Review of The Future of Mobile: A Segment Analysis by GigaOM Pro

I have been covering any subject that is in the intersection between ICT and energy. In this intersection are cloud computing, mobile and wireless computing, telecom, smart grid, new energy sources, and energy efficiency. Energy and ICT are getting much closer because they influence each other much more than before. ICT does not work without energy, and energy generation and distribution is controlled and optimized with ICT.

Computing is changing rapidly from fixed location to mobile and from a large form-factor desktop to laptop and handheld devices. GigaOM threw a timely conference to focus on mobile computing. In conjunction with this conference, GigaOM published a report, The Future of Mobile: A Segment Analysis by GigaOM Pro, which comprehensively covers the field of mobile computing, provides some basic information, analyzes each major area and predicts its future, and lists players in each segment. The report is a densely packed 111 pages, but when you finish it, you will have a good picture of the current state of the mobile field. You can get it from here (subscription required).

If I have any complaint with the report, it’s that it did not discuss mobile and energy. Well, maybe that is not a fair accusation because a discussion of mobile computing usually does not include its use for energy management. However, because mobile devices are replacing fixed and semimobile devices for computing, covering mobile and energy might have been a good idea.

The following is my description of the contents of the report. I don’t go into the details, simply because this blog couldn’t cover every subject with equal emphasis. Instead, I will mention some highlights that attracted my attention.

The report contains an introduction and twelve main subjects. I substitute my own headlines for theirs for brevity’s sake. Each section is written by a different author, and some by two authors. If you are overwhelmed by the report’s length, read the first two sections then skip to the areas you’re most interested in.

These are the sections:

  1. Introduction
  2. Platforms (OS)
  3. Tablets
  4. Mobile services with cloud
  5. Connected devices (Internet of things)
  6. Health care
  7. Social-location-mobile and e-commerce
  8. Mobile search
  9. Hyperlocal targeting (digital coupon)
  10. Mobile payment
  11. Mobile advertising
  12. Mobile VoIP and chat
  13. Wireless mobile backhaul
  1. Introduction: This is a good summary of the report.
  2. Platforms: Platforms influence everything, and this section looks at the history of mobile platforms and predicts their future, with some advice from the lessons learned. One such lesson is to avoid channel conflict. As the battle between the iPhone and the Android intensifies, what will Google do to avoid channel conflict? Although other companies like Microsoft are not out of the competition, the two top dogs are the iPhone and the Android. This section is full of good lessons.
  3. Tablets: The iPad has a commanding lead at this point, despite other offerings. Apple has set $500 as the price of a standard entry-level model. The price could fall, as more penetration is expected, or rise, with more functionality. The iPad will continue to dominate until 2013 or so, but by 2014 the number of applications available on the Android platform will allow Android-based tablets to overtake it. Amazon’s new version of Kindle may have its place in this segment. Finally, tablets will enter the enterprise market, first in vertical markets like hospitals.
  4. Mobile services with cloud: Mobile services are enabled by applications on mobile platforms, derive data in clouds, and convert the data to useful information for consumption. Apple has an early lead in mobile services, but startups and established companies, such as Google, Microsoft, and Yahoo, cannot be ignored. Apple’s new iCloud this fall is limited to Apple’s platform but may support others. Potential M&As are likely in this space.
  5. Connected devices (Internet of things): In 2020, there will be from 50 billion to 1 trillion connected devices, either single- or multipurpose. The latter includes smartphones, which were mentioned several places in the report as key drivers for accelerated mobile market expansion. To collect, process, and turn data into useful information, a set of tools will be required, including hardware, networking, and management platforms that will be hosted in the cloud.
  6. Health care: Mobile health care uses wireless devices to manage health conditions, collect health data, monitor vital signs, provide clinical decision support, and access health information. Although now in its infancy, the mobile health market will take off globally, not just in the US, partly because of aging populations in many parts of the world. This space also includes wellness in addition to dealing with the sick, expanding its market applicability. For other drivers, read this section.
  7. Social-location-mobile and e-commerce: Location-based services have been mentioned elsewhere, but no significant progress has been made. However, the confluence of social, location, and mobile, or SoLoMo, works well to connect consumers and businesses, providing what consumers want in their current context, including access to social media and their current location. SoLoMo with e-commerce opens up new markets.
  8. Mobile search: Google and Microsoft have dominated search, but search in the mobile context is quite different from search on PCs and laptops. People with a mobile device are more location aware and demand more precise information about their current context. A keyword search based on PageRank generates more information than a small display on a mobile device can handle. New entrants are quite possible as the paradigm of search changes in the mobile computing.. One area that stood out and caught my attention is the virtual assistant. As with a human assistant, you do not need to specify the details to get your job done. The virtual assistant executes your job by automatically obtaining the necessary information.
  9. Hyperlocal targeting (digital coupon): In short, this is a digital coupon. Consumers are more engaged when they are given coupons (perceived as content) rather than straight marketing messages. People with a mobile device are mobile, and their context, such as a location, changes constantly. Timely coupons and daily deals (with an upfront purchase requirement) will catch their attention.
  10. Mobile payment: I was involved with a company that provided security to mobile platforms for mobile payment too early in that market’s maturation process. Now it seems that the market has finally started to move. For mobile payment to work, a good ecosystem needs to be built, including handset OEMs, software vendors, carriers, banks, and credit card companies. Near-field communication (NFC) has emerged as one of a mobile payment solutions and is expected to grow. The total global transaction volume processed through mobile payments will exceed $753.3 billion by 2015, rising from $31.8 billion in 2011. Mobile NFC transactions will be the primary driver of mobile payments through 2015 and will grow from almost $4.3 billion to $595.7 billion in 2015.
  11. Mobile advertising: Spending on advertising in the US is $33 billion, but spending in the mobile space will be approximately $4 billion worldwide this year. This space will grow as the population with smartphones grows, because smartphone owners provide a rich target: They browse, search, consume content, and conduct commerce in and through their phones. Advertisers need to be there at those critical moments of purchase decision-making, which now takes place on smartphones—and to a lesser yet still important extent on tablets. Be sure to read about the seven trends in mobile advertising.
  12. Mobile VoIP and chat: Juniper Research recently predicted that the total number of mobile VoIP minutes would jump from 15 billion in 2010 to 470.6 billion by 2015, thanks to the proliferation of 3G and 4G networks. The biggest boost will come from the US, which will account for 135 billion mobile VoIP minutes by 2015. It is somewhat difficult to make a precise prediction, because these features eat mobile phone companies’ lunch. One of the drivers is again a smartphone.
  13. Wireless mobile backhaul: With the proliferation of smartphones with access to the Internet, the backend requires more bandwidth. Over the next few years, we expect to see increased adoption of wireless backhaul worldwide, with PMP and e-band technologies delivering increasingly attractive and cost-effective solutions for the new LTE networks. The companies to watch in this space are drastically different from the other companies to watch in this report.

The emergence of smartphones like the iPhone that allow access to the Internet and the proliferation of SNS make the mobile space quite different from legacy computing, and even from semimobile laptops. People are more context aware and demand data and information specific to their situation. Also, access to a vast amount of information and data from their SNS enables them to look for specific information. This is a game changer and there is no wonder that both Google and Apple, the two leaders in the smartphone space, show up in each category of companies to watch.

Cisco and Vocalocity Deliver Cost Savings Opportunities for Small Businesses

Again, the only complaint I have is the lack of coverage of mobile applications for energy. What was done at a fixed location for energy can now be done with a mobile device. Mobile should open up a new territory to monitor, control, and optimize energy in general. For example, a mobile device can be used to monitor and control energy use at home, for example, by following electricity use and remotely turning equipment on and off. Beyond the home, energy use can be monitored at buildings and factories. With appropriate data, utilities can dispatch repairmen to the exact location of a disturbance in transmission or in a distribution grid. More mobile applications can be developed to optimize the use of energy.

Finally, the report is well written and contains comprehensive information on the status of mobile computing. I highly recommend reading it.

Zen Kishimoto

About Zen Kishimoto

Seasoned research and technology executive with various functional expertise, including roles in analyst, writer, CTO, VP Engineering, general management, sales, and marketing in diverse high-tech and cleantech industry segments, including software, mobile embedded systems, Web technologies, and networking. Current focus and expertise are in the area of the IT application to energy, such as smart grid, green IT, building/data center energy efficiency, and cloud computing.

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