Mobility: Things NOT going to happen in 2011

BANGALORE, INDIA: Prediction ain’t easy. But that doesn’t stop many would-be pundits from trying to read the 2011 tea leaves, with sometimes hilarious results.

The antidote? ABI Research’s annual take on what’s NOT going to happen next year in many of the markets.

The Wholesale Applications Community will not go anywhere fast.

After adding significant numbers of members this year, the initiative looks to be plagued with divisive intentions and counterintuitive political forces. It is a simply case of too many cooks spoiling the broth. While the consortium wrangles to get everyone’s input accommodated in a highly politicized environment, other apps initiatives — driven ostensibly by single powerful entities — are running away with the swag.

Also read: Internet to bring Indian TV shows to N America homes 

BlackBerry will NOT be eclipsed by enterprise iPhones.

As much as everyone likes to point to how the iPhone will kill the BlackBerry in the enterprise . . . . it won’t happen. The iPhone is flawed from a security perspective and cannot support some of the mission-critical behind-the-firewall apps that are seen on the RIM platform. The iPhone will make inroads in personal use in the enterprise (as will Android based products) but the corporation sensitive to security breaches will keep to the BlackBerry path. Just look to the tightening of information control in the financial vertical to see where this is going enterprise-wide.

Also read: Why Google's TV plans is seen as threat by TV businesses 

Moreover . . . .

Android will NOT begin to eclipse Apple in 2011.

Licensing ideology aside, Android’s primary value proposition is a less expensive and more flexible alternative than Microsoft’s Windows Mobile for handset OEMs. There are no improved technology or standout features that make products significantly more attractive than the iPhone.

Handset OEMs will continue to release an abundance of models running Android, most without strong technology or feature differentiation. Android may win the volume war, but how many OEMs and models will it take to best an iconic device from a single vendor?

Nokia will NOT collapse in a heap.

As ever, the major concern is that Nokia doesn’t continue to be too arrogant to take this opportunity

Although much in the media (especially US-centric media) has been said about the eventual demise of Nokia it must be recognized that this is an absurd concept. Nokia still ships more smartphones than anyone else. Moreover, Symbian-based products will provide the preeminent smartphone solution for the democratized smartphone. It must also be remembered that there is an incredibly potent new OS solution looming in the form of Meego. That, coupled with new management and the desperate need of the carriers to find a supplier they can bully in the usual way (unlike Google and Apple) creates a world of opportunity for the supplier. As ever, the major concern is that Nokia doesn’t continue to be too arrogant to take this opportunity, or wastes even more time developing an OVI strategy that alienates its core customer base.

RFID tagging of retail items, e-ID, and contactless smart card programs will NOT be challenged by “mounting” privacy and security concerns.

While the privacy and security discussion is real, most of the claims are not.

Since ABI Research initiated its RFID market coverage, we can comfortably say the industry has made tremendous progress on a number of fronts, including improved performance, lower costs, total solution development, increased user adoption, and much more. There is an ample evidence to support these claims. However, there is one area where little advancement has taken place: combating continued misinformation about RFID and NFC technology’s capabilities, uses, and limitations. We believe that the industry must more forcefully address the potential damage of this misinformation.

The issue of misinformation about RFID and related contactless technologies is exacerbated as the use of the Internet grows, especially via social media programs.

Hackers looking to shine a spotlight on RFID and privacy and security challenges related to contactless payment or e-passports/e-ID often tout their unsubstantiated and unverified claims on the Internet via a blog or YouTube posting, capturing immediate attention. This is often followed by mass media coverage of the hacking episode.

Unfortunately, little coverage is given to the physics/physical limitations of RF-based technologies and the database correlation hurdles that nefarious characters need to overcome. It is generally conceded that most consumers do not have a problem with the use of RFID, especially in the retail space, if they understand that the tag can be removed or disabled. And, e-ID, contactless smart card and NFC programs and rollouts continue without much public protest. We believe, however, that continued education of the public, end users such as retailers, and key political decision makers is needed on the security and privacy aspects of RFID, smart card and NFC technology in 2011.

Google TV is NOT dead on arrival, and yes, it will live past 2011.

The naysayers have it right that Google TV is still in beta and that, despite Google’s best attempts to reach out to (brownnose) the powers that be at the networks, Google has failed to provide PC-levels of content on the Google TV platform. D’uh! We are dealing with television networks sitting on big cash-cows (cable networks) and afraid of giving customers choices. For several years they have blocked every attempt to liberate content to the TV.

However, those naysayers are comparing Google TV to a PC, not to a TV. Compared to other connected TV platforms, Google TV offers search (not refined enough yet) and will open a big middle-east style bazaar of an app store early next year. Search doesn’t organize everything the way you’d like? There’s an App for That. And why are Samsung, Vizio and Toshiba so eager to join Sony and Logitech at the party? Open-source Google TV will allow them to cut their software teams while still offering great features. Now if only it worked on a cheaper ARM processor. Oh yeah: it will. 

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While your kids might get stuck watching The Vampire Diaries (CW) in their bedroom on an iPad (because they don’t want to sit in the living room with you), you are the King or Queen of your home, and have the right to use the living room TV to watch Walking Dead (AMC). Oh. Your Comcast Xfinity subscription will let you watch premium video on demand (TV Everywhere) content on your iPad, but not your Google TV? Give it a couple of months. Those big, bad networks want to keep you paying your cable bill (it provides 50 per cent of their paycheck) — and cable companies may start longing for the day they can stop investing in a large capital expenditure — that set-top box under your TV.

That’s it, then. We hope you’ve enjoyed our assessment of what’s not going to happen in 2011. Along the way, of course, these forecasts have hinted at what we may well expect in the coming year. As developments take shape, ABI Research’s analysts will continue to provide unbiased, in-depth coverage and interpretation. Meanwhile, the authors of this paper join the rest of ABI Research’s analysts and staff in wishing you all a happy and prosperous new year.

The holiday shopping season is upon us, and some say — where have we heard this before? — that Real Soon Now mobile marketing will transform our buying habits. Or not!

2011 won’t be the year of mobile marketing and advertising for a number of reasons.

For one, that is just fuzzy thinking. Mobile marketing isn’t a one-year wonder. Marketing via mobile devices is an ongoing business practice, just as it is in other media. Mobile marketing will still represent a small portion of the bigger pie when compared to online and traditional advertising for quite some time. The volume of spending will only be a fraction of the total, even in five years.

Finally, there are still serious challenges to overcome: clear measurement standards need to be established (those are coming), audiences are still relatively small (though growing, to be sure), mobile budgets are puny, ad agency support is lacking, too many platforms clutter the space, and consumers remain squeamish over privacy concerns.

A better way to look at mobile marketing is to say it’s here to stay. It will grow and change. Already, marketers need to consider how to play in the tablet arena. Further out, they will face questions about how to exploit Augmented Reality and flexible displays. If you need a time boundary around all this, you could say it’s “the decade for mobile marketing.” But even that is too limiting and fuzzy, because at some point mobile will just become a facet of all marketing, along with “social” and whatever else gets invented in the coming years. Enough with these silly “year of” proclamations!

Among the serious players, the common assumption is that mobile marketing is headed for a growth spurt. There is little doubt of that. The simple fact is a growing number of eyeballs — tens of millions of them — will be staring at smaller screens in the coming year: searching, comparing and shopping. This will be enough to move the needle next year, even if it’s only a little bit. Smartphone sales are going to continue to soar. Consumers are going to buy tablet devices in growing numbers. In short, mobile audiences are spiking, and marketing dollars will follow. This is not hype. And despite the challenges previously mentioned, forward-looking marketers have good reason to spend some of their budgets on mobile. Those who don’t will miss out on an opportunity, and run the risk of competitors taking market share. 

Location-based advertising will NOT be huge.

Without a doubt the Location-based Advertising (LBA) market is going to happen, it’s just unlikely to happen in 2011. The LBA gun is loaded, with GPS proliferating, app stores established, location information aggregated and trigger-happy advertising agencies already trialing LBA with huge success — so why not 2011? Well, first and foremost, the overall mobile advertising market is still in its early stages of development. Add to this the uncertainty surrounding awareness, privacy and successful advertising techniques, and it is clear that this market will take time to mature.

Many advertising agencies have said that it is still too early for LBA in 2011. In fact, ABI Research estimates that just 2% of on-deck and off deck LBS (location-based services) revenues will be generated through LBA in 2011. So what constitutes “happening”? Well, by 2016 this segment will have grown to 15% of a multi-billion dollar market. Furthermore, that forecast does not even include location-enabled services such as Google and Facebook places, which highlight the potential for smaller LBS developers.

So thank goodness all those shopping offers are still coming into the “conventional” Internet we access at home and in the office. Because smartphones won’t replace computing devices for access to the Internet

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Smartphones–with their complex user interfaces–are still far too daunting for the average consumer. Usability problems with the physical size of the mobile device form factor, including the small screen size and limitations of user input, still hamper intuitive and comfortable use for all but the most determined users.

Sometimes there’s no getting around it: Internet or no, you just have to go out to shop. In the US and other spread-out countries, that usually means driving (unless you’re rich enough to have a chauffeur!) What a hassle, especially the parking! But Google revealed in October that a vehicle it developed had been quietly driving itself around California. The car was doing all the navigating and driving, and was capable of unconventional parking maneuvers.

The Google experiment reports that vehicles have covered over 140,000 miles of testing with the occasional human intervention, but more than 1000 miles of journeys had no driver control used at all. Despite this success, engineers still see 8-10 years before anything like this goes into production.

But some significant pieces of this overall package are on the road today. Adaptive cruise control can maintain a chosen speed if the road is clear, and automatically adjust to slower vehicles moving in front. Lane keeping systems can monitor the road markings ahead and nudge the steering wheel in the correct direction if potential drift is detected. Collision warning systems can automatically stop cars to avoid accidents and pedestrians. What this means is that some types of driving can now be automated . . . just not whole journeys.

The good news for 2011 is that these systems will become available on some mid-range vehicles and not just on high-end luxury cars.

OK, forget the auto-pilot. The all-electric Nissan Leaf debuted in a number of countries in 2010, but guess what, we’re NOT all rushing to buy electric cars.

Auto buyers the world over are not going to rise up in 2011 and say, “We need electric cars. Bring us the electric cars.”

For one thing, the infrastructure for them has not yet been built out, so “Range Anxiety,” the fear that you’ll drive your electric car too far from a charging station to make it back home, will rule. When people start to understand how using the radio or the air conditioner in an electric car can shorten battery life even more, that fear will grow.

Cost is another consideration that will depress sales of electric cars. They’re not cheap to start with, but since they have some cachet as new and cool, auto dealers mark up price tags like mad, looking to gouge extra thousands from people willing to put down $1,000 or more just to get on a waiting list for the things.

Then there’s the cost to fuel the vehicle. Remember, you won’t be spending 10 minutes at a gas station once a week or so to fill up; you’ll be plugging the car into your personal charging station to recharge the batteries over the course of several hours, perhaps overnight. Unless you know somewhere that you can plug the car in and charge up for free, you need to consider the cost per mile of a recharge

that can take you 40, 50, 100 miles, vs. the cost per mile of a fill-up at a gas station that can take you 200 miles or more. In terms of time, a gas or diesel-fueled vehicle wins hands-down. In terms of expense, it’s a close race right now.

If you’re thinking of buying an electric car for environmental reasons, think about where that electricity comes from.

Finally, if you’re thinking of buying an electric car for environmental reasons, think about where that electricity comes from: a big, smelly power plant that’s more than likely fueled by coal and is releasing plenty more hydrocarbons and other unhealthy stuff into the atmosphere than a gasoline-powered car does. So where are the savings?

Bottom line: electric cars will remain a novelty in 2011.

Whether we’re driving electric or petroleum-fueled cars, we have become ever-more addicted to our navigation devices, and smartphone navigation has been making serious inroads in this market. But they won’t complete their conquest of the car in 2011.

A lot of the debate in the telematics industry during 2010 has centered on the integration of smartphones and applications into the car environment, with Ford SYNC’s planned entry into the application store space and Nokia’s Terminal Mode grabbing the headlines. However, while there is no denying smartphones will play an important role as remote controls and monitors of connected vehicles, they will not replace embedded telematics systems which offer superior reliability, ease of use, and above all a safer user experience, the major handicap of smartphones as repeatedly pointed out by US regulators during 2010. Openness and affordability will be critical success factors for embedded telematics platforms, both of which are addressed by the GENIVI automotive infotainment consortium and initiatives from Continental and Bosch. Automotive OEMS should not hand over control to the mobile industry, keeping their options open to tap into new revenue streams and customer relationship tools offered by the connected car revolution.

So what is on your holiday wish-list this year? And if you can’t have it in December, what tech gadget do you crave in 2011? Want a quad core smartphone?

Yes please! . . . just not in 2011. With clock speeds estimated to reach 2.5GHz, delivering up to five-times improvement in performance as compared to most currently available processors while requiring considerably less power, the quad core processor seems set to revolutionize the mobile handset industry.

Yes, quad core chipset will power a rich multimedia computing experience on a smartphone . . . . but not in 2011. Why not?

First, ARM, the leading processor architecture IP provider, is still in the early phases of chipset design development. Further, the chip needs to be manufactured in 32nm, or smaller, technology in order to achieve targeted operating performance and energy consumption characteristics expected of a smartphone. As a result, there will be inevitable need for more time, prototype development, validation, and mass production. The smartphone market will see eventually quad core phones, just not in 2011.

There’s another kind of smartphone that hype-merchants have been touting: the NFC-enabled one. But US consumers won’t be giving up their wallets in favor of NFC-capable smartphones in 2011

Smartphone industry heavyweights such as RIM, Samsung, Nokia and Google have committed to bringing NFC (Near Field Communication) functionality to smartphones in 2011. With NFC many expect that US consumers will ditch their wallets and use their phones to pay at the local grocery store, at a ball game, or a gas station. Early test trials of this have shown very promising reactions from users. ABI Research believes that in the future phone payments will be extremely popular in the US; but not by 2011.

Today many folks do not carry cash in their wallets/purses because they know that they will be able to find a location that ‘takes plastic’. Initially, however, not every merchant took Visa, or Discover, or whichever card service the consumer was a member of. Without a majority of the banks and mobile operator agreeing to a unified approach, NFC payment systems may suffer from payment fragmentation much like that faced by credit cards in their early days.

Unfortunately the fact remains that the banking industry and the mobile operators are not ready to go mainstream with this yet. Both want to ensure that they get their ‘cut’ of this new service capability and that there is a solid business model in place. While the big four mobile operators and Discover have banded together to solve this problem, other card-issuers such as Visa are still investigating their options. Operator billing systems are notoriously outdated and would need much work to get ready for this type of feature, and the US banking industry has remained woefully behind the rest of the world in the adoption of mobile capabilities.

Getting these juggernauts to dance in sync is going to take a great deal of negotiating, time and effort.

While some preliminary test services may go live in 2011, NFC will not have reached mass penetration in smartphones as Wi-Fi has. The small user base will make it difficult to convince smaller retailers to pay for NFC payment terminals (and possibly terms) until the larger retailers have proven the business model and generated both awareness and demand. This will further slow the adoption of terminals and push mainstream penetration further out.

Video games are of course perennial holiday favorites. But are consoles now for the birds?

Another prediction for 2011 -- the video service/rental market will not get any easier to navigate.

2011 will be a transition year for gaming as new devices such as the Nintendo 3DS (and possibly a new PSP and a new Wii) hit the market. New peripherals such as Microsoft’s Kinect and Sony’s Move will redefine the capabilities of this generation of consoles. If sales slow, it won’t be because competition is beating them, but because this generation of consoles is maturing. While there’s still plenty of room for growth, we must remember that previous game console generations usually lasted five or six years; the Xbox 360 just turned five this year. The PS3 and 360 (and possibly even the less advanced Wii) look to have a few more years left in their lifecycles.

This year few would be surprised to see iPads under the Christmas trees of the well-heeled. But PC vendors won’t challenge Apple’s early leadership in media tablets.

The iPad was not the first media tablet (the first tablets started appearing in retail outlets about nine months before Apple commenced shipments), but Apple was certainly the first brand marketer with a significant budget to promote the device segment and achieve greater than one million units shipped.

While most tablet vendors are introducing first-generation devices aimed at diffusing the iPad’s impact, a next-gen iPad is expected to be announced in January that addresses currently perceived shortcomings.

A lack of iPad competition in 2010 will give way to a crowded mix of OEM and white box players during 2011

A lack of iPad competition in 2010 will give way to a crowded mix of OEM and white box players during 2011. The market share for Apple will drop accordingly, but no single vendor will best the iPad’s shipments as it turns one year old in April. The non-Apple ecosystem of vendors offer a fragmented content and application story (even though 75 per cent +of commercially available tablets are using the Android OS) compared to Apple’s closed iTunes App Store content platform.

ABI Research has also tracked the netbook device segment since its inception in 2007. While media tablets have seen excellent growth in their first year, they are not shipping faster than netbooks did from their “day one.”