Today the boys and girls of the mobile industry pack up and will leave Barcelona. They have a lot to think of. They got quite some messages for the next year to think about. I am not in the mobile business nor am I in Barcelona. I am just a mobile user with an interest in the development of mobile content. So I have been reading the stream of press releases. Most of them could be relegated to the dustbin immediately and were not even worth reading. And as I wrote before about the Readius, the mobile with flexible digital paper, of course the old tricks were played to lure the press; but the press can have a better memory these days due to search engines. (I recently spoke to someone who had seen and felt the Readius and was shocked to find out that you have to open the mobile when called. There is no interface and/or screen on the outside of the mobile to accept the call. This mobile will not win a usability award, was his final judgement).The flood of press releases shows that the mobile industry will have to deal with saturation. This year there will be more mobiles in China than in the USA. Of course there are still markets which still have to pick up mobile telecom, but they are not the most interesting markets. And the profit margins on devices are under pressure; Nokia has to move its production from Germany to Romania.
After saturation, consolidation sets in. No longer the various models of mobile telephone (or handy as the Germans call the device) are important but the software will influence the acquisition. And the software is based on the operating system. Presently there are some 50 operating systems and new ones still pop up like Google's Android. But the most important ones for now dominate the market: Symbian, Microsoft Mobile, Opera. And the manufacturers are no longer strict in using operating systems. Even Symbian shareholder Sony-Ericsson has now used Microsoft Mobile in one of its new models. And they are desperately looking for infrastructure like search engines. Of course Microsoft hoped to catch two flies in one go with Yahoo. Once the search engine would be part of the conglomerate, it could also function as mobile search engine.
But the main manufacturers and operators are still dancing around the issue of content. The latest item in content is of course television. This will bring in the ship with gold; so they think. I am not a believer of that. Mobile television will fit in the snack culture: short, funny movies. I do not believe that you will watch television series. In my view this will be something for the Ultra Mobile PCs, which will flood the market by mid 2008.
But also in other content areas, manufactures are looking again. Nokia started to distribute content of games, music, navigation information and other information through its Ovi service. Local operators will be glad to pick up the connect minutes, but will not get any extra’s out of it. The operators have also looked for the content revenue extension. But the time of the walled garden services is over. Besides people pick what they want to have and not what the operators think that they should have.
One of the reasons mobile content has not been a success is the tariff of connect time. Just downloading a1Mb from the mobile net cost a fortune. Of course T-Telecom has brought down the price, but if you have to pay yourself, you will not connect to YouTube for the daily selection. And money is not the only handicap, but also the operating systems. The scaling/reformatting of internet screens does not really work, even not on smart phone screens.
There is an old wisdom in the PC world that you have to sell a PC for free and ask money for software. IBM forgot to do this, when it launched the PC in 1981 and Microsoft came in. In 2004 IBM had to sell its PC business to Lenovo. Nokia is trying to hold the fortress by launching the Ovi service. But will this service mature in time to deliver profits, when the profits on device manufacturing will start to tumble and local operators are back to their old game of ticks and bundles.
Blog Posting Number 1008
Tags: mobile, walled garden, smart phone, digital paper
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