Worldwide Mobile Phone Market Grows 14.3% Amid Economic Jitters
by: Jerry Liao
The worldwide mobile phone market experienced an expected sequential downturn in shipments following a busy holiday quarter. According to IDC’s Worldwide Quarterly Mobile Phone Tracker, vendors shipped a total of 291.6 million units during the first quarter of 2008 (1Q08), down 11.6% from the 330.8 million units shipped during the previous quarter (4Q07) and up 14.3% from the 255.0 million units shipped during 1Q07. While the first quarter results are in line with IDC’s 2008 forecast, concerns over the economy may negatively impact handset purchases as the year progresses.
“The mobile phone market will be under increased pressure from a number of factors that compete for users’ attention and wallets,” said Ramon T. Llamas, senior research analyst with IDC’s Mobile Device Technology and Trends team. “Disposable income is being eroded by rising food and fuel prices and worries about global financial markets and slow economic growth are creating a cautious outlook for the months ahead. Against this backdrop, many emerging markets continue to offer tremendous growth potential and IDC expects highly competitive pricing and innovative service plans will keep the overall market on track for the year.”
Demand for handsets in the low cost segment will remain present in certain emerging markets throughout 2008, driving worldwide shipment growth. In contrast, more mature regions are increasingly characterized by highly competitive markets for replacement handsets and somewhat slower shipment growth.
“As predicted, most mobile phone vendors experienced a lull in the first quarter of 2008 with the exception of LG,” said Ryan Reith, senior research analyst for IDC’s Worldwide Mobile Phone Tracker. “Continued growth in the low cost segment will mean average selling prices (ASPs) will be generally lower than in the past, but this will be balanced somewhat by further expansion in the converged mobile device or smartphone segment, especially in mature markets.”
Top Five Vendors
– Nokia once again outperformed its competitors, with total shipment volumes greater than those of the next three vendors’ combined. Keeping volumes at a high level were its entry level devices going into emerging markets, including its successful 1100 and 1200 series devices, while more fully featured devices like its 5310, 5610, and 6500 series and Nseries devices generated the most revenue and profit for Nokia. With a strong presence in emerging markets, Nokia is poised to capitalize on replacement handset opportunities in these markets.
– Samsung gained further clarity as the No. 2 vendor worldwide, building its largest margin yet against Motorola. Although shipments remained even from the holiday quarter, Samsung improved its presence within key emerging markets, balancing out against soft demand in Europe and North America. In the process its decreased marketing expenses, allowing for double-digit profitability. Samsung remains confident that it will reach its goal of 200 million units shipped this year, and look to more full featured devices to be released in the months to come.
– Motorola had a disappointing quarter, falling further behind Samsung and reaching shipment levels not seen since the second half of 2004. Gaps in its product portfolio left the company vulnerable, especially in the areas of music, touch, and messaging where other vendors have flourished with their own products. Further compounding its problems was another quarter of operating loss and lower operating margin. While the results speak to its ongoing difficulties, Motorola has been building a framework to turn its fortunes around with plans to separate the mobile devices business unit from the company and streamline its silicon and software platforms to bring new devices to the market later this year.
– LG Electronics capitalized on Sony Ericsson’s challenges to re-take the No. 4 position for the first time since the beginning of 2006. Thanks to the continued demand of its flagship feature phones, including the Viewty, Voyager, and Venus, LG bucked the trend of seasonal decrease in shipments. In addition, LG returned to double-digit profitability. Looking ahead, LG plans to grow its presence within emerging markets and ship more high-end devices next quarter.
– Sony Ericsson started off the year citing several challenges affecting its shipment volumes: diminished demand for its mid-range and high-end devices, channel inventory buildup, component shortages, and greater interest in low-price handsets in Asia/Pacific, an area where the company has not had a strong presence. Despite this dour news, the company hopes that its renewed focus on the North American market with the W350, W760, Z555, and XPeria along with several Cybershot, Walkman, and Web-ready devices around the globe will yield positive results later in the year.
Mid- and High-End Mobile Devices Will Run a Linux Operating System by 2013
by: Jerry Liao
Linux may not be as successful as Windows and MAC OS in the desktop front, but it sure is making waves in the server market and in mobile devices. We’ll according to ABI Research, it seems the future for Linux in the mobile world is getting better and better.
Linux, which has been much maligned by Symbian and Microsoft as a non-starter in the handset operating system market, is set to see strong growth as issues with framework fragmentation and silicon requirements are alleviated. The growing momentum behind the LiMo Foundation initiative, as well as the marketing boost that has been realized from the entry of Google’s Android solution has been further enhanced by Nokia’s support of the Maemo solution and its purchase of Trolltech. ABI Research believes that by 2013, nearly one out of every five mid- or high-end mobile devices will use a Linux operating system.
ABI Research vice president Stuart Carlaw notes that, “Clever choice of public license support, along with software engineering that isolates proprietary items from open source items, allows operating system vendors to generate revenue from a very cost-effective OS solution.” He goes on to add that, “Linux OS solutions will be far more cost-effective than incumbent solutions, even when silicon requirements are taken into account, given that a fuller application layer will be included in the standard package and that the burden of customization falls mostly on the independent software vendor.”
A new ABI Research study has found that Linux solutions will be at the center of the drive to bring more content-rich environments to users who currently utilize mid-tier devices. More importantly, it looks increasingly likely that mobile Linux solutions will be an important building block in enabling an application domain that embraces Web-based applications and blended Web/native applications.
The new report, “Mobile Linux: Bringing License-Free Operating Systems to Smartphones and Middle-Tier Devices” provides a picture of the projected uptake of Linux in two major applications, as a commercial OS and as an RTOS replacement. It offers a frank analysis of the strengths and weaknesses of the Linux solution, and describes major drivers and barriers that are dictating the growth of the mobile Linux market.
Leading independent research and advisory firm, Financial Insights, announced the release of a new report highlighting how Philippine banks are gearing up for a more vibrant banking market by making significant investments in technology. Based on interviews from senor executives of the country’s largest banks, Financial Insights forecasts that Philippine banks will spend approximately US$338 million on IT and related financial technology in 2008, representing a year-on-year growth of 11%. IT spending among banks is projected to grow by a compound annual growth rate (CAGR) of 8.5% from 2007 to 2010.
Michael Araneta, senior research manager for Financial Insights’ Asia/Pacific IT Benchmarking Practice says, “We believe that Philippine banking sector will show one of the highest growth rates in technology investments in the Asia/Pacific excluding Japan (APEJ) region. Even amidst a supposedly slowing global economy, the Philippines will see bright prospects in several business areas such as remittance, consumer banking, and lending to select industries. Banks will strive to gain significant foothold in these areas by improving operational efficiency, scalability and market responsiveness.”
Key areas of spending include channel rollouts, risk management projects, and core banking upgrades. Large banks are expected to focus on getting efficiencies out of their recent investments, finding opportunities for scale, and rationalization. Smaller players, meanwhile, will increase their spending on foundational investments, as well as on discrete projects that will win market share for them. There will also be project related loans origination, remittance, cash management, and payments.
Araneta notes, “We of course note impending mergers involving some of the biggest names in the market. More consolidation will improve the sector’s overall efficiency and productivity. We believe however that consolidation takes a long time to play out. Still, senior executives we spoke to admit to investing especially in channel-related technology to compete more effectively against suddenly larger peers.”
Araneta continues, “If the anticipated round of consolidation proceeds, the banking landscape will be transformed to have groupings around a handful of anchor banks, and then, at the bottom, smaller niche players. We believe that while the fight for scale will be won by those that have built effective distribution channels and good marketing insight and execution, it will ultimately be won by those that have deep pockets to acquire institutions and nerves of steel to pull it through. The more tactical battle will be on those that want to create niche propositions, and already, technology is playing a crucial role in the effort.” The report cites niche businesses being created in wholesale banking and payments.
Financial Insights also observes that while foundational and infrastructure-related projects are prevalent, initiatives that focus on the banking customer have not been so well defined. Araneta states, “There are pockets within banks that are keen to understand the customer more effectively and, from there, craft differentiated response to unique customer requirements. However, these still have to find momentum.”
The Truth Behind Customer Service Satisfaction
by: Jerry Liao
Everytime you watch television, drive along Edsa, turn the pages of newspapers and magazines, listen to the radio and browse the Internet – what is that one thing that you see in all the mediums that I mentioned? ADVERTISEMENTS.
Companies spend billions to advertise their brand, products and services for one purpose – to increase their sales and eventually earn more profit. The name of the company is to get a major share of the market, control or dominate it as much as possible. But how much is being poured into customer service? How important is customer satisfaction to these companies?
My fellow CNET Asia blogger Michael Tan shared a very interesting story a about a Singaporean woman by the name of Ms Tan Geok Hoon. Here’s her story (http://forum.omy.sg/showthread.php?t=2120):
I bought a Nokia phone in Aug 2007 through Starhub with 24months contract at $388.
The phone was not functioned properly in the very first week. I tried to ask for a one to one exchange and was replied, “Nokia has no such policy”. I got no choice but to send to Nokia Care Centre for repair. Between Aug 2007 and Nov 2007, countless of visitation and many phone call were made to Nokia. So much time was wasted but the phone was getting from bad to worst.
I gave warning to Nokia that I was considering to file a claim against them through Small Claim Tribunal. I finally took action as there was no proper follow up from Nokia after one month. Nokia authorized a young girl to come for the first consultation and then in default of attending before the Tribunal for the rest. I finally won the case and was awarded $778 by Small Claim Tribunal in 18 Dec 2007.
Nokia was given 15 days to make the settlement, but they did not respond to me. I called to check about it on 22 Jan 2008, and Nokia said that they did not receive such notice.
I went to their HQ the next day, after presenting the Order of Tribunal to the Manager, he finally agree to pay. However, Nokia would pay me if only I agreed to sign a conditional letter. They wanted to keep my mouth shut and I was not allowed to disclose this claim to any third party. I refused as they had no right to impose any condition because this was not an out of court settlement.
I then applied for WSS (Writ of Seizure and Sale) the next day. An appointment date was scheduled on 11 Feb 2008. I accompany the bailiff officer to Nokia HQ. Nokia was then given two options by the bailiff officer. One was to make settlement and the other one was let the bailiff officer to sticker their movable assets.
They finally woke up and agree to make payment. By then, they got to pay $1,018.43 instead of $778.
By sharing this experience, I hope that many have a better idea of what to do if encounter similar situation in the future. Many of us wouldn’t want to take the trouble to make such claim. Some may have no time, and some may think that Nokia is such a big company and no point goes against them.
The Relations Manager of Nokia, Ms Serene Teo, told me that I won’t be able to win the case and the most I could only get back $388. This was what she believed, but she was wrong.
Straitstimes also carried the story at http://www.straitstimes.com/Latest%2BNews/Singapore/STIStory_209885.html
This story could be an isolated case but something does not add up here. Companies worldwide will spend billions to advertise their products but will not even lift a finger to address a legitimate complain? Nokia is not alone here, there are other more companies who are doing the same as well. And I am sure other consumers have their own stories or nightmares to tell with regards to their purchased products. Feel free to email me at firstname.lastname@example.org so that like Ms Tan Geok Hoon, we can fight for our rights – consumer rights that is.
Study Finds “Alarming” Ignorance About Cybercrime
by: Jerry Liao
Not knowing that your computer has been compromised is a big problem. Not knowing that your computer can be compromised is even a bigger problem. How can you protect your system or find a solution to your system’s problem if you do not know what threats are out there. With the advancement of news reporting, you might think this is impossible. Well, we all better think again.
The National Cyber Security Alliance (NCSA) announced study findings that 71 percent of consumers lack the knowledge on cyber criminals’ weapon of choice and the Internet’s fastest growing threat – botnets. This is quite alarming considering botnets are comprised mostly of consumers’ computers and are increasingly being used to perpetrate identity theft and spread viruses.
“Last June, the FBI identified more than one million computers infected with malware which could have been hijacked and used as part of an army of bots to attack other computers, spread malware, or attack our nation’s infrastructure,” said Ron Teixeira, executive director of the NCSA. “Botnets continue to be an increasing threat to consumers and homeland security. Consumers’ unsecured computers play a major role in helping cyber criminals conduct cyber crimes not only on the victim’s computer, but also against others connected to the Internet.”
The study also reveals that Americans are largely unaware their computer’s security plays a role in our nation’s security and preventing online crime. A majority of respondents think it is not likely their computer could affect homeland security while only 51 percent think it is possible for a hacker to use their computer to launch cyber attacks.
“It is alarming that consumers do not know how to secure their computers,” said Teixeira. “It is important for consumers to understand that safe cyber security practices not only protect them from identity theft, but also prevent cyber crime and attacks. By taking simple steps, consumers can protect themselves from cyber crimes and join our effort to protect other Internet users.”
Compelling findings from the study include:
– 71 percent have never heard the phrase “botnet” – the weapon of choice for cyber criminals
– 59 percent think it is not likely their computer could affect homeland security
– 47 percent believe it is not possible for a hacker to use your computer to launch cyber attacks or crimes against other people, businesses and our nation
– 51 percent have not changed their password in the past year
– 48 percent do not know how to protect themselves from cyber criminals
– 46 percent of consumers are not sure of what to do if they became a victim of a cyber crime
2,249 online consumers between the ages of 18 and 65 were surveyed using the online panel managed by Harris Interactive. The panel is widely regarded as statistically reflective of the general U.S. online population. The interviews were conducted with randomly selected U.S. consumers.
Althought the survey was done in the U.S., I find this study alarming. For the simple reason that the U.S. is considered one of the most, if not the most advance country when it comes to information technology. And yet, the study reveals that most of its citizens are not aware of the threats that are existing.
If the same survey is done in other countries or Asian countries, there is big possibility that the results will even be higher. Which means we in the media industry and those who are in the I.T. industry should work doubly hard to inform the public about the dangers lurking around the I.T. world.
A well-informed consuming public is I think the best defense to cyberthreats and cybercrimes.
Research highlights differences between male and female IT directors
by: Jerry Liao
A new survey on behalf of Total Recall has found striking differences between the sexes about technology. The research, which examined the attitudes of male and female IT Directors, found that women were more security conscious and confident in their computer systems than their male equivalents but had significantly smaller IT budgets.
– Security first. The most important IT headache for women was “email and internet downtime” – a third 33% of female IT Directors identified this as their key concern. Only 9% of men felt the same. In contrast, the most critical issue worrying men was “day-to-day IT hassles”. 37% of men and 26% of women thought this was their major problem.
– Less money. Women were responsible for smaller budgets. Over half (52%) of those questioned had annual budgets for hardware/software of under £25k, compared to 27% of men. The average IT budgets for men was £67k, more than a third higher than the £43k average for women. Interestingly, however, almost half (48%) of female IT Directors were expecting their budgets to increase in 2008 – the comparable figure for men was 29%.
– Home sweet home? Women were far more likely to take their backup tapes home than leave the tapes in the office – a third of those questioned stored backup tapes at home in contrast to just 23% of men. Intriguingly, less than half of women IT directors (42%) had ever tried to restore a file from their backup whereas 72% of men had performed the same task.
– More confident. Female IT Directors were more confident in their IT systems than their male counterparts. 89% of women rated their computer systems as good or very good, with 79% feeling as positive.
Mark MacGregor, CEO of Total Recall online backup, which commissioned the research said,
“As a company we have been trying to recruit more women into IT. There are still many people who believe that women and technology simply don’t mix. These findings show that women who have managed to succeed in IT are more confident in their systems despite having less to spend.”
The survey of 151 IT Directors was conducted by The Survey Shop in October 2007.
Yahoo! Makes Mobile Search Faster And Easier With Voice Command
by: Jerry Liao
The search war is shifting from desktop to mobile devices with Google leading the desktop search space. But Yahoo! is not about to give the search battle to anyone in a silver platter. Yahoo! is putting up a fight and I must say – it’s a good fight.
Yahoo! Inc. recently unveiled Yahoo! oneSearch 2.0, a new version of its mobile search service. Key enhancements will allow users to initiate searches faster using text or voice. Yahoo! also plans to provide greater relevance through richer, more detailed search results by opening up Yahoo! oneSearch to publishers to integrate content, simplify search input with Search Assist and voice-enabled search, and make search instantly accessible on the idle screen of many phones. These innovations build on Yahoo!’s strategy to become the starting point for the most mobile consumers.
OPENING YAHOO! ONESEARCH: BETTER ANSWERS, NOT JUST WEB LINKS
Yahoo! took a major step forward in enhancing its popular Yahoo! oneSearch service by previewing plans to open up mobile search results to publishers and developers across the Internet. By enabling publishers to integrate relevant content into the Yahoo! oneSearch results, it is more likely that consumers will be able to find exactly what they’re looking for. Opening up Yahoo! oneSearch will:
– Turn web search results into answers – the usefulness of the results increase as more actual content is returned versus traditional web links
– Unlock the power of the Semantic Web – results integrate more helpful content, much that otherwise is not usually surfaced in search results
– Provide more relevant content – consumers receive richer information, into which they can dive deeply
Open search results are expected to debut with initial partners in Q2 2008.
YAHOO!’S MOBILE SEARCH ASSIST – MAKING SEARCH INPUT EASIER
Yahoo! oneSearch is simplifying mobile search by taking the pain out of typing search queries on mobile phones. Yahoo! oneSearch with Search Assist provides:
– Faster and easier input
– Predictive text completion
– Contextual recommendations
VOICE-ENABLED YAHOO! ONESEARCH – THE SIMPLEST WAY TO SEARCH
While Search Assist is easier than typing, talking is easier yet. To make that possible, Yahoo! is partnering with vlingo, a leading speech recognition company.
With the voice-enabled version of Yahoo! oneSearch, consumers can search for anything, including flight numbers, locations, Web site names, local restaurants, and more, by simply speaking. For example, a search query like “N-C-Double-A” instantly returns a rich set of results highlighting the latest tournament scores, upcoming game times, and breaking news. Whereas most mobile voice recognition systems are specific to vertical categories such as local listings, Yahoo! oneSearch with Voice lets consumers perform “wide open” searches – returning relevant results for practically every kind of query.
Consumers do not need to follow prompts and think about how to say a mobile search; with Yahoo! oneSearch they simply speak whatever they are looking for and have access to instant answers.
Key Features Include:
– Wide-open voice-enabled mobile search – Speak anything and get relevant results returned through oneSearch.
– Personalizes to your voice – Voice-enabled Yahoo! oneSearch adapts to your voice the more you use it.
– Multi-modal input – Allows users to switch between speaking and typing at any time, enabling consumers easy access to refine queries.
With the growing mobile users worldwide, Yahoo! oneSearch 2.0 with text or voice is definitely on the right track. Let’s see how the others will react to this new offering of Yahoo!.