5 ms·

Mobile Growth: Don’t Bet On It

15 points by epi0Bauqu 18y ago

known 18y ago
Not true. In India the growth rate is 10 million new mobile connections per month.
- nuclear_eclipse 18y ago
  Please read the article: That's still not an argument to bet on the mobile web; even at a rate of 10m new connections, the vast majority are not smartphones, and will likely not have any major monetary presence on the web in the near future.
  - rwebb 18y ago
    ok. even if it's 10%, that's 1M new smartphone users a month in india, which is massive growth. i don't agree with this article at all. even though matt is a gambling man, i'm guessing he's not shorting companies banking on mobile growth - he's just trying to get traffic to his blog.
    - azharcs 18y ago
      You are being too bullish here. India is a country with a per capita of $1000. 71.6% of the people earn less than $2 a day. As i have seen the mobile growth in India, i know it has grown by leaps and bounds, but it is not the population from which you can make money of. Almost every one has a mobile here, even some of the poorest people. The reason for that is the dirt cheap handsets combined with lifetime connections, you can get a handset for $28 plus a life-time connection for $12 and you are connected for life. I really don't see this people buying $300 smart phones and start using Google or buying stuff from internet. It is not going to happen and when i see this huge companies talking about how they will make tons of money from China and India, it only makes me laugh. Again just have to wait and watch.
      - mattmaroon 18y ago
        Exactly. Which is not to say that I don't expect India (and the rest of the BRIC) to some day be a source of revenue. It will, undoubtedly. They're getting their economic act together. But it's going to be a process that will take more than 5 years. When they have a GDP per capita of $40k, they'll be worth a hell of a lot to whichever search engines they use. But even then, the growth won't be attributable so much to mobile (even though it may come through that channel) as to developing nations.
river_styx 18y ago
Second, people will, until some radically new, currently unforeseen technology becomes available (and I’m talking way beyond Blackberry/iPhone here) prefer surfing on the PC over the web when both are available. That's really the key issue. Most people don't lug around a laptop or PC everywhere they go, so in most situations outside of home/office, the forced choice between phone and PC doesn't exist. Also, I often use my iPhone at home for browsing, because its Safari is good enough to make it not worth my while to boot up the laptop. I've seen many others do this as well.
- pchristensen 18y ago
  I do this too.
dazzla 18y ago
If you want to see the future of mobile you should not look at the USA but Japan, Malaysia, Europe, etc. The iPhone has been a good catch up for the USA but even that is less restricted outside the USA.
- mattmaroon 18y ago
  Japan has a lot of stuff that we don't and that never really works here because our cultures are so different. They'll buy a device so laden with features that they don't even know how to use 3/4 of them, because they value that. We'll buy a device that looks better and is simple to operate. The iPhone is a much better model of what Americans want now (and possibly what the Japanese will want in 5 years) than the feature packed phones they have.
  - axod 18y ago
    It's not just that though. Look at the mobile operators etc. In the UK, I get an iPhone 3g with excellent edge/3g coverage, free wifi from thousands of wifi spots, and unlimited data. I don't think I would have bought the iPhone without the unlimited data and free wifi, as I use it mainly as a portable browser. The US seriously needs to catch up in terms of pricing plans, data, etc.
    - mattmaroon 18y ago
      Well, I think we all agree on that.
  - menloparkbum 18y ago
    I lived in Japan for a year. The reports about how advanced the Japanese mobile phone situation are a bit overblown. The most popular service was still i-Mode, which is old, proprietary and severely limited. It is kind of like if "Prodigy" ran on mobile phones. According to wikipedia: Even i-mode's creator, Takeshi Natsuno, has stated "I believe the iPhone is closer to the mobile phone of the future, compared with the latest Japanese mobile phones."
i_am_neuron 18y ago
Well, this sounds like a typical POV of the person who never used mobile internet device (iPhone, for example, performs best in this role). Of course, screen is small, but there are a lot of UI specialists dealing with this and a bunch of developers ready to port their applications to mobile devices (have you seen Facebook client for iPhone?). I would not replace my IDE running on the PC with its mobile version, but geez, apart from that what else are you doing on your PC? Exploring Flickr? Updating Facebook status? Shopping on Amazon? Reading blogs? We could do all of that mobile, even now. Mobile phone with internet access could potentially become a source of not less important revenue stream for anybody offering anything on the internet. Simple example: mobile operator (owning the identity and bank account info of the phone owner) could act as identity provider for online micropayments and charge them to the subscriber's mobile account. I could go to my friend's, see an interesting CD, scan its barcode with phone's camera, be redirected to Amazon immediately and pay without entering credit card details, using my mobile phone account -- all in couple of clicks, on one device. I would not bet on mobile growth, I would bet on mobile shift. 4 times 2 minutes spent with surfing the web on iPhone on the go could be oh so much more rewarding (in terms of revenue attracted) for any internet service I am using, than 8 full hours in front of PC.
- mattmaroon 18y ago
  Yeah, it would sound like that unless you actually read the article, in which I mention that I've been using mobile devices for 5 years.
biohacker42 18y ago
I agree with a lot of that, Matt put into words a lot stuff in my head that I couldn't. But I don't think the point about payment is true. People in Europe already buy all kinds of crap with their phones. Everything just shows up on your phone bill, no credit cards to fuss around with.
- maxklein 18y ago
  No they don't.
  - biohacker42 18y ago
    Indeed, in Japan and in Finland people already buy goods via their phones. From here: http://www.pcworld.com/article/122590/use_your_cell_phone_instead_of_your_credit_card.html http://www.pcworld.com/article/122590/use_your_cell_phone_in... I would have found better references if I had more time and google didn't keep returning results for vending machines which dispense cell phones, instead of allowing you to pay via cell phone.
    - mattmaroon 18y ago
      I've read about that too, and it is pretty neat. I could totally see phones extending small credit lines (and maybe larger ones to customers with better credit scores) to be used that way. It will still never match the efficiency of our credit card industry though, just due to sheer numbers.
- mattmaroon 18y ago
  That works largely because service is prepaid there right? Otherwise the phone companies are essentially acting as credit providers. Which I could totally see happening here, but having 3 or 4 phone company lenders would be nowhere near as good as having the thousands of banks that combine to make credit card products for people of all FICO scores.
jfarmer 18y ago
His assumption is that the only mobile growth that matters is smartphone growth, but that's not true. You can build lots of valuable stuff using just SMS.
- mattmaroon 18y ago
  Such as? Google already has SMS products, and everyone already has SMS, yet it's a negligible source of revenue for them.
TrevorJ 18y ago
Given the subsidized upgrade paths that most mobile providers give you, the half life for a mobile device is less than for a desktop. The experience gets better with each generation of new hardware. The killer app of mobile devices is that you DON'T have to be next to a PC. People are willing to trade a heck of a lot of functionality in order to not be chained to a desk. With apps living more and more in the cloud, the value of having connectivity anywhere will only increase.
- kingkongrevenge 18y ago
  > People are willing to trade a heck of a lot of functionality in order to not be chained to a desk. I'm not sure that's really true. People in the west spend time at home and at work. Millions of people are probably not yearning to surf the web in strange places outside of their daily routine.
- mattmaroon 18y ago
  The experience doesn't get that much better. I've been using it for 5 years. Data speeds have greatly improved, especially with EVDO Rev A. Keypads today are barely better than the Treo 650's. Apple's made some definite strides in making the touch screen usable (far beyond the old Palms) but it's still vastly inferior to a 19" LCD and a mouse, and improvements will now come incrementally.
johnrob 18y ago
When a phone comes with an internet connection and a fully capable browser, it's not really a 'phone' anymore. It's just a small computer. Looking at it another way, if a phone has a capable browser, then you really don't have to do any extra work to support it - just build a web app as you normally would. Every site on the internet becomes a "mobile site". There's no reason the leading internet sites won't also dominate these new pocket computers as well. The only reason that wouldn't be the case is if they had to build some a new product in order to capture the market - which by definition is not the case.
- mattmaroon 18y ago
  Obviously you've never tried to surf normal web sites on a phone. It's an experience that I imagine to be about as fun as giving yourself a tracheotomy.
  - axod 18y ago
    You serious? I'm pretty happy using Safari, zooming, etc Sure, it's a small screen and you might have to pan around a while, but it's certainly usable. And as the parent pointed to, I very rarely use mine as a phone. It's a portable internet device.
    - mattmaroon 18y ago
      Most people use their mobile primarily as a phone or email device. Most people will always prioritize those functions above web surfing because they will prefer web surfing on a PC and are usually near one. And why would you want to deal with all of the zooming when you can just have a monitor? I mean, it's great when you're on the road, which is maybe what, 5-10% of your waking hours for the average Joe, but at home?
      - axod 18y ago
        I don't buy that at all. What about people stuck on a train? What are you going to do? Surf the web on your iphone. What about if you're waiting in a dentist? You're going to whip it out of your pocket, and surf. Yes, compared to time spent at a PC, this is a small amount of time. But I'd bet the usage on the iPhone is the browser, then email, then phone/sms (With games+music in there somewhere). I don't even think young people use their phones as phones (voice calls) very often now (UK anyway). It's all sms. Of course it won't replace the laptop, but it replaces a lot. It's much easier to wake up, pick up the iPhone and check a few sites, than get on your laptop. I agree about the zooming to a point, obviously if there was a hologram projector or something, it'd be great. But the scroll/zoom works for now.
maxklein 18y ago
Of course people prefer to type stuff in a big screen instead of a small screen. In that respect, big screens will continue to dominate, but what we will see is that the screen of phones will become big. You dock your iphone, it becomes your laptop. Apple is working on this, I heard.
- mattmaroon 18y ago
  Then is that really mobile growth? I mean, it might replace a PC, but that's not growth, it's just switching from one device to another. The iPhone has a long way to go there. It can barely even run flash on that potato chip of a processor.
  - Herring 18y ago
    regardless, it's probably the future. All you need is a few more years of Moore's law plus a screen like this http://images.google.com/images?q=plastic+logic http://images.google.com/images?q=plastic+logic I don't know why phone companies aren't scrambling. With skype & wireless almost done, all the pieces are here, if not in place.
  - maxklein 18y ago
    Oh processors will be fine. The problem is in heating and batteries, and that is almost there. I am at a certain prominent laboratory often, and I have seen what is happening in that area. Mobile is changing. It's absolutely not about small screens anymore, it's now about a generic app running OS, and the screen is just a display format of the app. Apple didn't see this coming when they released the iphone, but google has seen it, and now apple has also got the message. The phone has become the computer, the question is just who is going to create the first full screen scalable phone that interfaces with a standard keyboard. Your perspective is wrong, because you are looking at what was, and what is, instead of what will be.
    - mattmaroon 18y ago
      Well, I see the rampant complaints about the iPhone 3G's battery life, and the relatively slow improvement in batteries overall. It's going to take a tremendous leap for a phone to match my laptop's dual core processor, and have a graphics card that can power an external display, while getting battery life that's tolerable to most people. You really think it's almost there? I'm definitely not privy to any research labs, but I've seen nothing in the past, or in current literature, to make me optimistic about that big of a leap. Laptops still lag significantly behind desktops in general, especially at the same price point. Why should phones not lag even further? Also, even if what you say is true, and they swap laptops for phones, that's not growth, it's just a shift. If they still use the phone primarily docked, where they would previously have used a PC, and only 10% of the time mobile, then it's only 10% growth from Google's perspective.
iloveyouocean 18y ago
Scenario: Google comes out with killer mobile apps, including some location aware, flow/stream, whatever stuff that leverages all the info. and advertising, etc. that Google has, plus new mobile centered advertisers (Businesses that are not traditionally searched for). Its so good that none of the carriers can duplicate it. These applications drive carrier revenue by encouraging data usage, mobile payment usage(in a future form), 'location usage', etc. Google realizes people are not clicking on ads (as much as when 'browsing' on a PC). So they do two things, charge the carriers to offer their services(take a share of mobile payments they generate, data usage, etc.) and charge businesses to get their ads in front of people on mobiles, perhaps on a non CPM basis. Is this 'growth'? Yes. Its very possible people will 'search' (to use the term very loosely) for different things from their mobile than they do on the web. Fast food coupons, vs. straight info. And its also very possible that 'searching' wont be typing into a search-box, but instead some type of flow based suggestion mechanism.
- mattmaroon 18y ago
  You have a very high buzzword per paragraph ratio going there. If we were playing buzzword bingo, you'd win.

15 points by epi0Bauqu 18y ago

known 18y ago

Not true. In India the growth rate is 10 million new mobile connections per month.

nuclear_eclipse 18y ago
Please read the article: That's still not an argument to bet on the mobile web; even at a rate of 10m new connections, the vast majority are not smartphones, and will likely not have any major monetary presence on the web in the near future.
- rwebb 18y ago
  ok. even if it's 10%, that's 1M new smartphone users a month in india, which is massive growth. i don't agree with this article at all. even though matt is a gambling man, i'm guessing he's not shorting companies banking on mobile growth - he's just trying to get traffic to his blog.
  - azharcs 18y ago
    You are being too bullish here. India is a country with a per capita of $1000. 71.6% of the people earn less than $2 a day. As i have seen the mobile growth in India, i know it has grown by leaps and bounds, but it is not the population from which you can make money of. Almost every one has a mobile here, even some of the poorest people. The reason for that is the dirt cheap handsets combined with lifetime connections, you can get a handset for $28 plus a life-time connection for $12 and you are connected for life. I really don't see this people buying $300 smart phones and start using Google or buying stuff from internet. It is not going to happen and when i see this huge companies talking about how they will make tons of money from China and India, it only makes me laugh. Again just have to wait and watch.
    - mattmaroon 18y ago
      Exactly. Which is not to say that I don't expect India (and the rest of the BRIC) to some day be a source of revenue. It will, undoubtedly. They're getting their economic act together. But it's going to be a process that will take more than 5 years. When they have a GDP per capita of $40k, they'll be worth a hell of a lot to whichever search engines they use. But even then, the growth won't be attributable so much to mobile (even though it may come through that channel) as to developing nations.

river_styx 18y ago

Second, people will, until some radically new, currently unforeseen technology becomes available (and I’m talking way beyond Blackberry/iPhone here) prefer surfing on the PC over the web when both are available. That's really the key issue. Most people don't lug around a laptop or PC everywhere they go, so in most situations outside of home/office, the forced choice between phone and PC doesn't exist. Also, I often use my iPhone at home for browsing, because its Safari is good enough to make it not worth my while to boot up the laptop. I've seen many others do this as well.

pchristensen 18y ago
I do this too.

dazzla 18y ago

If you want to see the future of mobile you should not look at the USA but Japan, Malaysia, Europe, etc. The iPhone has been a good catch up for the USA but even that is less restricted outside the USA.

mattmaroon 18y ago
Japan has a lot of stuff that we don't and that never really works here because our cultures are so different. They'll buy a device so laden with features that they don't even know how to use 3/4 of them, because they value that. We'll buy a device that looks better and is simple to operate. The iPhone is a much better model of what Americans want now (and possibly what the Japanese will want in 5 years) than the feature packed phones they have.
- axod 18y ago
  It's not just that though. Look at the mobile operators etc. In the UK, I get an iPhone 3g with excellent edge/3g coverage, free wifi from thousands of wifi spots, and unlimited data. I don't think I would have bought the iPhone without the unlimited data and free wifi, as I use it mainly as a portable browser. The US seriously needs to catch up in terms of pricing plans, data, etc.
  - mattmaroon 18y ago
    Well, I think we all agree on that.
- menloparkbum 18y ago
  I lived in Japan for a year. The reports about how advanced the Japanese mobile phone situation are a bit overblown. The most popular service was still i-Mode, which is old, proprietary and severely limited. It is kind of like if "Prodigy" ran on mobile phones. According to wikipedia: Even i-mode's creator, Takeshi Natsuno, has stated "I believe the iPhone is closer to the mobile phone of the future, compared with the latest Japanese mobile phones."

i_am_neuron 18y ago

Well, this sounds like a typical POV of the person who never used mobile internet device (iPhone, for example, performs best in this role). Of course, screen is small, but there are a lot of UI specialists dealing with this and a bunch of developers ready to port their applications to mobile devices (have you seen Facebook client for iPhone?). I would not replace my IDE running on the PC with its mobile version, but geez, apart from that what else are you doing on your PC? Exploring Flickr? Updating Facebook status? Shopping on Amazon? Reading blogs? We could do all of that mobile, even now. Mobile phone with internet access could potentially become a source of not less important revenue stream for anybody offering anything on the internet. Simple example: mobile operator (owning the identity and bank account info of the phone owner) could act as identity provider for online micropayments and charge them to the subscriber's mobile account. I could go to my friend's, see an interesting CD, scan its barcode with phone's camera, be redirected to Amazon immediately and pay without entering credit card details, using my mobile phone account -- all in couple of clicks, on one device. I would not bet on mobile growth, I would bet on mobile shift. 4 times 2 minutes spent with surfing the web on iPhone on the go could be oh so much more rewarding (in terms of revenue attracted) for any internet service I am using, than 8 full hours in front of PC.

mattmaroon 18y ago
Yeah, it would sound like that unless you actually read the article, in which I mention that I've been using mobile devices for 5 years.

biohacker42 18y ago

I agree with a lot of that, Matt put into words a lot stuff in my head that I couldn't. But I don't think the point about payment is true. People in Europe already buy all kinds of crap with their phones. Everything just shows up on your phone bill, no credit cards to fuss around with.

maxklein 18y ago
No they don't.
- biohacker42 18y ago
  Indeed, in Japan and in Finland people already buy goods via their phones. From here: http://www.pcworld.com/article/122590/use_your_cell_phone_instead_of_your_credit_card.html http://www.pcworld.com/article/122590/use_your_cell_phone_in... I would have found better references if I had more time and google didn't keep returning results for vending machines which dispense cell phones, instead of allowing you to pay via cell phone.
  - mattmaroon 18y ago
    I've read about that too, and it is pretty neat. I could totally see phones extending small credit lines (and maybe larger ones to customers with better credit scores) to be used that way. It will still never match the efficiency of our credit card industry though, just due to sheer numbers.
mattmaroon 18y ago
That works largely because service is prepaid there right? Otherwise the phone companies are essentially acting as credit providers. Which I could totally see happening here, but having 3 or 4 phone company lenders would be nowhere near as good as having the thousands of banks that combine to make credit card products for people of all FICO scores.

jfarmer 18y ago

His assumption is that the only mobile growth that matters is smartphone growth, but that's not true. You can build lots of valuable stuff using just SMS.

mattmaroon 18y ago
Such as? Google already has SMS products, and everyone already has SMS, yet it's a negligible source of revenue for them.

TrevorJ 18y ago

Given the subsidized upgrade paths that most mobile providers give you, the half life for a mobile device is less than for a desktop. The experience gets better with each generation of new hardware. The killer app of mobile devices is that you DON'T have to be next to a PC. People are willing to trade a heck of a lot of functionality in order to not be chained to a desk. With apps living more and more in the cloud, the value of having connectivity anywhere will only increase.

kingkongrevenge 18y ago
> People are willing to trade a heck of a lot of functionality in order to not be chained to a desk. I'm not sure that's really true. People in the west spend time at home and at work. Millions of people are probably not yearning to surf the web in strange places outside of their daily routine.
mattmaroon 18y ago
The experience doesn't get that much better. I've been using it for 5 years. Data speeds have greatly improved, especially with EVDO Rev A. Keypads today are barely better than the Treo 650's. Apple's made some definite strides in making the touch screen usable (far beyond the old Palms) but it's still vastly inferior to a 19" LCD and a mouse, and improvements will now come incrementally.

johnrob 18y ago

When a phone comes with an internet connection and a fully capable browser, it's not really a 'phone' anymore. It's just a small computer. Looking at it another way, if a phone has a capable browser, then you really don't have to do any extra work to support it - just build a web app as you normally would. Every site on the internet becomes a "mobile site". There's no reason the leading internet sites won't also dominate these new pocket computers as well. The only reason that wouldn't be the case is if they had to build some a new product in order to capture the market - which by definition is not the case.

mattmaroon 18y ago
Obviously you've never tried to surf normal web sites on a phone. It's an experience that I imagine to be about as fun as giving yourself a tracheotomy.
- axod 18y ago
  You serious? I'm pretty happy using Safari, zooming, etc Sure, it's a small screen and you might have to pan around a while, but it's certainly usable. And as the parent pointed to, I very rarely use mine as a phone. It's a portable internet device.
  - mattmaroon 18y ago
    Most people use their mobile primarily as a phone or email device. Most people will always prioritize those functions above web surfing because they will prefer web surfing on a PC and are usually near one. And why would you want to deal with all of the zooming when you can just have a monitor? I mean, it's great when you're on the road, which is maybe what, 5-10% of your waking hours for the average Joe, but at home?
    - axod 18y ago
      I don't buy that at all. What about people stuck on a train? What are you going to do? Surf the web on your iphone. What about if you're waiting in a dentist? You're going to whip it out of your pocket, and surf. Yes, compared to time spent at a PC, this is a small amount of time. But I'd bet the usage on the iPhone is the browser, then email, then phone/sms (With games+music in there somewhere). I don't even think young people use their phones as phones (voice calls) very often now (UK anyway). It's all sms. Of course it won't replace the laptop, but it replaces a lot. It's much easier to wake up, pick up the iPhone and check a few sites, than get on your laptop. I agree about the zooming to a point, obviously if there was a hologram projector or something, it'd be great. But the scroll/zoom works for now.

maxklein 18y ago

Of course people prefer to type stuff in a big screen instead of a small screen. In that respect, big screens will continue to dominate, but what we will see is that the screen of phones will become big. You dock your iphone, it becomes your laptop. Apple is working on this, I heard.

mattmaroon 18y ago
Then is that really mobile growth? I mean, it might replace a PC, but that's not growth, it's just switching from one device to another. The iPhone has a long way to go there. It can barely even run flash on that potato chip of a processor.
- Herring 18y ago
  regardless, it's probably the future. All you need is a few more years of Moore's law plus a screen like this http://images.google.com/images?q=plastic+logic http://images.google.com/images?q=plastic+logic I don't know why phone companies aren't scrambling. With skype & wireless almost done, all the pieces are here, if not in place.
- maxklein 18y ago
  Oh processors will be fine. The problem is in heating and batteries, and that is almost there. I am at a certain prominent laboratory often, and I have seen what is happening in that area. Mobile is changing. It's absolutely not about small screens anymore, it's now about a generic app running OS, and the screen is just a display format of the app. Apple didn't see this coming when they released the iphone, but google has seen it, and now apple has also got the message. The phone has become the computer, the question is just who is going to create the first full screen scalable phone that interfaces with a standard keyboard. Your perspective is wrong, because you are looking at what was, and what is, instead of what will be.
  - mattmaroon 18y ago
    Well, I see the rampant complaints about the iPhone 3G's battery life, and the relatively slow improvement in batteries overall. It's going to take a tremendous leap for a phone to match my laptop's dual core processor, and have a graphics card that can power an external display, while getting battery life that's tolerable to most people. You really think it's almost there? I'm definitely not privy to any research labs, but I've seen nothing in the past, or in current literature, to make me optimistic about that big of a leap. Laptops still lag significantly behind desktops in general, especially at the same price point. Why should phones not lag even further? Also, even if what you say is true, and they swap laptops for phones, that's not growth, it's just a shift. If they still use the phone primarily docked, where they would previously have used a PC, and only 10% of the time mobile, then it's only 10% growth from Google's perspective.

iloveyouocean 18y ago

Scenario: Google comes out with killer mobile apps, including some location aware, flow/stream, whatever stuff that leverages all the info. and advertising, etc. that Google has, plus new mobile centered advertisers (Businesses that are not traditionally searched for). Its so good that none of the carriers can duplicate it. These applications drive carrier revenue by encouraging data usage, mobile payment usage(in a future form), 'location usage', etc. Google realizes people are not clicking on ads (as much as when 'browsing' on a PC). So they do two things, charge the carriers to offer their services(take a share of mobile payments they generate, data usage, etc.) and charge businesses to get their ads in front of people on mobiles, perhaps on a non CPM basis. Is this 'growth'? Yes. Its very possible people will 'search' (to use the term very loosely) for different things from their mobile than they do on the web. Fast food coupons, vs. straight info. And its also very possible that 'searching' wont be typing into a search-box, but instead some type of flow based suggestion mechanism.

mattmaroon 18y ago
You have a very high buzzword per paragraph ratio going there. If we were playing buzzword bingo, you'd win.