This post first appeared on my SAP Blog on January 6, 2014.
Welcome to 2014! Before I embark on my 7th consecutive year of mobile industry predictions, let’s wrap up 2013 with a review of last year’s predictions. Overall, it has been another exciting, challenging, but overall profitable year for the mobile industry. We saw some rises and falls, new iPads, a new iPhone, new Samsung devices, new mobile OS’s, consolidations, acquisitions, as well as a myriad of new products and innovations.
Before I prophesize about 2014, let’s take a look at my 2013 predictions. Last year, my 2012 predictions were 66% right.
1. The device wars (as some have called them) will continue to reshuffle. I still have some confidence that Windows Phone will overtake Bada and Symbian in 2013, becoming the 4th place mobile OS behind Android, iOS and Blackberry. Blackberry 10 will help solidify its 3rd place ranking in 2013, bringing new life to Blackberry, as its innovative LTE models hit the streets.
Reality: Number 1 and 2 is Android and iOS, as expected. Windows moved to 3rd place with Blackberry OS in 4th (not 3rd as predicted); however, Windows has outdone Symbian and bada. Call this one 80% correct.
2. We will see significant LTE build out by mobile operators around the world, thereby almost doubling the number of LTE networks by the end of 2013. That means I am expecting greater than 200 commercial LTE networks by the end of 2013.
Reality: As of December 18, 2013, the Global mobile Suppliers Association (GSA) confirmed that 251 LTE networks in 93 countries are now commercially launched (with 260 forecast by the end of 2013). 100% correct.
3. Of those more than 200 LTE networks, at the end of 2013, we will see more than 50 networks supporting commercial LTE roaming with other networks. Roaming and global ubiquity is a key benefit for LTE; however, due to frequency fragmentation and new infrastructure needs, implementation of LTE roaming is not as easy as it was for 3G. Virtually all of these networks will utilize IPX and LTE Roaming hubs (e.g. Diameter hubs) to support roaming.
Reality: The new Apple iPhone 5s and 5c, as well as the new iPad Air support more LTE bands than ever before (Apple Rolls out the Red Carpet for LTE Support with the iPhone 5c/5s) and these devices in the wild will surely help subscribers roam; however, as of the end of 2013, less than 50 operators worldwide are supporting production-level LTE roaming. The correct number is around 15-20; however, substantially more are in deployment testing – virtually all through IPXs with Diameter hubbing. Only 20% correct.
4. Based on these LTE networks, RCS rollout will continue across the world, with no fewer than 35 operators supporting RCS, by the end of the year. Many of these will support in-country interoperability. These will include RCS messaging (IM-like), voice, video and presence-based address books, supported on many devices – both via downloadable apps and OEM-provided RCS clients.
Reality: As of late December 2013, there were 23 operators in 17 countries with live RCS deployments, per GSMA statistics. RCS is interoperable among operators in Spain and South Korea. Both OEM and downloadable clients are available. 60% correct.
5. The wide-open SMS-enabled OTT/NUVO community will expand to markets outside the United States, including Western Europe and Asia-Pacific. This phenomenon will also provide new opportunities for SMS-enabled OTT providers to help stabilize SMS traffic, including working in harmony with mobile operators, where non-SMS-interoperable had previously made some inroads.
Reality: This is one tough nut to crack! SMS-enabled/OTTs (e.g. NUVOs) only slightly expanded outside of the USA/Canadian market. Some are still working on European launches and will launch in 2014. The main issues are interworking with other national operators and acquisition of phone number assets to assign to subscribers. Work will continue in 2014, no doubt. Only 20% correct.
6. SMS will remain the dominant medium, worldwide. . Apple’s overall market share will stay around 15-17% and with more non-iOS devices hitting the market, which means a greater chance that the other party will be a non-iOS device – hence, SMS will be used. Additionally, SMS remains the dominant communications channel in emerging markets.
Reality: It looks like iPhone will end up with around 16-17% total market share, worldwide (larger in more developed markets). Additionally, non-SMS-compatible OTTs continued growing the overall messaging pie, but SMS remains the dominant, most ubiquitous texting medium. According to Portio Research, SMS continued overall growth in LATAM, MEA and Asia for 2013 indicating continued reliance on SMS in emerging markets. 100% correct.
7. Mobile consumer engagement becomes more mainstream in 2013. This means that within the top 10 shopping apps, more than half are direct-shopping engagement apps such as Groupon, ShopKick or Store-specific Apps to help push both retailers and brands. We’ll see additional mobile CRM solution apps to engage consumers that will offer even more coupons and rewards to help build brand loyalty than ever before on both national and local levels. Both brick-and-mortar and online brands will benefit from expanded mobile customer engagement.
Reality: With a variety of national and international retailers all increasing consumer engagement via their mobile apps, the idea of showrooming is now welcomed at brick and mortar locations. Groupon, Living Social, Shopkick as well as store-specific apps all increased their usage and during 2013. A2P / brand-specific SMS also continued to increase across the world, based on our own statistics and supported by research from Portio Research. 100% Correct.
8. I’ll go out on a limb again and state that in 2013, we’ll see more options for Point-of-Sale payments through channels such as iOS Passbook, PayPal and a few more without NFC, although more devices with NFC will enter the market. One more out on a limb prediction: the next iPhone (6?) will have NFC support, leading to or becoming a catalyst for more consolidation (finally) in the PoS payment market – a good thing for consumers.
Reality: I’m going to have to quick predicting that Apple will include NFC support as this prediction has burned me for last couple of years; however, I wasn’t completely wrong. iBeacon (in iOS 7) was launched this year; although few have made real use of it. Still, iBeacon has tremendous potential. Otherwise, we continue to see new payment options. In late December, 2013, PayPal rolled out payments to 630 JD Sports locations across the UK. PayPal can already be used, via its mobile app in a variety to stores including Home Depot, Office Depot, and many more, including restaurants. Let’s call this 75% correct.
9. A new option to iOS, Android, Blackberry and Windows Mobile will be introduced in 2013 that will steal headlines and pique interest from the top 4. Will it be Jolla’s Sailfish? Or something else new, like a browser-based mobile OS. There is a great deal of innovation in this industry and I think that some in the top 4 will not be the top 4 by the end of this decade. By the end of 2013, a new mobile OS / platform – possibly supporting emulation modes for various OS’s will enter the market and grow rapidly in market share, attracting a number of OEM device makers.
Reality: It is the Firefox OS that captured the most headlines (introduced at MWC in 2013). At the end of 2013, Firefox has now launched in 14 countries, worldwide, including Telecom Italia on the Alcatel One Touch Fire. Firefox has also been launched on devices from ZTE and LG, to be available in the UK in 2014. Other countries include Brazil, Columbia, Spain, Germany, Serbia and Montenegro, Norway, and Venezuela. 100% Correct.
10. Mobile Big Data will become prominent as mobile operators begin to understand the importance of the data contained within their CDRs. CDR data will be brought into the cloud where service providers can run behavioral analytics to provide aggregated demographics, protecting consumer identities, which can be used to better engage the consumers.
Reality: Big Data dominated global IT headlines and the mobile industry is quite suited to leverage big data. For example, according Business Insider, big data is being used to optimize and personalize mobile experiences and is being leveraged to help drive hyper-local, targeted advertising. Big data – typically data generated by mobile services and apps – began exploding in popularity in 2013, along with concerns regarding its security, privacy and usage; however, mobile operators began strongly mining this data to help them further engage with their customers. 100% Correct.
My predictions for 2013 were 75.5% correct – an improvement from my 2012 prognostications. I’ll admit a few of these were easy; however, others were long shots. But these reflect the direction that the mobile industry took in 2013. It was certainly eye-opening for many when revelations were made regarding meta-data from mobile operators that was made available to the NSA; however, it also made us, as consumers more aware of our own security and privacy from unwanted corporate “snooping” and even more conscious of keeping our data secure from hackers and unwanted intruders into our electronic records. I believe this leads to more security scrutiny for the “big data” sets that will be created as mobile and the Internet of Things continue to converge.
2014 will bring more drama, to be sure – especially for this industry. We’ll have everything from another new iPhone to more new services. A great deal of capacity and bandwidth is being created as more and more LTE networks are built out. We’ll see more innovation and usage of this increased data capacity in our lives and there will be much more that our mobile devices will be able to interact with, thanks to the Internet of Things.
Now for my 2014 predictions… again, in no particular order:
- By the end of 2014, over 300 networks will have launched LTE services. Additionally, at least 25 will have launched some capabilities known as LTE-Advanced. Another way of putting this prediction is that LTE will be more mainstream than not by the end of 2014. By the end of 2014, at least 100 LTE networks will have launched LTE roaming with one or more other networks.
- Mobile OS wars continue with Android and iOS leading the way. But, we will also see market share gains from Windows and Firefox. Firefox will move ahead of the dying Symbian and bada. Blackberry will remain in 4th place.
- In terms of consolidation and acquisitions, 2014 will be the year that T-Mobile USA will be acquired or merged with another entity (not necessarily a mobile operator). Additionally, we’ll see two or more Messaging-oriented OTTs merge and/or be acquired by a larger non-messaging party.
- The new iPhone (will this one be the iPhone 6?) will not incorporate NFC; but will sport a larger display, with more capabilities (both for device and infrastructure support) for iBeacon to become a secure payments channel. Additionally, a single model will be released for the world, supporting all major LTE bands so that any device would have a better chance of roaming to more markets.
- Mobile messaging (standards based: SMS, MMS, RCS) will remain strong, with continued growth in some markets and it will see a resurgence in other, previously declining markets, due to new operator initiatives to revise pricing and features (including supporting more “cloud” messaging, integrating OTT-type services into the mix). In some markets, landline texting will enable new channels for SMS for both P2P and consumer engagement.
- Non-SMS OTTs will grow less and some will come under pressure to monetize their existence. This messaging market segment will see some volatility, due to non-interoperability policies, too many “islands,” free or freemium pricing models. They will become more and more open to operator and inter-operator interworking, along with SMS interoperability. There will be some consolidation in this market segment.
- Consumer engagement via multiple mobile channels will increase. Standards-based mobile messaging (SMS, MMS, and RCS messaging) for consumer engagement (e.g. A2P messaging) will increase. Other channels including push, social networking via mobile, and others will also grow as well.
- IPX will take on new significance in 2014 as the Internet of Things grows and becomes more prominent. Many devices would only be reachable via mobile networks; therefore, the cloud applications supporting and communicating with these devices will need the security and quality of an IPX.
- Mobile data pricing falls in major, developed markets around the world, due to higher usage and better network capacity control. With more complete roll-outs of LTE networks as well as newer LTE-A network capabilities, network capacity becomes less of an issue than before. Mobile operators will also provide newer services to better compete with basic services (voice, messaging) now being provided by OTTs.
- Security and privacy issues around mobile devices, applications and services will continue to gain prominence. In 2014, we will likely see security incidents damage the reputation, if not greatly degrade popular applications and services. Conversely, many services will cite security and privacy controls as major assets of their app or service.
Overall, 2014 will be a year of change and convergence – both in the business world and technology world. I do expect some game-changing announcements and we’ll see new companies rise and a few fall, including companies and services that were “hot,” just a few months ago. The mobile industry is quite fickle and little remains the same for long. Winners will evolve and change with the times, while the losers will have grown too fast to be sustainable or will sit still too long. Have a great and healthy 2014.