T-Mobile USA Targets Lower End of Smartphone Market

T-Mobile USA appears to be planning an aggressive targeting of lower-cost smartphones as a way of securing its customer base.

Chief Executive Philipp Humm said many of his smartphones will eventually be made up of Google-powered phones costing less than $100, half as much as the smartphones typically available at U.S. carriers. In October, to lower the cost of monthly bills, Mr. Humm introduced a limited data plan that costs $10.

With Verizon and AT&T staking out the high-end device segment, and T-Mobile USA the lower end, Sprint has to figure out where it wants to play.

T-Mobile Smartphones to Head Down Market - WSJ.com (subscription required)

Dave Michels responds:

Gary, 

This doesn't make any sense to me. Networks are like roads (not cars) and staking our "high" or "low" end doesn't work. Even expensive toll roads have junkers. 

T-mobile is clearly accommodating the low end with some of their devices (Optimus T) and new data plan, but they also have their "4G" with a large footprint and some very highend phones from HTC and Samsung. 

A good carrier will have good solutions for the high-end, low-end, and business sectors - not one target. 

To truly embrace the low-end, there is much more work to be done. Tmo is still requiring a 2 year contract with data (albeit $10 data) on their entry level smartphones. Two years on a sub $100 device is robbery and the run away success of the Apple Touch shows these smartphones can be very useful (games and other apps that don't require a connection) without a data plan (wifi only). 

I was thinking recently that the carriers are really over complicating things - so this headline caught my attention.' 


--Dave Michels


Good insight, as always. I think the point has to do with customer segmentation, not the actual networks or devices. Most observers would say Verizon Wireless always has tried to occupy the "high end" of the mobile market, while Cricket has tried to dominate the "local voice line substitution" market, for example. Virgin Mobile has targeted the "younger, hipper user." T-Mobile USA in recent years has targeted a younger demographic. 


It is true that the networks, per se, are not highly differentiated. But the customer segments can be. 

Explaining Value of Business IP Telephony in 4 Minutes

Tablets are the New Gaming and Video Platform

Any brand-new consumer electronics category will feature some new lead app, feature and use case. For the iPod it was music, for the iPod Touch it arguably has been games and web apps. For the new category of tablets, it appears games and video consumption actually are emerging as the lead apps, even though tablets continue to be used for some business applications and light consumer computing tasks as well.

Wi-Fi remains the connection of choice. AT&T CEO Randall Stephenson says half a million tablets on the AT&T network had active 3G connections. But something on the order of three million tablets get sold each quarter.

For most consumer products, price remains the single most important factor in consumers’ purchase decisions. But tablets appear to have been somewhat different in the early going, largely because of the early adopter profile of most Apple iPad buyers. 

Price ranks fourth among purchase considerations in one survey by NPD Group. Only 77 percent of potential tablet buyers say price factors very highly in their purchase decision. Click images for a larger view. 

Yankee Group : Research Report

Verizon Could Bring Apple Millions of iPhone Users

Opinions are split on how many iPhone customers Verizon could take away from AT&T. Charles Golvin, an analyst at Forrester Research said he believes initial sales will mostly involve Existing Verizon customers who want to upgrade to the iPhone and Sprint Nextel Corp. and T-Mobile USA customers who weren't willing to switch to AT&T because of its poor network reputation might drive most of Verizon Wireless iPhone sales, some believe.

AT&T also has launched promotions to lock in existing iPhone customers on its network in advance of the Verizon iPhone launch. AT&T recently launched a promotion offering $49 3GS phones as well as easier upgrades to the iPhone 4. Many other iPhone owners are on the carrier's family or business plans, making it trickier to switch.

Many observers predict sales of nine million to 12 million iPhones on the Verizon network in 2011.

Verizon Could Bring Apple Millions of iPhone Users - WSJ.com (subscription required)

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Get Ready for "Twitter Phones"

A year ago, Twitter mobile devices were used to create around 20 percent to 25 percent of tweets , but now this has risen to nearly 40 percent of all tweets, Twitter says. So watch for the company to optimize Twitter use on mobiles even more. That might mean pre-loaded Twitter or even the ability to "Twitter optimize" a device.

CES 2011: Get Ready for Twitter-Embedded Phones

Jajah "Dynamic Buttons" for In-App Communications

Jajah Buttons add communications functionality to any website.

Sprint as Wal-Mart?

“Sprint is at a crossroads,” said Craig Moffett, a New York-based analyst at Sanford C. Bernstein. “Their time-to- market advantage is now largely gone for 4G.”

That's true enough. What isn't so clear is how Sprint's positioning will evolve, now that the 4G platform does not offer such uniqueness.

Some might argue that Sprint will have emphasize its lower cost plans for unlimited wireless data use. "Unlimited," assuming the other carriers do not offer it, will offer some uniqueness.

I suspect Sprint will do more than that. Whether Sprint would agree with the Wal-Mart analogy is not clear. That Sprint would base its strategy on that seems unlikely. We'll see.

Sprint May Become Wal-Mart of Mobile as Rivals Move to `4G' - Bloomberg

Verizon Finally Lands the iPhone

The Apple iPhone is finally coming to Verizon Wireless, and among the big questions are whether the move leads to a significant exodus of customers from AT&T to Verizon Wireless, or not. We have five iPhones in use in the immediate family so I will be anxious to see what happens. It already appears that half the accounts are in no danger of any provider shifts. But three of the devices are used mostly in New York and Los Angeles, and there are significant reliability issues for at least one or two of those accounts, fairly regularly.

If I had to guess, I'd say two of the lines could shift. If that is replicated across the whole iPhone user base, it would be a big deal. I think I'd be surprised if three of five shifted to Verizon. That would be a really big deal.

Verizon Finally Lands the iPhone - WSJ.com (subscription required)

Cloud Computing: Less Adoption Near Term; More Than You Think Long Term

It would be entirely within historical precedents for cloud-based enterprise software to achieve less near-term revenue success than analysts expect, but more success than anticipated long term. That, in fact, is a common experience for truly-important and successful innovations.

RIM Still Has Largest U.S. Smartphone Installed Base

Some 61.5 million people in the United States owned smartphones during the three months ending in November, up 10 percent from the preceding three-month period, as RIM led with 33.5 percent market share of smartphones, according to comScore.

After several months of strong growth, Google Android captured the number-two ranking among smartphone platforms in November with 26 percent of U.S. smartphone subscribers. Apple accounted for 25 percent of smartphone subscribers (up 0.8 percentage points), followed by Microsoft with nine percent and Palm with 3.9 percent.

comScore Reports November 2010 U.S. Mobile Subscriber Market Share

Verizon iPhone Announcement Jan. 11?

Verizon Wireless has scheduled a press conference next Tuesday, Jan. 11, in New York, and the quick consensus is that this is finally when Verizon will announce the Verizon iPhone.

Quickly, people on Twitter are wondering why Steve Jobs would let Verizon announce this, instead of an Apple-hosted event. Simple answer: Because this isn't a new product.

Here's Why Steve Jobs Would Let Verizon Announce The Verizon iPhone

FCC Chairman Predicts 35-Fold Mobile Bandwidth Increase Next 5 Years

The amount of spectrum available for mobile broadband represents about a

threefold increase over where we were a few years ago, says Federal Communications Commission chairman Julius Genachowski. "Sounds good, until you see the forecasts of a 35 times increase in mobile broadband traffic over the next five years."

"And I believe that projection is conservative, not fully accounting for the explosive growth of tablets and what I predict we’ll see from 4G."

http://www.fcc.gov/Daily_Releases/Daily_Business/2011/db0107/DOC-303984A1.pdf

Verizon FiOS TV: IP Migration Enables Multi-Device Consumption

Verizon executive Joe Ambeault says there are some clear multi-device implications for migrating Verizon FiOS TV to IP delivery.

Consumers watching traditional FiOS TV should never see a difference, but by transitioning to IP, Verizon will have an opportunity to deliver its television service to a wide range of web-connected gadgets in the form of an app.

In other words, FiOS TV could become another service a consumer can buy in an app store, accessible across multiple screens and delivery platforms. In theory, consumers could even bring their own broadband to the table (FiOS or otherwise) and just layer FiOS TV on top, some might argue.

What If Verizon FiOS TV Was an App?

Common Mobile App Mistakes Many Brands Make

Some day we probably will look back on the early days of mobile apps and have something of the same sense we did early in the development of the World Wide Web, when companies did things such as posting electronic versions of their brochures online, and basically left it at that.

So what are some common issues that Macroview Labs encounters when engaging with big brands that want to create mobile apps?

Common mistakes include duplicating a web site on the mobile screen. That does not take advantage of the capabilities a mobile has, such as cameras, bar code scanning, accelerometers and GPS, for example.

Companies design for the wrong users, the wrong devices or for use cases where mobile signal coverage is going to be an issue. Brands tend to want to recreate an ad experience, when the key thing is to engage users.

Aron Ezra, MacroView Labs CEO, has quite a lot of experience engaging with, and creating applications for, large organizations and brands ranging from major Las Vegas casinos to NASCAR, Elitch Gardens and the city of Arlington, Texas.

“Artwork is really important,” says Ezra, something you can verify yourself at http://www.macroviewlabs.com/work/sample. “Fresh content also is important, because you have to give people reasons to come back.”

Mobile Marketing and Technology