Digital Lifescapes

Has the increasingly powerful and multifaceted box-of-tricks that's connected to your television set already won the online "media center" race? Consider the following, then you decide. In the current video game console cycle, each of the three devices -- Microsoft's Xbox 360, Sony's Playstation 3, and Nintendo's Wii -- is inherently capable of connecting to the Internet, and each has built-in storage for downloaded multimedia content. In addition to primary traditional hardware and software sales, connected consoles now support three incremental growth business models: premium subscription fees, paid downloadable content (DLC), and a fledgling advertising market. The revenue derived from online consoles is separate from online PC game revenue and from the traditional retail-driven videogame hardware and software revenue. "Gamers' use of connected consoles is expanding the business opportunities and cash flow for this console cycle," according t...

The migration of Bluetooth for music streaming into the automotive and portable navigation markets is increasing automotive Bluetooth adoption. In fact, this wireless technology is set to account for 94 percent of in-vehicle communications system shipments by 2013, according to a new Strategy Analytics report. Over the last 12 months, key product trends were emergence of audio streaming via the Bluetooth Advanced Audio Distribution Profile (A2DP), Bluetooth integration on embedded automotive infotainment systems and an increase in portable navigation devices offering Bluetooth hands-free functionality. "Audio streaming using the Bluetooth A2DP profile is a key current trend in wireless and portable device markets. This trend is now starting to migrate into automotive markets, led by Japanese system suppliers in the aftermarket," according to report author, Clare Hughes, Global Automotive Practice. Car makers, including Fiat, Ford and Toyota, are also offering embedded infotai...

Effects of the systematic consolidation within the traditional U.S. telecom and broadcast media sector are now very apparent as trade-show organizers continue their struggle to aggregate enough registered attendees to make their events seem worthwhile. As an acknowledgment of this phenomenon, NXTcomm Executive Director Wayne Crawford released the following statement in an attempt to put a positive spin on the NXTcomm 2007 conference and exhibition final attendance audit. "NXTcomm, a major event organized in less than five months and designed to serve as the one show that would unify the converged information, communications and entertainment technology industry, attracted 15,273 attendees to its debut at Chicago's McCormick Place on June 18-21. Some 500 NXTcomm exhibitors occupied more than 200,000 net square feet of exhibit space, and nearly 450 members of the press/analyst community reported on the show." However, upon a closer examination of the registered "atten...

Nokia has been ranked at the top of the latest global "Smartphone Vendor Matrix" released by ABI Research. Motorola and RIM (Research in Motion) claimed the second and third spots in ABI's most recent evaluation of worldwide smartphone vendors. I find this latest insight of particular interest, given that ABI also recently reported that Nokia continues to have a modest relative share of the North American market. Again, the implication, Nokia is gaining market share in most of the mobile service growth markets, which seems to make its shortcomings in the U.S. market -- in particular -- a moot point. The Vendor Matrix is an analytical tool developed by ABI Research to provide a clear understanding of vendor positions in specific markets. ABI evaluates vendors on the basis of Innovation and Implementation by selecting multiple criteria related to product/company characteristics. Upon evaluation, vendors are assigned numerical scores that are aggregated and analyzed to provi...

ComScore released the results of their study of online credit card services, which revealed strong growth in the use of the Internet for credit card account management. The study found that customers visited their credit card issuer site 57 percent more often to service their accounts in 2006 than in 2005. This follows a 55 percent rise in 2005 over 2004. Strong growth in online servicing has continued in the first quarter of 2007, as the number of customer visits to issuer sites jumped to more than one billion, an increase of 32 percent versus the same period a year ago. As part of the study, comScore measured consumer attitudes toward online servicing of credit cards. The survey revealed that 63 percent of credit card users find online servicing important to their overall experience with their credit card. Sixty-nine percent of all customers have logged into their credit card Web site at some point in time and 58 percent of online customers log in more than once a month. Among custo...

Worldwide VoIP service revenue jumped 66 percent to $15.8 billion in 2006 after more than doubling in 2005, and is expected to more than triple by 2010, according to Infonetics Research. Hosted VoIP services continue to outpace managed IP PBX services by far, with residential services fueling the market, but the business segment is also growing, and will continue to grow. "Asia Pacific has been leading the VoIP services scene for a couple of years, with Japan's SoftBank pioneering the service and taking a strong lead, but the EMEA and North America regions have gained some ground at the expense of Asia in the last two years. The Latin American & Caribbean region is also posting impressive growth and gaining share," said Stephane Teral, principal analyst at Infonetics Research and lead author of their report. Other highlights from the report include: - Worldwide revenue from residential hosted VoIP services jumped 68 percent between 2005 and 2006; managed IP PBX se...

Forrester Research believes that the Long Tail is indeed a strong concept that explains the success of the early Internet eCommerce and its champions -- like eBay and Expedia, which enable consumers to find needles in haystacks. But, according to Forrester, the rise of Social Computing and Networking is altering the Long Tail. On the demand side, consumer's paths to purchases are changing. Consumers used to walk a straight path from brand awareness to consideration and then to purchase. But more often, consumers are open to new experiences, by discovering something they don't know -- a song from an unknown artist, as an example. When shopping offline or online, a third of U.S. teenagers communicate with friends in five different ways, and 74 percent of these teenagers say they are always willing to try or do something new. At the same time, the proportion of consumers who say that advertising helps them with purchase decisions has dropped by 20 percent. On the supply side, dist...

As broadband service providers look to in-home local area networks as a means of enhancing productivity, communications, and entertainment, a new report from Parks Associates warns that their customer service costs will escalate dramatically. The report entitled "Digital Home Services: Carriers, Retailers, and the Consumer" projects that consumer technical support costs for home networks alone could exceed $200 million annually for U.S. broadband providers. I believe that this is a very conservative estimate, given the facts. "Assuming that few enhancements are made in monitoring broadband and in-home networks between now and 2011, customer support costs will escalate significantly as subscribers turn in growing numbers to their broadband service providers to solve in-home networking issues," said Kurt Scherf, Parks Associates vice president and principal analyst. "Given the pressure on service providers to boost not only revenue but also profit margins, we...

With companies in the Chinese high definition television (HDTV) service market generally adopting wait-and-see strategies at present, investment and marketing efforts on HDTV in China have been small, according to In-Stat. As a result, HDTV subscriber growth will be slow in China over the next several years, reaching a modest two million by 2011, the high-tech market research firm says. "The most important element in the service market is content production," says Simon Sun, In-Stat analyst. "At present, the majority of HDTV content is produced by government-led initiatives, and the quantity of programming is small." In-Stat's research report entitled "HDTV in China, Device Comes Before Service" covers the Chinese market for HDTV. It provides forecasts for HDTV subscribers and revenue, HDTV sets and set top box (STB) shipments and revenue, and next-generation DVD optical disc player shipments through 2011 in China. In-Stat's market study found the ...

Estimates of Apple iPhone shipment volumes in the first weekend they were available have ranged from 140 thousand units to 500 thousand units -- depending upon which market analyst was asked. Meanwhile, ABI Research forecasts that the overall smartphone market segment will grow from 218 million units in 2007 to 426 million units in 2012. Now that we have a little distance from the launch, ABI believes that it's time to ask "Will the iPhone change the smartphone market?" According to Stuart Carlaw, wireless research director at ABI Research, the answer is a qualified "yes." "The iPhone will not revolutionize the smartphone market," he says, "but it is a significant evolutionary step forward. As was pointed out once its specifications were made public, the iPhone is not cutting-edge telecommunications." That said, most agree -- it's more usable. "Where it is radical -- in its user-interface and functionality -- it will certainly change...

Wireless network operators are failing to make their high 'average revenue per user' (ARPU) subscribers in North America feel special, according to a new market study by In-Stat. More than 60 percent of these mobile phone service users do not believe that their wireless operator appreciates their business, and 80 percent believe that operators should do more, the high-tech market research firm says. "The kind of appreciation these users would like to see include loyalty programs where subscribers earn points for awards, free or low-cost directory assistance, and free batteries and travel chargers," says Bill Hughes, In-Stat analyst. "The good news for operators is that these three awards could be turned into even more revenue. For example, directory assistance directly encourages more calling, and offering more batteries and charging options ensures that heavy users can always make a call." To date, the U.S. mobile service provider 'customer retention st...

The market for set-top boxes (STB) will grow at a steady pace through the end of the decade before easing slightly, as service upgrades to existing pay-TV customers are completed and the market shifts from new technology growth to growth driven by the addition of new pay-TV subscribers. According to the latest market study from ABI Research, three main drivers will propel this market in the coming years: advanced features, the new interactivity offered by hybrid STBs, and the possible development of a retail set-top box market. "There's a war going on in the trenches for TV customers," says vice president and research director Stan Schatt. "In an effort to 'lock-in' customers, cable operators are migrating to newer STBs that offer features such as PVR (personal video recording) and high-definition support. Meanwhile telecom operators are leveraging IPTV technology to support interactive services." Accelerating sales of high-definition (HD) TV sets and th...

The homegrown Web 2.0 industry is projected to boom with a regional population of 900 million consumers under the age of 16. This accounts for approximately a third of its population, compared to under 20 percent in mature economies such as the U.S., UK and Germany. More than 80 percent of these consumers are coming from India and China. In terms of users, IDC estimates that a third of all (unique) Internet users in 2007 are Web 2.0 users in India, 83 percent for the same in Korea and 70 percent in China, indicating that Internet users are quickly going beyond emailing, chatting and Web surfing. "The Digital Marketplace will flourish in Asia-Pacific because of the sheer size of the population, the growing consumer influence with the rise of new money and government push to create a vibrant IT and Internet savvy population in many parts of the region including the rural areas and villages. The region's entrepreneurial spirit and aspiration combined with the strong need for loca...

ABI Research estimates that 263.8 million mobile handsets were shipped in 2Q 2007, a year-over-year quarterly increase of 13 percent. "A 13 percent increase is hardly stellar," says Jake Saunders, vice president at ABI Research, "but it does pay the handset vendor's bills. The second half of the year should prove more robust, ending the year with 15 percent YoY growth at 1.13 billion." "More dramatic was Nokia's continued consolidation of the handset market," adds wireless research director Stuart Carlaw. "Nokia's market share grew by 1.4 percent to 37.3 percent in the second quarter, the largest increase in market share of all the vendors." LG and Sony Ericsson also made respectable gains of 0.8 percent and 0.6 percent. Samsung's market share increase was more muted. Since Motorola has retrenched from emerging markets, and is still in the process of revamping its handset portfolio, it should not come as too much of a surprise tha...

Motorola's poor second-quarter performance in the global mobile phone handset market helped boost the results of its competitors -- most notably Samsung -- according to a preliminary ranking from iSuppli Corp. In the second quarter, Motorola shipped 35.5 million mobile handsets, a 21.8 percent decline from 45.4 million in the first quarter of 2007. Company market share plunged to 13.3 percent, down 4.6 points from 17.9 percent in the first quarter. Motorola was the only company among the Top-5 companies to suffer a decline in shipments. Meanwhile, Samsung of South Korea shipped 37.4 million mobile handsets during the period, a 7.5 percent increase from 34.8 million during the first quarter. This gave Samsung a market share of 14.1 percent, up from 13.8 percent in the first quarter -- allowing it to displace Motorola as the world's second-largest mobile-handset OEM in the second quarter. "The mobile-handset business moves fast; the rapid pace of innovation means that produc...

The worldwide population is expected to rise from approximately 6.55 billion to approximately 7 billion between 2006 and 2012, and at the same time Portio Research forecasts the worldwide mobile subscriber base to also increase from 2.65 billion to 4.81 billion. Asian markets, which are growing at a staggering pace, are expected to account for 50 percent of the total worldwide subscriber base by 2008. Also, the rise in mobile penetration in Latin America and Africa will contribute significantly towards the overall growth of the mobile market. Although revenues from voice calls still comprise 80 percent of worldwide total mobile phone service revenues, operators globally are focusing on data services for increasing their average revenue per user (ARPU). Of the various data services available, while attracting none of the recognition as a leading product in most Mobile Network Operator (MNO) service portfolios, SMS actually still accounts for approximately 75 to 80 percent of non-voice s...

Mobile e-mail, sales force automation tools, mapping applications and Internet access -- these are all mobile data applications and services that make enterprise customers more efficient and improve their work quality. According to a new report from ABI Research, mobile data applications and services used by business customers will generate over $100 billion in worldwide revenue by 2012. Principal analyst Dan Shey comments, "The industry is at the cusp of some phenomenal growth for data applications and services delivered to the handset. Although voice will still generate the bulk of revenues from business customers, mobile data services revenues will become 26 percent of ARPUs by 2012, a 29 percent compound annual growth rate." Business applications and services for the handset include communications, information access, computing, integrated information access & computing, and business process solutions. The communications category includes real-time communications and ...

ComScore released the results of a study on the expansion of social networking across the globe, revealing that several major social networking sites have experienced dramatic growth during the past year. Social networking leader MySpace.com attracted more than 114 million global visitors age 15 and older in June 2007, representing a 72 percent increase versus year ago. Facebook.com experienced even stronger growth during that same time frame, jumping 270 percent to 52.2 million visitors. Bebo.com (up 172 percent to 18.2 million visitors) and Tagged.com (up 774 percent to 13.2 million visitors) also increased by orders of magnitude. "During the past year, social networking has really taken off globally," said Bob Ivins, executive vice president of international markets. "Literally hundreds of millions of people around the world are visiting social networking sites each month and many are doing so on a daily basis. It would appear that social networking is not a fad but...

Bluetooth had another successful year in 2006, and it will have continued success in 2007, led by its increasing penetration into mobile phones, according to the latest In-Stat market study. However, market growth for Bluetooth products is beginning to slow, and it will see some complications arising from integration trends and new Bluetooth standards reaching the market, the high-tech market research firm says. The market for Bluetooth semiconductor chips is also in flux. "The Bluetooth silicon market is beginning to see some consolidation, as larger silicon vendors add new capabilities, such as Wi-Fi and GPS, to their chip portfolios, either by internal development or acquisition," says Brian O'Rourke, In-Stat analyst. "The goal is to create combined radio silicon that is being demanded by mobile phone vendors." Market research by In-Stat found the following: - Growth of Bluetooth devices will increase by 34 percent in 2007, slowing from the recent past. - Wir...

comScore released a report on U.S. e-commerce spending for the second quarter of 2007, which showed that non-travel (retail) e-commerce grew 23 percent versus year ago to $27.2 billion, while online travel spending increased 14 percent to $20.3 billion. Total U.S. e-commerce spending climbed 19 percent to $47.5 billion during the period. "Retail e-commerce rebounded solidly in the second quarter after a modest start to the year," said Gian Fulgoni, chairman of comScore. "After posting 17 percent growth versus year ago in Q1, retail e-commerce sales grew 23 percent year-over-year in Q2, matching the growth rates we've seen during the past couple of years." The top-gaining e-commerce category in Q2 versus last year was video games, consoles & accessories, which jumped 159 percent on the strength of Nintendo Wii and PlayStation 3 sales. Sport & fitness also saw substantial gains (up 58 percent), followed by consumer electronics (up 51 percent) and event ti...