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2012 Predictions for Mobile & Wireless

2/15/2012 03:29:00 PM

Last year wasn’t a very good year on the global economic front.  However, the tech world seemed to weather the world’s economic uncertainty better than other industries.

In the mobile and wireless market, the pace of innovation continued to accelerate with the advancement of Google’s Android operating system taking first place in terms of smartphone market share, the introduction of Apple’s iPhone 4S, Apple’s iCloud cloud offering, and the mainstream adoption of tablets.

If people are optimistic for 2012, it’s simply because the next 12 months should be better than 2011.  Still, despite these mobile advances, there is potential and a lot of work that needs to be done.

With that in mind, I’m offering a series of predictions about mobile and wireless that seem pretty likely.  I predict that Apple will launch an iPad with a 7-inch display.  It’s clear from the tremendous sales of the 7-inch Amazon Kindle Fire and Barnes & Nobel Nook Tablet that the smaller form factor is becoming popular, especially for reading content like digital newspapers and magazines which often result in the reader holding the tablet in one hand.  If a user tries to hold an iPad in one hand on the edge, it feels uncomfortable.  However, a 7-inch tablet is more comfortable when held that way.

I predict that smartphone shipments will exceed feature phone shipments worldwide.  It’s going to happen at some point during the next couple of years.  If the prices of iOS, Android and Windows Phone smartphones drop to less than $100, then there will be no reason for new buyers to purchase a phone without a full-featured operating system.

I predict that both Apple and Android will continue to increase their respective market shares in the smartphone market.  Both companies are firing on all cylinders right now, and both are likely to continue to offer products that excite customers.  Interestingly, Microsoft is likely to realize a significant share of the smartphone market this year, at least outside of the United States, due to its partnership with Nokia.

I predict that tablet sales will continue to rise significantly and exceed 110 million units worldwide.  I don’t see people abandoning their notebooks for full-time use of tablets.  That may happen someday, but I continue to see the tablet as the third member of the mobile stool:  one leg for the smartphone, one for the laptop and a third for the tablet.

I predict that cloud-based apps will become a viable market in the same way application stores have become for smartphones and tablets.  For example, Apple could create an iCloud store where apps are built for interacting with the Internet cloud rather than just operating locally.  A good example would be a multi-person gaming platform but extended to other areas.

I predict that we’ll see most web sites create optimized Websites (so browsers on mobile devices will work well) and mobile applications (so good user experiences will be provided for local operation).  Thus, we’ll have the Web done in triplicate:  the original Web, mobile optimized Web and mobile apps.  If someone has a Website, they either have a mobile app or are likely building one. It’s possible that eventually the number of mobile apps may exceed the number of Websites.

I predict that mobile commerce will still be more hype than reality simply because the infrastructure (terminal readers in retail stores), near-field communication (NFC) and mobile software have not matured to the point that we’ll see broad deployments.  I would predict, however, that some company - perhaps Apple - will make a big splash in the mobile commerce market this year that will allow users to start to use their smartphone to select the payment method and then touch their smartphone near the NFC-enabled reader to complete the transaction.  It seems obvious to me that most of us will be paying for most goods and services using our smartphones within 10 years.

I predict that Research in Motion (RIM) will continue to experience a decline in the smartphone market through 2012.  It’s a shame to watch RIM and its BlackBerry franchise falter as the company has simply not been able to execute a new strategy to keep up with Google, Apple and Microsoft.  RIM may bounce back in 2013 but it will be tough for the company to achieve.  It wouldn’t surprise me if RIM gets acquired in 2012 simply due to its decline in market capitalization.  Nokia, Microsoft or HP could acquire them simply to add 70 million subscribers.  Or, they could be acquired by Motorola Mobility and, as a result, become part of Google.

I predict that Windows 8 will be well received and allow Microsoft to enter the tablet market “from above” - meaning the operating system succeeds on laptops, as well as tablet PCs.

I predict that Mac will continue to gain market share against Windows in the laptop market.

I predict that Intel will acquire a company that makes ARM-based CPUs in order to transform itself into a major smartphone and tablet player.  Nvidia is one company that comes to mind.

Predictions.  We all love them and hate them, but they do define the way we think the world may turn out and in this case, represent my best guess on what may happen in 2012. Let’s see if any of these predictions come true during the year.

 J. Gerry Purdy, Ph.D., Principal Analyst, Mobile & Wireless
MobileTrax LLC

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