Half-year 2014 handset review

19 Aug 2014

Have we seen something really interesting in the handset market this year? I don’t think so. Can we expect something interesting during the rest of the year? I don’t think so. We’ll see an iPhone with a larger screen, and some other new things, but no game changers.

Basically all new models we have got this year from the leading manufacturers like Samsung, HTC, and Microsoft have something more and better, but nothing truly new. It is hard to expect that the iPhone 6 disrupts the business. And Chinese manufacturers offer more for a lower price.

Maybe the old forecasts that smart phones are a mature business (as this analysis from 2013) stand really true this year. What could be the new things we could get: 1) wearable technology, 2) better privacy and security, 3) hardware innovations like flexible display, 4) significantly better battery life, or 5) truly new user experience. Of course, these are just some guesses, and it might be that we don’t see anything interesting and new for long time.

Wearable technology has had a lot of expectations, but no real commercial products so far. Smart watches are only accessories to smartphones, and alone they are quite useless. Real independent devices and supporting ecosystems are needed. And devices need their own user experience, not only a copy from a phone or watch. Could Apple do it again and innovate a smartwatch user experience?

Some manufacturers, like Blackberry and Blackphone, and some app developers have seen opportunity for better a privacy and security. The question is whether people really are interested in paying for better privacy. They can become niche products. Blackberry has a better starting point to offer solutions to corporations. This might be the strongest bet for Blackberry in order to survive.

Most probably we won't see any significant breakthrough products with flexible displays or super long battery life, maybe only some samples from the future this year or even next year. Much better battery life and flexible displays can really be game changers in the industry, and also blur lines between phones, watches, tablets and TV. It can bring a new user experience.

Based on this we can expect that we won’t see any significant changes in the smartphone market during the rest of the year. Apple can increase its market share, if it launches the expected larger screen iPhone. Samsung will have a tough time keeping its share, and also struggle to get its smartphone business to profitability. Many people have started to prefer pure Google Android phones, or go after cheaper Chinese options.

Android and iOS continue their dominance in the market. The most significant effort in the phone business is now going towards developing ecosystems and significant hardware innovations - and then finding the right and easy way to offer them to users.

This is a boring year in the phone business and companies in that business really must work hard to create their future cash cow product categories. The next wave of innovations in mobility and smart devices will probably only come in 2016 and it will have a lot of influence on all business all the time.

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