January Mobile Update

I’m sorry that I haven’t had a chance to post a mobile update lately which is too bad because January has been a very busy month in mobile!  Here are the important things that happened in the past few weeks:

Carriers

Verizon

Geez, where to start?

At the Consumer Electronics Show (CES), Verizon pitched their LTE 4G service in a big way!  Several handsets and tablets were on display all supporting LTE.  The handsets are all Android devices from the usual suspects (HTC, Samsung, LG, Motorola). Expect to see them be released mid-year.  Verizon has not announced 4G pricing for handsets yet, but we can expect it to be more than 3G pricing and to have tiered pricing plans. Phone pricing has not been announced, but a leak shows the HTC Thunderbolt costing $249 from Verizon. This is $50 more than other Droids.

My take on Verizon 4G: It sounds like Verizon’s LTE network is very fast and coverage should continue to grow until it is at 100% in 2013. For handsets, high speed data opens new opportunities such as high quality video and gaming but high costs, data consumption limits, and battery life can stall 4G acceptance. Sprint’s 4G phones are already known for poor battery life. Add dual core processors and these phone will certainly not make it a day on a charge.

iPhone 4 on Verizon is an equally big story which previously I discussed in detail. Verizon will sell a lot of these.  Predictions range from 9MM to 23MM units in 2011.  It will be interesting to see how Verizon markets 4G devices as well as their 3G iPhone. Verizon and Apple commercials for iPhone on Big Red are starting to make their way to television. The device will be available on February 10.  With all the hatred of AT&T, it will also be interesting to see how many iPhone users switch carriers.  A ChangeWave survey shows that 16% of AT&T users are ready to switch.

Verizon announced it will be offering an unlimited data plan for iPhone for $30/month, but only for a limited time.  This has prompted AT&T, which had stopped offering such a plan, to start offering it again.  (Yay, competition!)  Neither carrier will allow tethering with an unlimited plan (boo!).

Other Verizon news includes changes in their service plans. Subscribers now have to wait 20 months before they can upgrade phones at the subsidized price.  Also, the “new every two” plan  where Verizon offers handset discounts for re-signing a two year contract is gone.

AT&T

At CES, AT&T unveiled their bizarre strategy of using the label “4G” for both their HSPA+ network (which is an upgraded 3G service) and their upcoming LTE service.  This lets them roll out phones called 4G now but is sure to cause confusion this summer when the LTE service is released.  I’ve discussed this earlier.

Rumor has it AT&T will have various tiered pricing plans for LTE based on data usage and speed.  This means you can pay less for slower speeds.  I’m not sure how well this will fly given Verizon’s and Sprint’s 4G pricing plans. Maybe budget pricing for “good enough” LTE will lure consumers over to Ma Bell.

AT&T has passed Verizon in number of subscribers to become the largest carrier in the US.  According to each companies quarterly results, Verizon has 94.1MM and AT&T has 95.5MM.  That can change pretty quickly when Verizon starts shipping iPhones in February.

Sprint

Sprint is raising the rate for their “premium” 3G service $10 per month which means there will be no difference in price with their 4G service. The “premium” adjective is silly as Sprint does not offer any other type of 3G service.  This should help push people to 4G service as there is no longer a pricing penalty.

Apple

Apple put up some stellar Q1 numbers. Apple sold 16MM iPhones in this period, up 86% from last year. Apple will sell their 100 millionth iPhone this year.

The app store just delivered its 10 billionth app. The lucky downloader received a $10,000 gift card from Apple.

Apple released a beta of iOS 4.3 for iPhone and iPad earlier this month.  One of the sexier features is multitouch gestures to allow switching apps, going to the home screen, and opening the task viewer.  This led to speculation that iPhone 5 and iPad 2 will not have a home button.  Apple responded quickly by saying these features were for testing purposes only and will not be part of iOS 4.3 when it ships.  The feature has already been removed from the second beta.  But maybe we’ll see it in iOS 5 this summer?

The mythical white iPhone 4 appeared on BestBuy and AT&T inventory lists. I continue to be amazed that people make such a big deal about this.

Bloomberg is reporting that Apple will include NFC hardware in iPhone 5 and iPad 2. In addition, Apple will include a mobile payment solution that is tied to their iTunes infrastructure.  This system could be in place by mid-2011.  Apple is also reported to be working on POS terminals that they could subsidize or even give away to small businesses wanting to offer the technology to customers.  Apple supposedly would take a cut of every transaction which could turn out to be a huge revenue stream for Apple.

TechCrunch has an interesting perspective on why Apple may succeed with NFC where Google may not,

Sadly, Steve Jobs has taken a leave of absence for medical reasons again. Tim Cook will be responsible for Apple’s day to day operations while Jobs is away. Although Cook is more than competent to run Apple, Jobs is the soul of the company. His absence will be felt.

Google

A preview release of Android 3.0 Honeycomb was made available recently to let developers start building applications for the forthcoming tablets.  The release isn’t the final one, but it gives a good idea of the capabilities of the platform.

Google will now let you port your phone number to Google Voice for $20. I’m sure that carriers are not happy about this. Once you move your primary number to Google Voice the carrier really becomes just a data pipe.  Perhaps tiered data plans will discourage this.

Google also had a shakeup at the CEO level as well with Eric Schmidt stepping down for Google co-founder Larry Page to take over. It is unclear is this will have any change in Android’s direction.  It is hard to argue that Schmidt’s reign over Google has been anything less than phenomenal, but it will be interesting to see how the more technicallyminded Page runs the company.

SmartPhones

For those who think SmartPhones are just a fad, you may want to know that shipments of SmartPhones almost doubled between Q4 2009 and Q4 2010 to over 100MM units sold.

Tablets

2011 will be the year of the tablet.  As such there is plenty going on.

According to BGR, over 100 different tablets were on display at CES.

IDC reports that Apple sold 17MM iPads in 2010. That’s pretty amazing considering they didn’t start selling them until April. TechCrunch points out that predictions of iPad sales from professional and amateur analysts that came out when iPad shipped in April came up quite short to the reality (but the amateurs came closer than the pros). Apple sold 90% of all tablets sold in 2010 which shouldn’t be too surprising considering there was really no competition. 2011 should be an interesting year as an abundance of tablets will be available from top tier manufacturers running Android 3.  HP will be unveiling its own tablets running webOS in February.

An interesting data point from AT&T’s statements is that they only activated 442K tablets in Q4 (as opposed to the 4.1MM iPhones).  It would seem that tablet buyers are not rushing to buy data plans. I do think tying a tablet to a 2 year commitment when buying a tablet is somewhat crazy considering how quickly the technology is changing. The iPad 3G’s model is certainly more welcoming.  With the wave of Android tablets about to hit, it will be interesting to see if consumers wait for less expensive Wifi versions or commit to the contract.

Apple wasn’t the only seller of tablets last year.  Samsung sold 2MM of its Galaxy Tab Android tablet.  The Tab 2 will be announced in February, presumably running Honeycomb.

And speaking of Android tablets, the Motorola Xoom tablet (Google’s flagship Android 3.0 (aka Honeycomb) device) should be available on February 27 for $700 with 32GB of storage if leaked the documents are to be believed.  As a comparison, the 32GB iPad 3G costs $729 without contract.  It is unknown whether the Verizon model requires a 2 year contract for that price.  I would hope not.

HP is holding an event on February 9 to show off their new webOS devices. Information about two tablets (a 9″ and 7″ model) has leaked out to the media.  It should be interesting to see what Palm has done with webOS for the larger platform.

Over at RIM, rumors of delays have been squashed by a DigiTimes report that RIM is in full production building their 7″ tablets. They PlayBook is getting great buzz, but it still seems like a mistake to me to bind the device so tightly to a BlackBerry phone.

 

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About Lee J.

Mobile Guy!
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