Predictions for 2008

Hopefully I can do better than 6 out of 10… in any case, here are my predictions for the coming year. Be sure to leave yours in the comments, or link to them on your own blog.

1. Apple won’t grow organic market share by much.

Sure, Apple will sell more phones as it expands the number of countries in which the iPhone is available. But it won’t make big inroads into existing markets, since pretty much everybody that wants an iPhone in those places has one already (or they’re getting one for Christmas). Any new models won’t appeal to a much wider crowd without adding something significantly new and cool — and just chunking in 3G isn’t enough.

2. Android won’t match the hype.

This feels like a bit of a cop-out, as nothing in the mobile industry ever matches the hype, but I’ll say it anyway. 2008 should see the first Android devices, and perhaps they’ll be pretty cool — but the market reaction will be mostly ho-hum. The big challenge for Google (and for Apple, as well), is to make people care about this stuff. It’s easy for enthusiasts and MH readers to get excited about new mobile data services and applications, but we need to remember that, generally, most members of the public don’t really care. I’d venture that the iPhone’s image as a really cool iPod with a big screen and a phone squeezed in, helped to sell way more devices than its nice web browser did. And sure, people think, “Google Maps on my phone, that sounds pretty cool,” — but when it comes time to pay for it, their enthusiasm may wane.

The iPhone and Android have made a lot of noise because they appeal to a very vocal, but very small, part of the market. But they’ll remain confined to that niche until Google, Apple, operators, other handset vendors, and the rest of the industry can get the mass market to care. Sure, the iPhone has created a lot of awareness, but that’s just a first step. Getting the public to really be interested in mobile services will do a lot more, in the long run, for Google (and everybody else) than coming up with the ultimate mobile software platform.

3. Ad-supported content will continue to grow, but there will be some friction as operators figure out how to insert themselves in the experience.

Individual publishers big and small will figure out they can make money from mobile ads in 2008, and for big publishers, this means a shift away from operator deals, and towards beefing up their standalone sites, both in content and visibility. But the problems will emerge as operators look to get in on the action. Things like content transcoders will become more popular, as operators look for a way to build up their advertising inventory.

4. The 700 MHz auction in the US will toss up an interesting license holder.

The auction for 700 MHz spectrum licenses gets underway in the US in January, and nearly 300 companies have been approved to bid. The usual suspects are there, along with the high-profile ones like Google. But somebody new/interesting/different is going to snag a license here, even if it costs them billions. There’s a tremendous opportunity for disruption here — both in the mobile market, but also in the fixed broadband one — and somebody is going to seize on it, even though it will carry a high cost.

5. Smartphone sales won’t accelerate much, as existing users get fed up with poor usability, and featurephones get smarter.

Smartphone sales continue to grow year after year, but 2008 could be something of a turning point. First, there are a lot of existing users that are fed up with the user experience their smartphones provide. Sure, they carry awesome functionality, but at the cost of terrible usability. Second, featurephones are getting better and “smarter”. The feature gap between the two is closing quickly, particularly for “normobs”, or normal mobile users. Combine these two trends and you’ll see normobs eschewing smartphones for lower-cost, more attractive and easier to use featurephones, alongside smartphone users abandoning the devices and giving up that extra functionality (plenty of which goes unused anyway) for the relatively better user experience many featurephones offer.

6. Euro 2008 and the Summer Olympics in Beijing will generate a decent amount of interest in mobile TV, but that interest won’t be sustained.

These two sporting events will put mobile TV in the shop window. There was a lot of talk about the 2006 World Cup in the same way, but it was too early. Mobile TV is common enough now that people will have some interest in following these events on their handsets, particularly if operators do some aggressive marketing (though operators in the UK are probably cursing second-choice Steve McClaren…). But it’s unlikely that after these events and the promotions end, all that many users will stick with the services.

7. Handset vendors will pay more attention, both lip service and real, to environmental issues.

Nokia’s already started down this path, with its new auto-shutoff charger and the green-targeted 3110 Evolve handset, but the “green” handset market will boom in 2008. There’s a lot of stuff that can be done that has real benefits, such as the new-style chargers, which don’t draw power then they’re not charging a device, and improved handset recycling programs. But there’s going to be a lot of fluff disguised as environmental action, too. In any case, there are great strides that can be made by handset vendors to make their products a bit more green, beyond simple lip service.

8. Embedded radios in consumer electronics will become much more commonplace.

The Kindle was the tip of the iceberg, as 2008 will see more and more devices featuring built-in mobile/cellular radios. The launch of Sprint’s WiMAX network in the US, as well as others worldwide, will help to drive this; so too will the “open” pledges by various operators, as well as the realization that there’s a significant market for them here if they’re willing to offer manufacturers some new business models.

9. Operators will wake up to the threat of IM and push e-mail to their messaging revenues.

Without question, SMS has been the most successful mobile data service of all time. Traffic continues to grow — but revenues aren’t keeping pace, and they’re under further threat from mobile IM and push e-mail. Forward-thinking operators will take a look at this space, and realize that mobile messaging needs an overhaul, and that a holistic approach combining disparate channels (SMS, e-mail, IM, social networks and so on) is the way forward.

10. “Open” will dominate the discussion in 2008.

This is another gimme: operators will fall all over themselves trying to persuade people that they’re open. Most of this will be BS, but there will be a few operators that actually, truly embrace openness, and they’ll shake up their markets.

So there you have it, ten things that will happen in mobile in 2008. As I said, be sure to leave your own predictions in the comments, or link to them on your own site. Enjoy a happy and safe holidays, and best wishes to everybody in the New Year!

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