Apple's IPad Getting Enterprise Traction

Despite its launch as a consumer device, the iPad, like the iPhone before it, is getting workplace adoption. That doesn't mean Apple is especially anxious to create enterprise products, but simply that the same attributes that appeal to consumers also appeal to business users.

Research in Motion and Microsoft are the two companies which have to worry about such trends, since those two companies tend to dominate corporate demand for smartphones and PCs.

Apple's IPad Wins Corporate Converts at Wells Fargo, SAP - Bloomberg

Easy to Use Web Browser Impact

By now it is abundantly clear that smartphones with easy-to-use browsers encourage people to use the web when mobile.

To the extent that Symbian and Research in Motion devices have been harder to use, their web usage shows the impact of the barrier, while Apple and Android devices indicate what happens when the barrier is removed.

Some will say this poses a potential problem for mobile service providers. But there is one problem worse than dramatically increased data demand: insufficient demand.

Phone.com Mobile Office for Android Devices

Android Seems Built for the "Cloud"

One thing is clear with the release of Android version 2.2: Google seems to be much better positioned for a "cloud-based" approach to features.

The new Android version has a “cloud-to-device” feature that Apple doesn't seem able to match, at least for the moment.

If a user buys an app from the Android Marketplace using a PC web browser, he or she can select an Android device, and the item you just purchased will be pushed directly to that device over the air.

If a user is working in browser, then wants to leave and resume on the Android, that can be done. It is possible, using version 2.2, to push the the current URL from the PC web browser to the Android, over the air. If it’s a web page, it’ll open in the Android web browser; if it’s a Google Maps URL, it’ll open in the Android Maps app.

To the extent that mobiles do have a shot at "replacing PCs" in many cases, such cloud-based features likely will be important.

Daring Fireball: Post-I/O Thoughts

Apple Calls the Tune, Again

Apple might not yet have remade the notebook or netbook business, and might not have conclusively proved there is an undiscovered new consumer electronics niche for tablet devices, but it has caused Microsoft to kill its existing slate project, known as "Courier."

Microsoft’s Courier originally was conceived as the tablet of the future, Microsoft’s answer to Apple’s iPad, with two screens. Apple might disagree that the iPad is a "big iPod Touch," but Microsoft apparently has concluded that a two-screen device with a book style form factor is not what the market will want.

Perhaps the bigger deal, perhaps obvious in retrospect, is that although the device would have been "touch" capable, it somehow fails to offer an experience similar to the iPad. Make that one more case of Apple disrupting the conventional wisdom about user experience and user interface. And it apparently hopes to do the same in the mobile advertising businesss.

Apple never likes to play at the low end of any business, so we should not be surprised to see Apple taking that tack as it attempts to show what its iAd network can do on devices such as the iPad, iPhone and iPod Touch.

Apple also is famously "controlling" about the "user experience," so you should not be surprised to hear that Apple is making "initial demands for greater control over advertisers' marketing campaigns."

According to the Wall Street Journal, Apple is looking for placements priced about an order of magnitude (10 times) higher than is typical.

If you recall the demo Apple put together for its iAd announcment, you can understand why: Apple is aiming for content-rich campaigns that may involve branded characters and expensive production.

Apple Inc. aims to charge close to $1 million for ads on its mobile devices this year and perhaps even more--as much as $10 million--to be among the first participants.

Ad executives say they are used to paying between $100,000 and $200,000 for similar mobile deals.

Obviously, Apple is attempting to pull off a couple "hero" campaigns that likely cannot be replicated too widely in the future because most campaigns will not be able to afford the high rates.

One example Apple has been showing advertisers is an ad for Nike's Air Jordan basketball shoe.

When a user is in an application, an animated banner ad appears on the border of the screen, along with an iAd logo. If the user taps on the ad, it expands across the screen, displaying a video, an interactive store locator and exclusive offers at local stores, among other features.

Apple is planning to charge advertisers a penny each time a consumer sees a banner ad, ad executives say. When a user taps on the banner and the ad pops up, Apple will charge $2. Under large ad buys, such as the $1 million package, costs would rack up to reach $1 million with the various views and taps.

Marketers will be able to target ads to groups of users based on consumers' download preferences from its iTunes store, according to ad executives. For instance, a marketer could choose to show its ads to people who have downloaded financial applications or reggaeton music, horror movies or comedy TV shows.

Marketers also will be able to target ads to users in a general location like a city, although they cannot target ads to individual consumers or access personal details.

Apple is seeking high quality ads from big-name marketers for the launch, ad executives say. The ads will go through an approval process, and Apple will build the ads itself during the first couple of months to make sure they work well and attain a certain aesthetic and functionality, ad executives say. Eventually, Apple plans to create a developer kit so that agencies will be able to design and create the ads themselves.

The process is causing tension among some ad directors, who are hesitant to give up control. Welcome to Apple's world.

eBay Expects $1.5 Billion in 2010 Merchandise Sales Using Mobile Apps

Online retailer eBay is launching two iPhone apps, one for the eBay.com global marketplace and one for eBay’s new classifieds site, eBayClassifieds.com, part of its plan to sell $1.5 billion worth of merchandise directly from mobile sites.

With the new eBay Selling and eBay Classifieds mobile apps, consumers can easily photograph and list an item in 60 seconds or less, eBay says. Consumers can now list for free in eBay’s auction format, reaching 90 million active eBay users around the world, or in eBay Classifieds, to reach buyers in their local communities.

Plus, in addition to selling, buying has never been easier with eBay’s leading mobile shopping app and mobile platform and the new eBay Classifieds mobile app.

On April 3, eBay will take mobile commerce a step further, with a new version of the eBay app for iPad. The company earlier had released a mobile app for Android devices as well.

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Nexus One Outsells iPhone in February...Sort of

Sales of the Google Nexus One are now on the rise and beat the iPhone by 16 percent in February 2010, says RCS Limited, which expects the trend to continue. That data, based on U.K. results, contrasts with sales in the United States, where initial sales have been modest.

It isn't clear that the statistic means a whole heck of a lot, though. Sales practices are quite different in the U.S. market, compared to others where devices often are bought "unlocked" and at full retail prices. Since most U.S. iPhones are bought at subsidized prices, while many to most Nexus One devices are bought at full retail price, the sales comparisons are difficult. Any expensive device sold primarily "unlocked and at full retail" is going to have low sales volume in the U.S. mobile market.

Also, the Nexus One has been viewed by many as a "demonstration" project whose real objective is to show what can be done when Android open-source software and hardware are tightly integrated.

According to a report by Flurry, Google sold roughly 135,000 of its new Nexus One phones in its first 74 days on the market. By contrast, Apple sold 1 million of the original iPhones in the first 74 days, while Motorola sold 1.05 million Droid phones -- which are based on Google's Android software -- during the same timeframe.

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RIM, Apple, Google Grow in Smartphones, Microsoft and Palm Drop

Over the last three months, Research in Motion, Apple and Google have gained smartphone market share, while Microsoft and Palm have lost share, comScore says.

42.7 million people in the U.S. owned smartphones in an average month during the November 2009 to January 2010 period, up 18 percent from the August through October period.

RIM was the leading mobile smartphone platform in the U.S. with 43percent share of U.S. smartphone subscribers, rising 1.7 percentage points versus three months earlier. Apple ranked second with 25.1 percent share (up 0.3 percentage points), followed by Microsoft at 15.7 percent, Google at 7.1 percent (up 4.3 percentage points), and Palm at 5.7 percent.

Google’s Android platform continues to see rapid gains in market share.

In an average month during the November through January 2010 time period, 63.5 percent of U.S. mobile subscribers used text messaging on their mobile device, up 1.5 percentage points versus three months prior.
Browsers were used by 28.6 percent of U.S. mobile subscribers (up 1.8 percentage points), while subscribers who played games made up 21.7 percent (up 0.4 percentage points). Access of social networking sites or blogs experienced strong gains in the past three months, growing 3.3 percentage points to 17.1 percent of mobile subscribers.

Social networking now is more popular than listening ot music, at least where it comes to mobile device activities.

Enterprise Workers Ready to Ditch Their PCs for Smartphones?

Something rather unusual seems to be happening in the enterprise mobility space. According to a recent survey taken by iPass, 63 percent of mobile employees prefer to use a smartphone, not a laptop, as their primary mobile device, for trips of any length.

For trips of up to five days, 59 percent of respondents prefer to carry a smartphone, while 41 percent prefer a laptop. For trips lasting longer than 30 days, 64 percent prefer a smartphone to a laptop.

That likely is testament to the high value traveling workers place on voice and text communications, as well as the increased capabilities smartphones now offer, including email and Web access.

But the findings also suggest that some enterprises are over-investing in laptops and software and might need to look at scenarios where mobile or traveling workers can get along just fine with smartphones.

There is another and possibly darker view here as well. Industry suppliers have been touting mobility investments as a driver of productivity. As it now appears, enterprise workers do not even want to carry laptops with them when traveling. So what is the value of all those investments in remote access?

Granted, most enterprises likely are trying to get a better handle on mobile phone expenses, so indiscriminate replacment might not be wise. But the survey also suggests the near-universal embrace of the BlackBerry has "soft" support from users.

According to the iPass survey, while 32 percent of mobile employees ranked the BlackBerry smartphone as their mobile device of choice, 54 percent of BlackBerry smartphone users would switch to an Apple iPhone if it was supported by their enterprise.

"Mobility" also once was an issue of supporting traveling workers. Today every employee
is a potential mobile employee, iPass says. While many mobile employees have some business travel, many more are logging in from home.

About 68 percent of iPass survey respondents did not travel during the last quarter of 2009, but  45.8 percent of mobile employees logged in from home at least twice a month, and 16.8 percent logged in more than ten times a month.

Excluding home and the office, mobile employees most often log in from hotels (42.6 percent), airports (27.2 percent), retail outlets and restaurants (27 percent).

According to the iPass survey, while 32 percent of mobile employees ranked the BlackBerry smartphone as their mobile device of choice, 54 percent of BlackBerry smartphone users would switch to an Apple iPhone if it was supported by their enterprise.

Apple Plans "Big, Bold" Steps, Says Jobs

Apple Inc. CEO Steve Jobs says Apple is holding onto $25 billion in cash to take “big, bold” risks. That should be an immediate concern for any company that competes with Apple or thinks it might have to compete with Apple.

Whatever else might be said, Apple already has reinvented itself. Apple used to be thought of as a "computer manufacturer." These days, sales of Macintosh computers probably represent about 18 percent of the company's equity value. The iPod, which not so long ago was the rising company star, now represents about three percent of the company's value.

Even the new iPad, which has just launched, represents four percent of the company's value.

These days, Apple has suddenly, dramatically, become a "mobile handset" company. Sales of the iPhone now represent about 52 percent of the company's equity value.

The iTunes and iPhone App Store represent about 5.6 percent of company equity value.

So what about Apple's purchase of Quattro, a company providing mobile advertising for Apple, Android and other smartphone devices?

Apple probably is less interested in profiting from ads than in making the iPhone the most attractive device for developers to build applications. And money might have a lot to do with that. Right now, eighty to ninely percent of app store downloads are of "free" apps. That isn't such a great business model for a software developer.

Eighty percent of the three billion downloads from Apple’s App Store are free, for example. By offering a way to sell ads, Apple can help entice developers who will have another way to make money, other than selling software.

Apple executives said recently during their quarterly earnings call that the firm had no idea whether mobile advertising would develop as an actual revenue stream for Apple or whether it would simply help reinforce its App Store operations.

"I honestly don’t know," says Peter Oppenheimer Apple CFO. "We will have to see."

App Stores Very Valuable for Handset Suppliers and Users; Maybe Not Developers

App stores have been a huge boost to smartphone perceived value. What they haven't yet proven is that they are an effective way for software developers to sell applications.

About 80 percent to 90 percent of app downloads are of the "free" rather than "paid" variety, according to AdMob.

Google Nexus One: Buy the Rumor, Sell the News

"Buy the rumor, sell the news," traders sometimes say. That seems to apply to Google's announcement of the HTC-built "Nexus One" smartphone.

There was so much leaking of news about the device, its distribution model and retail pricing that some of us likely were underwhelmed by the actual launch.

That is no slam on the device, just a comment about expectations.

As sometimes happens with financial assets, sometimes the big run-up occurs only at the "rumor" stage, with the actual confirmed event then provoking a bit of a sell-off. Some of us might note that it has taken a year for Android devices as a whole to reach what appears to be an inflection point in terms of mass buyer interest.

One probably has to credit Verizon Wireless for almost single-handedly creating "buzz" around its Droid, with spillover effects on the rest of the Android market, in all likelihood. But as many have noted, though the Nexus One appears to be a fine device, the business "wrap around" is largely conventional.

In fact, in some ways, Google is being "carrier friendly" in a way Apple has not been. That likely comes as quite a shock to many who thought Google was angling for a bit more disruption. The phone can be bought at full retail and unlocked. That's fine, but few Americans buy their devices that way.

An unlocked device can in principle be used on any GSM network in the United States, but the frequency range specified for the Nexus One means that, if used on the AT&T network, 3G won't work. In practice, that means the Nexus One is a "T-Mobile USA only" device.

If bought with a two-year contract from T-Mobile, the device costs $179. Some people will note that the Nexus One is "first" device that actually can go "head to head" with the iPhone. Others might almost say, "so what?" If all any other competing device can do is replicate the iPhone, many users might simply buy the iPhone.

Progress in the Android handset space continues to be quite rapid, so we'll have to wait and see what happens next. But it would not be surprising if it takes a little time for the Nexus One to have an impact. If the massive Verizon advertising campaign for the Droid means anything, it means promotion and marketing can make all the difference, even for a highly-capable device such as the Nexus One.

As the launch hype fades, we likely will settle in for a year or more of what appears only to be incremental growth for the Nexus One. So far, some of us cannot yet see why the Nexus One is such an advance over the Droid, as some expected. Then again, that's what this next year or so is about: allowing consumers to become familiar with the device and figure out where it fits in the smartphone market.

One might simply argue that the Nexus One is not the iPhone, and neither is the Verizon Droid, meant in a market positioning sense. The Apple iPhone seems to have created a large and sustainable niche of its own. Other devices might emulate the iPhone, but cannot create their own sustainable niches unless they somehow create differentiated audiences, as we might say in the media business.

In other words, Nexus One has to create a fan base that uses and perceives the device to be different from an iPhone, not the same. So will the Droid and all other devices in the high-end smartphone segment of the market. There's only one "iPhone." All other high-end devices must essentially create their own sustainable niches.

Matters are different at the lower end of the device market, where price and functionality make more devices functional substitutes for each other. I don't think that is the case at the high end. We'll see.

Smartphone Niches Emerging

Data from ChangeWave about smartphone preferences might suggest both the existence of clear smartphone segments as well as an evolution of those segments.

By definition, all smartphones handle voice and text. Beyond that, there seem to be distinct user niches.

One might characterize the Palm user as someone whose unique application is the "organizer."

One might characterize the BlackBerry user as oriented to email, and the iPhone owner as oriented to Web-delivered applications.

Looked at this way, the Changewave data might suggest that the value proposition for the email-focused remains steady, but that the value of "organizer" functions is receding, while mobile Web is growing. We also have seen the introduction recently of devices organized around social networking and navigation, so the number of smartphone niches addressed by particular devices seems to be growing.

The Palm Pre and Motorola Cliq are among new devices pitched at the social networking niche. Garmin's nuvifone is perhaps the best example of a navigation-focused smartphone. So the obvious big question is how the growing raft of Android-based smartphones will contribute to the proliferation of devices with a lead application mode.

How demand for the Droid will shape up is hard to say at the moment. Some fragmentary data suggests that Droid users access the Web even more than iPhone users do. But its turn-by-turn navigation features might also emerge as a key drawing point.

Pingo Launches Smartphone-Based Global Calling Service

Pingo, the prepaid international calling service from iBasis, now has released a smartphone application enabling simple international calling from a wide variety of smartphones, including the iPhone, Blackberry, Treo and phones using operating systems such as Nokia Symbian, Windows Mobile and Google Android.

"Pingo EZ Dial" automatically syncs with the mobile's address book, so dialing happens the way it always does, but the Pingo client recognizes that an international number is being called and routes the call using the Pingo network.

EZ Dial users don’t dial access numbers, PIN codes or change their calling behavior in any way and does not require users to connect to Wi-Fi. Users will consume domestic or local airtime minutes of use, but incur no global calling charges from their mobile provider.

Users go to the Pingo Web site (http://www.pingo.com) to sign up for a prepaid account. Users of iPhone devices can download the client for free from the Applie App Store. Users of other phones simply enter a phone number and Pingo sends out a text message with a hot link that initiates the over-the-air client download.

Pingo thinks the move is important since more calls are being initiated from mobile handsets these days, so more global calling also is being initiated from handsets.

Users with feature phones can get the same low rates, but will have to dial a local access number, since those phones cannot download the EZ Dial client.

All of that will change as Long Term Evolution or WiMAX networks become more ubiquitous, since all devices operating on those networks will be data devices able to download clients.

In many ways, the Pingo mobile calling capability is a reflection of the broader shift to mobile-originated and terminated calling. Pingo long has been a huge supplier of white label wholesale services to other retail providers, and most of those providers were wired network providers.

Since the U.S. market is by far one of the largest global markets in the world, mobile support is important for any company that makes a living from international voice traffic. Also, mobile origination is more important in the U.S. market, since the ratio of origination to termiantion is about three to one outbound compared to inbound, says Jayesh Patel, iBasis VP. "Most countries don't have that sort of  imbalance."

Recently, iBasis has noted more use of its calling plans by business users as well, so EZ Dial is offered in a business account version that allows easier administrative setup and call tracking.

Smartphones are Changing the Wi-Fi Hotspot Business

Smartphones are changing the nature of the hotspot business, it now appears. Originally envisioned as a way to provide "outside the home" and "outside the office" connections for laptop and notebook PC users, hotspots now are becoming important sources of broadband connections for smartphones.

One example: iPass, which used to focus on managing PC authentication processes for traveling enterprise workers, now finds it is focusing more attention on managing authentication processes for enterprise smartphones, says Rick Bilodeau iPass VP.

"Smartphones are the new thing," he says. "Now it is smartphones and Blackberries." The software is available for BlackBerry, Symbian and iPhone at the moment, and iPass is watching the Android, though it hasn't seen enterprise demand for that device yet.

As a firm that manages broadband access for hundreds of Fortune 2000 companies, iPass has to manage connections created on hundreds of global networks, but now scores of smartphone devices as well.

To make that process easier, it created an "Open Device Framework," a standardized interface to iPass client software that allows enterprises to write their own XML scripts for the specific dongles, phones and other devices they want to support.

The company also now preconfigures Mi-Fi routers, loading SSID information directly into the boxes before they are delivered to their users, for example. The iPass log-on software also can be preloaded. "We're first to do this, we think," says Bilodeau.

ODF is available now and the Mi-Fi featuers will be available in December 2009, he says.

Enterprise iPhone? Just talk to RIM Servers

Though there are other issues, Apple would get far down the road as an enterprise device if it did just one thing: ensure compatibility with Blackberry servers.

Though Microsoft Mobile is growing its share, BlackBerry is the device to beat. Apple will keep getting heat for its lack of security as well.

But the main thing is the ability of a user to get company email on an iPhone, not just on a Blackberry.

Enterprise iPhone

Enterprise iPhone users now have a specific set of plans and a financial inducement to sign up for a minimum two-year enterprise iPhone plan. The inducement is a $25 a month discount through December 2008 for new accounts. Users can sign up for the typical voice plans, and then pay a new enterprise data fee. At least that appears to be the case. The Web site isn't crystal clear about the matter.

The enterprise data plans include visual voice mail, unlimited data with both email and Web inside the United States, plus a bucket of text messages.

Data plans range from $45 to $65 a month. For users requiring data access outside the United States, at&t also offers data global roaming plans costing $24.99 a month with 20 megabytes of global data access, and a $59.99 a month plan offering 50 Mbytes of data access in 29 countries outside the United States.

It will be interesting to see how user perception of the value of a smart phone changes over time. Up to this point, the Web browser, though seen as useful, as been of the "nice to have" rather than "must have" feature, as this survey data from InfoTech suggests. So far, though, Web browser use and mobile searches by iPhone users have been significantly higher than is the case for a typical smart phone user.

As the developing trend of use of Web-enabled enterprise software continues to grow, the browser obviously will assume new importance.

Thailand, SE Asia iPhone Deal?

It doesn't appear to be a done deal. In fact, it might be premature to say the deal will get done, but Thailand’s Advanced Info Services is collaborating with shareholder Singapore Telecom and Australia’s Optus to win the right to bring Apple’s iPhone to Thailand and the southeast Asia-Pacific region.

AIS Chief Marketing Officer Sanchai Thiewprasertkul says " up to 60,000 iPhones have been smuggled into Thailand so far," according to TeleGeography.

China Mobile Says "No" to iPhone

China Mobile has decided it doesn't want to carry the iPhone, and has stopped negotiations with Apple, opening the door to talks with the second-largest mobile provider in China, China Unicom.

It is sais that China Mobile and Apple could not agree on revenue-sharing terms. An unnamed China Mobile source was said by Dow Jones Newswire to be unwilling to pay between 20 and 30 percent of future user fees from the iPhone to Apple for the right to carry the device.

Motorola Launches Mobile Video Device

Motorola has developed a stand-alone media player, the DH01 device that works with the DVB-H mobile video standard and also plays on-demand video clips and programs saved on digital video recorders. Motorola, Nokia, Samsung Electronics and LG Electronics already make phones that can receive live TV streams. What is different here is that Motorola wants to gauge demand for a stand-alone video device.

At some point, the user desire for simplicity will outweigh the desire for multiple functions in a single device, even as designers work to simplify inherently-complex devices so they will support multiple applications.

Up to a point users seem to enjoy having multiple functions in one device. Email and text plus voice is one example, while voice plus text plus music provides another example. What is less clear is what happens when users are offered devices that add Web services, enabled by Wi-Fi as well as mobile broadband, as well as video. At some point, the cost of a "do everything" device starts to get pretty high, while the functionality has to be balanced, possibly decreasing user satisfaction as a multi-function device will tend to perform less elegantly than a purpose-built device.

The issue is that the range of applications people want to access is growing all the time: gaming, navigation, video, audio, radio frequency identification and sensor network access. At some point, the complexity overwhelms the user experience, which has to be kept as simple as possible.

The other issue is how much tolerance end users exhibit for higher device prices when those devices break, get lost and wear out fairly frequently. It might be one thing to expect replacement or loss of a $100 device. It might be quite another to risk the loss and replacement of a $700 device. With volume and time, the issue arguably becomes less pointed, as features found in $700 devices migrate down the product lline.

Still, some point likely will be reached where users simply find "do it all" devices less desirable than carrying a couple devices that are highly optimized for the applications those people want to use most.