More Than 550 Million GPS-Enabled Handsets Will Ship by 2012
In the wake of personal navigation devices’ success, cellular carriers have started to offer on-board and off-board navigation solutions, as well as a range of LBS (Location Based Services) such as friend finder and local search on GPS handsets. Community and social-networking-related functionality, such as the sharing of POIs (Points of Interest) and geo-tagged pictures, is also becoming popular and is expected to boost GPS-enabled handset uptake as carriers, handsets manufacturers, and service providers look to capitalize on the LBS trend.”While most CDMA handsets are already GPS-enabled and GPS is set to become a standard feature in GSM smartphones, GSM feature phones are next on the agenda to be equipped with GPS technology,” says ABI Research principal analyst Dominique Bonte. “GPS chipset vendors increasingly target handsets, looking for new markets and spurred on by the recent dramatic growth of personal navigation devices.”
However, as GPS begins to penetrate lower-end phones, the cost, power consumption, and footprint of GPS chipsets will have to be further reduced. This will be made possible by single chipset technology and the emergence in 2009 of combination chips integrating GPS, Bluetooth, and Wi-Fi all on one die. Major silicon vendors such as Broadcom, NXP, and Atheros are well positioned to develop such solutions following the acquisition of GPS chipset vendors Global Locate, GloNav, and u-Nav, respectively.
At the same time, the thorny issue of indoor GPS coverage has to be addressed, since handset-based LBS services are frequently used in challenging environments with reduced GPS signal strength. Network-assisted A-GPS and high-sensitivity GPS-receivers are becoming key requirements to reduce the time necessary to acquire fixes and to improve location accuracy.
ABI Research’s report, GPS-Enabled Mobile Devices, examines the market landscape and future potential for GPS-enabled mobile phones. It discusses critical business and marketing issues, as well as market opportunities and challenges for handset vendors, mobile operators, semiconductor vendors, and other industry players who address the GPS-enabled handset market.
This report forms part of two ABI Research Services: Mobile Devices and Location Aware Services, which include a variety of Research Reports, Research Briefs, Market Data, Online Databases, ABI Insights, and Analyst Inquiry Support.
Posted on 12th May 2008
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While a large number of phones today still use browsers with very limited web browsing capabilities, many smartphones are incorporating browsers that support the latest capabilities such as AJAX and RSS, as well as websites optimized for viewing on a mobile device. ABI Research sees this segment of the mobile browser market accounting for the vast majority of growth over the next five years, as the open-Internet browser (OIB) segment for mobile grows from 76 million in 2007 to nearly 700 million browsers delivered in 2013.”The focus today for mobile browser developers is to take advantage of the latest web standards while also developing solutions tailored towards the unique experience of using a browser on a mobile phone,” says research director Michael Wolf. “The most recent commercial solutions from Opera, Openwave and ACCESS, as well as those using open source solutions such as Webkit, are targeted towards allowing consumers to access content on the web without limitations due to browser constraints.”
Verizon Wireless and AT&T were the major winners across the board, together accounting for more than 80% of the auction’s $19.1 billion in bids. Verizon won seven of the 12 Regional Economic Area Groups (REAGs) in block C which provides nationwide coverage in the continental United States and Hawaii, and which also carries an “open network” requirement for the license holder. According to ABI Research senior analyst Nadine Manjaro, “These licenses will enable Verizon to extend coverage into rural areas and potentially pose a significant threat to rural operators. In addition, since Verizon has announced plans to deploy LTE, it is highly likely that LTE will be deployed in this frequency band.”"It’s no surprise that Google didn’t win,” Manjaro continues. “Google just went in to get the networks opened up. They did achieve their goal of requiring that the networks be open to whatever devices they intend to bring to market, without incurring major costs. The rules of the C block requires the spectrum to be open to any device and any application.”
The market for smartphones will grow from around 10% of the total handset market in 2007 to 31% of the market in 2013. A new study from ABI Research projects this meteoric growth to be a product of a number of complex factors including carriers’ drives to grow data revenues from advanced services and the general trend to pushing “smart” operating systems down into middle tier devices.ABI Research vice president Stuart Carlaw comments, “Smart operating systems are continually being optimized to run on processors with lower performance. There is a strategic move to support smart OSes in single chip midrange devices in order to unlock more data revenues.” Carlaw adds that, “The market is currently dominated by Nokia (52%) and Symbian (65%). However, the coalescence of the framework wars in the Linux environment and the growing stature of Windows Mobile will enable new competitors to put pressure on this established axis.”
The total number of 4G subscribers worldwide, including both LTE and WiMAX, is expected to exceed 90 million in 2013, but a number of milestones must be passed en route, according to a new forecast from ABI Research. At the end of 4Q 2007, says the firm, there were nearly 3.4 billion mobile subscribers worldwide, with 2.7 billion on GSM/EDGE/GPRS networks.Worldwide WCDMA subscriber numbers hit 180 million in 4Q 2007. ABI Research expects migration to HSPA+ to begin in early 2010, and migration to LTE will commence by the middle of the same year. Vice president Asia-Pacific Jake Saunders comments, “We forecast the total number of WCDMA subscribers (including HSPA) to approach 720 million in 2013.”
Sales of mobile phone accessories are expected to generate over $40 billion in revenue in 2008. Handset vendors and mobile operators know that to increase sales of their feature-rich handsets, they also need to provide accessories that will allow users to fully enjoy and benefit from the applications and features supported by the handsets. This means providing accessories such as headsets, memory cards, and data connection kits, in addition to chargers and batteries.”Current market trends including the growing adoption of smartphones in the prosumer and consumer segments, as well as the increasing popularity of iPhone-like feature-rich devices with touchscreens are contributing to the growing demand for mobile phone accessories,” says ABI Research industry analyst Shailendra Pandey. “Further, more people buying expensive smartphones and feature-rich devices mean greater demand for accessories that protect handsets, and also for accessories that enable the use of different features and applications on the handsets.”
NEC Corporation today announced that NEC Europe, a subsidiary of NEC Corporation, is working with mobile operator Telefonica O2 Europe to deliver the UK’s first live femtocell trial.O2 has begun an initial period of live testing in February. If successful, the trial will be rolled out in greater numbers across the UK in the summer, with the view to a commercial launch by early 2009. NEC is providing O2 with its Femtocell Solution, which includes 3G Femtocell Access Point for direct subscriber use, Femtocell Gateway and Access Point Management and Provisioning System.
Shipments of recycled handsets (old handsets recycled for reuse) are expected to exceed 100 million units in 2012, according to a recent study from ABI Research. Shorter handset replacement periods, growing demand for low-cost handsets in emerging markets, regulatory requirements, and growing consumer awareness are key factors driving the market for recycled handsets.ABI Research industry analyst Shailendra Pandey says, “Mobile phone recycling companies such as ReCellular, Fonebak, and Eazyfone are witnessing good market growth, but increasing consumer awareness and retrieving used handsets at affordable prices are still key challenges. Also, the ASP of used handsets falls rapidly, so these handsets need to be handled at the lowest possible cost to ensure decent margins on their resale.”
Recently, Motorola took a stake in UIQ, a user interface solution for mobile devices pre-integrated with the Symbian mobile operating system. Symbian has long been considered a company dominated by the agenda of Nokia; and Motorola’s apparent “buy in” to the ecosystem looks to be (at face value) a knee-jerk reaction to its current poor performance. But ABI Research asks: Why would Motorola entertain strengthening the competitive position of its biggest competitor, Nokia?Research director Stuart Carlaw answers, “Motorola could be characterized as a blue-sky thinker, which is good with respect to long-term planning, but falls short on the here-and-now trends. Conversely, Motorola may look to release compelling multimedia phones to the market quickly, in order to combat softness in this segment of its portfolio.”
As recently as 2001, some mobile communications experts were saying that mobile television might be a reality within 20 years, but would probably arrive much later because the technical problems were so difficult. Yet only half a dozen years later, according to a new study from ABI Research, successful mobile video technologies are largely in place. As questions about business models, distribution, and content are resolved, the mobile TV industry will take off in earnest.ABI Research director Michael Wolf says, “Just a year ago, there was a lot of discussion in the industry about whether unicast or broadcast distribution models would prevail, and it seemed possible that unicasting would soon disappear. The new research suggests that while the major top-ranked channels will follow a broadcast model, unicasting is here to stay as a conduit for the ‘long tail’ of other content that consumers will desire.”
More than 100 million handsets with touch screens will be shipped in 2008, according to a new study from ABI Research. Increasing numbers of handsets with touch screens have started to appear in the market, including the Apple iPhone, the LG Prada, the HTC Touch, and the Ultra-Smart F700 from Samsung, as well as the P990, M600, and W950 handsets from Sony Ericsson. Touch screens and touch pads are gaining popularity and becoming more common on handsets, while helping to make the handsets more intuitive, pleasant, and efficient to use.According to ABI Research industry analyst Shailendra Pandey, “Handsets with intuitive user interfaces allow quick and easy access to various applications and services and can result in higher ARPUs for mobile operators by generating greater usage of their value-added services. Mobile operators are therefore keen to promote and market handsets with good UI on their networks.” In the past, many smartphones and high-end handsets with a good number of attractive features have been commercial failures, simply because their user interfaces have been too complex and difficult for convenient use.
A whole new class of “always-on” Internet-connected products, collectively termed “Ultra-Mobile Devices” (UMDs), will become popular over the next five years, according to a new report from ABI Research. By appealing to a wide range of buyers they will reach shipments of nearly 95 million units by 2012, and should prove extremely profitable for their makers.”Mobile Internet Devices and UMPCs” is the first study covering both types of devices. It categorizes in unprecedented detail the buyers who will be adopting them, and what applications they will be running.
The Linux community is assaulting the mobile phone environment with a two-pronged attack that focuses on commercial operating system solutions and real-time operating system (RTOS) replacement. In a new study, ABI Research forecasts that by 2012, more than 127 million devices will be enabled with a commercial Linux OS, up from 8.1 million in 2007. Additionally, device shipments that incorporate Linux as an RTOS replacement are set to grow to more than 76 million units in 2012, up from nearly zero in 2007.”Linux in the cellular phone is not a question of ‘if’, but ‘when’,” says research director Stuart Carlaw.