Analyst Report: Mobile Winners and Losers of 2009


As the year winds to a close, GigaOM Pro’s crack team of contributors takes a look back at what went right, what went wrong, and for whom.



While consumers who live in areas with spotty coverage or where smartphones saturate the networks might disagree, 3G came into its own in 2009. Just a few years ago, the mobile web was painful, but faster wireless broadband has helped to both make it a “must-have” feature and fuel the rise in smartphone sales. But 3G is also going mainstream — more non-smartphones than ever offer 3G connectivity, as do non-traditional products like e-book readers. Such pervasiveness is helping to educate consumers on tomorrow’s wireless offerings, too. As 3.5G and 4G networks roll out in the coming years, carriers won’t have to sell the benefits of an unknown product — they can simply say it’s just like 3G, but faster. — Kevin C. Tofel

In-flight Wi-Fi

Would you like the can — and a Wi-Fi connection? Source: Flickr user davitydave

Would you like the can — and a Wi-Fi connection? Source: Flickr user davitydave

What was once a loser is now a winner. People want their Internet more often than ever thanks to popular web applications, online media and more importantly, social networks. There’s still some novelty factor involved with using the web at 30,000 feet, but thanks to the maturity of web services, connectivity is becoming more of an expected utility rather than an optional toy. But in-flight Wi-Fi isn’t new — like a phoenix rising from the ashes, it’s merely flying high again after practically disappearing two years ago. With the maturing web and the desire to use social networking to stay in touch with family and community, in-flight Wi-Fi is taking to the skies so that we never feel out of touch. — Kevin C. Tofel

Google Android

When it comes to mobile, one of the big winners of 2009 is Google’s Android platform. Android became a force in the smartphone world this year, with most major handset makers producing Android-based handsets. The latest figures from industry analyst AdMob show Android global network traffic has grown by almost 700 percent this year, driven by a surge in handset sales as a growing number of model hit the market. Several major ODMs have stated publicly plans to build the lion’s share of their new products using Android; Motorola said it will go all in, dropping competing platforms altogether. Indeed, Android is projected to steal smartphone market share from the competition well into the next few years, an enviable situation for a relative newcomer to the market. — James Kendrick

Research in Motion (RIM)

The BlackBerry maker has continued to produce well-received handsets into an increasingly crowded market, many of which have successfully straddled the enterprise and consumer markets this year. It recently announced agreements with carriers in China, which should help to cement its global position for the foreseeable future. While Android-powered handsets may eat into RIM’s business more aggressively in 2010, the company has maintained a strong enterprise position that will help it withstand the assault. — James Kendrick

Mobile application developers

It was only a couple of years ago that mobile application developers had some pretty unattractive paths to market. They could distribute their wares through (mostly low-profile) third-party sites and hope to attract the attention of a small fraction of mobile users, they could try to distribute their wares directly to users or they could kowtow to carriers in the hopes of getting space on the all-important deck. All that has changed in the wake of Apple’s App store, though, and the countless other storefronts that continue to surface. The App Store’s library cruised past the 100,000-app mark several weeks ago, the Android Market is getting legs in a big way and Research In Motion is building out its App World – to name just a few of the smartphone-targeted storefronts. What’s more, outlets like GetJar continue to pick up steam by targeting feature phones in addition to higher-end devices, and potentially attractive new platforms like Nokia’s Maemo and Samsung’s bada are giving developers more choices than ever. Platform companies are hoping to seduce developers by offering vast sums of prize money, and app creators can monetize by selling in-app ad inventory and leveraging in-app transactions. Code writers, traditionally viewed as geeks hunched over their laptops in the basement, are now among the most prized players in the space. — Colin Gibbs



femtocellThese personalized cellular stations for the home were poised to sell up to a million units in 2009, but by all estimates, fell far short — prompting some analysts to cut their estimates going forward by as much as 40 percent. In the meantime, femtocells still suffer from a perception problem related to cost. The devices are used to provide solid cellular signals in small, fixed areas. But customers have to provide and pay for the femtocell backhaul, mainly to get better cellular coverage – for which they’re already paying. The perception of paying for a service twice must be overcome before this loser can turn into a winner. — Kevin C. Tofel

Personal Navigation Device Makers

After enjoying a rise in demand for their services that lasted years, the makers of personal navigation devices, such as Garmin and TomTom, are seeing a shift in their fortunes. Navigation services on smartphones started to seriously eat into their popularity in 2009. When Google introduced Google Maps Navigation, a free turn-by-turn solution, the market cap drop of Garmin and TomTom plummeted, dropping a significant percentage (more than 12 percent and 28 percent, respectively) the day of the Google announcement. — James Kendrick


The venerable handset maker opened the year by unveiling its webOS platform and flagship Pre handset, both of which drew raves at CES in January. And the Pre’s commercial debut in June impressed analysts despite low inventories at launch and a puzzling lack of marketing from Sprint, which remains the phone’s exclusive U.S. carrier. (Palm tried to provide some marketing muscle itself but ended up with TV commercials that somehow felt more creepy than compelling.) But Palm failed to capitalize on whatever momentum the Pre was able to generate at launch, and sales fell as the new iPhone 3G S gained traction and price points for lesser smartphones plummeted. Meanwhile, Palm has failed to build out its app store, leaving Pre users to look longingly at Apple’s vast App Store and Google’s expanding Android Market. Verizon Wireless could do much to help reverse Palm’s fortunes when it releases the Pre next year, but the nation’s largest carrier seems smitten with Android and isn’t likely to invest much to tout the Pre. So while webOS remains a top-notch operating system, Palm’s future is far dimmer than it was a year ago. — Colin Gibbs

Cut-rate prepaid service providers

boost-mobileThe increasing popularity of bargain-basement prepaid services was a huge story in 2009 as customers ditched postpaid plans in favor of offerings from Boost Mobile, Leap Wireless, MetroPCS, TracFone Wireless and others. The reason behind that growth, of course, is obvious. A year ago, services that included unlimited voice, text and web access cost about $80, but Sprint’s Boost kicked off the year with an all-you-can eat plan for an astounding $50 a month. The move sparked a brutal price war that saw other providers meet or beat Boost’s price, and TracFone lowered the bar with a two-tiered option that included unlimited voice and text for $30 a month and added web access for an additional $15. TracFone’s threat became even more imposing in October when Wal-Mart began selling the service at 3,200 stores nationwide. So while the landgrab for customers continues, margins are being whittled away as businesses try to figure out exactly how low they can go before they wave the white flag. Worse, the smaller providers are increasingly threatened by some tier one providers, which are lowering their prices and have the added advantages of superior handsets, nationwide coverage and big marketing budgets. There are other ways for the prepaid guys to generate revenues – by offering value-added services, for instance, or experimenting with mobile ads – but when it comes to unlimited services we may already have reached the bottom. — Colin Gibbs


Nearly 2 million subscribers around the world will be using WiMAX by the end of the year, according to recent figures from ABI Research. A look past that seemingly impressive number, though, reveals some decidedly unimpressive deployments and uptake. Subscriber numbers have stagnated in South Korea, according to ABI, and Japan’s UQ Communications, which aims to provide WiMAX mobile services to 90 percent of its home market by 2012, is already behind on its rollout. Meanwhile, Clearwire has snared fewer than 200,000 users despite deployments in more than two dozen U.S. cities including major metropolitan areas like Chicago, Dallas and Seattle. Those lackluster showings are partially offset by successful deployments in a handful of markets such as Russia and Malaysia, but LTE already looms on the horizon and boasts a litany of heavy-hitting supporters. WiMAX will surely find an audience as a niche market technology, but its window of opportunity as a mass-market 4G alternative in mature markets is already beginning to close. — Colin Gibbs

That’s our list. Who do you think we missed?

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