Over half a billion low-cost smart-phones, priced less than $100, will be in use by the end of 2012 as demand for basic handsets that still have computer-like functions continues to grow, according to the predictions of Deloitte’s annual report on top telecommunications trends for 2012.
“The rise of the $100 smartphone is analogous to the growth of the net-book low cost, low power laptops as consumers look to replace more basic handsets but don’t need the power or functionality of high-end devices. The biggest opportunity is in emerging markets such as some countries in the Middle East where internet access is low but the desire for communication and information services is growing,” Santino Saguto, partner in charge for the Telecommunications, Media and Technology (TMT) industry, Deloitte Middle East, said.
The Deloitte report on 2012 telecom predictions also indicated that the $100 smart-phone could also appeal to users in mature markets where it could become a perfect teenage ‘starter’ phone. This will put pressure on the supply chain to cut the price of components but also presents a challenge for app developers as low-cost smart-phone owners are less likely to want to pay for downloads.
The rise in the number of the devices with embedded near-field communications (NFC) technology is set to soar to the 300 million levels by the end of 2013. NFC – the transfer of small amounts of data over a very short distance – has been dominated by the ‘wave and pay’ notion of embedding a credit card into a mobile phone but the application of the technology is likely to have a wider reach. Many people remain uncomfortable with the notion of using a phone to pay for items and consumer perception about the security and battery-draining aspects of NFC need to be overcome. However, even if 2012 turns out to be no more than a “transitional year” for mobile payments, the NFC chips will not go to waste. There are thousands of applications of NFC – from gambling, to gaming to healthcare – that could build up a head of steam over the course of the year even if the media continues to focus on the ‘digital wallet.’
The internet has become ubiquitous as means for delivering information and data between users but the strain on networks, both fixed and mobile, is set to force more people to turn to short-range wireless connections to transfer data. Such technology has been pervasive before in the form of infrared and Bluetooth connectivity and is set for a resurgence in the form of web bypass – cutting out the need to connect to the internet at all – as the need for the quick transfer of data between devices and users grows. Roughly one per cent of all wireless data exchanged in 2012 will be between devices rather than routed over the internet which is double the level of 2011. With telecoms companies balancing the need to invest in network improvement with the demands of customers for data capacity, web bypass will emerge as a third network option alongside fixed broadband and mobile for transferring information.
The demand for data has already seen many mobile phone networks call time on the “all-you-can-eat” world and 2012 could be the year that a similar trend occurs in fixed line broadband. One hundred million Internet users will have to start watching the capacity meter this year as explicit monthly bandwidth caps are introduced to alleviate congestion. Demand is growing at over 30 per cent a year with traffic at peak times already forcing many network providers to throttle back speeds. The caps placed on mobile networks have forced many consumers to offload data usage onto Wi-Fi networks which has added further strain to the wire line world. Whether it is a billing-based cap or a speed-based cap that is introduced, the era of “unlimited” data may be drawing to a close and options such as “web bypass” may become a way for consumers to reduce their consumption to avoid breaching their limits.
The number of apps available surged through the one million mark in December and will double again by the end of 2012. However the proportion that is paid for remains small. Only a fifth of those that are downloaded break through the 1,000 mark and only a tiny proportion of un-promoted apps will ever become unsuccessful. The demands on the developer are increasing as the variety of smart-phones and tablets increases. To reach a global target market a developer may have to make 360 different variants which have all-but called time on the part-time app developer. With so much choice on offer, app-store providers should consider ways to improve and assure the quality of the products on offer. Stores should look to differentiate by considering subscription models focused on different genres, or selected by editors, that would create ‘app bundles’.