Ronnie05's Blog

IDC: Mobile phone industry numbers (Q4,2011)

Posted in Uncategorized by Manas Ganguly on January 31, 2012

Nokia, Samsung and Apple are the top 3 global mobile phone makers for Q4, 2011 and CY 2011. Apple displaces LG from the 3rd spot even while Samsung reduces the gap with Nokia. LG and Nokia lost share and volumes.

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The drivers of Amazon’s Tablet success

Posted in Mobile Devices and Company Updates by Manas Ganguly on January 30, 2012

The 10% increase in market share of Android is due largely to the entry of the Kindle Fire by Amazon.

Flurry, which compares application sessions among all Android tablets For January, uses month-to-date figures to provide hard testimony to the success of Amazon Kindle Fire. In November, Samsung Galaxy Tab dominated application session usage on Android, with the Kindle Fire only having recently launched. At that time, the Samsung Galaxy Time was widely considered the only viable competition to the iPad, though a distant second. The holidays provided a strong adoption of Kindle Fire, combined with significant downloads driven from the Amazon App Store, which has resulted in a massive surge in session usage that edges out the Galaxy Tab. Kindle Fire represents 35.7% of sessions and Galaxy Tab represents 35.6%. Remarkably, the Kindle Fire overtook the Galaxy Tab in just half a quarter. Total Android tablet sessions in January more than tripled over November, with Galaxy Tab sessions increasing by more than 50%. Overall, Android Tablets are growing aggressively as a category.

So how can a late entrant like Amazon, with little-to-no hardware DNA, waltz in and knock off a consumer electronics juggernaut like Samsung, a company that also enjoyed strong growth in 2011? Amazon’s launch of Kindle Fire had more in common with an Apple-style launch than it did with aligning with the Android system.To date, the Android world has focused on marketing the operating system and the “power” of the devices, with quality of content and the consumer experience subordinated in priority. With Google managing the Android Market, which lacks content control and a seamless commerce experience, inertia pushes those developers who choose to build for the platform toward advertising models.Developers who monetize through other means tend to make less on the platform. To ensure that it could take full advantage of its unique digital store prowess, Amazon forked the Android operating system.

Apple, on the other hand, understands that great content is the key to increasing the attractiveness of hardware. They learned this hard way during the 1980s when an inferior combination of PC hardware and operating systems overtook Apple computers, primarily due to a lack of software.For the iPhone and iPad, Apple created a robust economy in which developers could thrive, ensuring their allegiance to innovating for the Apple platform, ultimately making Apple hardware more desirable, and creating a rare, but powerful virtuous cycle.
Amazon’s go-to-market strategy for the Kindle Fire is ground breaking among the Android guard. With its offering, Amazon takes the focus away from the device and operating system, emphasizing content, a differentiated consumer experience and commerce. For its launch, it lined up key content such as Facebook and Angry Birds, as well as offering Amazon Prime, its own streaming TV and movie service. Beyond leveraging its cloud and e-commerce infrastructure, Amazon controls its own store, commanding among the largest aggregations of consumer credit card accounts on the planet. Upon launching the Kindle Fire, consumers must either link to their Amazon account or enter credit card information. This makes the user base 100% payment enabled.

Amazon’s approach to the distribution of digital content is the ultimate razor-razorblade model, where the “stalk” (tablets) is given away for as little as possible and profits are made from the sale of razors (content). Understanding that Amazon is a high volume seller of goods, now becoming ever more digital than physical, sheds light on why they embrace the end-user experience and the religious focus on making the sale of content compelling and easy. Thus the launching with an aggressive low price penetration strategy for their hardware, priced at $199, was critical to its strategy.

Amazon, once moved the world from buying goods at retail to buying them online and having them shipped to doorsteps, is now distributing the new form of mobile store via tablets. In a move that reduces the possibility of its own disintermediation, Amazon’s distribution model starts with its own roots: books, music and video (aka “BMV”). Through this move, Kindle Fire is changing the rules of engagement on the Android platform to shape the playing field into one where they, the consumer and the developer win.

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Global Smartphone marketshares: IHS and Strategy Analytics

Posted in Mobile Devices and Company Updates by Manas Ganguly on January 28, 2012

The battle for smartphone device supremacy is all the way headed in 2012 with Apple and Samsung slogging it out. Nokia which was the market leader till 3 quarters back has now been pushed back to 3rd spot on the market shares. While Apple managed to sell 37 million iPhones in Q4, 2011, Samsung managed to edge out Apple as the year’s top smartphone manufacturer. Samsung played to a portfolio strategy and advanced in 2011 because of its strategy of offering a complete line of smartphone products, spanning a variety of price points, features and operating systems.

The relatively small growth of Sony Ericsson and Motorola may indicate that the Android smartphone market is becoming too crowded as the various licensees compete for limited consumer mindshare and shelf space.

With global smartphone shipments nearing half a billion units in 2011, Samsung is now well positioned alongside Apple in a two-horse race at the forefront of one of the world’s largest and most valuable consumer electronics markets. Nokia’s global smartphone market share halved from 33 percent in 2010 to 16 percent in 2011. A lackluster touch-screen smartphone portfolio and a limited presence in the huge United States market caused Nokia’s shrinkage last year. Nokia’s partnership with Microsoft will be very much in focus during 2012, and the industry will be watching closely to see how swiftly the two companies can expand in the high-value 4G LTE market that is rapidly emerging across the United States, Japan and elsewhere. The silver lining for Nokia was that a million Lumia’s have been shipped in 2 months since launch and Nokia has in over a decade has found some traction with US Operators with the Lumia.

Strategy Analytics: Apple maintains lead in Tablets. Android closes gap

Posted in Mobile Devices and Company Updates by Manas Ganguly on January 27, 2012

Apple ranks number one in terms of the global tablet shipments for the fourth quarter of 2011. 27 million tablet units were shipped in the fourth quarter of 2011. While the Apple iPad occupied a majority of the global market share with 58 percent, Android tablets recorded a 39 percent global share. Android captured a record 39 percent share of global tablet shipments in Q4 2011, rising from 29 percent a year earlier. Global Android tablet shipments tripled annually to 10.5 million units. iSuppli estimates Amazon Kindle fire to be the second biggest tablet maker with 3.9 million units which establishes it as 14.55% of the global tablet shipments.

Demand for slates has increased by 150 percent all over the world as compared to the figures that were recorded in the fourth quarter of 2010. 15.4 million iPads were retailed in Q4 2011. Even while there are many companies manufacturing tablets running on the Android OS, Apple has shown that its iPad, which has somewhat been the inspiration behind the whole tablet revolution, still maintains the top position.

Another interesting finding that emerged from this Strategy Analytics study is that the amount of tablets shipped globally in 2011 was 66.9 million which is a 260 percent leap from the 18.6 million figure registered in 2010.

Apple’s super sweet success in Q4,2011

Posted in Mobile Devices and Company Updates by Manas Ganguly on January 26, 2012

Apple is predicted to become the first $trillion global company in 2016 and going by the momentum they seem to gather, it does seem very possible unless Apple becomes a victim of its own success. Apple sold 37.04 million iPhones, its flagship product, (representing 128 percent unit growth over the year-ago quarter) and 15.43 million iPad tablets (a 111 percent unit increase over the year-ago quarter). Apple posted a record quarterly revenue of $46.33 billion and record quarterly net profit of $13.06 billion. These results compare to revenue of $26.74 billion (73% increase YOY) and net quarterly profit of $6 billion, an increase of 117% in the year-ago quarter. Gross margin was 44.7 percent compared to 38.5 percent in the year-ago quarter. International sales accounted for 58 percent of the quarter’s revenue. Apple sold 5.2 million Macs during the quarter, a 26 percent unit increase over the year-ago quarter. Apple sold 15.4 million iPods, a 21 percent unit decline from the year-ago quarter.Apple’s cash and securities swelled to almost $100 billion.

The stellar results only emphasise the point that 2012 is going to be a good year for Apple with the iPad 3 and iPhone 5, which are expected to add to the growth story. The growth momentum going into H1, 2012 should be driven by demand in China as well as the low channel inventories.

With 37 million smartphones sold, Apple dominated the smartphone market during the fourth quarter, even while for 2011 as a whole, Samsung managed to edge out Cupertino as the year’s top smartphone manufacturer. An interesting anecdotal statistic to Apple iPhones sale first broached by Luke Wroblewski is that with 37.04 million iPhones sold, Apple sold more iPhones in a day (402K) than babies born globally in a similar 98 day period(300K)

While Apple reveals in its huge success and possibly takes the lead and momentum through to 2012, one question that begs to be asked is how long can Apple better its already unmatched stellar performance? Q1,2012 will be Apple’s China takeover story but what about Q4,2012? What device/devices will power YOY growth over a blockbuster quarter such as Q4,2011. Will Apple feel the strain of heightened expectations? Will it miss its god, Steve Jobs?

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Infographic: Tablets and the home computer take over

Posted in Industry updates, Mobile Computing, Mobile Devices and Company Updates by Manas Ganguly on January 26, 2012

The Three Platform paradigm in connected future of technology

The future belongs to connected experiences over a large range of devices starting from Smartphone, Tablet, Networks and not limiting only to TV, Vehicles, Home appliances and more. As a new era of convergence sweeps in, increasingly its evident that the Apple, Android and Windows will lead this march of convergence into the future.

Apple leads by the experience example on a relatively modest number of its own devices. The key will be the experience factor which will power Apple as a high margin and profitable enterprise. The key challenge for Apple will be to enable experiences seamlessly across platforms and devices. Apple will not be in the game of out-innovating Android. It will be more about how well it is able to merge exepreince, interface with technology services on various platforms and devices.

Android will emerge as the mass vehicle. Being open and free will anchor a lot of innovation, some of it across some very new devices and interfaces. The key here is Android’s flexibility which will provide sound base for innovation across platform and devices. The challenge for Android will be in terms of providing a common user experience. There may not be any pure Android experience since innovation on various platforms will add to disintegration of the “pure” Android Interface and experience. This is both good and bad for Android (the Amazon example) because it would mean staying ahead of the curve at the cost of not having an interface as good as Apple.

Microsoft Windows will consolidate its Enterprise position and leverage its advantage across legacy platforms and security.  Microsoft however has been loose in bringing innovation to markets. For every Kinect, there is a surface which is not yet commissioned. However, Microsoft’s niche has to be the enterprise and with its Windows8 it is trying to establish credibility across mobility experiences. Microsoft may still be lagging the “killer app” in enterprise mobility- and a Balckberry acquisition can give it just that edge in terms of the Blackberry infrastructure. There are some reports of a acquistion afoot. Interestingly enough Blackberry has put off its QNX platform till end of 2012. If one wishes to read between the lines … a struggling Blackberry puts off QNX almost indefintely, a Microsoft is fishing for “the killer enterprise app”, RIM is a prime sell off target, Microsoft had evinced interest…. is the acquisition a near reality?? We shall see

Yang departs: The choices before Yahoo! Now

Posted in Internet and Search by Manas Ganguly on January 19, 2012

The time has come for me to pursue other interests outside of Yahoo!- Jerry Yang

Yahoo! has not delved into details regarding Jerry Yang’s exit.. It didn’t really have to.

While Yahoo! remains one of the biggest draws on the web with about 600 million people visitors a month, but like AOL, that other dinosaur of the first era of the internet, Yahoo! has been left flat-footed as Google and Facebook emerged as the next generation of online leaders. Sales have fallen at Yahoo! since 2008 and Google and Facebook are taking an increasing share of its display ad business. The firm has cut costs and found ways to boost its profit margins and keep earnings up. But the pressure for change is on – and it shows.

In 2008, Microsoft’s Steve Ballmer launched a $44.6bn (£28.8bn) takeover bid for Yahoo! but it was resisted, especially by Yang, and eventually the deal collapsed. Yang was the man who fought hardest to reject Ballmer’s offer. Yahoo! is currently worth about $19bn but now that Yang has gone, it may require a more radical fix.

Yahoo! is still huge, but what is sort of company is it? They are not going to beat Google in search, or Facebook for the social network. They will continue to get ads because of their size, but if they are not seen as relevant – and they are not – the quality of those ads and the price paid will fall. In today’s environment, companies that are not seen as relevant are dead. Yahoo! is on its downward spiral. Yahoo! lost its way long ago. It’s big in news, sport, finance, email and it owns Flickr, the photo-sharing site. But somehow one of these sites add up to a whole. It will take a Steve Jobs to turn Yahoo! around. Someone needs strips it down to the core before building it back up again. Yahoo! recently appointed a new chief executive, Scott Thompson, former boss of eBay’s online payment company PayPal. He replaces Carol Bartz, acrimoniously ousted by a board she dismissed as doofuses. Given the firm’s shoddy record with bosses, she might have had a point. But so did they.

Bartz’s strategy – trim costs, sack people, sell stuff – did little for Yahoo!. According to comScore data, the number of minutes that US website visitors spent on Yahoo! sites during her two-and-a-half years as chief executive fell 33% while the stock price stayed flat.

The big question for Scott Thomson is what is he going to do that’s different. Thompson is likely to sell off Yahoo!’s Asian assets, a move many believe Yang was holding back.Yahoo! bought a 40% stake in China’s Alibaba in 2005 for $1bn. It was a great buy. Analysts calculate that the Alibaba holding, along with the company’s stake in Yahoo! Japan, is now worth $17bn.

But what happens after that? Yahoo! is undergoing a “strategic review” and competitors smell blood in the water. Microsoft is reportedly looking at Yahoo! again, albeit at a far lower price, and private equity firms have been sizing it up. Jack Ma, Alibaba’s founder, has also expressed an interest and is tipped as a likely buyer for Yahoo! Japan and maybe more. If Yahoo! were to be acquired by Alibaba that would be the biggest Chinese takeover of a US company in history.

Scott has the choice of turning Yahoo! around. However, that’s not really his skill set. The rumour in Silicon Valley is that he was far from the company’s first choice. Like Bartz, who came from a design software firm, Thompson does not have a media or advertising background. But if that doesn’t work, at least he’s a finance guy. He’ll know how to package this company for sale.

With Yang gone, a sale of all or part of the business looks more likely. It’s what comes after this that worries. Yahoo! is one of the top sites in the world. That’s a lot of opportunity. But if it can’t redefine itself, it could be scattered to the winds.

Suggested Reading:

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2012: Make or Break for Yahoo!, Blackberry and Nokia

Posted in Mobile Devices and Company Updates by Manas Ganguly on January 13, 2012

2012 promises to be a very tough year for Yahoo!, Blackberry and Nokia who having ruled their respective domains for a decade, suddenly risk redundancy due to lack of innovation. In the technology domain, historically, once an incumbent looses a pole position to challengers riding a new wave of technology, the incumbent no matter how large and dominant finds it difficult to come ahead and regain the leadership position. This has been the story with Yahoo!, Blackberry and Nokia.

• Blackberry and Nokia have eroded 81% and 50% of their m-cap in the last year and are 90% off from their historical highs. Same goes with Yahoo! which is 85% off from its historical highs in the heydays of dot com bubble.

• All three have leadership changes in recent/one year and have made a few hard choices and a few other risky ones to get back into reckoning. Can Stephen Elop turn around Nokia, Can Scott Thompson revive Yahoo and Who replaces Lazardis/Basilie at RIM (and more importantly how fast)

Value erosion* is the m-cap loss in last 1 year

• The Market position of Yahoo!, Nokia and Microsoft is vastly altered from 2 years back. Yahoo! is gradually loosing its No.2 spot to Microsoft and the search relevance in the overall picture. Nokia lost its Smartphone leadership to Samsung and Apple in 2011 and as per reports, Samsung forecasts walking off with the Mobile Phone manufacturer crown in 2012. Blackberry has lost out to Android and Apple in good measure and its Playbook has been drubbed. There isn’t much that is expected from future releases of BB OSs and Devices.

• Blackberry appears to me as the worst in the lot and is a prime acquisition target. Same goes with Yahoo!. The Nokia Lumia series of Windows phone has seen some limited success and also been able to secure partnerships with T-Mobile and AT&T. However there is talk of Microsoft acquiring Nokia Smartphones which leads one to think how would Nokia compete without Smartphones?

2012 will need to be the turnaround year for these three and if not then there is a possibility that there could be partial or full acquisition and buy outs very soon.

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How Android stormed India! (The dynamics and insights behind the growth of Android)

Posted in Mobile Devices and Company Updates by Manas Ganguly on January 12, 2012

How the Red Worm (Android) came from nowhere to demolish the Black Worm (Symbian)

1. Introduced in 2Q,2009, it has taken Android 10 quarters to come from a zero base to the best selling Mobile OS in India.
2. Android has an installed base of 3 million users in India.
3. The very first Android phone in India was launched in Q2, 2009 by HTC Dopod
4. Android beat Windows to become the no.3 OS in Q2,2010
5. Android became the no.2 OS in India in Q4,2010 beating Blackberry
6. 10 quarters after the launch of Android,in Q3, 2011, Android became the No.1 Smartphone OS in India beating a rapidly declining Symbian.

Prior to Android, Indian Smartphone OS was polarized by Symbian which ran across smartphones from Nokia, Samsung, Sony Ericsson and LG. Barring Blackberry, other OSs such as Windows, Linux had never been market favourites really. Android provided the much needed variety and option for Smartphone OSs in India.

7. Only a meager 2% of total Android activations in India have been CDMA devices. 79% of CDMA Android devices are Samsung devices.
8. Samsung having sold 1.2mn Android devices is the largest Android seeder in the Indian Market. HTC follows with .93 mn 9. Android handsets sold. Sony Ericsson is a distant third with .43mn Android devices sold.
10.Both Samsung and HTC contribute 70% of the total Android sales in India.
11.Samsung, HTC, Sony Ericsson, LG and Moto contribute to 90% of the total Android sales in India. While a number of local manufacturers have tried to ride the Android wave, success has so far been limited.
12.Sub-brands such as Galaxy, Wildfire, Xperia, Desire, Optimus and Milestone have contributed to 75% of the total Android sales.

Decline of Smartphone ASP and Android ASP in India

13.As against the ASP of smartphone devices, Android ASP drop has been more aggressive. Android OEMs have been aggressively trying to position to newer categories of users, thereby increasing the audience, appeal and the numbers. Between Q1,2009 and Q3,2011, Android ASPs came down by 43% while the overall smartphone ASPs came down by 19%.
14.In the 7 quarter period, Q1,2010 to Q3,2011, Android multiplied sales by a factor of 41x. Corresponding ASP drops was 36%.

15. Mid end Androids have been the most successful in Indian markets with 56% of total Android sold belonging to the $100-$299 category.

With Samsung testing the sub-10K price segment for Youth categories for Android, this category will accelerate in time sto come.

16. Interestingly enough a lot of local Indian brands tried riding on the wave of Android in lower segment but as stated earlier Android’s have been more successful when launched and marketed by the larger brands.

Data sourced from Import numbers for mobile phones in India

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