Participants on a panel Tuesday at GSMA Mobile World Congress in Barcelona, Spain, included, from left to right: Microsoft CEO Steve Ballmer, Nokia CEO Olli-Pekka Kallasvu, AT&T Mobility CEO Ralph de la Vega, Wall Street Journal columnist Walt Mossberg.
(Credit: Marguerite Reardon, CNET Networks)BARCELONA, Spain--iPhone maker Apple isn't at GSMA Mobile World Congress 2009 along with the rest of the mobile phone industry, but the company's growing success is definitely top of mind for key executives in the mobile market.
The iPhone and Apple's successful App Store got more than a passing mention on Tuesday during a panel moderated by The Wall Street Journal technology columnist Walt Mossberg.
The panel which included three of the most powerful CEOs in the mobile industry--Ralph de la Vega, CEO of AT&T Mobility, the second largest mobile operator in the U.S.; Olli-Pekka Kallasvu, CEO of Nokia, the world's largest handset maker, and Steve Ballmer, CEO of Microsoft, the worldwide software leader--centered on the need for more openness to spur successful innovation in the mobile market.
But the discussion quickly devolved into the need for openness, despite the growing success of Apple, considered the most closed player in the industry.
Each executive had his own idea of what openness means and how if Apple adopted its own vision of openness it could be more successful. De la Vega and Kallasvu said fewer operating systems are needed so that developers can create applications that run on more devices.
"Customers want us to simplify," de la Vega said. "Our corporate customers, especially, want a smaller set of operating systems to manage."
De la Vega, whose company is the exclusive operator offering the iPhone in the U.S., even said that more openness could benefit Apple.
"The iPhone is a great success, but it would be even better if the applications were interoperable," he said.
Kallasvu agreed. And he used Apple and its "closed" ecosystem as an example of what could limit innovation in the mobile market in the future. He said Apple's vertically integrated model, where its hardware and software are tightly controlled by the company, further fragmented the market. And he added that what is truly needed is more openness in developing applications.
Ballmer argued that device openness was important to give customers more choices. And he pointed to the number of choices that Windows Mobile customers have when choosing a device.
"I agree that no single company can create all the hardware and software," he said. "Openness is central because it's the foundation of choice."
Even though each of these executives argued for openness and took jabs at Apple for its lack of openness, Mossberg pointed to the company's growing success in the market. The iPhone, which was launched a year and a half ago, has seen tremendous growth in terms of shipments. And so has its newly launched application store. Apple said last month that there are a total of 15,000 applications available through the App Store. And the number of downloads has hit more than 500 million in just over six months.
All the talk of Apple and its success annoyed at least one European audience member who asked Mossberg and the other panelists why they were so worried about what Apple was doing when Apple's total worldwide market share is still miniscule.
De la Vega answered with a response that seems to sum up how the industry views Apple: "Because the other 99.5 percent of the industry is trying to copy the iPhone."
Indeed, they are. Even two of the companies on the panel have copied aspects of Apple's playbook. Nokia recently introduced its first touchscreen phone to rival the iPhone, the N97, in December. And Microsoft's new Windows Mobile 6.5 allows touchscreen navigation that looks eerily similar to the iPhone's software. What's more, Microsoft and Nokia clearly think that Apple is on to something with its App Store, since each company announced its own version of an application marketplace here this week.
Prithvi Raj, a product manager for Microsoft, demonstrates the new Windows Mobile 6.5 running in an HTC touch-screen handset at the GSMA Mobile World Congress 2009 in Barcelona.
(Credit: Marguerite Reardon/CNET Networks)Microsoft is trying to sell the world on the notion of a "Windows phone."
The first part of that effort is simple. It's a rebranding exercise. Although Microsoft will continue to sell its Windows Mobile operating system, it is going to put its marketing muscle behind the term "Windows phone" to describe the devices that run its software.
The second part is trickier: convincing consumers that they want a Windows phone as opposed to all of the other smartphones on the market, such as the iPhone, BlackBerry, or Palm's Pre, to name just a few.
On Monday at the Mobile World Congress event in Barcelona, Spain, the company is showing off Windows Mobile 6.5, an update to its operating system aimed at making the software more "finger friendly" and just more appealing to consumers in general. The update, which won't show up on phones until the fourth quarter of this year, also features an update to the mobile Internet Explorer browser and a new "marketplace" for buying software that can run on the phone.
Microsoft will also formally announce its My Phone backup and restore service, some details of which leaked out earlier this month. The service is designed to not only make sure things like calendar and contact data are synced to the Web, but also other phone data such as photos and text messages.
These are the kinds of improvements that Windows Mobile boss Andy Lees said he was alluding to in an interview with CNET last month, where he laid out Microsoft's vision for the phone.
"We talked about importance of the device being easier to use and being a window in on your life," Lees said in an interview on Friday, shortly before he headed to Barcelona.
In the earlier interview, Lees acknowledged that Microsoft had fallen somewhat behind by trying to offer software that could run on "the least common denominator" of hardware, but said that the next 12 to 18 months would bring a series of announcements that would help Microsoft thrive in a world in which phones will soon have dual-core processors and graphics abilities to rival the original Xbox.
With the new software update, Microsoft is adding a rival to the iPhone's App Store as well as making its software easier to use without having to reach for a stylus or flip down a keyboard.
But it remains a question whether Microsoft's changes will be enough, particularly as rivals improve their products over the coming year.
On the browsing front, for example, Microsoft is focusing on the fact that, while other browsers may look nice, Mobile IE can do more than the others because it is compatible with the desktop Internet Explorer 6 and with Adobe's Flash. Microsoft commissioned a study that found its browser can execute "up to 48 percent more assigned tasks than the other browsers and phones studied."
However, it is unclear that such metrics--as opposed to just plain ease of use--are what consumers use to select a phone.
Lees notes that supporting multitouch, a la the iPhone, has its downsides as well. Such phones require capacitive screens which are less precise, making things like handwriting recognition less feasible. Microsoft sells many Windows phones, for example, in Asian countries where handwriting recognition can prove far quicker than a keyboard for entering text.
Windows Mobile 6.5
(Credit: Microsoft)On Monday, Microsoft officially unveiled the latest version of its mobile operating system at GSMA Mobile World Congress 2009. Microsoft CEO Steve Ballmer previewed Windows Mobile 6.5 during his keynote address, and as expected, the updated OS brings a handful of enhancements, including an application store, a backup and restore service, and an improved mobile Web browser. Here's a full rundown of the new features:
My Phone service
My Phone is a free service that allows you to back up your phone's information to a password-protected Web service. It offers automatic synching and backup so you can store your contacts, appointments, text messages, and other information to the service and then easily restore the information to your device if you happen to lose it or upgrade to a new smartphone.
In addition, My Phone lets you automatically upload photos and videos straight from your phone to the service. Currently, My Phone is only available as an invitation-only beta.
Windows Marketplace for Mobile
Windows Marketplace for Mobile will operate as the central hub for searching, browsing, and purchasing mobile applications for your smartphone. It comes preloaded on all Windows Mobile 6.5 devices where you'll be able to download applications over the air or from your PC simply by entering your Windows Live ID. Developers who have already created programs for Windows Mobile will be able to offer their products through the marketplace after a security and compatibility check from Microsoft.
Internet Explorer Mobile
With Windows Mobile 6.5, you'll get more features from Internet Explorer Mobile. Built on the Internet Explorer 6 engine, the mobile browser will support Flash and JavaScript and includes new tools for better page navigation, such as zoom in/out sliding scale and a breadcrumb feature that shows you where you are on a Web page. In addition, Microsoft added that the browser allows for more transactions (e.g., checking flights, buying movie tickets) than any other mobile browser.
BARCELONA--If imitation is the sincerest form of flattery, then Apple's biggest competitors are laying on the love a little thick.
It seems like handset makers aren't just trying to match Apple in terms of developing cool new touch screen devices, but now they're all clamoring to develop their own version of an application storefront, where users can easily discover and download applications for their smartphones and developers can easily create and monetize those apps.
Rumors have been flying around that Nokia, the largest handset maker in the world, will unveil its plans for its own application store at its press conference here at the GSMA Mobile World Congress on Monday morning.
But Nokia isn't the only company getting into the app store game. The Wall Street Journal recently reported that Microsoft is also readying its own application "bazaar," which some people expect will be announced here this week. U.S. software firm Amdocs, which provides software and services for wireless operators, is also planning to announce a "white label" application store at MWC that will allow carriers to offer an application store with their own brand.
The application marketplace frenzy follows the big success of Apple's App Store, which provides applications for the iPhone and iPod Touch. The storefront, which works in conjunction with Apple's iTunes music and multimedia online store, launched last summer.
The mobile marketplace has been wildly successful with thousands of developers creating new applications and adding them to the site everyday. Apple said last month that there are a total of 15,000 applications available through the App Store. And downloads from users has hit more than 500 million in just more than six months.
Soon after Apple announced the App Store, other smartphone companies started jumping on the bandwagon. In October, when T-Mobile introduced the G1, Google announced that it was also creating an online application store for all its Android phones. BlackBerry maker Research In Motion, followed suit with its own application store announcement.
The worldwide recession has hurt the sale of new cell phones. In fact, IDC recently reported that that for the fourth quarter of 2008 sales were down some 12.6 percent. But smartphone sales were up about 22.5 percent in the fourth quarter. What makes these phones appealing are all the cool applications that can run on them. And as smartphones grow more popular, experts believe that applications that run on those phones will also be in high demand.
So it makes sense that companies looking to sell these sophisticated devices would want to give their customers cool applications to use on them. But replicating Apple's success will be tough.
Apple already had a very successful distribution mechanism through the iTunes music store when it first launched the App Store. But in addition to its distribution, Apple seems to have gotten right two other key pieces of the puzzle. First, the company has nailed the hardware design of the device. And consumers love it. Second, the iPhone's software, which is by no means perfect, works pretty well and provides a lot of advanced functionality. And because it's based on Apple's computer operating system software, it's also somewhat familiar to developers, which makes creating iPhone applications a little easier, as well.
So far, none of Apple's competitors can match the company in all three areas. For example, Nokia has developed solid hardware. There's no question the company can build a phone. But building a phone with slick software that can do a whole bunch of other things other than make phone calls has been trickier for the company. What's more, the company lacks a strong distribution channel for its applications and services. For over a year, it's been building the Ovi platform. And it's launched its music store. But the company still lags far behind Apple in either of those areas.
Microsoft has the software expertise and knows how to distribute it. The company has been successful distributing games and other content through its with Xbox Live service. But Microsoft lacks its own built and designed handset. Instead, it has licensed its software to several other hardware makers, none of which has come up with a truly compelling device to take on the iPhone.
There is no question that the battle for the smartphone market is far from over. In fact, it's only just the beginning. But my prediction is that it will take more than copy-cat application stores to match the excitement of the iPhone.
Updated at 11 a.m. PST with Microsoft comments and more background on Danger.
Microsoft apparently is serious about the consumer cell phone business.
The software giant said Monday that it's acquiring Danger, the Palo Alto, Calif.-based maker of the T-Mobile Sidekick for an undisclosed amount.
T-Mobile Sidekick Slide
(Credit: Corinne Schulze/CNET Networks)"The addition of Danger serves as a perfect complement to our existing software and services, and also strengthens our dedication to improving mobile experiences centered around individuals and what they like," Microsoft entertainment unit President Robbie Bach said in a statement.
Danger's Sidekick brings many of the same abilities as business-oriented smartphones--Web browsing, e-mail, and instant messaging--but it does so in a way that has been more popular with executives' kids than with businesspeople themselves.
The challenge for Microsoft, though, is that Danger has its own operating system, distinct from Windows Mobile, as well as completely different way of doing business than Microsoft.
Although both companies use others to manufacture their devices, Danger gets its money primarily by getting a cut of the monthly service for its phones, while Microsoft gets its money licensing the operating system to phone makers.
On the plus side, Danger actually is agreeing to be bought by Microsoft, unlike Yahoo, which formally rebuffed Microsoft's bid Monday.
Microsoft's acquisition brings a halt to Danger's plans to go public. In December, the privately held company had filed its preliminary paperwork for an initial public offering.
Danger was started by Andy Rubin, who later left the company to launch another mobile start-up, which was acquired by Google. Since then, Rubin has been leading the development of Google's Android open-source mobile platform, which is gaining attention at the Mobile World Congress in Barcelona, Spain, this week.
Danger's two other co-founders, Matt Hershenson and Joe Britt, have remained at the company, heading its technical teams. Britt has prior experience of being gobbled by Microsoft, having been at WebTV when Microsoft bought that company. Danger has 294 workers in total, according to the company.
Update: In a telephone interview, Microsoft General Manager Scott Horn said the company isn't ready to announce its specific plans for Danger, but said the company plans to continue operating its existing Sidekick business.
Horn said Microsoft has already spoken with Motorola and Sharp, the two companies that make phones for Danger. Both, he noted, already also make Windows Mobile phones.
Although Danger's business model is different from Windows Mobile, Horn said that Microsoft already licenses some of its mobile Windows Live software for a monthly fee.
Horn said Microsoft will look at ways of bringing the two businesses--and the two operating systems--more closely together.
Update: 10:25 p.m. with photo, more details
Handset maker Sony Ericsson is announcing plans for its first Windows Mobile device, a move aimed at boosting the company's presence in the North American smartphone market.
The first product is a business-oriented phone with a QWERTY keyboard, but a family of devices is expected. Over time, Microsoft hopes Sony Ericsson will leverage its camera and music expertise to help build more consumer-oriented devices.
Xperia X1 has an unusual arc slider that reveals the QWERTY keyboard.
(Credit: Sony Ericsson)"They've really got some great consumer brands that we'd love to partner with and bring to Windows Mobile," Microsoft Vice President Pieter Knook said in an interview.
The company is expected to have more to say about Windows Mobile in general at its press conference Monday, but Microsoft isn't announcing any details on its future operating systems. There have been rumors aplenty about both a modest update to Windows Mobile 6 and a future version that would have much more touch-screen capabilities a la the iPhone.
Knook acknowledged that Apple has included some nice features with the iPhone, particularly in the Web browser, but declined to talk about when Microsoft might incorporate some of those advances.
"We are certainly investing in the browser," Knook said. "We are certainly investing in entertainment scenarios."
Photo handling is another area he identified as important. The most recent version of Windows Mobile allows for photos to be uploaded to Windows Live Spaces, but Knook said there's more work to do on that front.
"That's still an area where the user experience is more cumbersome than it needs to be," Knook said. As for music, Knook noted the company's recent purchase of Musiwave, as well as the work being done by Microsoft's Zune team.
"We do envisage that some of those experiences will come to the Windows Mobile platform in the future," Knook said.
Update: The device will be known as the Xperia X1, featuring a 3-inch VGA display with an "arc slider" to slide out the keyboard. The device will support HSDPA and HSUPA networks, as well as Wi-Fi.- prev
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