Samsung Galaxy Note. First Look
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Spillikins ¹152. Social Aspects of Mobile Technologies: Quiet Revolution
If someone missed our New Year greetings then happy New Year to you again! Let the coming year bring only success and positive emotions to you!
Despite lengthy holidays the market rambles on to give us interesting food for thought. In this issue we will mention how modern devices change our habits. It is one of my favorite topics, because gadgets are always secondary to people and their habits. I would like to mention that over a course of the next several days we will cover CES. After September 15 we will have to catch up with numerous articles we planned to release at the end of the last year. Now read the traditional offering of Spillikins, which is luckily becoming more and more popular.
The term “smart mob” was introduced in 2002 by Howard Rheingold, in his eponymous book on social aspects of mobile revolution. The book was translated into many languages and stays actual even 10 years after. It is a good example of paying attention to eternal values and not the ever changing characteristics of mobile phones.
We meet smart mobs on a regular basis, but the core of the notion stays more or less unchanged. Nevertheless at the end of 2011 something new emerged. US consumers used their mobile devices so much that traditional companies ran into trouble. The underlying reason was the booming market of smartphones. According to the Nielsen review published this summer 40% of devices in the USA are smartphones with 70% of the market represented by modern Apple and Android handsets (and both OS have enough apps for every purpose). How the proliferation of smartphones affected the sales in traditional chains?
The connection is direct. Users can search online for better prices or scan bar codes, which is also handy. Developers not related to retail chains offer their solutions to search for best prices and it has changed the world. If ten years ago you could walk into a store and being lazy to go elsewhere pay slightly more now you can capitalize on home deliveries and save time. Stores turn into shop windows, where you can try a product and then buy it cheaper online. Do retailers lose money this way? There is no clear answer, but the online trade took off from mid 2000s and there is no end in sight. The market will go from strength to strength and the number of smartphones and online purchases will only go up. Computers are fine, but they are not mobile enough. You will not walk the aisles of supermarkets with your laptop, but it is easy to take a picture of the product with the smartphone or even scan the bar code. In minutes you will know where the price for the product is the lowest. You will be shown the map or offered to hold the item in the online store. It is not science fiction, but a part of everyday life now.
Such behavior of customers was a revelation for retailers and some banned taking pictures of products on shelves under different pretexts, but their main fear is for shoppers to compare prices. According to a recent article in New York Times Best Buy outlets hide bar codes for certain products to avoid comparisons with other stores (bar codes scanner is not the only tool, but it is the obvious choice). Retailers are trying to fight the smart mobs back, but should they be so scared?
On the other hand Amazon understood that it is useless to wrestle with customers and their app allows comparing prices with other online retailers. You can add not only the price feedback, but indicate the store where the price differs from that of Amazon.
Can you imagine that a store interested in selling its goods will automatically inform you about the prices at rival institutions? It defies the logic in accordance with which you should protect your customers from any information coming from competing outlets, but in the world where anyone can get the information really quick new rules come into play. Moreover, it is different from the PC and Internet bundle, which did not threaten brick and mortar retailers that much. The world has changed and its mobility affects the shoppers.
It is only the taste of things to come as smartphones still have much room for growth and not many people use price comparison apps yet. The popularity of this shopping method will spread via word of mouth. At a party someone will surely mention how he saved time and money on the TV located in the room and it will be taken from there. Smartphones will be in bigger demand to realize new possibilities of modern consumers. Retailers will have to change their marketing strategies and fight for the loyalty of customers. Surprisingly, it will be a win-win situation for everyone involved.
The majority of stores attract shoppers with service, discounts for permanent customers and promotions aimed at buyers, who spend a lot at a time. There is so much space for improvement, because the purchasing prices are similar among retailers and they cannot offer hefty rebates. The level playing field is useful for all, because different chains will have to offer unique products to compete with analogues form rival shops. This competition will improve the products in question and will offer more choice to customers. Undoubtedly, retailers cannot survive courtesy of unique offerings alone as they comprise a tiny segment of their portfolio, albeit having a higher margin.
Offerings from retailers will become more sophisticated. New schemes will emerge to take into account your previous purchases (types of products, but not the amounts spent) and provide discounts for a range of products together, etc. New types of customers’ behavior will change the retail world and we cannot be unhappy about it.
Obviously the process will take time and traditional retailers will not change overnight. At the same time look at bookstores in the US, which close down in droves, while people buy more books rather than fewer. The world is changing and the time has come for retailers to do their bit in this never ending evolution of tastes.
At Christmas and on the New Year Eve the number of SMS usually breaks new records, but 2011 was an exception. Mature markets saw the drop in the use of texting and this trend was evident throughout the year. Some networks had a 35% decrease in the number of SMS sent, while army of subscribers grew 40% during the last 3 years. It is even more dramatic, because users send longer messages, which are considered as several SMS by carriers. There is no exception among different providers as we see another new trend emerging.
Conventional logic fails to explain what is happening. Why people are sending fewer and fewer messages to each other? Initially my attention was attracted by an article in Forbes, where a senior analyst of MGI Research Tero Kuittinen provided data on the decrease of SMS traffic from several markets. For example, the leading Finnish carrier Sonera saw a drop of Christmas texting to 10.9 million from 8.5 million recorded a year ago, which is quite impressive. In Hong Kong the drop reached 14%. According to the article mobile carriers receive up to 20% of their income from texting, which is a lot. This tendency is explained by the increasing popularity of social networks and the US carriers will come across this issue too.
I wanted to compare the data from the article not with other markets, but to find the correlation between the popularity of social networks and smartphones and the drop in SMS usage. Having spent several days I came up with a straightforward, but very startling scenario supported by the statistics from carriers. In networks where subscribers use smartphones a lot, especially for social networking both SMS and voice traffic went down. It happens not only on holidays, but throughout the week as well. The only difference is that peak pressure highlights the trend more vividly.
The social aspect of the data does not point to the drop in communication, but the style has changed. First we could greet people via e-mail, then we added SMS, but now even more options are available. The first one is to use an analogue of SMS: Whats App, iMessage and so on. The traffic increases on holidays there, but the growth is less dramatic than the drop in texting and account for all changes. The obvious conclusion that these apps take away a slice of SMS traffic is not true. They compete, but cannot win over each other.
I can share my own experience, which is not absolute, but can give some insight. My address book contains around 2000 entries, but I send New Year greetings to 300 hundred of them. 30% of them received my personal greetings and I received answers from all of them. In my inbox I found only 40 SMS sent before my messages (so they were not initiated by me). This number represents barely 10% of messages I got last year. What happened to all the people? I even thought my phone was malfunctioning.
A brief interview of some acquaintances revealed they left the message on Facebook or Twitter. The general sentiment was that “if I am interesting then friends will see my greeting anyway, so it’s better than sending messages to all contacts”. The number of people we send SMS has narrowed down, which is not necessarily bad. It helps us to distinguish the inner circle of dear ones.
I think the same applies to the rationale behind more people using social networks at the expense of texting. They greet friends online and do not repeat the action elsewhere. Services get new meaning, while personal SMS become faceless. There is a question if SMS were ever considered personal or maybe just irritated recipients? There are no clear answers yet, but statistics proves that society is shaped by technology. The rules of etiquette are different now and greetings on social networks are as acceptable as SMS or a voice call.
The popularity of particular social networks is not important, because Facebook or Twitter of today can be superseded by new “kings” of the day. It is more important that we are moving to a new paradigm from sending messages to definite addressees to an infinite number of unknown ones. We start broadcasting our personal media files. It does not apply to close relatives and friends, but this group is often limited to 10-15 persons (according to the number of most popular SMS recipients in the majority of countries).
We greet not a particular person, but everybody interested in you. There are more possibilities and dangers here. In future our social contacts will be changed in comparison with what we have today. For better or for worse it is already happening.
I think that Android 4.0 UI looks very sleek; it is also very easy to use and leaves a good impression about the OS in general. I like it more than any other UI overlay currently on the market. And until recently I was wondering what Google were going to come up with to make the manufacturers who put time and money into their own UI overlays to leave users a choice between overlays. I found an answer in this little article on the Holo UI developed for Android Ice cream Sandwich.
The main new feature is the choice the user has between the UIs available. Google is insisting on a choice only if the phone is using Google Experience (ironically Android Market is a part of it). it is an elegant move to force developers to always leave the user with a choice. I suppose most users will be quite satisfied with the standard UI. However, it makes me wonder about how exactly the UI selection is going to be realized in Samsung Galaxy S3. Of course, this news leaves a lot of questions but I think Google made a right move.
I am getting a little bit confused by all the new services and apps. After making a brief hype around Siri Apple seem to have forgotten about it as well as Apple’s rivals who did not care to respond with similar services. Google announced a Siri rival for 2012 (no precise dates but certainly not before February). Google is raising the bar very high for voice recognition services as they aim at adequate recognition at any speech pace in virtually any language.
Windows Phone 7 has received a free app called Ask Ziggy which uses the Nuance recognition module while the app simply makes a search request in search engines and returns you the results. This app looks very basic as compared to Siri but the interesting thing is that it was created by just one person. This makes me hope for more voice recognition software in the near future more powerful and more intelligent. Check out this video of Ask Ziggy in action:
The first rumors about Eastman Kodak preparing for bankruptcy appeared in October 2011. The 131 year old company never managed to accommodate to the demands of the digital world. Ironically Kodak developed the first digital camera in 1975 and was the leader in digital photography for a long time. However, the company did not react adequately to the market changes and remained loyal to its traditional products. In early 2000s the company’s new management took a course for renewal, they aimed at restoring leading positions on the market and partly they managed to it and in 2005 Kodak was number one digital camera manufacturer in the US. But it was a temporarily success as it was achieved solely by low range cameras – the company still was not producing prosumer cameras. This one lucky shot also made sales of camera phones plummet but inexpensive Kodak cameras cannot find a buyer today.
According to the Wall Street Journal the company is preparing to seek Chapter 11 protection and remain operative. Kodak is now looking for $1 billion to remain afloat while undergoing bankruptcy. All current Kodak transactions are unprofitable and Kodak is unlikely to be bought out. However, Kodak owns a great many patents in digital photography that Google, Microsoft or Samsung could use. It is yet unclear whether anyone is willing to pay several billion dollars for Kodak patent portfolio. But it is clear that the Kodak brand will not be used anymore.
Blackberry is having a lot of problems and according to some the biggest one is that the company is run by two CEOs, the founders of RIM. Unfortunately, their decisions have led the company into the current uncertainty. According to the Financial Post the two RIM’s CEOs were forced by investors to leave their posts in favor of Barbara Stymiest, an independent manager who joined RIM’s board in 2007. RIM investors are desperate for a change and they will surely insist on it. The reasonable thing to do in this case is to appoint an independent manager as the company’s CEO who would satisfy the current CEOs and the investors. But whether these rumors are true and such castling will actually take place we will learn only in February. By that time RIM’s committee of independent directors will have taken a decision concerning the structure and the management of the company.
During the last few weeks RIM’s situation has been aggravating. The company was forced to lower their tablet’s price to $299 until February 4th. I expect after that the price will go even lower although there is nothing that could revive this stillborn product.
Nokia 800 Lumia, Nokia’s current flagship, is so unpopular it made Nokia turn to their Favorite weapon – advertising. Nokia 800 banners can be found on practically any website but Nokia apparently thought that this was not enough and resorted to spam: they sent SMS to phone numbers owners of which never gave Nokia the permission to use their numbers. In case you don’t know: all Nokia phones send an SMS with your number to Nokia database the first time your start your phone with a SIM. Previously you could refuse to send this SMS but since mid-2011 this delivery has been forced and it is you who pays for this SMS. There were complaints about this but Nokia’s lawyers somehow found a way around them although it is outrageous disrespect to customers.
I could never expect a company as big as Nokia to resort to such means but just look at the SMS: all URLs lead to websites that belong to Nokia (all copyright signs are there). I have never encountered such a massive mailout. The funny thing, some people who have never used Nokia products in their lives also received this spam. Is Nokia that desperate that they have to resort to spam?
I want to thank everyone who responded to my call and sent me snapshots of the Nokia SMS spam: I have received over 200 letters and I am really grateful for them.
P.S. The New Year is promising to be extremely interesting, CES is about to start in Las Vegas – follow my daily reports of everything that caught my eye. Let’s have a happy New Year together!
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Published 11 January 2012
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