Due to a Overwhelming Interest, Symbian has Been Canceled

While this is outside my customary topics for this blog, it represents work I have been doing in forecasting handset and smartphone shipments. Recently, GigaOM Pro published my global five-year smartphone platform forecast at almost the same time Nokia made an earth-shaking announcement.

Nokia Drops the Bomb
It wasn't all that long ago -- back on February 11th 2011 -- Nokia announced it was getting to bed with Microsoft and turning its smartphone platform from the incredibly successful Symbian to the incredibly unsuccessful Pocket PC Phone Edition/Windows Mobile/Windows Phone/Windows whatever-Microsoft-is-calling-it-this-month.

Naturally, industry watchers went nuts, including this Wired article saying Nokia was "killing Symbian." (Such statements, by the way, violate my First Rule of Thinking About Technology).

And the impending death of Symbian? Well, that's not entirely accurate. The official press releases said they have, "the intention to form a strategic partnership with Microsoft to combine complementary assets and expertise to form a global mobile ecosystem and to adopt Windows Phone as our primary smartphone platform..." [emphasis added].

Seriously? You Think Nokia's Gonna Kill This?
What a shock we got two months later when Nokia announced two new Symbian-based phones: The E6 and X7, both with the latest update of the Symbian OS. The world was aghast! How could Nokia bring out new Symbian devices when they were about to kill Symbian??!!

First of all, in a letter  to developers released the same day as the Microsoft announcement, Nokia said it is still planning to sell an additional 150 million Symbian devices... nearly two years worth of sales even with a declining market share.

But what happens after that? Does Nokia kill Symbian altogether?  In 2010, Symbian was the most popular smartphone OS in the world with more than one-third of the global market. There were nearly as many Symbian phones sold as iPhone and Android combined. I don't see any killing there at all. With all its troubles, don't you think Nokia would continue to embrace the most popular smartphone on the planet for as many years as it can?

Nokia's Possible Scenarios
I'm thinking there are three things Nokia could do at this point:

1. Dump Symbian and lose the lower end of the market (and the majority of smartphone sales). This seems to be what is expected.
2. Dump the new strategy of CEO Stephen Elop--who, by the way, was just hired away from Microsoft--and continue with the Symbian growth curve.
3. Let the two platforms live side-by-side and move Windows to the upper end while continuing to support Symbian at the lower end as the market adjusts to more-expensive  smartphones worldwide.

Know which one I'm betting on? Number 3. Give it a year or so and watch what Nokia does.

The Forecasts
The Nokia/Microsoft announcement came at a time I was just finishing up a forecast for GigaOM on mobile handsets and smartphone platforms. I'd been working on it for a LONG time and was eager to just get it published.  And, to tell the truth, I don't believe  Nokia would embrace Scenario 1 above and dump Symbian, regardless of all the other  forecasters seemed eager to do. So now there's some controversy -- even from within GigaOM in an article called When, Exactly, Is The Timing of Symbian's Demise -- about the validity of all the forecasts in this market.

My forecast calls for this: Android and iPhone continuing their dash to market domination. Combined, they'll eclipse Symbian's market share during 2011. However, my  assumption is that Nokia sees that it can sell more than 700 million Symbian phones by 2015, instead of stopping at 150 million in 2012.

Here's one other assumption that's being made by other forecasters (look it up... don't make me call them out): That Microsoft's OS will magically replace Symbian's market, nearly phone-for-phone. I'm here to tell you, the resource-hungry Windows Phone system will not become the worldwide bestseller -- after 10 years of struggling -- simply because Nokia's out there trying to sell it to their (decreasingly) loyal customers.

Here's what my original forecast looks like. If there were a title for it, I think it would be, "Nokia realizes what a good thing it has in Symbian before it's too late."

Source: Alloy Market Research, February 2011

If Nokia doesn't change its strategy, it's likely that the greatest increase will be in the "Other" category, epitomized by the Samsung "badu" platform, as they rush to fill the void left by Symbian. Eventually, Microsoft will start to improve its position, but during the 5-year forecast period is unlikely to rise higher than fourth place in market share behind Android, Apple iPhone and BlackBerry.

Mobile DTV prospects improve: people remember commercials (plus: video of actual Mobile DTV receivers)

OK, who doesn't love their TiVo or other Digital Video Recorder (DVR) that allows them to skip past all the commercials.  Or watching online? When you can go do something else until the commercial is over? One of the greatest inventions besides the television, right?  All it takes is a huge hard disk drive to store up all your favorite TV shows and let you skip forward and back through them.

Well, digital video recorders are great inventions unless you're an advertiser who wants you to watch their commercials or you run a TV station that relies on the money from those (increasingly less-effective) advertisements.

Now comes Mobile DTV, which is designed to go into a small package that operates from a battery like the Samsung Moment below.

It has a receiver, it has a screen, it has an antenna and a channel selector. But it doesn't have a giant hard drive, and, therefore, it doesn't let you skip the commercials or record your programs for later.  Mobile DTV is, at this point, back-to-the-50s TV that runs program in specified time slots and if you miss it you miss it. And if you want to watch, you have to watch the commercials, too.

Which is, I suspect, why advertisements on Mobile DTV devices are so effective, according to this article by Joe Mandese from Media Daily News. The article says the TV Bureau of Advertising ran several public service announcement commercials during the DTV Showcase in Washington DC.  Commercials were shown as 30-second anti-drunk driving PSAs, along with banner ads on the channel selection page and during the few seconds of dead air while the channel changes.

And the exciting news from this test is... PEOPLE REMEMBER SEEING THE ADVERTISEMENTS! Which is a really big deal if you are buying or selling advertising.

Recall of anti-drunk driving advertising by mobile phone users in the Showcase more than doubled, from 15% prior to the launch of the campaign to 34% post-campaign. 

The majority of users who recalled seeing the ads saw them while they were out of home (69%). 

A large number also recalled that they'd seen the ads when away from their homes.  According to the article, here's what this all means for Mobile DTV:

Abby Auerbach -- the executive vice president and CMO of the TVB, who oversaw the bureau's participation in the project -- said that the fact that more than two-thirds of viewers said they saw the spots while they were out-of-home was especially encouraging for advertisers and local TV broadcasters, because it means mobile may actually extend the reach of local television to places and at times when viewers aren't otherwise able to watch it. In essence, she said, the digital platform is a net positive for local broadcasters and advertisers, not a negative.

She said more research needs to be done on when, where and how consumers utilize mobile digital TV, but that the initial finds are very encouraging for the broadcast TV industry, which is working with the OMVC to try to convince consumer electronics manufacturers -- especially cell phone, smartphone and hand-held computing device manufacturers -- to install special chips and receivers into their devices that will enable the mass market to access digital mobile TV signals.

Some of the people who were watching those ads were were using a Samsung Moment smartphone that was specially equipped to receive the signals.  Here's a YouTube YouTube video from Samsung that shows the Moment in use.  Most interesting to me is the external antenna.

RIP MediaFLO? One Man's Experience

Having been a part of the mobile research and advisory industry for more than 10 years, I was lucky enough to get some cellphones to test when they were announced by the mobile operators.  AT&T was the most generous and I had the chance to use both a LG VU and a Samsung Eternity, both of which were equipped with MediaFLO receivers. These were both great phones (the Eternity is still in loving use) and the mobile TV function was something I needed to try out so I could have a clear understanding of how it worked from the consumer's perspective.

The relatively low frequencies used by the MediaFLO TV signal (UHF 52-54) gave it pretty good range and building penetration, so I could watch good TV even inside the house.

But the real test came when I was taking a train to my old family home in Michigan. Snow on the tracks had delayed the Amtrak Wolverine Express for several hours (Snow? In Michigan? In December? How could Amtrak have anticipated that?!) So I whipped out my LG VU to start watching TV programming.

And I watched.... er... well. Nothing that I really wanted to. I'm bored out of my mind, I have THE best technology to chase my boredom away and there's nothing. Deep inside Chicago's Union Station, the signal was weak. Once we started clickety-clacking through the Chicago suburbs, though, the signal was strong.

The programming, however, was weak. A movie that was halfway over. Spongebob Squarepants. Something about football. I kept flipping the channels, thinking "15 channels and nothing to watch." I finally settled on a news documentary about some woman who had killed her child (not my customary viewing).

Luckily, or not, once we got outside Chicago and neared Gary, Indiana, the signal sputtered and vanished. No more FLOTV for me for the rest of the trip.

I was deeply unsatisfied and, not only that, I was getting the signals for free! Because I was an industry analyst with a test unit, I wasn't even paying the $15/month charge.

I felt let down. And I remembered my visit to the huge, elaborate network operations center QUALCOMM had built in San Diego. They said proudly that they had the most advanced NOC anywhere... even the major networks didn't have operations like this.

15 channels and nothing to watch.

It was pretty clear MediaFLO was about to die a slow death.  There's no doubt that the technology worked, and worked really well. But the programming and the cost doomed US operations of MediaFLO from the start. Good try, great proof-of-technology. Business case? Not so much...