Bottom Line: The mobile hardware market is evolving in rapid iterations, with the releases between major device generations shrinking to under 12 months windows. This state of change has created a volatile target for those publishing content directed for mobile consumption. Moving forward the pace of innovation does not look to be slowing down, particularly with the emergence of tablet devices into the mobile space.
- Half of U.S. adults own either a smartphone or tablet device. 15
- 45% of all U.S. adults own a smartphone. 16
- 66% of U.S. adults between the ages 18-29 own a smartphone. 16
- Smartphones are now outselling traditional PCs. 3
- 1 in 4 U.S. adults own a tablet device. 15
- The mobile platform/OS space has narrowed to be held by four major vendors.
- Google with their Android platform has grown to become the dominate player in the mobile space and must be considered when making any mobile strategies.
- Android has become the dominant leader in the smartphone market.
- Android is trending to become the leading platform in the tablet space in 2013.
- Apple with their iOS platform will continue to hold a strong position in both the smartphone and tablet spaces leveraging their existing customer base and strong ties with content publishers.
- Microsoft has put forth a needed effort to reposition their mobile presence with the introduction of their Windows 8 and Windows Phone 8 line of products.
- RIM with their BlackBerry line of smartphone products continue to struggle to position themselves in the smartphone market after dropping out of the tablet space.
The term ‘Mobile’ covers a broad range of meanings in the current state of technology. It has evolved to become an integrated mix of hardware devices, network connectivity and software design. On the hardware front it includes a whole spectrum of devices ranging from mobile smartphones to tablet computers. As devices have increasingly become more powerful and portable the desire and need to have them connected to the Internet has risen. This has giving way to the almost always connected state we live in today, leveraging both the availability of local WiFi and cellular network access. With this ability to now interact with and consume digital information from virtually anywhere, the design of the software that facilitates this interaction has also evolved. This leads us to where we are today where the term ‘Mobile’ comes down to having the ability to access and interact with digital information regardless of one’s physical location.
Smartphones, mobile phones with data network connectivity and feature rich mobile operating systems, are the driving force behind the adoption of mobile strategies. With worldwide sales trending to reach 550+ million units in 2012, smartphones are now outselling traditional PCs. This trend is causing a shift in how consumers interact with on-line information and services. In the U.S. smartphones are now outselling traditional feature phone with over 116 million active smartphones as of August 2012. The two leading players in the U.S. smartphone market are Apple and Google holding a combined 87 percent share.
Source: comScore MobiLens August 2012 10
Apple’s 2007 launch of the iPhone set the future direction of the smartphone market. Since its release 209 million iPhones have been sold, positioning Apple with a 34 percent share of the U.S. smartphone market. As a platform Apple maintains full control over both their device hardware and operating system. Apple’s custom iOS operating system has evolved over time to become the foundation that allowed them to create an entirely new consumer market with the creation of the Apple App Store.
About a year after the iPhone’s release, Google entered the smartphone arena with their Android platform. Google took the approach of releasing the Android operation system as a open source platform and leaving the manufacturing of device hardware to partner companies like Samsung, LG, HTC and Motorola. This allowed for the rapid adoption by hardware manufacturers, as they could extend the platform quickly to meet their custom needs. This ability to extend and modify the base Android platform has also been seen as one of Android greatest weaknesses by driving a high level of platform fragmentation as device manufacturer look to differentiate themselves from competitors. Google has taken recent steps to control the effects of fragmentation from the users perspective, however it will continue to be an ongoing issue compared to other platforms because of the open nature of the Android platform. Driven by this diversity of available devices, Android’s momentum in the consumer space has allowed Google to grow and hold 53 percent of all active the U.S. smartphone devices.
The other major smartphone manufacturers are RIM with their BlackBerry line and Microsoft with their Windows Phone platform. Combined they represent 12 percent of the current U.S. smartphone market. RIM has come from a long history within the business and enterprise market, however has struggled to position itself against Apple and Google in the consumer space. RIM is looking to regain some lost ground with the launch of their much-delayed BlackBerry 10 product line in early 2013. Microsoft has had a similar history by originally targeting the enterprise, however with the latest iterations of their platform have gone through a re-visioning with an increased focus towards consumers.
Source: IDC Worldwide Mobile Phone Tracker, Nov 1, 2012 14
Tablets are another emerging mobile device platform rapidly replacing traditional PCs. Apple currently holds the top position in the tablet market with their iPad product line, however their lead has been rapidly decreasing. The other major players in the tablet space are Google with their Android platform and Microsoft with Windows 8. As of August 2012, one in four adults in the U.S. now own a tablet device.
Source: Pew Research Center, Oct 1, 2012 12
The Apple iPad was the first product in the tablet space to trigger mass consumer interest. In the 2 years since its initial release 100 million iPads have been sold. Apple made the decision to extended their existing iPhone operating system iOS to provide the software platform for the iPad. This decision gave the iPad a strong mobile influence and allowed Apple to leverage their existing base of iOS iPhone applications. In August 2012 Apple held a 52 percent share of the tablet market, a drop from 81 percent a year before.
Google has followed an approach similar to Apple’s by extending their mobile Android OS to provide a common base across both smartphone and tablet devices. For hardware they followed suit with their smartphone strategy by leaving the manufacturing of the tablet hardware to partner companies like Samsung. With the Android OS being an open platform, it also gave content companies like Amazon and Barnes & Noble the opportunity to quickly leverage the platform and extend their existing eReader product lines into the tablet market space.
For Microsoft this is their second attempt into the tablet space. Their first take was back in 2001 with their Microsoft Tablet PC line, which was not meet with widespread adoption. Microsoft then attempted to relaunch their tablet line with the Slate PC in 2010 just before the introduction of the iPad. However, because of issues with the Windows 7 OS used at the time of the launch Microsoft held off a full rollout. Microsoft was then forced to take a step back and reevaluate the direction of their Windows OS line. This initiated the momentum behind Microsoft transforming Windows 8 into becoming an effective tablet operating system. With the completion of Windows 8, Microsoft reintroduced their tablet product line in October 2012 with Microsoft Surface.
Source: Pew Research Center, Oct 1, 2012 12,15
Android: A mobile centric operating system released in 2007 by Google primarily designed for smartphones and tablet computers.
Apple App Store: Apple’s digital content distribution service for iOS devices.
BlackBerry OS: A proprietary mobile operating system created by Research In Motion (RIM) for their smartphone product line.
eReader: A mobile device primarily designed for the purpose of viewing digital e-book content.
Feature Phone: A mobile phone which lacks the full feature sets of more capable smartphones, however there is no defined set of features to distinguish between the two.
Google Play: Google’s public digital distribution service for range of content forms, ranging from mobile applications, music, movies and e-books.
Mobile Operating System: A operation system primarily used on mobile hardware ranging from smartphones to tablet devices.
iOS: A mobile operating system developed by Apple Inc. Release in 2007 for the iPhone and iPod Touch devices, it has remained the base OS for all of Apple’s mobile device lines.
Platform Fragmentation: Refers to the varying range of both different hardware and software combinations available for a targeted platform.
OS (Operating System): A collection of software that controls the interactions between a device’s hardware and application programs.
Smartphone: A mobile phone with data network connectivity and feature rich mobile operating systems.
Tablet: A mobile computer that is primarily operated via a touch screen.
WiFi: A wireless internet connection obtained through a local network (e.g. home or business internet hub) rather than the mobile cellular network.
Windows 8: Microsoft’s current version of their Windows Operating System, publicly released October 26, 2012.
Windows Phone: A mobile operation system created by Microsoft to target smartphone devices.
Notes and References