Yes, I realize that we are already several days into 2010, but thanks to a monster flu I have been out of action for some time now. Today, I’m finally getting a chance to put down my thoughts and predictions about what the year 2010 will bring. So here is the first installment of a series of posts focusing on the forecast for specific market segments in the coming year.
Handhelds
Google Nexus One
The worst kept secret in the world from last year was the much-rumored Google phone. The Nexus One has finally arrived and Google is touting it as the greatest thing since, well, the Apple iPhone (Click here for a very cool Nexus One demo). Why Google has chosen to move away from its long-held practice of avoiding hardware development has a lot of us wondering. I’m sure it has Google’s partners who have developed Android-based phones (like Motorola) wondering as well. Why should they continue to pour money and resources into their Android phones if their software supplier (Google) is now going to be a direct competitor? Consider how many device manufacturers would jump at the chance to build phones running iPhone OS and competing directly with the iPhone itself? Not too many I suspect.
Ultimately, I suspect the Nexus One will do little to alter Apple’s growing dominance in handheld devices. It’s too little, too late, and there are way more iPhone apps than Android apps out there. In addition, Apple still holds the edge in sex appeal.
2010 will hopefully be the year when Verizon subscribers can (finally) choose an iPhone. This will depend on whether Verizon and Apple can come to terms and introduce a CDMA-equipped iPhone that works on Verizon’s network. This would be a big development for many of us (like myself) who would like to have an iPhone but are put off by AT&T’s spotty coverage. I mean, this is 2010 for goodness sake. Isn’t it embarrassing for AT&T that “Are you there?” is the most common phrase that is transmitted (or dropped) across their network?
For all of the other mobile phone manufacturers the competitive landscape has just become much more difficult. Companies like Nokia, Samsung and Motorola will struggle to differentiate themselves in a market segment increasingly dominated by Apple and Google. This could also be the year that Palm finally goes under overwhelmed by the Apple wave.
Winners: Apple, Verizon
Losers: Google, Nokia, Motorola, Palm, AT&T
Tablets
So-called “tablet” computing devices are likely to be a major new growth segment in 2010. These devices are shaped like a slate and typically include touchscreen interfaces and may or may not include a stylus or other writing device. Tablets are intended to be simpler and easier to use than full-featured notebook computers. In my opinion, there is a serious market need for a device with a bigger screen and more functionality than a handheld that is also less expensive and easier to manage than a notebook computer. Some are saying 2010 will be the “year of the tablet”. I think they could be onto something.
Given that, the company to watch in this segment is, of course, Apple. Rumors have been flying that Apple will soon announce a tablet computing device dubbed the iSlate. This will be a multi-media touch-screen device with e-reader functionality. Reportedly, iPhone apps can be adapted to run on the iSlate without too much effort. This is critical because it means that the iSlate will have a wide array of applications available right out of the gate.
Microsoft Courier
Microsoft is also expected to soon announce Microsoft Courier. This is a booklet device with two screens that allows you to draw and write with a stylus or your fingers. While Microsoft was an early pioneer in tablet computing they have never been able to turn it into a big money-maker. My opinion is that Courier will be too cumbersome to be useful and I have never been a big fan of pen computing. Computers should free us from the use of pens and paper, not duplicate them. I will concede that there are some applications where a drawing device is essential; it just isn’t required for the large majority of us.
Not to be outdone by its rivals, Google is also rumored to be putting the final touches on a tablet device. This device will run Google’s Chrome OS which I discussed here and here. The Google tablet would (of course) have touchscreen capabilities, e-reader software and should do a bang-up job with multimedia presentation. Chrome OS will also be easy for consumers to manage since it’s going to keep all of your data and applications in the cloud (where they belong) rather than keep them on your local device. This operating system will also be crucial to the success of the upcoming Google netbook.
One of the most surprising success stories of the last few years has been the explosive popularity of Amazon’s e-reader device, the Kindle. Amazon rapidly gobbled up this market segment while everyone else was sleeping. With Apple and Google now pushing their way into this space it’s likely going to get a lot more difficult for Amazon to maintain its dominance. Book and magazine reading is rapidly going to become an expected feature in tablet computers. The question then becomes whether Amazon will transform the Kindle into a full-fledged tablet computing device in order to keep pace. That undoubtedly will not be easy.
Winners: Apple, Google
Losers: Microsoft, Amazon
