mobilestance 2009 mobile predictions sm2Peer into Mobilestance’s Proprietary Crystal Ball!

Well it’s that time of year again… when pundits and publishers large and small exploit the slow end-of-year news cycle to recap the old and forecast the new.  Here at mobilestance it’s a extra-special time of year… as it was nearly one year ago when we formally “came out” of beta with our 2007 Recap piece and spammed it out to our publisher’s 3,000 +  email address book.  Ahh… memories!

This year, rather than spend the next thousand words rehashing what was undoubtedly the most exciting year in mobile since the advent of the crazy frog ringtone, we decided instead to take the easy way out and peer ahead to future…   casting our lot into a sea of like-minded posts from across the blogosphere.

So what will occur in 2009 at the intersection of Mobile and Marketing?  Will location become (as Dan @ Organic so eloquently put it in a recent Facebook status) “just another input”?  Will MMS finally become interoperable between carriers and ShortCodes, and finally emerge as a realistic marketing vehicle?  Will a wave of consolidation sweep the industry, as smaller independent mobile agencies, technology vendors and ad networks become casualties of the “great recession”?   Will newly legislated digital privacy-controls arrive just in time to kill the mobile web?  And of course the big question on everyone’s minds: Will mobile finally jump from the backwater of marketing budgets known as “emerging,” grow some legs, ditch the tail, and finally walk upon solid (budgetary) ground?

So read on then, fearless time shifters… and arm yourself for the ensuing complexities that will envelope our fledgling industry in the coming year!

Mobilestance’s Top 10 Mobile Marketing Predictions for 2009

  1. 2009 Will be the Year of Mobile.   After many false starts the Long Joke will finally end… and Mobile will finally have its moment in the sun.  With the rising popularity of smartphones; the lower cost of mobile data; and the pervasiveness of mobile broadband, internet and other “beyond voice” services, Mobile (with a capital “M”) will finally achieve critical mass in the US – and agencies, brands and business infrastructure providers alike will finally start paying attention with the purse strings.
  2. 2009 Won’t be the Year of Mobile.  What would a mobile marketing prognostication piece be without some conflicting signals?  Call it hedging my bets… but I just couldn’t resist punching up the contradiction that is the current state of mobile marketing.   Sure, everything I said in the previous ‘graph is dead on… the crystal ball is crystal clear on that.  But will that make 2009 “The Year of Mobile?” Hardly.  Sure, mobile has made some great strides of late in terms of its effectiveness as a marketing channel, and there is NO doubt that will come even farther, faster in 2009.  But sorry kids, it simply will not find its way out of the “emerging” bucket when it comes to budgeting.  No, the “Year of Mobile” can only be declared after we see dedicated “mobile” advertising, CRM and/or marketing budgets… or (at a minimum) a substantive breakout from a larger “digital” line… and with 2009 shaping up to the second coming of the “Flight to ROI” of 2002 (warning: pdf link) , we’ve probably got until 2010 until we can finally herald the end of the Long Joke. In the meantime there’s still plenty for Mobile Marketers to do – namely, hone our skills and prepare ourselves for when the money spigot really opens up in 2010.
  3. Mobile Search Comes of Age.   OK, enough with the levity… let’s get into some serious forecasting. If there’s one thing we’ve learned about mobile usage in ’08, it’s that smartphones = search volume.  While previously a mere academic curiosity, this correlation will show real legs in ’09, as legions of iPhoners, Crackberry Addicts and the like will continue take to mobile search like a longshoreman on a bender (read: heavy consumption punctuated with colorful language) .  We’ve already witnessed both Google and Yahoo fine tuning their mobile search products – albeit in very different ways – and in 2009 we will see the beginnings of a real business emerge in this sector. Watch for the leading engines and agencies make a major mobile plays in ’09, as both will look to the sector to help sustain revenue growth and counter the “leveling off” of the (once interstellar) growth trajectory of “traditional” online paid search and/or SEM – as both (especially the former) begin to show early signs of maturation.
  4. Mobile Video (finally) Gets Interesting.  Along with search, the other interesting affect that comes with increased smartphone penetration is increased consumption of mobile video.  I say “interesting” as in “somewhat viable” or “worth experimenting with”- which should not be interpreted as “it’s going to explode” (or even that I’m reasonably bullish on the channel).  No… while I’ve been a mobile video hater for many years for reasons too numerous to count, we’ll see enough scale in 2009 to merit some testing… as after all, leveraging the moving image remains (arguably) the most effective method by which one can influence consumer behavior.
  5. Apples Grow on Trees… While Android Picks up Steam.  A no brainer that simply cannot be ignored… and the importance of which cannot be overstated.  Most likely, Apple will successfully keep its momentum into ’09 by rolling out popular, yet evolutionary iPhone models (think new colors and modestly increased storage capacity/performance, rather than new form factors or revolutionary new features or price points).  Android will likely see a bigger increase in Mobile OS share (albeit from a smaller base) than Apple, as Samsung (Spring) and Motorola (Fall) roll out hot new handsets utilizing the Open Source mobile OS.  And speaking of Open Source, it will be interesting to see if the (reasonably) open Android starts “out innovating” Apple’s proprietary mobile OS when it comes to features and applications.  As it is we’re still waiting for Google to integrate a working commerce model (safe money is on Google Checkout… duh!)  into the Android Marketplace so that developers will have an easier time charging consumers for applications (expected Spring, 2009) – so it might be awhile before developers truly embrace Android as tightly as they have with the iPhone SDK.  Our prediction:  in 2009 Android will become the “hip incubator” for mobile application and/or OS innovation… with Apple and/or independent iPhone developers skimming the cream and co-opting the most interesting ideas of the bunch.
  6. Biggest Losers of 2008: Motorola, Palm and Sprint Stay Alive.  Notable for their ability to keep breathing, the “Crap Pack” of ’08 will not kick the bucket as so many are predicting.  Sprint will slowly turn the corner in ’09 under Dan Hesse’s steady hand (is it us, or is anyone else getting a “Fred Thompson” vibe from his gently reassuring, speak-directly-into-the-camera series of commercials?), making incremental customer support improvements and leaning on that “Clearwire Thing” to leapfrog ahead in the bandwidth arms race (see “Wi-Max Casts Wide Shadow” below for more on this).  The great recession saved Motorola’s Wireless business, as the venerable Schamburg, Illinois red ink factory likely found no suitable suitors.  Now the company is forced to do what it does best… crank out a hit product to save the company – which we believe we’ll see in the form of a swank Android handset sometime late next year.  Until then Moto will occupy itself by doing the other things it does best: bleeding market share and taking on further debt… which brings us to our last lovable looser, Palm.  The fact that Elevation Partners decided to invest $100MM to keep Palm afloat just last month proves that there’s somebody out there for everybody… no matter how unsightly, aged, infirm or otherwise unappealing.  Seriously, we’re not entirely sure know how much lifespan $100MM buys Palm, but we’re betting 18 months, at best.
  7. Cash Poor Mobile Start-ups Get Snapped Up by Web, Traditional Media Players.  Another obvious one that needed to be said: the credit crunch / recession combo will start claiming casualties among the most vulnerable in the mobile sector, while traditional media giants and other web firms lacking mobile chops go bargain hunting.  Specifically, the time might be right for WPP’s 24/7 RealMedia to formally acquire one of their partner mobile ad networks (such as JumpTap or Millennial), should the opportunity present itself.  On the Cable side both Comcast and Time Warner have already made big bets on wireless with their Clearwire investments… yet neither have much else to leverage here in the form of inventory of other mobile-ready assets. A mobile video acquisition for each of these players on the order of a Rhythm NewMedia or Transpera might just be in the cards.
  8. WiMax Casts Wide Shadow.  While 2008 was all Apple and Google, newly-formed Clearwire (not to be confused with the “old” Clearwire, which had the same management yet different investors – a confusing situation that deserves a dedicated posting of its own) quietly rolled out what we believe to be the first real mobile broadband network in the US… (OK, well in Baltmore, MD – but heck, it’s a start!).  As Clearwire partner Sprint Wireless brings new WiMax hardware to market, and  the high speed service rolls into new markets like Portland and Chicago in 2009, look to Verizon Wireless and AT&T to fall all over themselves to attempt to bring their competitive 4G “LTE” (Long Term Evolution)  product to market by the end of the year.  It’s a moot point if Clearwire ever really rolls out a national WiMax network, or instead (like many are predicting) runs out of cash sometime in 2009 (prediction: cash-laden Clearwire partners Intel and Google will pony up an additional round of investment in the network while cash strapped partners Comcast and Time Warner sit this round out – slowing, but ultimately sustaining, Clearwire’s national rollout) what matters most is that Clearwire and WiMax is giving the industry a huge kick in the pants… and with this we’ll finally get the true mobile broadband experience we’ve all been waiting for.  Cue the brass band!
  9. MMS Gets its Act Together (Just in Time to Become Totally Irrelevant).   It’s no secret that MMS never really caught on with the public… and even when the carriers got their act together in 2006 and brought cross-carrier MMS interoperability online, the bloom was already nearly off the rose, as it were.  Marketing applications remained uber-niche, as lack MMS support for cross-carrier short codes left brands with two, equally unappealing options (e.g. the use of either a ten digit phone number or an email address in the primary Call-to-Action).   Still, while some consumers are giving the “Most Morbid Service” a second chance, the last nail in the coffin may have come from Apple, when it shafted the technology by not supporting it on the iPhone.   Now it seems the CSCA , along with their strong-armed cousin, NeuStar, are working with the US carriers to bring MMS support to intercarrer (common) ShortCodes… which, if achieved, would greatly expand the effectiveness of the channel as a marketing medium.  The question is, will this work be completed before the technology becomes altogether irrelevant?  Perhaps… although no one (including us) is betting on it.
  10. Application “Bubble” Doesn’t Burst… Yet.   A minor one, but just squeaks into our Top 10 (take that, “Privacy Concerns!”).   First, in order to predict that a bubble won’t burst, you need to prove the existance of a bubble.  Case in point: iFart (point proven!).  Now just when will the “App Bubble” burst?  Well, it would seem that in order to “burst”, the bubble would first need to achieve maximum volume, which won’t happen until iPhone and similar “ReallySmartPhones(TM)” achieve critical mass (we’re thinking 15-20% penetration) – and that’s not happening for at least a year or two – even in the rosiest of scenarios.  Still, for all the whooplaa around “+300MM iPhone app downloads in the first six months of app store,” some have acutely pointed out that the iPhone app growth curve has already started to flatten out.  That said… we’re likely to see a whole new crop of iFarts-like hits in 2009 – and needless to say Mobilestance awaits on baited breath.

Well folks… there you have it – our top 10 predictions for 2009.  Feel free to leave a comment if you feel we’ve missed something… or if you just want to throw some gasoline on the fire… and check back with us throughout the year as we continue to chronicle this thing we call Mobile.

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linux penguin bluetooth headset mobile stanceConsumer Dissatisfaction and the Macroeconomics of Mobility Provide Linux with the Opportunity to Achieve in Mobile What it Failed to Reach on the Desktop: Relevancy.

Last week Verizon Wireless was just the latest big player to jump aboard the Linux train. In joining the LiMo Foundation, “an industry consortium dedicated to creating the first truly open, hardware-independent, Linux-based operating system for mobile devices,” Verizon joins existing LiMo members Motorola, Samsung, Panasonic, NEC, NTT DoCoMo, Orange and Vodafone.

The Google / Verizon Open Access Wars Continue. Verizon’s move is consistent with it’s grudging embrace of “openness,” a relatively recent development and likely result of Google’s aggressive initiatives with their own Linux-based mobile initiative, the Open Handset Alliance (whose members read like a who’s who of the mobile ecosystem), as well as the search giant’s success in influencing the latest US spectrum auction to partially adopt “open access” rules. These rules prohibit the new “owner” of the highly sought-after “C-Block” of wireless spectrum to restrict network access – based on either device or software requirements. This was a landmark ruling by the FCC that upset established business practices by the US operators (especially Verizon Wireless).

Ironically (or by Google’s design, if you buy into the hype) Verizon Wireless, who vigorously pursued legal action against the Google-backed “open access” initiative, is by default its biggest backer, as the carrier ended up spending $9.4 billion to win the auction for the “open” C-Block wireless spectrum. Maybe “ironic” doesn’t quite cut it. “Asleep at the switch?”, “Poetic Justice? or just good old “Machiavellian Legal Mastery?” So much to think about I just can’t get my head even half way around this one… hopefully a “tell-all” book will hit the market and shed some light on what really happened here between Google, Verizon and the FCC.

Regardless, Verizon asserts that among its reasoning for joining the LiMo is that, unlike the Google-led OHA, LiMo software is truly open source (whereas Google maintains a relatively tight grip over its Linux-derived Android Mobile OS). That said, both operating systems are “open enough” in that developers are free to create and distribute highly robust mobile applications unencumbered by (the current) intellectual property and financial barriers maintained by the wireless carriers and (to some extent) the handset manufacturers.

All roads lead to Linux? In addition to all of this, macroeconomic forces also seem to be contributing to an environment favoring Linux as a mobile OS. With the majority of the world’s mobile users living under severely limited economic conditions (i.e. the so-called “developing” world), an open source product such as a Linux-based handset and / or application would enjoy tremendous price advantages versus competing proprietary models – and is therefore far better positioned to compete for the majority of the world’s mobile user base.

While the US mobile industry has yet to feel any real impact resulting from all of these developments, rest assured that big changes are coming – and soon. One only needs to peruse the recently announced finalists in the Android developers challenge to get a sense the coming spike in mobile innovation. The development of rich, life-enhancing applications like Android Scan, a promising app that integrates a traditional barcode reader with existing online databases to facilitate real time product comparisons and m-commerce, would simply not be possible under without an open mobile operating system and business environment unencumbered by powerful gatekeepers.

Now, it might be tempting to dismiss Linux-based mobile initiatives due to the failure of Linux to achieve success on the desktop. The various desktop Linux operating systems also enjoyed the considerable advantages of pricing and of an open development environment, and yet none of them realized anything more than marginal successes. Why should mobile Linux be any different?

The key lies in the differences between the development and limitations of the two channels. When Linux arrived on the market most desktop users were relatively satisfied with the PC computing experience. Sure, Microsoft (and Apple) products had their problems, but most users were content with the functionality and prices associated with the leading PC operating systems and applications. The same cannot be said for the mobile data space, where most users face an entirely opposite scenario: a high (perceived) priced product delivering a wholly unsatisfying experience.

Ultimately, perhaps the walled garden model that worked “well enough” in the desktop space just isn’t up to challenge in the more demanding environment of the mobile data space – a space far more restricted in terms of device size, bandwidth, processor power, memory and display resolution – and is inherently laden with costs far greater than that of traditional wireline data networks. Perhaps it is precisely this challenge that Linux is uniquely suited to overcome, and perhaps this is why Linux – and perhaps only Linux – will be the portal that will finally fulfill the promise of the mobile channel.

31849319-2-300-overview-11.gif Today at CES Yahoo! is planning on announcing that they are opening up their “Yahoo! Go” mobile application to third party developers, this according to the New York Times. The Times is reporting that MTV, eBay and MySpace have already created Yahoo! Go widgets that consumers can download either online or directly via the mobile application. Yahoo! Go has been ported to roughly 250 mobile devices, and comes preloaded on some phones made by Motorola, LG, Samsung and Nokia outside the US (domestic carriers force users to manually download and install the application prior to use, although this might change once device manufacturers start selling handsets directly to consumers).

Analysis: Yahoo!’s work on developing Go to a more mature platform is commendable. While the move does serve to further fragment the development environment for mobile (What, another new platform to write for? Better hire another developer!), the platform’s large (for mobile) install base of 250MM users worldwide will be attractive to major publishers and content brands (although some estimates confirm less than half of this base are actively using the application).

A no-brainer for Yahoo!, the move costs them little in oversight, while serving as a short-term defensive move against Google’s open Android platform. Ultimately the long term success of the play will hinge on the ease of developing third party widgets for Yahoo! Go, as well as any advantages that the development environment might afford (access to the address book? GPS data feed?). More on this as it develops.