The Maze of Mobile Innovation

It may be true that Nokia sells more phones in a month than Apple has sold of the iPhone 3G since its release last July.  It may also be true that the iPhone is not the ultimate expression of mobile computing and communication, or that the negatives associated with its closed platform will outweigh the positives.  And it is undoubtedly true that anyone who works in the mobile industry, particularly in California, is suseptible to Apple Fanaticism, the iPhone Bubble of Hype, and a distorted sense of the iPhone’s penetration across the country and around the world.

That said, it’s also true the the iPhone, along with the App Store, represents a transformational event in mobile (big “I”) Innovation.  The core concept of a single company creating the hardware, platform, user interface and software delivery mechanism has resulted in a fundamental change in both user experience and user expectation when it comes to how we interact with our handsets.
When looking at trends in a post-iPhone world, the question is: Where does innovation go from here? Do the Android G1, Blackberry Storm, Palm Pre, Nokia N97, etc. simply represent variations on a theme?  Will we see lots of (small “i”) innovation in the form of new applications, enhancements and modifications?  Or are there more Innovations just around the corner?

Part of the answer lies in asking a related question: Where will mobile innovation come from?  The major stakeholders - handset manufacturers, platform developers, mobile carriers, content producers, advertising agencies – are all jockeying for position.

Part of what makes the iPhone transformational is that it has thrown all of the above into a frenzy of new business plans and re-ordered priorities. The recent admission by Glu Mobile’s CEO, Greg Ballard, as reported by Moconews, that his company was too slow in adapting its game development to the realitites of the new smartphones, suggests what is going on.

We’ve been clear in saying we were conservative in our launching of games for the iPhone, but those games we have launched have done well… In short, we remain committed to carrier business, even though we are dedicating a lot of resource to the next generation of handsets. In retrospect, we should have shifted our focus to the higher-end platforms earlier in 2008.

Content creators, like others in the mobile food chain, are struggling to find the proper balance between the carrier-based on-deck world in which they’ve thrived, and the brave new world they’re confronting.

For a bit of history: In the mobile world B.I. (Before IPhone), entertainment brands, content aggregators, advertisers and mobile service providers had a relatively small tool set with which to work.  The power was in the hands of the carriers, in the form of on-deck placement and discovery.

Unfortunately for just about all involved, the carrier’s on-deck interface was, and still is, rarely a thing of beauty.  The options for presenting content to customers included WAP sites, with their clunky navigation, and “text this to that” premium SMS.  These mechanisms were undeniably vital in helping to get data-based services off the ground, and have made a number of companies very rich.

But for all the dollars that ringtones, wallpapers, short-form video clips, games and other downloads have generated, it’s hard to see them as anything more than novelties that barely scratch the surface of a handset’s potential utility.

Re-orienting products and services away from the carrier’s deck and placing them in the environment of an app store is an innovation that can’t be understated.   Endless page clicks, confusing text links and crowded design have been replaced with a semblance of clarity, organization, and ease of use.

Witness the 500 million downloads from the iPhone/iTouch App Store.  And at a macro level, the app store has echoed through the industry, offering not only a better user experience, but also a more advantageous revenue split and a shift in control from the carrier to the manufacturer/platform developer.

So it’s little surprise that Google has launched Android Market, and that Blackberry, Palm, Nokia and Microsoft have all announced their own app stores.  Not every company needs an app store, as Greg Kumparak has wisely argued, but this trend should be seen as a healthy first step away from reliance on the carrier’s deck.

In addition to the changing dynamics among the stakeholders, the highly compressed pace of mobile development demands that innovation come from everywhere.  Mobile is the sum of all of our media-saturated, techno-savvy, web-enabled, expectations.  So developers are hard at work giving handsets the same capabilities as latest-generation TVs, laptops, handheld games, GPS devices and mp3 players.

And consumers, having seen this play before as each respective technology matured, have been schooled in impatience.  They don’t want to go back to a world of inconsistent TV signals, dial-up internet speeds or AOL-style walled garden from the carriers.  They want a mobile experience that’s fast, complete and (for the most part) free.

At the same time, the very nature of the mobile platform demands that innovation expand beyond just replicating what’s already in our pockets, cars and living rooms.  Mobile phones don’t simply inform and entertain, they also connect us.  As a device that is always on, always with us, and personalized to our needs and our social networks, innovation should never simply be about cramming every other device into a pocket-sized slab of plastic and circuitry.

The innovation - and perhaps even Innovation – that gets mobile professionals excited are geared toward creating new content, products, services and applications that can only happen on mobile.

Against this hyper-inflated set of expectations, it’s no wonder that the term “smartphone” is already running into trouble.  In the rarified air where much of today’s innovation is occuring, even smartphones such as the Samsung Instinct, the Blackberry Curve or the Palm Treo don’t dare to tread.  John SanGiovanni, in his posting The Rise of the Superphone, defines what - in addition to a “large display and a robust web browser” - makes a phone “super”.

The operative word is platform. The creative potential of this next generation of hardware is defined by the ecosystem that each respective Superphone vendor’s platform will enable. When features like touchscreens, browsers, location-sensing technologies and hardware acceleration are programmatically exposed through elegant developer tools, a device is two-thirds of the way to superphonedom. Lastly, add an end-to-end international storefront, and a new medium is born.

To be clear, that “new medium” is not the only place where mobile innovation is occuring, in the US or internationally.  But the significance of the emergence of the superphones, and the new alignment of handset-platform-carrier in a consumer-friendly, easy-to-market manner, can’t be understated.   The playing field has been transformed, and the next wave of mobile innovation will take its cues from this change.

As experts, entrepreneurs, and evangelists converge on Bacelona this week for the World Mobile Congress, there will be lots of announcements about network speed, increased handset memory, “layered” networks that add streaming video on top of 3G networks, progress toward LTE and other 4G wannabes, advertising models, the impact of cloud computing on mobile, and much, much more.  (See Top Topics ring in Mobile World Congress.) But from the perspective of the end user – after all, it’s the customer who ultimately decides what innovation lives and what dies - here are several trends to watch for:

1. Is this the year that location based services start to mean something to the masses?
2. Can editorial-based recommendation services cut through the clutter?
3. What are the consequences of the new mobile divide?

Coming next: Location, Location, Location – Finding value in LBS

1 Comment

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  Michael Troxler February 26, 2009 at 6:55 pm

  Marc – well put. Time to peel back the layers and delineate Innovation from innovation. However – the persistent question is – what is “open”? Commercially open like the off-net worlds in mature mobile economies? Technically open as in open source development platforms…think I’m still confused!