Technology | Media | Telecommunications

Monday, August 03, 2015

Affordable Smartphones Divide the Global Marketplace

The mobile communication subscriber landscape continues to shift and evolve as more markets reach saturation point across the globe. Most vendors have adjusted their product lines to incorporate low-cost mobile phone models that appeal to consumers in emerging nations, but a few still prefer to rely on the perception that their devices are worth a premium price.

However, over time, these vendors must innovate to deliver greater value, and thereby maintain their profit margins. Brand cachet is very subjective -- even the most committed fans have their limits. Ultimately, everything is subject to change, including gadget fandom.

According to the latest market study by International Data Corporation (IDC), vendors shipped a total of 337.2 million smartphones worldwide in the second quarter of 2015 (2Q15) -- that's up 11.6 percent from the 302.1 million units in 2Q14.

Following an above average first quarter (1Q15), smartphone shipments were still able to remain slightly above the previous quarter, due to growth in many emerging markets. In the worldwide mobile phone market -- inclusive of smartphones -- vendors shipped 464.6 million units, that's down -0.4 percent from the 466.3 million units shipped 2Q14.

"The overall growth of the smartphone market was not only driven by the success of premium flagship devices from Samsung, Apple, and others, but more importantly by the abundance of affordable handsets that continue to drive shipments in many key markets," said Anthony Scarsella, research manager at IDC.

According to IDC's assessment, although premium handsets sold briskly in developed markets, it was emerging markets, supported by local vendors, driving the momentum that heavily contributed to the second highest quarter of shipments on record.

While the Chinese players are clearly making gains this quarter, every quarter sees new brands joining the market. IDC now tracks over 200 different smartphone brands globally, many of them focused on entry level and mid-range models, and most with a regional or even single-country focus.


Affordable Smartphone Vendor Highlights:

Huawei captured the number 3 position thanks to strong European sales as well as domestic sales that led to a staggering 48.1 percent year-over-year growth. Huawei's mid-range and high-end models continue to prove successful with the flagship P8, Honor Series, and Mate 7 handsets delivering sustainable growth both in the consumer and commercial segment.

Xiaomi continues to find success in its home country thanks to both premium and entry-level devices like the Mi Note and Redmi 2 handsets, which helped Xiaomi achieve a 29.7 percent year-over-year increase. With a significant presence in India and Southeast Asia, Xiaomi is now looking to bulk up its IP portfolio to expand its reach even further outside of Asia-Pacific, starting with Brazil.

Lenovo, the third and final Chinese OEM on the list, captured the final spot despite steep home turf competition from both Xiaomi and Huawei. Outside of China, Lenovo continued to witness success in many emerging markets such as India with entry-level and mid-range models like the A600 and A7000, sold via Internet retail channels.

Friday, July 31, 2015

Enterprise Mobility Applications Automation Solutions

Today's commercial smartphone and tablet users are demanding better, faster performance from their field service organizations. As a result, the pressure to excel is generating interest in new enterprise mobility technologies -- such as the various forms of mobile communication management.

Frost & Sullivan has provided an overview of their recent worldwide analysis of the Mobile Workforce Management (MWM) market. The North American market is dynamic, with significant upside potential on a number of key fronts.

Moreover, the MWM sector is accelerated by vendor mergers and acquisitions -- and the development of new end-user markets. According to the latest global market study by Frost & Sullivan, they now forecast that the annual pre-packaged MWM revenue will grow to reach $2.7 billion by 2019.

"MWM is finding its way into the market at a somewhat slower capacity than vendors would like, however, actual results in the field and the money being devoted to creating and promoting novel MWM capabilities should act as strong growth drivers," said Jeanine Sterling, mobile enterprise industry director at Frost & Sullivan.

This is a market in transition, with larger software vendors acquiring smaller mobile-first app developers that created this MWM category over a decade ago. Such acquisitions have led to wider promotion of MWM and its benefits, as well as to a possibly disruptive shift in channel and technology alliances.


Furthermore, large, well-capitalized participants are funding and building innovative capabilities -- such as artificial intelligence, 3D visualization, and augmented reality -- that together could give rise to new revenue streams.

According to the F&S assessment, while a number of factors are working to propel the market forward, CIOs and IT managers are proceeding cautiously due to concerns around costs and data security.

In addition, many IT teams do not possess the internal resources and expertise to suitably manage and maintain advanced MWM solutions. To counter this, MWM providers offer cloud-based solutions that allow any business with service workers in the field to start at a slower rate, and later scale-up as needed.

"Moving MWM to the cloud can neutralize customer misgivings regarding affordability and day-to-day management," added Sterling. "The good news is that once organizations try these apps, they tend to be very satisfied with the results and eager to expand MWM deployments."

Another enterprise mobility space to watch is Mobile Application Platforms -- specifically, how these software solutions help an organization control the chaos of the app development process, and thereby enable Line of Business leaders to quickly and securely deploy competitive capabilities that meet their digital business transformation goals and objectives.

Thursday, July 30, 2015

Wearable Technology Market will Reach $74 Billion

The emerging applications for IoT sensors that are designed to be worn will become vast. The wearable technology market is forecast to rise from $24.2 billion in 2015 to three times that size in ten years -- creating a market of $74 billion in 2025, according to the latest market study by IDTechEx Research.

In addition to increasing demand for current enabling components and software, this market provides a large opportunity for new technologies as electronics move from being bulky devices to ones that can conform to the wearer.

As the traditional markets for consumer electronics devices begin to saturate, new markets are being explored and foremost among them is the evolution of smart wearable technology.

However, smart wearable gadgets thus far are mixed in terms of their success, consisting usually of bulky electronics with many limitations; power consuption being one of them.

About $1 billion was invested in wearables during 2014. According to the IDTechEx assessment, this level of investment will rise as the largest companies in the world compete for a slice of this emerging market.

The following chart provides the 2015 segmentation of wearable technology devices by revenue, excluding basic infotainment devices -- such as headphones and electronic watches.


Wrist-worn devices -- under Advanced Infotainment -- are currently the most popular and publicized area in wearable technology. Smart watches, in particular, have been extremely prominent in the media as these gadgets become more affordable.

Smart wristbands -- such as the Fitbit Flex and Jawbone Up -- have also become increasingly popular, with the market for health and fitness trackers being one of the key growth sectors.

Moreover, these devices are an extremely promising prospect for software app developers -- particularly in the open source big data sector -- who contribute to the ever growing need to counter the global obesity epidemic, without requiring lengthy and costly clinical trials.

Therefore, the health and fitness market has become extremely competitive and the incorporation of a broader range of more reliable and accurate sensors is key to making a device stands out from the ever-growing crowd of me-too vendors.

Wearable sensors are becoming increasingly versatile and mobile -- energy harvesting and storage systems are becoming smaller and more efficient and new e-textiles are just beginning to emerge. In fact, IDTechEx has forecast that $25 billion will be spent on formulations and intermediate materials in 2025, as a promising component of the overall wearables marketplace.

Wednesday, July 29, 2015

Industrial Internet Apps will Reshape Business Models

What is the Internet of Things (IoT), and why do numerous industry analysts now believe it could have a significant positive impact on most industries around the globe? Moreover, are there meaningful and substantive commercial applications that justify further consideration of this new technology?

According to one definition, it represents the combination of devices and software systems, connected via the Internet, that produce, receive and analyze data with the aim of transcending traditional siloed ecosystems of electronic information in order to improve quality of life, efficiency, create value and reduce cost.

Put simply, the IoT vision is to connect many of the previously 'unconnected' devices in the world to the public internet, with the intent to capture large amounts of 'data' that can be used to accomplish a goal(s) towards achieving a stated objective. Processing this abundant stream of 'big data' -- i.e. via automated software-enabled analysis and reporting -- will result in actionable insights.

As an example, imagine a scenario where electronic sensors are embedded in heating, ventilation and air conditioning equipment in commercial buildings. The sensors are used to monitor the operational efficiency of these HVAC systems, detect the need for routine maintenance, and identify potential problems that could negatively impact performance -- up to and including system failure.

Empowered by this practical IoT-enabled information, an HVAC technician can be proactively dispatched to work on the system -- thereby potentially avoiding the likelihood of expensive repairs or system replacement.

IoT Market Development Update

According to the findings from a recent market study by Juniper Research, it's now estimated that the number of IoT connected devices will number 38.5 billion in 2020 -- that's up from 13.4 billion in 2015, resulting in a 285 percent growth rate.

While IoT 'smart home' based applications tend to grab the most media attention, it's the industrial and public services sectors -- such as smart buildings and smart power grid applications, plus retail and agriculture apps -- that will form the majority of the installed base for these sensors.

This outlook is due to the compelling business case for these types of commercial applications. Besides, some of these more forward-looking applications could translate into noteworthy changes to the legacy business models of established multinational corporations.

Case in point: Michelin and John Deere have successfully transitioned their businesses towards becoming more 'service-based' companies through the use of IoT -- as opposed to their previous incarnations as traditional manufactured product vendors.


The Nascent State of IoT Evolution

The new Juniper research found that while the number of connected devices already exceeds the number of humans on the planet by over 2 times, for most enterprises, simply connecting their systems and devices remains the first priority.

"We’re still at an early stage for IoT," said Steffen Sorrell, senior analyst at Juniper Research. "Knowing what information to gather, and how to integrate that into back-office systems remains a huge challenge."

Additionally, interoperability hurdles owing to conflicting standards continues to slow progress. Nevertheless, there are signs that standards bodies and alliances are beginning to engage to overcome these hurdles.

That being said, the research findings also note that the IoT is ultimately only as effective as the sum of its parts. Mere connections create data; however, this does not become actionable information until it is gathered, analyzed and interpreted.

Therefore, the software analytics back-end systems of the IoT will form the backbone of its long-term success. Furthermore, many of the essential IoT software components will be based upon open source solutions that provide the foundation and framework of these industrial internet programs.

Additional findings from the market study include:

  • The consumer segment (composed of the smart home, connected vehicles and digital healthcare), represents a high ARPU (average revenue per user) market segment.
  • Meanwhile, the industrial sector (composed of retail, connected buildings and agriculture) will enable high ROI (return on investment) through IoT projects, owing to more efficient business processes.

Tuesday, July 28, 2015

New Wearable Device Human-Machine Interface Apps

Applications for new categories of wearable devices are beginning to evolve into some interesting areas -- particularly within the medical arena, where innovation is likely to have a very positive impact on the professional healthcare sector.

Consumer wearable devices targeting health and fitness applications have already demonstrated some promising early-adopter use-cases. Moreover, advancements in neuroscience technology research have several manufacturers preparing to launch Brain-to-Machine Interface (BMI) enabled products.

According to the latest market study by ABI Research, revenues from both medical-grade and consumer BMI related products will already approach $10 million in 2015.

That said, let's be clear about the potential applications, BMI technology is unable to read your thoughts. However, tapping into brain activity -- as a means of understanding human behavior, or controlling an external activity -- are now becoming possible.

Example BMI Application Scenarios

"Hardcore video gamers will be the first consumers to buy brain-to-machine interfaces," says Jeff Orr, research director at ABI Research. Combining augmented reality, eye-tracking, and BMI headgear will give elite players the upper-hand in real-time multiplayer gaming.

But don't expect to see people walking around wearing headgear to track their brain activity similar to those that have worn a fitness activity tracker. According to the ABI assessment, success of EEG-based headgear relies on precise placement and good electrode contact points with the scalp.

Also known by the medical research community as Brain-to-Computer Interfaces (BCI), clinical research trials of BMI solutions are combining the latest technology and brain-implanted modules to provide advanced robotic prosthetics, mobility controls, and communications capabilities to severely afflicted individuals.

BMI Device Market Outlook

In summary, revenue from both commercial and medical BMI products are forecast to reach $9.7 million in 2015, growing to $205 million in 2020 -- that's a a CAGR of 84 percent over the next 5 years.

Unit volumes for BMI products in 2015 top 20,000, increasing to more than 850,000 shipments in 2020 -- that's a CAGR of 113 percent over the 5-year forecast period.

North America and Western Europe have taken an early lead in the worldwide BMI market. The Asia-Pacific region, led by Japan, is forecast to experience the highest growth rate for both BMI units and revenues over the next 5 years, due to their advanced medical research community and savvy consumer technology buyers.

Monday, July 27, 2015

Hybrid IT Fuels Demand for Open Cloud Management

Hybrid IT is the result of combining internal and external services -- usually from a combination of on-promise data center and public cloud computing resources. But what are the perceived benefits of hybrid IT? What does the hybrid IT market look like today? Here's recent research findings that offer answers to these questions.

According to the latest market study by Technology Business Research (TBR), the need for better collaboration across traditional IT organizations and their Line of Business (LoB) internal customers -- for resource allocation decision making -- is primarily driving hybridization.

Besides, there's growing demand for an open cloud infrastructure management solution that provides total visibility and control over all cloud computing assets, without the unwanted limitations of the traditional legacy proprietary IT vendors.

TBR estimates the hybrid cloud integration market will generate $8 billion during 2015, with 14 percent year-to-year growth rate, and that's just for for integration. When taking into account the broader public and private cloud computing market pull-through, that's being driven by hybrid IT integration, then the upside potential for growth is significantly larger.


Today, 24 percent of all large enterprises have already begun their hybrid IT transformation process. TBR believes that all forward-thinking CIOs hybridize their infrastructure to some degree, and many other enterprise IT managers will likely start to expand their integration across Cloud-to-Cloud and Cloud-to-On-Premise resource management solutions.

"Hybrid cloud integration will be the key to improve business processes, standardize the usage of cloud and provide a cheaper, efficient method of data storage for vendors," said Jillian Mirandi, senior analyst at TBR. "Since the previous fiscal year, the hybrid cloud adoption rate has increased by nearly 10 percent over the last six months and will continue to do so over the next few years."

To date, according to the TBR assessment, recognized legacy IT vendors -- such as IBM and Microsoft -- have led the proprietary hybrid cloud market with out-of-the-box connections across their own portfolios. However, the rise of open-source frameworks -- from vendors such as Red Hat -- and pre-built integration connectors will expand hybrid IT capabilities, enabling enterprise customers to choose best-of-breed cloud computing technologies.

The extensive TBR analysis viewed the long-term opportunities for hybridization, the rates of cloud adoption and spending trends that will influence integration. They concluded that the digital business transformation goals of many organizations will continue to drive the need for cloud consulting professional services, in support of the ongoing take-up of progressive DevOps methodologies and the deployment of automation platforms.

TBR also points out that enterprises still have concerns around data ownership, storage location, and monitoring usage and internal controls. However, cloud computing security-related concerns, which have topped the list of adoption barriers for the last few years, are now decreasing.

TBR believes this is due to vendors building protection into management tools to address security issues, a growing number of global data centers and third-party security firms securing specific assets of cloud computing technologies, and improved CIO understanding of the cloud services arena.

During this study, TBR surveyed 2,200 decision makers in large enterprises across North America, EMEA and APAC to understand the overall cloud computing marketplace, and identify the key IT industry players that will lead growth in the open hybrid cloud arena.

Friday, July 24, 2015

Mobile Wallet Services are Coming to Developed Nations

There's a significant mobile technology innovation that was originated where you might least expect it. To date, the most meaningful new financial services offering that was created specifically for delivery over mobile communication networks has occurred outside of the most mature markets.

Moreover, as mCommerce via smartphones finally starts to gain traction across a few developed regions, a number of markets in sub-Saharan Africa and emerging Asia have already experienced a different kind of mobile money revolution.

The basic mobile phone has enabled individuals in these highly under-banked markets to achieve first-time financial freedom, to the extent that by the end of 2014 more than 15 countries had more people with 'mobile money' accounts than those that had traditional bank accounts.

According to the latest market study by Juniper Research, the number of mobile money transfers is expected to increase by nearly 150 percent in 2015 to more than 13 billion transactions.

Juniper has also observed that with U.S. social payment service 'Venmo' now experiencing transaction traffic approaching nearly $1 billion per quarter, leading American social media companies were now introducing their own financial services offering.

As an example, Snapchat has partnered with Square to deliver a person-to-person (P2P) financial services offering, while Facebook launched a U.S.-wide service last month. But most traditional U.S. banks have yet to respond to these latest developments.


Meanwhile, the Juniper global market study found that in China, both the WeChat and Alipay software apps saw astonishing spikes in P2P traffic during February 2015.

This was the result of result of 'red envelope' P2P gifting activity when WeChat users engaged in more than 3.3 billion P2P transactions in just 6 days over the Chinese New Year period.

In developing markets, the research found that while mobile airtime top-up accounted for the largest share of transactions, there had been a significant increase in the deployment and adoption of new services -- such as micro-lending, small savings and micro-insurance.

Juniper believes that mobile network operators were well positioned to deliver key data for risk assessment in the form of customer top-up histories, social media usage and location data, which could be subjected to big data analytics applications -- to provide information for consumer credit scoring.

"The beauty of mobile-based micro-insurance is that, for the first time, the un-banked can be afforded protection against natural disasters. Without it, a farmer suffering crop failure could lose his livelihood," said Dr Windsor Holden, managing director at Juniper Research.

Other findings from the market study include:

  • There are now 17 markets, the majority in sub-Saharan Africa, where the number of mobile wallets exceeds the number of banked individuals.
  • Mobile network service providers are expected to generate $2 billion from mobile money services this year, rising to $4 billion by 2018.

Thursday, July 23, 2015

Public Cloud Service Revenue will Reach $113B in 2018

The public cloud computing sector continues to thrive, as more enterprise CIOs seek sustainable ways to free themselves from the burden of updating the inflexible high-cost proprietary software platforms in their own data center.

According to the '1Q15 Public Cloud Benchmark' study by Technology Business Research (TBR), the public cloud market will reach $80 billion in 2015 and continue growing quickly -- now forecast to reach $113 billion by 2018.

"The public cloud market is as hot as ever right now," said Jillian Mirandi, senior analyst at TBR. "After a few years of incumbent vendors trying to scare the market away from public clouds, they now offer and promote public clouds as part of their hybrid IT strategy."

Public cloud pure-play service providers will continue investing in IT security, new data centers and geographic expansion in a successful effort to win more large enterprise deals.

Integrated SaaS, PaaS and IaaS Offerings

In addition, TBR believes that it's very likely that we'll see a number of niche industry-specific SaaS vendors emerge and greater synergies in public cloud PaaS and IaaS solutions over the next few years.

Today, leading vendors are investing heavily to expand their reach and stay ahead of their competition. These cloud providers are adding horizontal suites to their portfolios, customizing vertically, integrating with other leading vendors, and easing development and deployment processes for third-party software developers.

Similarly, they are expanding geographically to win new business and educate markets on the inherent benefits of their open source software foundation, as well as building new data centers in more locations to mitigate data sovereignty concerns.

Key Public Cloud Market Trends

Moreover, SaaS market leaders -- such as Salesforce and Workday -- integrate within their own portfolios, repackaging technology to expand into new lines of business or industry verticals. TBR believes that integration between competitors within SaaS workloads will increase as enterprise customers move to hybrid cloud environments and look to purchase pre-integrated solutions.

Besides, public cloud companies improve developer appeal by adding Linux containerization, open APIs and by providing automated distribution capabilities via software application stores.

As an example, ServiceNow and Verizon launched app stores to give independent software developers a customer base in which to sell and to monetize their offerings. In a different vein, Salesforce launched a marketplace for developers to buy build-packs and add-ons that make application creation easier.

Furthermore, market saturation, challenging macroeconomic conditions in Europe, and slowdowns in China and Japan are pushing public cloud service providers to invest in emerging markets such as India. Data center investments and partnerships will be a primary way to enter new regions.

What's more, partnerships with local IT consulting and systems integration firms, in particular, will be essential for multinational public cloud providers to gain regional brand awareness and establish credibility in these new markets.

Wednesday, July 22, 2015

Public Cloud Computing Cost Comparisons Drive Growth

While it's true that cloud computing infrastructure is often primarily deployed to enable an IT organization achieve a business agility goal, there's always the expectation that an operating cost reduction will also be the outcome -- as a direct result of cloud service adoption.

In particular, the tier-one hyperscale public cloud service providers are able to influence Line of Business leaders by demonstrating how they can offer limitless access to more IaaS resources for a lower cost. This trend continues to raise the bar of expectations for CIOs that currently rely upon legacy IT infrastructure.

Make no mistake, the competitive cost assessment of IT services will likely remain a constant KPI -- used as a peer-group benchmark test that's applied to the performance evaluation of every CIO and IT manager in a large enterprise.

Why Superior Negotiation Skills Matter

According to the latest Cloud Price Index from 451 Research, while on-demand pricing has fallen only slightly at 2.25 percent since October 2014, it is nowhere near matching the 12 percent reduction achieved by those enterprises that negotiate and commit.

Using 451 Research's cloud pricing model, representing a typical multi-service on-demand application, the cost is now $1.68 per hour -- in October 2014, the cost for the equivalent basket of cloud services was $1.72.

Revealing the extent to which cloud service providers encourage commitment to help them plan capacity and ensure capital for infrastructure investment, 451 Research's best-case price indicator is only $0.95 -- that's a significant 44 percent savings compared to on-demand.


The best-case price measures the same application used the same way as on-demand pricing, but takes into consideration negotiation, subscriptions, reserved instances, term commitments, and sustained-use discounts.

Although the Cloud Price Index shows compute pricing has fallen by 4 percent and bandwidth has come down 3 percent, cloud computing service providers are enjoying increased revenue and profits from other services -- such as cloud management, PaaS, data and storage pricing, which have remained static over the same period.

"If you believe the hype, public cloud providers are in a cutthroat price war and race to the bottom, where margins are being slashed, and profitability is at risk," said Dr. Owen Rogers, senior analyst at 451 Research.

According to Rogers' assessment, the reality is there is no cloud price war. There are battles being fought over certain cloud services -- particularly compute, where providers are seeking publicity and market share in return for price cuts.

But cloud providers are more than just compute -- considering 50 percent of the typical Web application's cost relates to cloud databases, it's easy to see how sales of more value-adding services can offset declining margins on basic IaaS services.

"Cloud has no bottom price," Rogers adds. "Even if infrastructure is eventually given away for free, as long as the provider sells other services, which offset this loss, then it can still be a profitable business."

Tuesday, July 21, 2015

U.S. Smartphone Market is Now Ready for Disruption

Historically, the competition within the mobile handset marketplace has been unrelenting. Prior success was never a guarantee of future prospects -- just consider the rise and fall of Motorola, Nokia and BlackBerry. The ongoing battles in the American smartphone arena were indicative of this trend.

However, there's been a noteworthy shift in consumer sentiment. U.S. smartphone demand in Q2 2015 dropped steadily and has declined by 8 percent, compared to June 2014, according to the latest market study by Argus Insights. Consumer interest has apparently peaked. What happened?

With data compiled from approximately 622,000 consumer reviews since January 2014, their study reveals that despite the introduction of the new flagship phones from Samsung and Apple customer acceptance of the latest iPhones, overall consumer demand and interest has fallen off significantly.

"This last quarter showed a very dramatic decline in consumer interest in the available smartphones in the U.S. market, and even the latest Samsung flagship phones barely made a difference in overall excitement," said John Feland, CEO at Argus Insights.

That said, Samsung and Apple maintained top spots in terms of consumer interest during the second quarter, ending June 30, 2015. In April the Samsung Galaxy S6 and S6 Edge were introduced, giving a boost to the company, though perhaps only because of ongoing retailer promotions.

In addition, there was sustained interest in the older Samsung Galaxy S5 and Note 4, however this mild Samsung demand came at a time when overall consumer interest was falling, so it came at the expense of other handset manufacturers -- not as an increase in overall U.S. consumer demand.

In the ongoing battle for the hearts and minds of smartphone customers between Apple and Samsung, American consumer data reveals that despite the release of two flagship phones, Samsung failed to gain new momentum.

While the new Samsung Galaxy S6 and S6 Edge created an initial influx in demand, those gains quickly fell off, and Samsung saw less happy, less interested flagship product users. During the same time, Apple saw some positive attention for the iPhone 6 and even the older iPhone 5S.

As reflected in the consumer review analysis, Samsung's recent effort to refresh their line of handsets was met with a dwindling volume of lackluster reviews. Meanwhile, Apple is apparently keeping their notoriously faithful customers somewhat satisfied -- even as the company's product innovation seems to have plateaued.

All this insight leads me to one conclusion; the U.S. smartphone market is truly ready for a significant disruption. Now's the time for the introduction of new thinking and design innovation. Who will unseat Apple from its throne? Will it be one of the emerging Chinese manufacturers? We'll have to wait and see.