Annual Smartphone Shipments will Double by 2014

Smartphone shipments will rise 105 percent to 506 million units in 2014 from 246.9 million in 2010, according to researchers at iSuppli Corp. Smartphones have become the fastest-growing segment of the cell phone market with unit shipment growth of 35.5 percent expected in 2010. Overall mobile handsets are expected to grow 11.3 percent.

At the same time,  video-oriented consumer electronics devices equipped with high-bandwidth wireless video interface solutions are surging as well, though from a low base.

Researchers at iSuppli expect the market for video-enabled consumer devices with high-bandwidth wireless video interfaces will grow to more than 85.2 million units by 2014, up from 606,000 units in 2009. By 2014, more than 53 million of these devices will be wireless-video-enabled digital TVs and netbooks or laptops.

LeapFrog Explorer to Take Advantage of App Trend

LeapFrog Enterprises is unveiling a new "Leapster Explorer" touchscreen gaming system that supports downloading of apps using a wired PC connection.

The Leapster Explorer is a multi-faceted device, allowing kids ages four to nine to play games, read e-books, watch 30-minute videos, or download new educational apps.

 It connects to a computer via a universal serial bus cable. The device isells for $69.

Apple’s iPod Touch seems to be the driver, rather than the iPad, as the Touch has become quite popular with tweens, for example, and many parents will not want to pay $500 for an iPad. LeapFrog has half the market share for the educational gadget market in the United States.

The Explorer comes with its own customizable pet, such as a dog, which the child can name and use as a persistent avatar on the device, and which also can be uploaded to the online site LeapWorld.

About 18 Leaplet apps will be ready for the launch.

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TD-LTE Kills WiMAX

TD-LTE will lead to the demise of WiMAX, with device sales peaking by 2015, say researchers at WiseHarbor. WiMAX has made significant commercial progress by occupying the unpaired spectrum that tends to be much cheaper than the paired spectrum used for CDMA-based technologies including EV-DO and HSPA, the firm notes.

But TD-LTE will eclipse WiMAX because it likewise allows the use of unpaired spectrum as well as the paired spectrum already employed commercially by LTE.

Mobile Broadband Devices Forecast to 2020 Predicts Demise of WiMAX With Rise of TD-LTE in Unpaired Spectrum:

Price is Key to Android Tablet Success

The latest Retrevo Pulse study asked over 1,000 people what phone they planned to buy this year and over 20 percent of the respondents indicated an iPhone. If that number holds up it could be another good year for Apple and the iPhone.

But the bigger issue is whether it already is essentially too late for other contestants to prevent Apple from dominating the category as it does MP3 players. So far, Apple, though a top contender, has not reached the level of market share domination in smartphones that it has in MP3 players. But nobody doubts Apple will try. And history suggests all other suppliers have to be worried about the sudden emergence of the tablet category as well.

Are we looking at another Apple dominated product category like the iPod did with MP3 players?

When Retrevo asked consumers what would prevent them from buying an iPad, the most common answer was “don’t need one,” followed by “too expensive.”

As most would have expected, users that already have an Apple PC or iPhone are more likely to think they need an iPad. When it looked at the iPhone owners, Retrevo found only 26 percent of those users thought they didn't “need” an iPad.

The Retrevo study also suggests that the e-book reader market and the tablet PC markets are distinct, to an extent. The company found a significant number (40 percent) of consumers who own or plan to own an e-Reader also plan to buy an iPad in 2010.

When Retrevo asked consumers what would get them to buy an Android-based tablet over an iPad, the number one answer was “price.”

While 53 percent of  respondents said they weren’t interested in buying a tablet at all, of the other 47 percent who wanted one, a little over half (53 percent of those who said they wanted a tablet PC) said they’d buy an Android tablet if it was less expensive than an iPad.

Also, 33 percent said they would buy if the tablet used the Verizon network.

If manufacturers of Android-based tablest want to grab significant share in the market, the poll suggests there is at least one thing they can do: create a device that doesn't cost as much as the iPad.

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17% of Verizon Mobile Subs Would Switch to an iPhone?

AT&T’s iPhone-exclusivity deal hasn’t yet expired; nor has Apple announced plans to sell the device through a second U.S. carrier, despite what seems to be a constant stream of rumors.

But Morgan Stanley equity analyst Katy Huberty has estimated that nearly 17 percent of all Verizon mobile customers would upgrade to an iPhone when given a chance to do so.

“There is substantial pent up iPhone demand within the Verizon installed base as 16.8 percent of Verizon subscribers said they are ‘very likely’ to purchase an iPhone if offered on the Verizon Network,” Huberty says. “This 16.8 percent is higher than AT&T subscriber’s 14.6 percent extreme interest in the current AT&T iPhone and well above the overall iPhone extreme interest of 7.5 percent.”

Assuming Verizon does add the iPhone to its smartphone lineup and that most of its subscribers who said they were “very likely” to purchase the device do so over a two-year period, Huberty estimates Verizon would sell about seven million to eight million iPhones annually, for a couple of years, at least.

Huberty does not appear to be among those who believe existing iPhone customers on AT&T's network would switch over to Verizon. Sure, there will some switchers, but Huberty does not think it will be a sizable number of subscribers.

In markets where the iPhone has gone from single-carrier to multiple-carrier distribution, such as France, the original iPhone carrier that lost exclusivity hasn’t suffered much at all.

Beyond this, there’s the issue of early-termination fees, which will make it difficult for current AT&T iPhone users to flee, says Huberty: Also, since it appears 70 percent of U.S. wireless accounts, as well as about 70 percent of AT&T's accounts, are part of a family plan, it would be even harder to switch, as the entire family account would have to change.

The early termination fees for a five-line account would be substantial, depending on when in the two-year cycle the switch occurred.

Video Snacking, Not Feasting, is One Impact of New AT&T Tariffs

AT&T's latest realignment of its smartphone wireless data plans based on how much bandwidth they use is hard to characterize in a uniform sense. Heavy users won't like it, but the plans reflect more realistically the value they derive from the network.

Lighter users might find they actually can save money by switching plans. Lots of non-users who believe they are likely to be light users will benefit. Moderate users will have to think about whether to keep their unlimited $30 plans or switch to the $25 plan.

The clearest impact will be on new users signing up starting June 7, as the difference between the unlimited plan and the 2-Gbyte plan will mean users will likely wind up snacking on video rather than feasting. That doesn't mean actual behavior even under the old plan would have been much different. Users likely were mostly snacking, to begin with.

It's just that the 2-Gbyte cap will encourage people to watch their video consumption more closely.

And that likely is modestly bad news for the mobile video industry, to the extent that revenues are based on subscriptions or advertising. In the first case it will be harder to sell a recurring subscription service when users are not sure what it will cost to use the service, in terms of bandwidth charges.

In the latter case people will be watching less video, therefore being exposed to fewer ads, and resulting in less activity that can be monetized.

Even AT&T's high-end, $25 monthly plan, including 2 GB of bandwidth, can be used up in less than a day of watching video. And while AT&T's $10 per GByte overage charges are much more reasonable than previous industry charges, they're still unlikely to be popular.

A two-hour movie, even compressed, could use upwards of 500 MBytes of data. that could mean variable and unexpected charges, and consumers hate that.

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Family Plans Now Dominate Mobile Industry

Family plans now dominate consumer mobile service packages. More than two thirds of consumer contract plans are family plans, up from less than 50 percent at the end of 2005, according to Nielsen Co.

According to a new T-Mobile survey, 73 percent of households with both family plans and children 22 or older still have an adult child on their plans.

At T-Mobile, for instance, an individual plan with 500 minutes and unlimited texting costs $49.99 a month with a two-year contract. A family plan with 1,500 minutes and unlimited texting costs $99.99 a month for two lines, or about the same per person for more minutes. Adding two additional lines costs $10 a month, and cuts the price per person to $27.50.