lite as well as a small touch pad device.  With that said, there are a few rumors around this happening, not just this one.  I cant find the original source but the posts seem to come from the New York Times, USA Today, and Businessweek according to the article.

There have been rumors swirling for about a month on some 10 inch touch screen devices that Apple is purchasing, this could line up with a device they are shopping around, or it could be something new they are bringing to market on their own. I actually believe that going to the carriers looking for a deal is a good solution, and here is why.  People have been snatching up netbooks for a while now.  These are great little “always connected” devices for accessing data so long as you are near Wi-Fi or happen to have a netbook with a 3G card built in.  If Apple wanted to bring a netbook to market they would have to be concerned about how it will cannibalize sales on the $999 Macbook.  Many people (my wife included) have  a Macbook that is primarily used for accessing Email, Facebook, Recipies, booking trips, online banking, etc.. NOTE:  Very little application access.

If you are trying to differentiate yourself against OTHER netbooks in the market, you surely can not do it on price right now.  Hell, even the OLPC laptops are selling for $199 still.  If you try to come in at the $200-$400 range, the only differentiators you have is the brand.  Don’t get me wrong, an Apple netbook at $400 would sell like hotcakes I think, I just don’t see Apple doing that.  You need to find something more.. something exciting and different to give people yet not cut off future sales of the Macbook line.

Apple has to be looking at the success they have had with the phone.  Partnering with a carrier to provide the infrastructure while they provide a portable computing platform and closed ecosystem for selling applications, what could be better!  This is working on AT&T so far.

OK, so I am Apple, I know I want to protect my Macbook sales.. and I want to bring a small netbook type device to market.  The logical thing I could do is try to repeat success I have had with the iPhone.. bring a small touch screen connected netbook to market that has constant connection.  The flaw here is if I am an iPhone user, I am on AT&T in the US.. so would I want to subscribe to Verizon for the access?

If this is the plan for Verizon, to get an Apple netbook deal, does it hurt Verizon as a “dumb pipe” play even if this is not a phone? Sprint sold access with Kindle.. that apparently worked for them.  I seriously just don’t see Verizon getting the deal for a connected device from Apple.  It would fragment their loyal customer base and cause TWO contracts for access.  Verizon is already starting to subsidize netbooks for users by allowing a $50 price so long as you sign up for data access on the device.  AT&T is testing it’s own netbook subsidy as well.  As a side note, why would carrier do this? The hope for the carrier is to increase awareness of mobile data usage, get people hooked on access to content 24/7 and then close the deal on multiple channels of data for each subscriber.  From there you want to collect usage data and leverage that to extend your relationship with you subscriber base.   We are already seeing places in the world where mobile penetration rates are greater than 100%, it won’t be long and AT&T/Verizon would love to see data penetration rates there as well.

OK, rambling.. back to the main topic.  More rumors.. We already know the rumors about Apple and Verizon. Today we have more coming out about Microsoft and Verizon trying to launch a device code named “pink”.  Apparently it is a windows mobile based device that Microsoft is working on with a modified OS to be more touch screen friendly.  First things first.. Apple nailed the usability because the iPhone was designed from the ground up to be touch screen, not a hack on top of an already outdated OS.  Second, iPhones are popular because they are also great media devices.  Microsoft either has to concede that Zune is failing and just let people use Media Player in the Windows Mobile OS, or they have to pull out all the stops and take a run with the Zune phone.  I vote for the former.  Serisously, there is nothing wrong with playing to your strengths Microsoft.  Let Zune die and realize that for your mobile play, Windows based OS with Office suite and Media Player is REALLY a good solution.  Just do it right.  Don’t hack it.

Where does this really leave us then?  Well, besides having more fodder to chat about tomorrow.. I think Verizon needs to close a deal with Apple for an LTE based iPhone as well as a heavily subsidized netbook if they have a chance to start playing in the “Apple spotlight”.  (if they care)  However, I think Apple would be better served by working with AT&T to offer a bundled plan that is a subsidized netbook, and if you sign up for a tethering plan on AT&T iPhones (something we know the 3.0 OS will support) it would give AT&T an opportunity to milk just a little more money from their already willing spenders on the Apple money train.   If I pay $30 a month for internet on my iPhone, would I pay $50-60 for my iPhone/Netbook combo?  Maybe. It could be bumped to $75-$100 for unlimited pricing and try to pull people from their ISP and use this as primary access.  Think of the data that could be gathered on their user base.. cross sell opportunities, etc.

WOW.. After re-reading that.. it really is a lot of info with my standard free-flow writing.  As promised, I don’t go back and re-write things.. I do a quick error correction pass and leave it as a stream on concious.  What are your thoughts after reading this?  Should Verizon try for Apple?  Should Apple secure a deal with AT&T to leverage more data rate and try to negotiate a portion of the data subscriber piece?

I am torn on the battle to get things to market vs. create good product.  As a product manager you are always working with engineering to make trade offs.  Can I get my product to market in time?  Can it make it at least in time for CTIA? No.. hmm, can we cut a couple of features?  No.. don’t worry.. no need to test that right now, we won’t demo that piece.  Seriously.. how many times have people either been a part of this.. or used a product that they can predict is a result of this exact way of life for us.

Market timing is essential in most any case.  My concern for companies is really around two areas.  One is what Google does.  Keep everything in BETA, set expectations low yet deliver a fairly competent product.  (or great in some cases).  I am not saying I agree with perpetual beta.. but after a while crutches even start to rub you the wrong way.  The other area where I have concern is around rushing product to market to a “release” that is not solid.  In many cases you can get away with it, in most you cant.

In a recent article about Smart Phones, Jim Balsillie was quoted saying that buggy phones are the “new reality“. (Another RIM Article Here) He not only admits that they got it a little wrong on their first touch screen, but most people get it wrong the first time around.  The issue with this in my view is two fold.  Mr. Balsillie was coming to market with his touch screen 1.5 years AFTER the killer touch screen came to market, and not only did it come late.. it had many issues with it.  Sure, Apple had some serious issues with the original version however they were competing with nobody in the market with this phone.  It stood alone.  RIM also had a problem with RIMs stellar reputation.  Sure it is good to have such a solid reputation with “enterprise class” devices, but it makes it impossible to hit the market with a flawed device without severely damaging the brand equity they had built up.

I came across this great chart showing RIMs market share in the corporate world of smartphones.  Sure.. the chart shows Apple passing Palm for market share, but look at the separation between RIM and Apple.  Significant yet starting on the closing trend.  Why give your strongest competitor another advantage by releasing a device that is NOT ready for prime time.  Sure.. I am coming down hard on RIM here but if I were in charge of the brand up there in Canada, I’d be worried about the next device.  Do you come to market 6 months earlier?  With Issues .. since your CEO already set the stage for you.. or do you refine it and release a knock down Apple iPhone enterprise killer to help keep your secure placement in the worlds of corporate IT gods.

HTC, RIM, Microsoft, Samsung.. face it.  Apple did the right thing.  They drove a product through proper design and testing, they have fantastic people and you are NOT going to replace the iPhone.  Find your niche and focus there.  Do not lose sight of your core business… bad reputations are hard to repair.

There has been discussion for quite some time now about payments coming to handsets.  For better or for worse, there are varying views.. it is coming.

Nokia is releasing the 6212 with Bluetooth NFC built in to the device.  This is not the first device with NFC built in however it is getting some press lately.  According to Wikipedia there are around 9 current handsets supporting NFC at this time.  While that is not a lot, it is progress.  Couple that with the already emerging smart card “touch” payment systems that are going in (same technology) and you have a very new  yet growing ecosystem to breed mobile payments.

Another way this is trying to be accomplished is through companies like Obopay. Obopay actually received funding from Nokia a while back and if I had to guess, may be part of the payment solution on the 6212.  Paypal has a solution similar to Obopay where you can send text messages to people to pay them. (you actually send to Paypal and they route the message) While this works, it is not only clunky.. it is expensive.  If I owe a friend $9.. paying through Paypal is costly.

I believe that mobile payments are going to become more popular over the coming years but I would venture to guess that we are a good 5+ years out from it being mainstream. Shifting behavior and getting some of my  “old skool” friends to adopt this may be more challenging than the industry thinks.  Let’s hope I am wrong.  I’d like to use it sooner than later.

via Engadget Mobile

It seems like every time we turn around, another “app store” is popping up on the radar.

SPOILER ALERT: Nobody will have the success (for the end users)  that Apple App Store is having.

Lets see if I can run down the list of recent stores popping up online. First is Apple’s App store.  The one people USUALLY mean when they mention App Store.  Then lets run over to the Android platform.  Android Market is ready to play.  Blackberry?  Sure, RIM finally put their head in the game to get something out with Blackberry App World.  What about Microsoft?  Windows Mobile Marketplace is coming online.  Palm didn’t want to be left out with the cool Palm Pre device, so the App Catalog is soon to live.  Nokia has their Ovi store for their S40 and S60 devices. CellMania is jumping in with their Android Content Storefront which is a direct competitor to the Android Marketplace.  Hell, even hackers are getting in the game with their own stores.  Cydia used to be a free location to get apps on Jailbroken iPhones, now you can also buy applications through them.  So, let’s take a run down of each one.

Apple App Store

Apple really nailed it I think when they came out with the whole package they did.  Not only did they launch an app store, they launched a very stable and thriving ecosystem.  Sure, not everyone is making money but this is the big win for end consumers.  I will explain why.

First thing that they did correctly is the same thing they are doing on Mac computers.  They are maintaining control of the platform. This helps the stability and reliability of the Mac computers and it is the same for the mobile devices they are offering.  Secondly they are offering a proper SDK around developing high quality applications for the devices they offer.  This means that not only is the platform stable, you get a much more professional application with the controls they are exposing through the SDK.  Thirdly is the approval process.  Sure there are complaints about the efficiency of the process, and even the rules and guidelines.  I do have to say though that some sort of checkpoint it at least setting a bar for the entry into the store.

Last of all, but the KEY POINT: The current App Store from Apple is supporting (for the most part) a SINGLE platform.  The devices have a common screen size, keyboard, capabilities with the exception of phone, microphone, GPS.  Why is this key?  It makes it MUCH cheaper for developers to enter the market and get an app running on the platform.  They don’t have a plethora of devices to support.   This may change with an iPhone Pro device coming to market, or even an App Store that supports an Apple Netbook.. but hey, I can dream. 

Android Marketplace

Android Marketplace was getting a fair amount of hype prior to launch.  It came to market with a lack luster FREE model and only recently started supporting sales.  (through Google Checkout)  Now, I have a Google Checkout account, but how many people do?  Compared to an iTunes account?  OK, so I will just go sign up if I had to.  Minor complaint.

What about devices? Well, the current G1 with it’s Chin is the only device.  Not only is another HTC device coming to market,  are other manufacturers are poised to deliver an abundance of devices over the coming years.  This will result in the same fragmentation around handsets which has pained everything from PocketGear to On Deck downloads.  If my application is not optimized for a given handset, the UI sucks.. making the app less than exciting.  If I optimize for ALL handsets, I can’t make money.

Blackberry App World

Rim is actually setup to do fairly well in my view.  They are more like Apple than others in that they are controling the Ecosystem around the devices and SDKs for building on these devices.  There are a bunch of J2ME developers already out there and many ready and willing to support a bunch of RIM devices, which will most likely amount to fewer combinations of capabilities to support than the Android store.

Enterprise is another space where RIM will not only do well, but surpass Apple for content sales. (at least until OS 3.0 really gets rolling for Apple in Q409/Q1 2010.  (I just realized you can’t really write Q110 and have it look right).  RIM has Apple by a mile when it comes to Enterprise support.  Couple that with a companies willingness to mobilize their workforce with paid applications and you are going to have a ripe market.  Salesforce partners rejoice, you will have another channel to make money! Where I think Apple will bring some competition is the ability for devices to integrate with the iPhone such as medical devices.  This is not directly in line with RIM, but could sway some users.

Windows Mobile Marketplace

I am just not convinced I know enough about the Windows Mobile Marketplace strategy to make a fair assessment.  I do feel that with 7.0 of their software, they will win over some users.  Just not sure how well it will play into the sales in the store.  They will have a strong development community the could leverage, they just need to embrace it and let them loose to really get the store full of quality apps quickly.   I think a couple of good enterprise plays to draw users away from RIM would be key.  Office Mobile products could sell like hotcakes if supported correctly.  Imagine a bluetooth keyboard and a good mobile Office app?  I would use that on a plane instead of my laptop. 

Palm App Catalog

This is one of the more interesting ones coming to light in my view.  Considering the Palm Pre is HTML based applications that are far easier to code than an Objective C app, I could easily see the number of applications explode in this space.  There will be a ton of solid Web Developers who could write more widgets than you could shake a bag phone at but many of these guys (or gals) may struggle with Apple’s Objective C, Android and its Java based apps with a complex framework under it or even RIMs SDK which is Java still.

The issue here is now a combination of full applications or the widget type cards.  What is the model here?  Can you sell each?  Only applications and the cards are a result of the Pre’s rendering?  They could monitize these a couple different ways probably, but you can bet one thing.  There WILL be a bunch of applications quickly in the PRE store.  Also a lot of crap.

Cellmania Android Content Storefront

Cellmania is going head on with Google on the Storefront.  This is either Genius or Suicide, you make the call.  On one hand, Google has not shown the willingness to brand carrier anything when it comes to getting things on deck.  Carriers need to be worried about the likes of the big brands building up their brand loyalty vs. the carrier brand.  Now.. on the other hand, if Google is faced with carrier X launching and embedding Cellmania’s storefront, or giving a little control and rev-share back to the carrier, it may be worth it.

Cellmania is doing some cool things around other billing integrations, subscriptions and in-app purchases that Google is not doing, so this may be a big win for them.  Google is focused on the platform.  Not necessarily on the Storefront.  Cellmania is clearly winning the Android storefront battle for now.

Cydia

Cydia is the Jailbroken iPhone users best friend when it comes to finding unsanctioned applications.  In the early days it was Installer.app as the reigning storefront for access to un-approved software.  With the advent of some great updates on Cydia’s part and the iPhone progression, Cydia is clearly winning.

In a recent update, Cydia’s developer Jay Freeman released paid applications as part of his plan to make Cydia the store of choice for advanced (read: brave, creative, stupid, needy) users.  He apparently has already lined up a lawyer in case he needs one.    The nice thing about Cydia’s app store is the ability to get applications that do things Apple does not approve of.  (Or AT&T for that matter).  If you want to tether with your iPhone, record video, make a VOIP call over 3g… you must Jailbreak and go searching around Cydia.

Ovi Storefront

I have to say out of all the Storefront activity, I really just do not get the strategy around Ovi. Ovi Suite.   To me this is a big pile of proprietary services that are solving problems that don’t need solved or adding in custom code where COTS would work fine.

Ovi offers a series of things as a platform that developers could leverage.  First off is what appears to be IP protected proprietary syncing software for contact information.  Seriously. Who doesn’t use Exchange Server for Enterprise (broad comment, I know).  Why not use SyncML?  I am a big fan of hating proprietary crap.

Ovi Mail?   nGage?  How about a proprietary photo sharing solution? No thanks.  As a developer I would want to write applications that are using Flickr, Open gaming platforms or POP/IMAP based email systems!  That is the market!

I clearly need to learn more about Ovi and Nokia’s goals here, but for now I am not getting it!

SUMMARY:

Fragmented devices are going to cause issues on two fronts. First is the ability for developers to make money on more than a single, broadly used platform.  Companies like Loopt are going to feel the pain because if they want mass penetration of their mobile play, they have to support a LOT of handsets and a LOT of storefronts.  Users are going to suffer due to developers focusing on a FEW handsets and not all. This means there may be 25,000 applications in your app store, but only 2800 work on YOUR phone.  That sucks.

Apple will dominate with the variety of quality applications available to their fan base.  They will struggle to compete with RIM on the Enterprise Mobile Application space for a bit, but I do believe the frameworks Apple is putting in place will allow for some amazing applications that are more hybrid iPhone/Device controls.

Palm will gain a strong following of Web Developers who are able to build a solid base of applications quickly.  Let’s just hope they are supporting things like HTML 5 standards.

Android will suffer the worst. First and foremost is the device fragmentation.  Couple that with Cellmania kicking their behind on the Storefront capabilities, it will be a confusing situation for many in the forseeable future.

Windows?  Sure, let see how they acutally make progress.  I am not convinced, but hopefull for them.  They have a solid chance to win back some enterprise customers if they execute properly.