So little space to differentiate

HTC has announced that it is shutting down HTCSense.com, the device firm’s portal that enables users to sync their contacts, messages, footprints and call history.

HTC has been caught between Microsoft and Google. There is no room for customized UI with Windows Phone and it is the same with Android and its non-fragmentation agreement. Furthermore, the services provided by HTCSense have been commoditized by the OS vendors: Microsoft Live and Google Mail are backing up all the device data in the background so you can access these data from your PC, tablet or a new device.

HTC Sense UI

The real question for device makers is ‘beyond hardware how can they differentiate from one another?’. Except for the ones with a fully integrated approach like Apple, the solution is to come from the outside.

Customers are lost in the zillions of applications available from the Application markets. I think they would appreciate some help from their preferred device manufacturer to pick up the best ones.

Which games? Which weather application? etc.

Device makers need to do something quite unusual for them: open to third parties, discuss partnerships and not try to do everything by themselves. The same service has much more value if provided by the top Internet brand than by the manufacturers. In these times of hardship, device makers need to focus on their hardware core business again and again.

Consolidation in the Japanese market

Toshiba and Fujitsu are discussing the merge of their 2 mobile companies according to the news. The merge should take place late this year.

> FT article

As I mentioned in a previous post, Japanese manufacturers suffered a lot from the end of device subsidies. The Japanese market shrank by 1/3 in 2 years.

One other special trait of the Japanese market is that it is dominated by local handset vendors. Japanese makers control nearly 90% of their home market. These vendors mainly play locally and have little if any presence outside Japan.

Japan market

The only foreign outsider gaining a position into this market is Apple with a 4% market share.

How long will the Japanese market continue to be an exemption with so strong local players? This consolidation between Toshiba and Fujitsu may be the first sign that this time has come to an end.


Market Share
Sharp 27%
Fujitsu – Toshiba 20%
Panasonic 15%
NEC Casio Hitachi 15%
Sony Ericsson 7%
Kyocera Sanyo 5%
Apple 4%

Stopping mobile subisdies: playing with dynamite

As I mentioned in a previous post SIM only plans are getting traction in mature markets where they amount already 20% of the new contracts. To such extend that some operators are considering abandoning the subsidy of devices. Operators find it costly and more and more difficult to manage.

Wouldn’t it be a better market if consumers paid the real price for devices?

Wouldn’t be better for device manufacturers not to have their price pressured by operators?
It’s all very fine, but let’s look at the Japanese device market where subsidies have been banned in 2007.

The shipments shrank by nearly one third within 2 years from 53M devices in 2007 to 35M units in 2009. It didn’t impact much operators, but now managing migrations from one technology to the other (e.g. 3G to LTE) cannot be achieved by ranging the new devices and putting more money on the table.

Japan shipments

Japan mobile shipments

Japan shipments graph

Japan shipments graph

Stopping subsidizing mobiles will impact dramatically manufacturers: the biggest will suffer and the smallest will disappear or merge with the medium ones. In Japan Hitachi, NEC and Casio merged their mobile divisions this year.

Furthermore it will slow the whole industry agility to adopt new technologies and services. Is it the price to pay for a virtuous ecosystem?

Vodafone’s FemtoCell sting

The last Vodafone advertisement in the London underground raised me a smile:  it features its new service Sure Signal. This ad is terribly true and funny: your life becomes a nightmare when your home isn’t covered. Your just hang through the window hoping to get an additional signal bar.

Vodafine Sure Signal Ad

Vodafine Sure Signal Ad in the London Underground

How is it really working. Well it’s quite simple: you install a Vodafone BTS in your living room, connect it to your broadband modem and switches on the whole. Then you get a Vodafone signal in your home and usually a bit beyond …

The offer is quite simple too, you pay a one off £50 or £5 per month depending on your plan.
The ad is enhancing the change in quality of life this solution has brought to many people…

Vodafone Sure Signal Offer

Vodafone Sure Signal Offer

But let’s think twice: these very people are just paying to improve the Vodafone coverage and don’t get anything in return. Furthermore they pay the CAPEX of this coverage extension but the OPEX too as the FemtoCell is connected through the home broadband which can be from any provider.

One would expect with this offer to get at minimum a discount on the calls you are making from home. This isn’t the case with Sure Signal. After all you are paying for the infrastructure and around 40% of the calls are made from one’s very home.
Furthermore by-passers in front of your home or neighbours may use the Femtocell you are paying for. I’m pretty sure you won’t get any revenue share from Vodafone for those calls.
My advice to these ‘desperate out of coverage’ VF customers would be switch mobile operator ! And my advice to Vodafone UK guys: don’t take consumers for fools.