Can you innovate more services with less resources?

Published by Ewan Spence at 14:07 UTC, September 23rd 2009

As the recession continues to bite, will there be any innovation in the mobile market in the near future? I don't just mean at the top level, where smartphone users (no matter the OS flavour) will try out every single application they can, but in the marketplace where hundreds of thousands of phones are bought every day. How will new services prosper in the modern environment? Read on for my thoughts.

Hardware seems to have reached a plateau for the next few years and there is no massive technology that still needs to be integrated. My personal feeling is that work on battery life and energy storage is going to be where advances are going to be made, either to increase standby and call time, or allowing faster processors and computation on your device.

With hardware becoming a commodity, software and services is the key to growth, and in this respect the hardware manufacturers may soon find themselves at a disadvantage. Nokia is currently pushing their Ovi platform hard, and the multi-disciplinary approach seems to be working – they must have some revenue coming in from the Nokia Music Store and N-Gage (stop laughing at the back).

But these services need to be not only break-even but also turn a profit. There are a number of options available but the two obvious ones may not be the right way forward. The first is advertising – the great white hope of Web 2.0, and while it's true to say that some sites can turn a profit it's not as easy and simple as many would think.

The lights are on, but is anyone working?

So if advertising is not paying, and at some point the Board will want the company to stop the subsidy of a web service, that means the user will have to pay, and this is why I'm wondering where the revenue will come from. Will users be happy to pay for more? Or is the average monthly bill going to be something that end users would prefer to remain steady?

Services such as Nokia Messaging have been advertised as being an “extra service” that could be added to a monthly bill and the revenue shared by the Finns and the network company; and there's the recent change to Comes with Music to allow monthly billing after the yearly subscription is complete. But that means a lot of extras that will add up on a monthly bill. A bit of data here, some music there, navigation as well... and that's before calls are taken into account.

The consumer has a finite supply of money, and they will be more conscious of how this is spent. It is the nature of people to want new tools, but at the same time they won't want to spend that much more on the mobile every month than they are doing. It's likely that Nokia have done the lion's share of the development on Ovi already, financing it during the boom period, but now there's less free cash floating around in the business system to invest in start-ups, or to buy out fledgling companies to build a super software hub for your platform.

It's notable that in one of the big Silicon Valley start-up shows this month, Tech Crunch 50, that the number of start-ups built around a mobile concept was minimal (although CitySourced was a notable exception). If hardware is stagnant, then software needs to pick up the pace – but right now there seems to be a calm in the industry, with no new practical ideas, a lack of cash both at financial and individual levels, and a general feeling that everything that could be done has been done.

Where does the next big thing come from, or is innovation in the mobile market going to take a break for a year or two?

-- Ewan Spence, Sept 2009.

News Discussion

Quote:

Originally Posted by rvirga I don't see how, in a year which has seen the introduction of: - 1GHz+ mobile CPUs (Snapdragon) - large (>3.5") touchscreen AMOLED screens - 12MPx cameraphones - 720p recording on a phone - demo of SMP processing on a phone - demo of a multitouch resistive screen

That's a list of items that 99% would be happy living without and, with the exception of multi-touch they are all badly flawed innovations.

Give me something I really want/need.

Quote:

Originally Posted by rvirga I don't see how, in a year which has seen the introduction of: - 1GHz+ mobile CPUs (Snapdragon) - large (>3.5") touchscreen AMOLED screens - 12MPx cameraphones - 720p recording on a phone - demo of SMP processing on a phone - demo of a multitouch resistive screen just to name a few, one can really say "Hardware seems to have reached a plateau". Before writing an opinion piece on the state of the entire mobile market, you should have stepped out of the Nokia bubble in which you live. Nokia hardware is stagnating, everybody else's isn't.

How many of those are truly innovative, rather than incremental changes to existing tech.

Faster processor... sorry, buying public don;t care on specs, jsut if it works/.
Megapixel cameras, We've argued often that (a) 3mp is more than sifficent for 95% of use cases and (b) the cmos is far more important
720p recording... err, it's still video recording. Is it big massive change? Don;t think so.
demo of smp... see processor
demo of multitouch... well we all know the UI debate can spin on and on...

As to stepping out the bubble, well I;ve got various phoens and OS within arms reach of this desk so thank you for your view on my view - I respectfully disagree. Fundamentally the iPhone is still the iphone launched years ago with some spec bumps, but nothing fundamentally new... windows mobile continues to run the same enterprise battle, Palm's WebOS remains to be seen but a social address book does not make a platform...

And show me where the start-ups in mobile are that have solid revenue making potential? Anyone? Anyone? Bueller?

Quote:

Originally Posted by rvirga There is innovation, and plenty of it; whether this innovation is evolutionary or revolutionary is immaterial. I remind you that the main innovation brought by the N95 was its 5Mpx camera, which was an incremental improvement over existing 3Mpx ones. It's funny to see that some of the people who in 2007 called the N95 "innovative" are now saying that incremental improvements aren't real innovation. Arguing whether we need/want these improvements is also beside the point. Some of us do, and nobody elected you the official spokeperson for all buying consumers.

Nail hit squarely on head there.

http://en.wikipedia.org/wiki/Innovation

"The term innovation means a new way of doing something. It may refer to incremental, radical, and revolutionary changes in thinking..."

Ewan thinks that only revolutionary change counts as innovation. Which is fine, but in that case what was the last revolutionary innovation from Symbian? .. The introduction of S60?

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