The global shipment of Smartphone grown QoQ by high single digit in just concluded Q2, 2013. The major thrust came from Android powered devices and spearheaded by Samsung 75 Mn plus Smartphone device shipment. Apple tried to maintain their market share but lost bit of ground due to absence of any device launch. Window Mobile gained bit of traction mainly with the rise of Nokia Lumia volume. Nokia Lumia volume increased more than 20% with the introduction mid range Lumia Smartphone to attract consumers in emerging countries. The phasing out of Symbian OS based Smartphone volume went down below 1 Mn mark in recently concluded quarter and impacted dearly to Nokia Smartphone market share. For the last six quarter, Nokia total and Smartphone market share is going down but many few recognized another rising jewel from Nokia. In Q2, 2013, Nokia shipped 4.3 Mn fully touch screen Asha Smartphone which is gaining good traction in emerging and third world countries. Nokia launched new lower priced range of Asha Smartphone at the end of quarter and volume is not reflected in the numbers. If Nokia manages to devices quickly to market place then one should not be surprised that during Q3, 2013, Asha platform attached Smartphone volume may surpass WM attached Lumia Smart devices. The constant negative new flows around Nokia ofcourse impacted its product positioning but one successful quarter with solid volume may change the perception of consumer.
E2E Applications
Indian Telecom Incumbent Players Defining Industry Trend – Pain for Challenger’s
The recent financial results from telecom service providers indicating early sign of recovery and also indicating future trend of sector. Post going through horrible four years of tariff war, license cancellation, ICR issue telecom sector was termed as kneel down sector by many analysts. On a contrary to the same, Industry incumbent players such as Bharti Airtel, Vodafone, Idea and RCOM took this period as an opportunity to realign their business model to reduce cost and at the same time started putting effort to shift the revenue dependency from voice to data. The recent results from top four players indicate that all of them managed to improve ARPU for both voice and data. Bharti Airtel ARPU is still the best and running at 200 INR whereas Vodafone and Idea is 192 and 174 respectively. On the ARPM, Idea and Reliance communications performed well whereas Bharti Airtel and Vodafone is in the process of realignment of free minutes. It is expected that Bharti Airtel or Vodafone may choose to raise voice tariff rates to improve on ARPM. In the data segment, Bharti Airtel ARPU is around $1 ( 60 INR plus) whereas the other players are more or less on the same level. The persistent concern area of Incumbent players are Mobile VAS and it is expected that they may observe another cycle of revenue fall from that business unit post stringent MVAS regulation amendment and implementation of consent gateway. With repositioned product, delivery and roadmap by Incumbent player, it would not be harsh to say that Challengers Mobile Service Providers would face uphill task to maintain their subscriber base even with free bees. Post the license cancellation, re-auction and limited geographical presence may play spoiler of challenger. It would be interesting to observe, how and when incumbent player launches subscriber sniffing services or products or plan to attract subscriber from Challenger service providers. In my point of view, Indian Telecom sector would again lead the growth trajectory of India very similar to 1990’s post liberalization.
Indian Regulatory Moves – Impact Analysis
In the last few years, different ministry based regulatory bodies in India are coming out with new or upgraded regulatory compliance requirements. Post series of hacking of government and non-government critical infrastructure, regulatory bodies seems firmed up to plug all way a rounds in order to reduce or mitigate security threats to critical and non critical installation. The recent cyber security policies, security compliance for OEM’s, Service Provider's -Telco’s, ISP’s, Social Networking; received with mixed reactions. Now, the new proposed regulation to include device or connected devices, apps and platforms under the net is going to change the whole dynamics of the ICT industries. Any additional regulatory compliance would impact other industries with change management and in-turn additional Capex and Opex. The flurry of regulatory guidelines is good for industries but it may act as disruptive move also. The device security certification by government authorized centre is going to delay the product launch by device players and at the same time would increase the cost of product dramatically. Currently, regulators are still struggling to appoint government authorized security compliance center in order to enable the device player to get the certifications. In that scenario, enforcement of regulation from 1st Oct 2013, seems overly optimistic scenario. Then comes the cyber security policies guideline and it contain hundred’s of new proposed mechanism as well as offer little visibilities for ecosystem players. In a world of convergence, when device or OEM’s or SP or ISP goes for security certifications the same certification centre must correlate the multiple security regulations in order to create the scenario’s to execute detailed testing instead of expecting the ecosystem player plunge into time taking process of going to multiple regulatory bodies for the same. In my point of view, regulatory bodies may take an option of working seamlessly internally and coming out with one consolidated guideline for the ecosystem for the certification process and also tag the time bound commitment from regulatory bodies to complete the certification clearance. It is observed the OEM’s are put in queue to get the clearance and it impacts their product delivery to end customer and subsequently delays the complete ecosystem cycle. I believe that good initiative would be made more seamless in near future.
Chinese Device Manufacturer Support is Must for Any Mobile OS Higher Adoption
According to reports from IDC, Canalys; The Q2, 2013 global Smartphone shipment witnessed 9.3% QoQ growth and reached 236.4 Mn. It represents whopping 51.3% YoY growth. The higher adoption of Smartphone devices truly offer indirect strength of Chinese manufacturing dynamics in rolling out cheap Smartphone while matching global powerhouse on Product feature side. According to Canalys, Chinese local player contributed 20% of the total Smartphone shipment are ignored by the print media and focus was on Samsung and Apple around their market share gain and loss. In my point of view, these local turned global Smartphone players are helping Android Mobile OS market share gain. As China offer great opportunity for global players to increase their volume but given the competitive product positioning of local Smartphone, it would be interesting to observe moves by other mobile OS such as BB10 and WM. Both WM and BB is reeling under tremendous pressure to increase their make share but only managed sub 5% market share slab. It is evident that the shift of Chinese device manufacturing hub support may make or break any mobile os adoption given their huge market size.
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