dw2

9 October 2010

On smartphones, superphones, and subphones

What comes next after smartphones?

There’s big league money in smartphones.  In 2009, around 173 million smartphones were sold worldwide.  IDC predicts this figure will jump to nearly 270 million in 2010.  According to Informa, that represents about 27% of the total mobile phone unit sales in 2010.  But as Informa also point out, it represents around 55% of total market value (because of their high average selling price), and a whopping 64% of the mobile phone market’s profits.

As well as big money from sales of smartphones themselves, there’s big money in sales of applications for smartphones.  A recent report from Research2Guidance evaluates the global smartphone application market as being worth $2.2 (£1.4) billion during the first half of 2010, already surpassing the total value of $1.7 (£1.1) billion for all 12 months of 2009.

  • What’s next? If there’s so much money in the rapidly evolving smartphone market, where will the underlying wave of associated technological and commercial innovation strike next?  Answer that question correctly, and you might have a chance to benefit big time.

Three answers deserve attention.

1. More smartphones

The first answer is that the smartphone market is poised to become larger and larger.  The current spurt of growth is going to continue.  More and more people are going to be using smartphones, and more and more people will be downloading and using more and more applications.  This growth will be driven by:

  • Decreasing costs of smartphone devices
  • Improved network connectivity
  • An ever-wider range of different applications, tailored to individual needs of individual mobile consumers
  • Improved quality of applications, networks, and devices – driven by fierce competition
  • Burgeoning word-of-mouth recommendations, as people tell each other about compelling mobile services that they come across.

Perhaps one day soon, more than 50% of all mobile phones will be built using smartphone technology.

2. Superphones

The second answer is that smartphones are going to become smarter and more capable.  The improvements will be so striking that the phrase “smartphone” won’t do them justice.  Google used a new term, “superphone”, when it introduced the Nexus One device:

Nexus One is an exemplar of what’s possible on mobile devices through Android — when cool apps meet a fast, bright and connected computer that fits in your pocket. The Nexus One belongs in the emerging class of devices which we call “superphones”. It’s the first in what we expect to be a series of products which we will bring to market with our operator and hardware partners and sell through our online store.

Blogger Stasys Bielinis of UnwiredView takes up the analysis in his recent thought-provoking article, “Nokia’s doing OK in smartphones. It’s superphones where Apple and Google Android are winning”:

Smartphones and superphones share some common characteristics – always on connectivity, ability to make phone calls and send SMS/MMS, access the internet and install third party software apps.  But the ways these devices are used are very different – as different as iPads/tablets are different from laptops/netbooks.

The main function of a smartphone – is a mobile phone.  You use it primarily to do voice calls and send/receive short text messages via SMS/MMS.  Yes, your smartphone can do a lot more things – take pictures, browse the Web, play music, stream audio/video from the net, make use of various third-party apps.  But you use those additional functions only when you really need it, or there’s no better option than a device in your pocket, or when there’s some particularly interesting mobile service/app that requires your attention – e.g. Facebook, Twitter, Foursquare, or other status updaters.   But they are secondary functions for your smartphone. And, due to the design limitations – small displays, crammed keypads/keyboards, button navigation, etc – using those additional “smart” capabilities is a chore…

Superphones, on the other hand, are not phones anymore. They are truly small mobile computers in your pocket, with phone/texting as just another app among many. The user experience – big displays, (multi) touch, high quality browsers, etc – is optimized to transfer big screen PC interaction models to the limitations of mobile device that can fit in your pocket. While the overall experience doing various things on your superphone is a bit worse than doing those same things on your laptop, it’s not much worse, and is actually good enough for the extensive use on the go…

There’s scope to quibble with the details of this distinction.  But there’s merit in the claim that the newer smartphones – whatever we call them – typically manifest a lot more of the capabilities of the computing technology that’s embedded into them.  The result is:

  • More powerful applications
  • Delivering more useful functionality.

3. Subphones

The first answer, above, is that smartphones are going to become significantly more numerous.  The second answer is that smartphones are going to become significantly more powerful.  I believe both these answers.  These answers are both easy to understand.  But there’s a third answer, which is just as true  as the first two – and perhaps even more significant.

Smartphone technology is going to become more and more widely used inside numerous types of devices that don’t look like smartphones.

These devices aren’t just larger than smartphones (like superphones).  They are different from smartphones, in all kinds of way.

If the motto “smartphones for all” drove a great deal of the development of the mobile industry during the decade 2000-2010, a new motto will become increasingly important in the coming decade: “Smartphone technology everywhere”.  This describes a new wave of embedded software:

  • Traditional embedded software is when computing technology is used inside devices that do not look like computers;
  • The new wave of embedded software is when smartphone technology is used inside devices that do not look like smartphones.

For want of a better term, we can call these devices “subphones”: the underlying phone functionality is submerged (or embedded).

Smartphone technology everywhere

The phrase “smartphone technology” is shorthand for technology (both hardware and software) whose improvement was driven by the booming commercial opportunities of smartphones.  Market pressures led to decreased prices, improved quality, and new functionality.  Here are some examples:

  • Wireless communications chips – and the associated software
  • Software that can roam transparently over different kinds of wireless network
  • Large-scale data storage and information management – both on a device, and on the cloud
  • Appealing UIs on small, attractive, hi-res graphics displays
  • Streaming mobile multimedia
  • Device personalisation and customisation
  • Downloadable and installable applications, that add real value to the base device
  • Access to the Internet while mobile, in ways that make sense on small devices
  • High performance on comparatively low-powered hardware with long battery life
  • Numerous sensors, including location, direction, motion, and vision.

The resulting improvements allow these individual components to be re-purposed for different “subphone” devices, such as:

  • Tablets and slates
  • Connected consumer electronics (such as cameras and personal navigation devices)
  • Smart clothing – sometimes called “wearable computers” – or a “personal area network”
  • Smart cars – including advanced in-vehicle infotainment
  • Smart robots – with benefits in both industrial automation and for toys
  • Smart meters and smart homes
  • Smart digital signs, that alter their display depending on who is looking at them
  • Mobile medical equipment – including ever smaller, ever smarter “micro-bots”.

By some estimates, the number of such subphones will reach into the hundreds of billions (and even beyond) within just a few short years.  As IBM have forecast,

Soon there will be 1 trillion connected devices in the world. A smarter planet will require a smarter communications infrastructure. When things communicate, systems connect. And when systems connect, the world gets smarter.

This will be an era where M2M (machine to machine) wireless communications far exceed communications directly involving humans.  We’ll be living, not just in a sea of smart devices, but inside an “Internet of Things”.

Barriers to benefits

Smartphone technologies bring many opportunities – but these opportunities are, themselves, embedded in a network of risks and issues.  Many great mobile phone companies failed to survive the transition to smartphones.  In turn, some great smartphone companies are struggling to survive the transition to superphones.  It’s the same with subphones – they’re harder than they look.  They’re going to need new mindsets to fully capitalise on them.

To make successful products via disruptive new combinations of technology typically requires more than raw technological expertise.  A broad range of other expertise is needed too:

  • Business model innovation – to attract new companies to play new roles (often as “complementors”) in a novel setup
  • Ecosystem management – to motivate disparate developers to work together constructively
  • System integration and optimisation – so that the component technologies join together into a stable, robust, useable whole
  • User experience design – to attract and retain users to new usage patterns
  • Product differentiation – to devise and deploy product variants into nearby niches
  • Agility – to respond rapidly to user feedback and marketplace learnings.

The advance of software renders some problems simpler than before.  Next generation tools automate a great deal of what was previously complex and daunting.  However, as software is joined together in novel ways with technologies from different fields, unexpected new problems spring up, often at new boundaries.  For example, the different kinds of subphones are likely to have unexpected interactions with each other, resulting in rough edges with social and business aspects as much as technological ones.

So whilst there are many fascinating opportunities in the world beyond smartphones, these opportunities deserve to be approached with care.  Choose your partners and supporters wisely, as you contemplate these opportunities!

Footnote 1: For some vivid graphics illustrating the point that companies who excel in one era of mobile technology (eg traditional mobile phones) sometimes fail to retain their profit leadership position in a subsequent era (eg superphones), see this analysis by Asymco.

Footnote 2: On the “superphone” terminology:

It wasn’t Google that invented the term “superphone”.  Nokia’s N95 was the first phone to be widely called a superphone – from around 2006.  See eg here and here.

In my own past life, I toyed from time to time with the phrase “super smart phone” – eg in my keynote address to the 2008 Mobile 2.0 event in San Francisco.

Footnote 3: I look forward to discussing some of these topics (and much more besides) with industry colleagues, both old and new, at a couple of forthcoming conferences which I’ll be attending:

  • SEE10 – the Symbian Expo and Exchange – in Amsterdam, Nov 9-10
  • MeeGo Conference – in Dublin, Nov 13-15.

In each case, I’ll be part of the Accenture Embedded Software Services presence.

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2 Comments »

  1. Great post David. I’ve been trying to stop using the word “phone” for these devices for quite some time. It works, and it has helped me understand the difference in usage more clearly myself.

    http://blogs.sonyericsson.com/troedsangberg/its-not-about-smartphones/

    “Mobile Internet Device”, shortened to simply “mobile”, describe them a lot better than “superphone” ever will.

    Comment by Troed Sangberg — 9 October 2010 @ 9:37 am

  2. I like especially your introduction of “subphones”.
    What comes to my mind here first is Android.
    While Android is currently the rising star for superphone OS, this is to a large extent driven by phone OEM’s survival and operator’s multi-supplier strategies, which may or may not sustain.
    Android’s underlying core strengths, however, make it ideal for smart embedded applications. Openly licensed, Linux and Java based, wide availability of software developers, adaptability to diverse hardware platforms. Even the unclear situation around intellectual property may be less of an Achilles heel in embedded than smart phones, as many patents may not protect non-human centric use cases.

    I’ve seen the recent announcement about Symbian going for embedded, as well, but cannot sell well how Symbian’s strengths could make it the leading platform.

    Comment by alex — 15 November 2010 @ 3:59 pm


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