Shared data pricing to become a reality, but will these plans provide the convenience we’ve all been waiting for?

Posted on May 18, 2012 by admin

In this year’s predictions we expected operators to start differentiating their offers by leveraging device subsidies and broadening their connectivity options to capitalize on the opportunity presented by today’s multi-device era.

This week, the two largest US mobile operators have stated that data sharing plans are likely to be introduced by the end of 2012. Other operators are likely to follow suit in what will become the next phase in data pricing. These plans will allow multiple devices owned by an individual or members of a family to draw data from a single monthly allotment in a move to innovate data pricing, as operators struggle to reap dividends from increasing consumer data usage.

This is a step in the right direction but will it go far enough? Sharing an allowance among family members with official portfolio devices is one thing – but will the operators limit the number / type of devices that the data can be shared between? We hope not.

If operators are going to successfully position themselves in the ‘connected home’ space and wield new revenue streams, the need for more transparent data plans that can be shared across multiple devices (including non-portfolio devices) has never been greater.

It’s worth reminiscing on the era of netbooks with embedded 3G modules. The connection rates were dire and even today the majority of tablet sales are wifi only! Consumers don’t see value in signing-up for ‘another’ data plan. They don’t want to consciously think about the device or network to which they’re attached and they don’t want a ‘data plan per device’.

We’re not naïve to the economics of this. There’s a careful balancing act to play. Operators of course want to maximize revenue and are therefore holding out for consumers to adopt multiple data plans to achieve the greatest return. However, conversely this maximizes consumer frustrations through the unnecessary management of multiple accounts. In addition, there is a general consumer expectation for their data allowance to be freely available to any of their connected devices (in the same way that a home ADSL connection / wifi configuration works).

Would a short term dip in [data] ARPU not be countered with greater Customer Lifetime Value from a more loyal and appreciative consumer?

The cheapest smartphone on the planet?

Posted on May 16, 2012 by admin

Recently, the industry has become enthralled in a [smartphone] race to the bottom, a trend that grew from the need to service high growth, yet price sensitive, emerging markets. Android is very much winning the race right now, affording manufacturers flexibility across hardware reference designs to reduce their bill of materials.

Following Android’s success, Microsoft is also looking to capitalize on these new market opportunities and recently announced (Q1 2012) that Windows Phone 7.5 would be tuned to work as well as possible on devices with as little as 256MB of RAM. The platform’s wider minimum hardware specifications have also been dramatically reduced (including no longer mandating a camera), allowing Windows Phone manufacturer partners to start competing at the lower-end of the market with devices such as the Nokia 610 which will hit Indian shelves at an (unsubsidized) price of $225 making it the cheapest Windows Phone in the world. But is this affordable enough?

In India, where smartphones are enjoying 87% year on year growth, RIM has embarked upon a discounting strategy and BlackBerry Curve models can now be found for as little as $145* (unsubsidised) from online Indian consumer retail outlets.

Despite their best efforts, Android still far outstrips both Windows and BlackBerry. Open to a wider group of manufacturers, it’s still by far the most flexible platform. Local Indian manufacturer, Spice, provides the cheapest Android devices in India, currently selling its Mi-270 Android model for as little as $55* through local online retailers (again unsubsidized)! That may well even qualify as the cheapest smartphone on the planet!

Can you trump the Spice Mi-270? Is there an even cheaper smartphone somewhere that we don’t know about? Let us know!

*Price data from www.mysmartprice.com.

RIM | I love buttons

Posted on May 2, 2012 by WDS

Series 1: Episode 3 Blackberry was an executive aspirational brand that was the game changer for mobile email. Many would say their messaging functionality is still superior, the build quality is... For over a decade, WDS has worked with some of the largest wireless brands to help them improve products and services and design customer experiences that create long-term value. Now we want to share our insight!

Is the smartphone ‘race to the bottom’ threatening value perceptions at the top-end of the market?

Posted on April 17, 2012 by admin

The arrival of Google’s open source OS marked a turning point in the wireless industry. Android played a key role in democratizing the smartphone, helping to drive lower costs and spur wider adoption across the wider mass-market. This year, according to analysts, the rapid spread of low-cost smartphones will replace high-end – and higher-margin – handsets, as the primary growth engine for the industry.

This ‘race to the bottom’ offers a welcomed window of opportunity on a number of fronts for manufacturers and operators alike. In particular it opens up a number of emerging markets, where price sensitivity or local market regulation against device subsidies made it difficult for many manufacturers to build market share. Although the charge is largely being led by Android devices, Microsoft recently announced that Windows Phone 7.5 would be tuned to work as well as possible on devices with as little as 256MB of RAM. The platform’s wider minimum hardware specifications have also been dramatically reduced, allowing Windows Phone manufacturer partners to start competing at the lower-end of the market with devices such as the Nokia 610 which will hit Indian shelves at an (unsubsidized) price of £140.

Equally the race to the bottom has come as welcome news to operators in mature markets, and to the traditional low-cost Chinese manufacturers who have long hoped to gain a wider share of Western markets. For these operators it’s a trend that is helping to reduce the increasingly unwanted subsidy costs that have become typical of smartphone products. Post-pay smartphone consumer expectations have been shaped around this initiative and as such the handset subsidy has become a compulsory requirement. In a bid to recuperate profit margins, operators are looking to slim down subscriber acquisition costs and low-cost handsets deliver exactly that.

But while this explosive growth heralds huge opportunities in emerging markets, does the desire by mature-market operators to range lower-cost product threaten the wider value of established hardware brands?

As we move away from the traditional landscape of ‘non-smartphone’ and ‘smartphone’ products, to a monotonous mass of ‘smartphone’ and ‘better smartphone’ products, how are value perceptions of the high end, higher priced devices holding up?

Take, for example Motorola, Samsung and HTC. Like many wireless OEMs, each occupies both end of the smartphone spectrum with product portfolios that span both lower and higher tier market segments. However, on the surface, these devices often look identical, they run the same (or similar) OS, and they each tick the same boxes for functionality. Often the only real difference comes in the form of processor speed, camera resolution or graphical performance. The lack of clear differentiation across price points has left consumers defaulting to the price tag when making purchasing decisions. This is bad news for high-end device sales.

The value adds for higher tier devices need to go beyond marginal performance enhancements. While quad-core processing will inevitably deliver a slicker experience, this value can only really be appreciated once ownership and usage of the device has begun; in most cases it’s not going to be on the consumers list of established requirements while in store shopping for a new device. OEMs need to deliver clear differential value that resonates with consumers. Despite the standardized trends in the smartphone form factor, there may still be room for design innovation beyond the black slab norm, however, a more likely answer may come at the service level.

There is a glimmer of more promising activity. Already we are starting to see Samsung drawing down on its wider product portfolio to offer value in the form of a connected home. In addition, HTC is refocusing its ‘Sense’ UI initiative. Partnership and acquisition activity with music audio brand Beats and music streaming service MOG, alongside Dropbox integration could help evolve ‘Sense’ into a truly differentiated platform of value adding services. The development and momentum of this trend will be intrinsic to the retention of brand value for the industry’s most popular mobile handset OEMs as the race to the bottom really starts to set in.

Windows Phone – Can it hit double digit market share?

Posted on April 10, 2012 by WDS

Series 1: Episode 2 Competing against the rampant march of Android and an ever-loyal base of iOS users, can Windows Phone compete in the brave new world of wireless to become the third ecosystem?... For over a decade, WDS has worked with some of the largest wireless brands to help them improve products and services and design customer experiences that create long-term value. Now we want to share our insight!

RIM can’t be all things to all men, a welcomed realization

Posted on April 2, 2012 by admin

When RIM launched its Pearl and Storm devices to capture a share of the growing consumer smartphone market, many thought BlackBerry was being watered down. Given the market conditions at the time, it’s easy to understand the reasoning behind RIM’s decision. Firstly it saw a growing consumer market and it wanted a slice of the action. Historically, smartphones had been the preserve of the enterprise user and early adopter. They were expensive, complex and of limited value to consumers in the days before widespread 3G coverage and unlimited data plans. That was all about to change. And change quickly it did. Within 12 months of the Apple iPhone’s debut, smartphones had started to ‘cross the chasm’ into the mass-market. More importantly, the rest of the industry aligned. Mobile operators started adjusting their business models around the smartphone; heavy subsidies and unlimited data plans made smartphones a legitimate consumer purchase.

It’s not surprising that RIM wanted a piece of the action. Who wouldn’t? But entering the consumer market undeniably resulted in a lack of innovation within their core market and it wasn’t long before BlackBerry’s ‘enterprise email’ party-trick started to look a little dated. Remember, business users are consumers too. They like a game of Angry Birds as much as the next person. It wasn’t a surprise then when they started lobbying to ‘bring their own devices’ into the enterprise. Overnight, RIM’s seemingly impenetrable fortress of BES deployments started to crumble.

At this point RIM’s value was being eroded from all sides. It had diluted its brand, failed to recognize the convergence of business and consumer use (instead of distinct product lines to both segments) and missed the app-store wave.

Last week RIM CEO Thorsten Heins, exposed the company for having spread itself too thinly in a statement that promised a refocus of attention on core markets. Heins acknowledged that “Blackberry cannot succeed if we try to be everybody’s darling, and all things to all people.” This was a welcomed realization that will make for some interesting developments in the coming year.

Like almost all other manufacturers RIM has suffered from the growth of the OS and the software ecosystem. Loyalties are now being courted not by hardware brands but by the likes of Apple iOS, Windows Phone and Google’s Android and as a one brand, one OS player, it will always have a ceiling to its potential market share. Comparisons between BlackBerry and Android devices (deployed by more than 30 hardware brands) are therefore a poor comparison of relative performance.

Despite the company’s recent portrayal in the press, things aren’t as glum as some reports would have you believe. In fact, looking at last year’s shipments, RIM still outsold HTC, Motorola and Sony Ericsson. If we look at the total market for all handset shipments (not just smartphones), RIM’s market share (albeit modest at under 5%) has actually remained relatively stable over the last two years, declining by just 0.6% between Q1 2010 and Q4 2011. By comparison, of the large tier one hardware brands it’s only Apple and ZTE that have increased their respective shares (the remaining increase in share comes from smaller manufacturers. The likes of Samsung, LG, Nokia and Motorola have all decreased from their positions 24 months ago. See here for the source of this market share data.

Hein’s has his work cut out. Many of BlackBerry’s traditional strengths of enterprise security and efficiency don’t seem as highly valued anymore. However, a refocus on the brand’s core values will almost certainly help to raise Average Selling Prices, as will the growth of cross-platforms tools such as BlackBerry Fusion which enables enterprise management of BlackBerry, iOS and Android product.

WDS Launches Experience Podcast Series 1

Posted on March 19, 2012 by admin

Exciting news. This week marks the launch of the first WDS Experience Podcast Series.

Experience Podcast | Series 1 Episode 1 | OEM Differentiation

For over a decade, WDS has worked with some of the largest wireless brands to help them improve products and services and design customer experiences that create long-term value. During this time, we’ve amassed an enormous amount of industry insight, employed some real industry experts and made some great industry connections. Now we want to share that!

We hope the podcast will become a platform for us to deliver insightful (and entertaining) discussions on the industry we know and love. First and foremost, we want to cut through some of the ‘noise’ that invades our industry, bringing you our take on the issues that really matter.

To kick start, episode one tackles the issue around OEM differentiation. At a time when many of the world’s leading manufacturers are launching products that look the same and run the same (or similar) OS, we ask how can they can build brand loyalty or compete on anything but price? What’s happened to differentiation on a hardware level? Must manufacturers now compete (if they can at all) on the service level?

Tim Deluca-Smith, VP Marketing at WDS, hosts with guests Nick Gyles, CTO at WDS, Howard Jones, Account Director at CCgroup, Paul Nolan, Associate Director & Head of Telecoms at CCgroup.

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Handset hardware and the threat of commoditization

Posted on March 15, 2012 by admin

In response to a recent article on telecoms.com regarding the possible commoditisation of software, we’d like to add our take on commoditisation and homogenisation within the wireless industry. Contrary to opinions expressed in the article, we believe it is in fact the hardware that has become the commodity.

Walk into any mobile retail outlet and the smartphones on offer will fall into two camps; the anonymous black touchscreen or the Blackberry / ‘looks like a BlackBerry but isn’t’ Qwerty. The problem is compounded with the screens switched off, devoid of any icons or branding to help in the identification process.

To the average person there is no clear point of differentiation delivered by OEMs, particularly those under the Android or Windows Phone umbrellas. Both design and functionality are largely comparable across the board. The current points of hardware differentiation are often underlying technical specifications that aren’t likely to resonate with mass market consumers. Let’s face it, ‘quad core processing’ isn’t that exciting to the average Jo.

Once was the day that devices were designed around specific demographics and use cases. OEMs even started building their brands around certain form factors. Wanted a flip phone, buy a Motorola. A candybar, buy a Nokia. A Qwerty, buy a BlackBerry.

Today, hardware is homogenizing, the smartphone parts-bin is shared out across brands, with screens, keys, processors and more becoming interchangeable between manufacturers. But while form factor must always consider technical limitations, that shouldn’t stop experimentation in industrial design, should it?

As a result of this trend, there has been a seismic shift in brand loyalty, moving away from hardware and over to software and service providers. We are seeing a growing number of consumers showing an affinity to OS and App brands and increasingly it’s the presence of or the accessibility to the software that’s now shaping the purchasing decisions of consumers. It’s at this level where personal requirements and preferences are being catered to.

The speed of innovation has reached a tipping point and OEMs are increasingly occupying the same ‘all things to all men’ proposition. No longer do consumers turn to a specific OEM to cater to their established requirements, be it design or functionality. Instead, smartphone hardware has homogenized to form a standard black slab, capable of everything but nothing specifically well, so as not to narrow the target market.

Literally everything the OEM has to offer is being squeezed into every device model they turn out; a slightly ‘souped up’ version for the higher end device, a watered down version for the low end, with a few floating about between the two for good measure. Do consumers even appreciate the slight variations in technical specifications when on the surface it appears there is very little difference, if any, between the functionality achieved?

It seems consumers now have to cater their device to their personal requirements themselves with the plethora of applications they have available. In the race to capture market share in the fast growing smartphone category, OEMs have lost sight of their traditional market segments. No longer do they enjoy the loyalty generated from catering to a well-targeted segment, and the specific needs of these consumers. Now the market is being treated in a uniform manner and it seems that no one OEM has the balls to deliver anything that targets anything less than the market in its entirety. As a result, consumers are bombarded with the same jack of all trades, master of none devices. Until market segmentation is resurrected, hardware will continue along a path of commoditization.

My first Mobile World Congress. Did Hollywood ruin it for me?

Posted on March 9, 2012 by admin

If Mobile World Congress 2012 was anything to go by, the age old connected home concept is officially starting to make it to the mass-market. There were a myriad of ‘connected’ devices on offer and the term ‘convergence’ was on the lips of many industry executives. Expectations are high.

However, more so than any of the actual market positioning and subsequent messaging from tech brands, my personal expectations for this (and other technologies) are largely formed by Hollywood .

Needless to say, as a result I’m often disappointed with the reality. I am aware of how unreasonable this sounds but I was born into a digital society, I’ve grown up with it in my life and for as long as I can remember I have seen technology evolve at break neck speeds. I’ve actively been encouraged to expect an era of inconceivable technological enhancements in my adult years. In all fairness the vast majority of the fictional technology I have grown up anticipating has actually arrived into the realm of reality, it’s just not as slick.

Last week I attended my first ever Mobile World Congress in Barcelona and I did so with these expectations at the forefront of my mind. I was excited to see many OEMs demonstrating ‘convergence’, showing off multiple products from a portfolio reaching beyond mobile into the tablet and television arena. I was eager to have a play and experience the luxury of what these exciting new products could soon deliver into my own home.

However I quickly discovered that in many cases the current reality of the ‘connected’ home is, ironically, pretty limited in its connectivity. One major OEM brand ran through a demo that involved ‘throwing’ content from a mobile device to a smart television. In reality, both devices where connected to the internet and content was simply uploaded from the mobile device to a cloud service and then downloaded by the television. I was deflated. This delivered an experience that was neither slick or convenient. The action needed to be invoked by the user and the devices weren’t connected anymore than dumb terminals connected to the internet.

Was I expecting too much? Had Hollywood over-promised?

As well as disappointed this left me confused. OEMs are striving for differentiation in an industry where greater opportunity often lies in the development of usability/use cases for existing technology rather than the iterative development of the technology itself. As a result, OEMs are often working from the same pool of tech capabilities and with this, the ability to differentiate falls on the experience a customer enjoys and the subsequent relationships they form with the brand.

There is a very obvious opportunity to generate loyalty and advocacy using the connected home concept. Many OEMs have a rich portfolio of devices and integrating these products to provide a superior, more convenient experience would encourage loyalty across the entire portfolio. Take, for example, a smart TV. On its own, a smart TV has clear usability obstacles. Try to navigate through an unfamiliar, propriety OS with a clunky remote, not to mention trying to type with it! That’s why those television brands with a strong presence in mobile devices (Sony, Samsung, LG, Panasonic etc) really have a huge opportunity in this space.

Offer me truly ‘smart’ connectivity and let me use the device most convenient to the task in hand; let me use a handheld mobile device to swipe through my library of content or download a movie trailer while I’m commuting home and then, when I walk through the door have that same content intuitively ready and waiting on my home entertainment system. Whatever you do, just give me some Hollywood wow!

Kayliegh Chapman, WDS

OEM Differentiation

Posted on March 9, 2012 by WDS

Series 1: Episode 1 The smartphone form factor has homogenized and many of the world’s leading manufacturers now launch products all running the same (or similar) OS variants. But if... For over a decade, WDS has worked with some of the largest wireless brands to help them improve products and services and design customer experiences that create long-term value. Now we want to share our insight!