Nokia admits defeat in Japan

Finnish mobile phone giant Nokia has said it will stop selling its handsets in Japan after struggling to grow its market share in the country.

Nokia said it would continue selling its luxury Vertu brand in Japan, and would dedicate its Japanese business to research purposes.

Nokia has nearly 40% of the global market for mobile phones, but it reportedly managed to take only 0.3% of Japan’s market last year.

Samsung and LG have also faced problems in Japan - a market dominated by sophisticated domestic phones.

According to research firm IDC Japan, foreign companies account for only 5% of the Japanese market, which is dominated by local firms selling phones with features such as TV broadcasting and electronic payment functions.

The Nokia-owned luxury brand Vertu was created in 1998 and focuses on one-off specialist phones costing from 3,500 euros to more than 100,000 euros.

2009 is crucial for mobile vendors

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Some time ago I wrote in my blog about the good results posted by the companies for that particular quarter. At that time I was slightly bullish in terms of future earning of the telecoms giants.

With the new financial results predicting more economic woes, the early signs suggest that the majot telecoms companies might have a rocky ride ahead.

Most of the major vendors have already issued warnings for their handset sales. The news comes amid a week of profit warnings from other handset makers, including Research In Motion and Palm, as the handset market faces declining demand in the midst of a global economic slowdown. The research firm Gartner also released statistics about the smartphone market, which saw its weakest year-on-year growth since the firm started tracking the industry, and Nokia saw its share of the smartphone market fall to 42.4 percent, down from the 48.7 percent share it had a year earlier.

I remember during the year 2000/2001 when we saw the major telecoms burst, Nokia was still holding up and it produced some good results. I expect/expected similar this time as well from Nokia.

I was proven wrong when Nokia issued a market warning for the second time in less than a month, cutting its outlook for global handset sales, as the world’s largest handset maker braces for a slowdown in the coming year.The Finnish giant now expects global handset sales to drop below the 330 million units for the fourth quarter it estimated on Nov. 14, and also said its estimate of 1.24 billion units for 2008 would have to be revised down. Those numbers were cuts from previous estimates. The company also said it expects growth to slow in 2009, with the market contracting 5 percent from its 2008 levels.

Indeed these figures coming out of Nokia presents bleak picture and make everybody nervous. It is very much evident by looking at the current climate that year 2009 will be challenging for telecoms industry.

However I still believe that companies like Nokia have a strong, enviable base to build on and I believe even in tough situation it will continue to strengthen its position on many fronts.

There is no doubt that in the face of a global economic downturn and weakening demand, handset makers and vendors affiliated with cell phone components are probably headed toward a large shakeup.

Companies with more high-end portfolios, including Apple, Research In Motion and HTC will be better positioned to handle any turmoil that would affect the handset market. All three have showcase devices that could help propel them through any choppy waters. In the case of RIM, there are multiple devices that could turn into large sellers, most notably the BlackBerry Storm, which Verizon Wireless has already launched.

However, others such as Motorola and Sony Ericsson, which cut 450 jobs from its North American headquarters earlier this fall, are in a weaker position. Motorola has said it is planning on focusing more on phones running on Windows Mobile and Google’s Android platform to chart it back to growth, but said an Android phone would not be in the market until the end of 2009.

Most of the handset vendors will develop a strategy where they will concentrate on the market where the handset sales are still on the up. Europe has already been considered saturated in terms of mobile sales and hence this doesn’t come as surprise when Ovum declared in its report that Europe has become the first regional mobile market to be hit by the economic downturn.
But the the US mobile market has to date resisted the downturn and developing markets such as Latin America continue to enjoy double-digit revenue growth rates. Markets such as Latin America which remains overwhelmingly buoyant gives enough hope to vendors hence the expectation that they will be able to ride out the current financial crises.

I guess 2009 is going to be interesting.

No LTE networks in UK before 2011

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According to Silicon.com, any rollout of a next generation mobile network in the UK is still years away, says telecoms kit maker Ericsson’s UK CTO John Cunliffe.

“I would say probably the end of 2010 at the very earliest,” he told silicon.com. “Networks will be ready for rolling out - shipping in commercial quantities - next year and then the devices, we think, will start to come in 2010,” he added.

Cunliffe would not give an estimate on how much a commercial rollout of LTE in the UK might cost. “People need to do more modelling around rollout costs,” he said. “It’s a new equation.”
However, he claimed operators switching to LTE would reap the benefits of “total lower capex and lower opex” - provided they are willing to stump up the infrastructure cash.

However Cunliffe highlighted that any large-scale deployment of rival 4G technology WiMax would also require similar investment in infrastructure to that of an LTE deployment. “If you think about WiMax starting off as essentially a radio you need a much bigger ecosystem around it,” he said.

“By the time you actually deliver a service, the operators still have to pay for the infrastructure that goes around it and they’ve still got their opex - their people costs and so on - so the WiMax piece - the radio piece - is actually a small piece of the equation. In terms of the maturity of the 3GPP ecosystem, it’s well ahead of where WiMax is.”

“The fastest being deployed in the UK at the moment is 7.2Mbps but our roadmap continues until 42Mbps. We can even see that it may be possible for the technology to reach as much as 80Mbps…so there is certainly a lot of mileage in HSPA…People maybe think that we’ve got to have LTE to get to the higher speeds but HSPA will go a long way before we need to get to LTE speeds.”

Cunliffe added the top speed of LTE currently being demoed by Ericsson in lab conditions is 160Mbps and a drive test has reached a maximum of 154Mbps, with an average of 78Mbps.

What are the biggest hurdles to a UK LTE network being rolled out? Cunliffe believes they are timing - when operators will switch, especially those with significant investment in HSPA - as well as the inexorable issue of ROI: “Obviously there will be questions about return on investment,” he concluded.

340m ‘Active’ mobile broadband users by 2014

Mobile broadband computing (MBC) has grown very strongly in 2008, to 35m global subscribers. This is forecast to increase almost 10x by 2014, to 341m according to a new report titled “Mobile Broadband Computing” by Dean Bubley from Disruptive Analysis.

Some of the interesting highlights from the report as follows:

* Growth has been driven by cheap HSDPA modems and flatrate data plans.
* The majority of MBC users exploit conventional-seized laptops with separate 3G USB modems (“dongles”). This model will continue to lead despite the growth of netbooks, built-in 3G, WiMAX and MIDs (mobile Internet devices).
* At present, Europe accounts for 50% of global mobile broadband users, reflecting earlier introduction of consumer-friendly USB dongles and ferociously-competitive low-priced HSDPA tariffs.
* “Free” netbooks, provided on a subsidised basis by mobile operators on typical 2-year contracts are popular, but have a limited addressable market.
* By the end of 2011, about 30% of mobile broadband users will be exploiting notebooks with built-in 3G or WiMAX modules. 58%, roughly twice that proportion, will use external modems like USB dongles.
* By 2014, there will be 150m users of notebooks and netbooks with embedded mobile broadband worldwide. In terms of shipments, 100m wireless-enabled laptops will be sold annually by then – but not all will be activated.
* By 2012, there will be 45m users of WiMAX-enabled MBC devices. 11m of these will also use 3G or LTE connections in various hybrid approaches.
* Use of LTE in mobile broadband computing devices will be very limited until 2012. After that, ramp-up will be rapid, reaching 75m units shipped in 2014.
* By 2011, only 40% of mobile broadband users will be on long-term monthly contracts. Most will use prepaid, session-based, bundled or “free” models.

Some of the other interesting points from the extended summary as follows:

* Some operators’ marketing teams have become over-zealous about competing with fixed broadband. In some markets, HSDPA is now cheaper than ADSL/cable. This is unsustainable, as the cost structures differ hugely. There are physical limits to the capacity of mobile data networks, which will rapidly be reached with the explosion of low-cost traffic. Some cellular networks now see more than 90% of 3G traffic from PCs. Network operators are now hostage to future high-bandwidth Internet applications gaining viral adoption among mobile users.
* Adoption of embedded-3G and embedded-WiMAX notebooks will grow slowly alongside separate “dongle” modems. Predictions of 50%+ attach rates in 2-3 years are over-optimistic; there are numerous practical, commercial and economic reasons for delayed adoption
* To date, most mobile broadband users have connected with an existing notebook PC, together with a separate datacard or USB dongle. Looking forward, a broader set of choices are emerging, with the advent of embedded-WWAN notebooks, small & inexpensive 7-10” sized netbooks, MIDs and the use of 3G handsets as “tethers”. Implicitly, these all compete to some degree against higher-end smartphones as well.
* At present, the majority of mobile broadband subscribers are engaged through
traditional monthly contracts, typically over 12-24 month periods. However, further evolution is necessary. Disruptive Analysis expects a variety of new business models to emerge and take a significant share of the overall user base, including:
o Session-based access, similar to the familiar WiFi hotspot model.
o Bundling of mobile broadband with other services, for example as an adjunct to fixed broadband or mobile voice services.
o “Comes with data included” models, where the upfront device purchase price
includes connectivity, perhaps for a year.
o Free, guest or “sponsored” mobile broadband, paid for by venue owners or
event organisers.
* Incrementing capacity of Networks by perhaps another 10x in the next 6 years will need investment in more spectrum, more cell sites, newer radio technology, better backhaul and dedicated “hotspot” solutions like femtocells and WiFi. Yet in the current climate, these investments face delay, meaning a “capacity crunch” is possible in some cases.

On an unrelated note, More than 25 per cent of the content that workers view each day will be dominated by pictures, video or audio by 2013, according to research by Gartner. Though this does not specifically say mobile content, I think the same phenomenon will be observed in the mobile world and maybe to a larger extent with applications like Youtube already very popular with the mobile users.

Forward texts to your email account

In the past few years text messaging has really grown especially with the young people like me although it’s a different matter I prefer to call instead of texting.

It’s not a rocket science that texting is cheaper and sometimes keep people going on their mobiles and also it’s a way of passing time for today’s youths.

I came across some interesting thing called txtForward earlier today, which I thought was worth a mention here.

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