Friday, April 18, 2014

Exploring the Wearable Technology Market Segmentation

The worldwide wearable computing market is finally expanding beyond the early-adopter segment, with more functional and stylish personal accessories that are making their way onto the pages of lifestyle magazines like GQ and Shape.

According to the latest global market study by International Data Corporation (IDC), wearables took a huge step forward over the past year and shipment volumes will exceed 19 million units in 2014 -- that's more than tripling last year's sales performance.

The global market is forecast to reach 111.9 million units by 2018, resulting in a CAGR of 78.4 percent.

Complex accessories -- such as Nike+ FuelBand, Jawbone UP, and Fitbit devices -- will lead the wearables market through 2018, as users continue to embrace their simplicity and low price points.

These devices are designed to operate partially independent of any other device, but fully operate when connected with IP-capable devices such as a smartphone, tablet, or a PC.

"Complex accessories have succeeded in drawing much-needed interest and attention to a wearables market that has had some difficulty gaining traction," said Ramon Llamas, research manager at IDC.

The increased buzz has prompted more vendors to announce their intentions to enter this market. IDC says that most importantly, end-users have warmed to wearable device simplicity -- in terms of design and functionality -- making their value easy to understand and use.

Another segment of the market, smart accessories, will gain momentum through the forecast period and surpass complex accessory shipments by 2018.

Similar to complex accessories, with their dependence on connecting with IP-capable devices, smart accessories allow users to add third-party applications that boost features and functions for a more robust experience.

While not quite ready for prime time, the smart accessory market will continue to mature as users better understand and accept the value proposition and vendors refine their offerings.

The third segment of the wearables market is smart wearables, such as Google Glass, which function with full autonomy, independent of any other device except to access the Internet.

To succeed, smart wearable vendors must convince users to shift to a new user experience while offering them a robust selection of third-party applications. It is not a question of "if," but "when" wearables as a whole will extend into the enterprise.

Finally, according to the findings from the latest IDC survey of more than 50,000 consumers in 26 countries, Samsung was identified as the most trusted consumer electronics brand for wearables -- ahead of Apple, Sony, and Google.

Thursday, April 17, 2014

PC Shipments Decline for Eight Consecutive Quarters

Low-cost mobile devices, cloud computing and open-source software continue to reshape the Technology, Media and Telecommunication (TMT) sectors of the global economy. The impact from the transformation is far reaching, as growth stalls in some of the more traditional product and service categories.

A case in point; worldwide personal computer (PC) shipments totaled 73.4 million units in the first quarter of 2014 (1Q14) -- that's a decline of -4.4 percent year-on-year, according to the latest market study by International Data Corporation (IDC).

Although still in a downward spiral -- and with continuing weakness in consumer and emerging market segments -- the preliminary results are actually slightly better than a projected decline of -5.3 percent.

Similar to the latter part of 2013, the upside in the first quarter arose primarily from demand in mature commercial markets. Commercial refresh projects, which had already been protracted, received a last push from the impending end of Windows XP support, particularly in Japan.

In addition, the slowing demand for media tablets seems to have helped constrain previously drastic cutbacks in notebook PCs. Nevertheless, emerging regions continued to post weak results, with growth in Latin America and Asia-Pacific (excluding Japan) falling even faster than recent declines as both economic conditions and continued tablet penetration stifled PC shipments.

"Worldwide PC shipments have now declined for eight consecutive quarters as a result of shifting technology usage and competition (notably with tablets and smartphones) as well as economic pressures related to the Great Recession, sovereign debt crises, and their related impact on international trade," said Loren Loverde, vice president at IDC.


According to the IDC assessment, the global economic front seems to be gradually stabilizing or improving. However, this has been a slow process, and it is unlikely that sovereign debt issues will be resolved soon or that growth in emerging markets like China will return to prior levels.

On the technology front, the transition to more mobile devices and cloud-based usage modes is unlikely to slow down, although the short term impact on PC shipments may be reduced as tablet penetration rises -- which is happening in some mature regions of the world.

In summary, the net result remains consistent with IDC's past forecasts -- in particular, that there is some potential for PC shipments to stabilize, but not much opportunity for meaningful growth.

PC shipment growth in the United States remained slightly faster than most other regions in the first quarter. However, the passing boost from XP replacements, constrained consumer demand, and no clear driver of a market rebound are expected to keep growth below zero going forward.

A rebound in consumer or a continuation of accelerated commercial upgrades could boost growth slightly, but low demand for upgrades in general -- combined with competition from tablets and lower-cost 2-in-1 systems -- limit the growth potential.

The American market continued to stabilize with growth near zero -- in line with forecasts. With shipments totaling 14.3 million PCs in 1Q14, the U.S. market contracted by -0.6 percent from the same quarter a year ago. Desktop shipments were slightly stronger, posting 3.5 percent growth, while portables remained in negative territory.

Wednesday, April 16, 2014

Exploring the Impact of Network Functions Virtualization

The forward-looking effects of Software Defined Networking (SDN) and Network Functions Virtualization (NFV) on the traditional wireline and wireless broadband service provider sector will truly be unprecedented. Vendors of deeply-rooted proprietary technologies are most at risk.

Moreover, plans for open-source hardware and software adoption will potentially reshape the whole value-chain, as major service providers start to procure new equipment and services that are based upon open innovation-related business models.

By leveraging virtualization and cloud technologies, SDN and NFV is looming as a disruptive force that is leading some telecom service providers to evaluate new network architectures and driving traditional equipment vendors to dramatically shift product development, according to the latest market study by Dell’Oro Group.

Some traditional networking vendors have already made dramatic shifts in their go-to-market strategy. Indeed, the Open Hybrid Cloud era has ushered in new thinking that was previously considered "unthinkable" just twelve months ago.

Market Outlook for Network Functions Virtualization

A new report published by Dell’Oro analyzes the potential effects of NFV, in particular, on the legacy telecom equipment market over the next five years.

"Over the past 18 months, NFV has rapidly gained attention across the industry as the future of network design, but the effect of this movement on equipment vendor and service provider businesses is largely unknown," said Shin Umeda, vice president at Dell’Oro Group.

According to their assessment, Dell’Oro now sees NFV as potentially affecting a change of technologies, business processes, and financial models in a way that can have either positive or negative results -- depending on where a vendor is positioned within the rapidly evolving industry.

Dell’Oro Group’s "NFV Advanced Research Report" assesses the NFV market over the next five years as it relates to telecom service providers and their equipment vendors.

The report includes a revenue forecast for NFV in selected technology segments and discusses the technology, business, and financial implications of this burgeoning technology.

Questions addressed in their report include:

Will NFV cannibalize or compliment network equipment?
Will NFV create a Service Provider evolution or revolution?
How will vendors implement – open or proprietary?
Will there be cross-vendor interoperability?
What are the long-term financial implications for SP CAPEX, OPEX, and revenue?
Will there be security, network stability or disruption issues?

One more very significant question needs to be answered -- what happens to the status-quo when SDN and NFV introduces open-source vendors directly into the core networking and data center infrastructure category of the telecom equipment marketplace?

Tuesday, April 15, 2014

As the British Embrace Mobile Internet, Marketers Follow

The mobile marketing channel is gaining momentum in the UK. Why now? Over one in four British consumers owns a media tablet, as advertisers spent a record £6.3 billion in 2013 to reach people via the mobile internet, according to a market study for the Internet Advertising Bureau UK (IAB), conducted by PwC.

Over one third (36%) of people accessing the internet are now doing so via their personal tablets, as tablet ownership grew 63% year-on-year from 11.0 million to 17.9 million Britons in February 2014.

Almost six in 10 (57%) tablet owners online say it's their go-to device to browse the internet at home. Two-thirds of owners (66%) say it’s easier to go online using a tablet. Almost two-thirds (65%) like to use them while watching TV.

Survey data shows that advertising on the internet and mobile phones overall increased, like-for-like, by 15.2% or £853 million to £6.30 billion in 2013 -- that's up from £5.45 billion in 2012.

"Digital advertising continues to grow at impressive rates simply because marketers are becoming more responsive and savvy to the increasing ways people consume content across different devices," says Tim Elkington, director of research & strategy at the UK Internet Advertising Bureau.

Among media owners who submitted revenue data to the IAB/PwC study, tablet-dedicated advertising has grown over 400% to reach at least £34.4 million in 2013 -- that's up from £6.8 million in 2012.

With smartphones now accounting for over three quarters (76%) of handsets in the UK, advertisers are continuing to invest more in mobile advertising. It grew, like-for-like, by 93% to £1.03 billion in 2013 from £529 million in 2012.

Mobile now accounts for 16% of all digital advertising spend – £1 in every £6 – compared to 10% in 2012.

Social media advertising spend on mobile increased to £221.8 million in 2013. Across digital overall, social media advertising grew 71% to £588.4 million. Consequently, the mobile channel now accounts for over one third (35%) of total digital social media advertising.

"Mobile is now more of a storytelling tool for advertisers rather than just an information device. Almost half of mobile ad spend is accounted for by TVs biggest advertiser categories – consumer goods and entertainment brands – which is testament to how important mobile has become for brands," said Dan Bunyan, the market study manager at PwC.

Monday, April 14, 2014

Why Mobile Content Marketing Expertise is Not Optional

If you're an American digital marketing practitioner and you're not already optimizing content for the mobile channel, then you are missing both a strategic and tactical market development opportunity. Mobile internet use is a mainstream activity. Mobile media consumption is commonplace.

Review the latest market study findings and see for yourself -- mobile content marketing matters.

comScore reported the key trends in the U.S. smartphone industry for February 2014. Apple ranked as the top smartphone manufacturer with 41.3 percent OEM market share, while Google Android led as the number one smartphone platform with 52.1 percent platform market share.

Google Sites continue to rank as the top mobile media property, while Facebook was the top individual app. Meanwhile, Yahoo has expanded its mobile audience reach and now ranks as the second largest mobile media property in America.

Exploring Smartphone OEM Market Share

163.2 million people in the U.S. owned smartphones (68.2 percent mobile market penetration) during the three months ending in February -- that's up by 7 percent since November.

Apple ranked as the top OEM with 41.3 percent of U.S. smartphone subscribers (up 0.1 percentage points from November). Samsung ranked second with 27 percent market share (up 1 percentage point), followed by LG with 6.8 percent (up 0.3 percentage points), Motorola with 6.3 percent and HTC with 5.4 percent.

Smartphone Platform Market Share

Android ranked as the top smartphone platform in February with 52.1 percent market share (up 0.2 percentage points from November), followed by Apple with 41.3 percent (up 0.1 percentage points), BlackBerry with 2.9 percent, Microsoft with 3.4 percent (up 0.3 percentage points) and Symbian with 0.2 percent.


Top Smartphone Properties and Applications

Google Sites ranked as the top web property on smartphones, reaching 89 percent of the mobile media audience (mobile browsing and app usage), followed by Yahoo Sites (85.7 percent), Facebook (85 percent) and Amazon Sites (64.9 percent).

Facebook ranked as the top smartphone app, reaching 75.7 percent of the app audience, followed by Google Play (52.1 percent), Google Search (49.8 percent) and YouTube (48.4 percent).

Given these latest market study findings, the business case is both clear and apparent -- mobile content marketing is not an optional activity for savvy marketers.

Friday, April 11, 2014

Overall PC Shipments Decline by 1.7 Percent in Q1 2014

Global personal computer sales continue to be weak in a marketplace that favors other devices -- such as smartphones and media tablets. Worldwide PC shipments totaled 76.6 million units in the first quarter of 2014 -- that's a 1.7 percent decline from the first quarter of 2013, according to the latest market study by Gartner.

"The end of XP support by Microsoft on April 8 has played a role in the easing decline of PC shipments," said Mikako Kitagawa, principal analyst at Gartner.

Among key countries, Japan was greatly affected by the end of XP support, registering a 35 percent year-over-year increase in PC shipments. The growth was also boosted by sales tax change.

The PC market continued to be tough for many vendors. Economies of scale matter tremendously in this high-volume, low-profit market, which is forcing some vendors -- such as Sony -- out of the market.

Lenovo experienced the strongest growth among the top five vendors. Its shipments grew 10.9 percent, and they extended their position as the worldwide leader. The company's shipments grew in all regions except Asia-Pacific, where growth in China it has been problematic.

Overall, the China market again slowed, in part due to the long holiday in the middle of the quarter.

The share difference between Dell and HP once again narrowed compared to last quarter. In the first quarter of 2014, HP achieved its fastest shipment growth of the last two years. HP’s shipment growth in EMEA well exceeded the regional average, which improved HP’s overall growth.

Dell maintained a strong position in the market. Since the completion of the leverage buyout last year, Dell has been aggressively expanding its PC business throughout the regions. The first quarter of 2014 was the third consecutive quarter of PC shipment growth for Dell, registering its highest growth since the fourth quarter of 2011.

In the U.S. market, PC shipments totaled 14.1 million units in the first quarter of 2014, a 2.1 percent increase from the same period last year. HP maintained the No. 1 position, as it accounted for 25 percent of PC shipments in the U.S. market. Dell and Lenovo experienced the strongest growth among the top five vendors, with growth rates of 13.2 and 16.8 percent.

The EMEA PC market saw positive growth after eight quarters of decline. Shipments in EMEA totaled 22.9 million units in the first quarter of 2014, a 0.3 percent increase from the same period last year. Improvements were driven by a PC refresh in the professional market from both the XP effect, and a general increase in professional spending.

In the Asia-Pacific market, PC shipments reached 24.9 million units in the first quarter of 2014, a 10.8 percent decline from the first quarter of 2013. Pressure on traditional notebooks continued as the installed base transitioned to alternative devices and replaced only on an as-needed basis.

New hybrid ultramobiles with lower price points were available, but demand remained slow as buyers evaluated usage scenarios and application availability amid a market with many other options that make expensive ultrabooks seem like low-value for the money.

Thursday, April 10, 2014

Upside Demand for New Home Networking Applications

The adoption of more internet-connected devices within the home -- such as media tablets and smart TVs -- creates rapidly increasing broadband connectivity demand. As a result, worldwide home network penetration is expected to climb from 24.8 percent in 2013 to 33.2 percent by 2018, according to the latest market study by ABI Research.

In particular, growth of home networking applications is driven by the continued spread of broadband services and demand for multi-screen video services.

What is seen as commonplace in mature markets, including server provided broadband routers with integrated Wi-Fi access points and leveraging fixed broadband connections to offload expensive mobile data packages while consuming large amounts of content, is slower to move to emerging markets.

In some cases, this is driven primarily by low service ARPU while in others it is simply limited fixed broadband infrastructure.

"Wi-Fi remains the most important networking technology, but despite an ever growing number of connected devices in consumer households, the demand for next generation wireless technologies will likely occur via normal upgrade cycles rather than technology driven purchases," said Michael Inouye, senior analyst at ABI Research.

Wired networking technologies continue to play an integral role in service provider deployments of whole home DVR installations and extending the network beyond the reach of the router or gateway.

Integration of “no new wires” networking technologies into consumer electronics (CE) devices has thus far been limited, but this is a necessary step to see wider adoption beyond the service provider network.

MoCA remains the most integrated wired networking technology, albeit still confined to the service provider market.

In this regard HomePlug has had more of an impact in the retail market, notably with highly integrated hybrid products such as wireless range extenders.

While standards based hybrid solutions like nVoy are still relatively new, this market could grow significantly -- particularly if companies like Amazon, Google, Microsoft, Sony, and Apple continue to invest in original programming and launch premium video services.

With the launch of new premium video services these companies could look to hybrid networking solutions to offer consumers the most flexible and robust solution available -- by embracing other technologies companies could also open the door to evolving offerings, such as Smart Home applications.