Last week I was intrigued to find that a survey conducted by the Telecommunications Regulatory Authority (TRA) in the United Arab Emirates of mobile phone handsets by manufacturer, model and operating system had found that Nokia is still the phone of choice – one of the markets normally associate with a high mobile broadband penetration – particularly as incumbent Etisalat was claiming 80 percent population coverage for its 4G LTE network as long ago as 2011.
The UK’s Ofcom recently reported that smartphones now account for 58 percent of shipments in the UK, and it begged the question whether Nokia and other feature phones are now dead or whether there is still an underlying demand.
One of the issues is that the operators offering 3G and 4G want to push smartphones to the exclusion of everything else as data is now the big revenue driver, and some well known groups have consequently stopped selling feature phones.
The ‘Portio Mobile Fackbook 2013′ notes that Nokia dominated shipments in four out of the seven world regions in terms of highest overall handset shipments in 2012. The reports finds Asia Pacific, Eastern Europe, the Middle East and Africa were all led by Nokia in 2012. Samsung however had the upper edge in North America, Latin America and Europe.
In its ‘Smartphone Futures 2012-2016′ report, Portio does however warn that Nokia’s current dominance is not set to last as 2012 is the year that global smartphone shipments will top half a billion (500,000,000) in a year. Smartphone shipments apparently hit 485 million in 2011, rising to 655 million at the end of 2012, and over 1.095 billion per annum in 2016. Portio reckon that by the end of 2016, half of all the mobile phone shipped will be ‘smart’. Read more…
How do you know if your mobile phone is a fake and does it matter?
I had to fly home from the States a couple of days after the 2006 transatlantic aircraft plot to detonate liquid explosives using water bottles had been foiled. It was the first time anyone had had to transfer the contents of their make-up and wash bags into plastic bags; and you weren’t allowed to take bottled water onto the plane.
I and my fellow passengers were a little more sensitive to things that might go bang, and to what our fellow passengers might be doing. Dear old ‘British Airways’ handed out complimentary copies of that day’s UK ‘Daily Mail’, and it carried a series of photographs that showed a Dell computer starting to smoulder, and then cheerfully bursting into flames at a conference.
The relevancy here was that the gentleman sitting next to me had a silver-cased Dell that looked very like the one depicted in the newspaper story… There was probably a greater threat from all the laptops on board than all those bottles of water that had been unceremoniously dumped at the airport gate that morning.
Generally Nokia phones don’t burst into flames if they have original components installed, and as Boeing well know to their cost, lithium-ion batteries at the best of times can be troublesome.
Looking at some batteries for my Nokia feature phone I bought on eBay the other day I noticed that these OEM items were made in Hungary. By chance skimming through the Portio Mobile Factbook 2013 on my way to work this morning there was a chart showing world mobile phone production by world region.
Eastern Europe accounted for 8.7 percent of global production in 2012, but falls to 7.9 percent in 2016. Something similar is happening in both Western Europe and North America; the former falling from 11.3 to 10.2 percent, and the latter from 12.5 to 11.6 percent in the same period.
The winners – according to Portio Research - are Asia-Pacific, the Middle East and Africa. Asia-Pacific already had 42.5 percent of world mobile phone production in 2012, and this lifts to 43.1 percent in 2016, whilst the Middle East rises from 8.1 to 9.9 percent, and Africa from 4.6 to 5.0.
The only region where there is no change expected is Latin America which accounts for 12.2 percent in both 2012 and 2016.
And how do you know if you phone is a fake or not? Just dial *#06# and the phone will show its International Mobile Equipment Identity (IMEI) number. If it hasn’t got an IMEI number, this might be the time to change your phone…
Wherever there’s a SIM card, there’ll be a mobile handset not far away. Once upon a time there would have been a handset for each SIM card, but variable service levels and even greater variation in tariffs means that there are more active SIM cards in the world than there are devices that they can plugged into.
This observation was quantified for me in this year’s issue of the Portio Mobile Factbook 2013. At the end of 2012 the report shows there were some 1.67 billion handsets shipped by manufacturers. This compares to the 6.512 billion active mobile subscribers logged in the same report at the end of 2012. On one level this means that there’s a mobile phone for every member of the global population. This however conceals an enormous disparity in ownership levels. At a family gathering this weekend in Scotland, and talking with friends from Canada, ‘dad’ was proud of the fact he hadn’t got a mobile phone at all, whereas ‘mum’ had three. Their two children had a smartphone each. A neat demonstrates of how an average figure of 1.25 devices per person might be arrived at.
Assuming therefore that there are approximately one SIM for every device, this suggests that a sixth of the mobile phone fleet is churned annually. In an age when we have come (almost) to accept designed-in obsolescence, helped by clever software such as Dassault Systèmes ‘Simulia’ that can model the life of a solder joint on a circuit board to within 0.05 percent in terms of the number of life-cycles it will perform before failure, the Nokia phone stands out.
Recently the telecoms regulator in the United Arab Emirates found that even now have the mobile phones in use are Nokia feature phones, and the Nokia 6300s acquired for the TelecomsMarketResearch Text Transit Tests are generally ‘as good as new’.
Portio reckon shipments are going to rise, forecasting shipments of 2.148 billion in 2016. Portio defines two markets for this activity – Replacement phones and Growth phones. The Replacement markets are defined as Western and Eastern Europe, and North America, whereas the Growth markets are Asia-Pacific, Latin America, the Middle East and Africa.
In 2012 the Asia Pacific region contributed the most to world-wide handset shipments with 42.5 percent share. It was followed by North America with 12.5 percent share. With the increasing mobile subscriber base and the rise in handset replacement rate the report anticipates that the Asia-Pacific region will strengthen its position as the overall largest region for handset shipments. Nearly 43 percent of world-wide total shipments will be in the Asia Pacific region in the year 2016. Conversely the contribution of the more saturated European and North American regions will decline during the period 2011 – 2016 whereas it will increase for the Middle East and Africa.
According to Portio, the smartphone business has been the single biggest revenue-generating growth-story over the last 4 years as the rest of the tech sector suffers amid this seemingly endless recession.
This has been counter to the dramatic slowing of subscriber growth in saturated markets, voice and text have reach commodity pricing and margins are constantly squeezed hard under consumer pressure, yet around the world the appetite for new smartphones continues to gain pace.
Continuing to redefine the handset business, smartphones are becoming the device of choice for hundreds of millions of consumers, and 2012 is the year that world-wide smartphone shipments will top half a billion in a single year. Smartphone Futures 2012-2016 shows smartphone shipments reaching 485 million in 2011, and that number will top 655 million in 2012, rising to over 1 billion smartphones per year by 2016.
Smartphone Futures 2012-2016 puts the value of the mobile handset industry as a USD 241 billion, and with that kind of revenue flow, you can see why the likes of Sony and Samsung are busy battling it out in Africa and Asia.
The ‘Portio Mobile Factbook 2013′ – a comprehensive market overview available as a free download – provides some interesting insights to the global mobile market.
In a table showing the world’s Top 10 largest mobile markets by net additions in the five years ending 2016, China and India not surprisingly take the top spots with 633.4 and 534.7 million respectively. But what is perhaps more telling is that in this Top 10, two of the countries are located in Africa, namely Egypt and Nigeria in fifth and ninth places respectively. Egypt even tops that centre of technological innovation, the United States of America, showing quite starkly how growth in the developed markets is rapidly tailing off, and Africa and Asia is where vendors and operators will be focusing.
Indeed, no market in Europe appears in the table. More telling is a chart showing compound annual growth rates. In the Top 10 this time there are five African nations and two from the Middle East.
The lead market by CAGR in the period ending 2016 is Egypt, followed by Oman and Sudan. In fourth slot is Bangladesh before Africa is back with Mozambique, followed by Iran. In seventh and eighth slot is Pakistan and China. Africa takes the final two slots with Uganda and Nigeria.
Portio does not totally ignore Europe, but it can only do it by providing a chart showing only European nations. So although not on the scale that will be seen in Asia and Africa, France tops the Top 10 CAGR chart of European nations, followed by Austria and Finland.
Ironically the UK is expected to see the lowest growth – of just 0.6%. With such a background, coupled with an already high penetration, the inevitable market consolidation is now taking place, with Orange and T-Mobile merging to form ‘Everything Everywhere’ – which is now being neatly branded as EE4G. Hopefully they’ll drop the 4G before 5G inevitable rolls into town. One wouldn’t want to name a mobile company after a technology just in case that technology was rapidly overshadowed whilst was still striving for market share…
It still seems amazing that the global number of mobile phones at the end of 2012 will be 6.5 billion – that’s one per phone per person. That, of course, is the average, as the reality is that some people have more than one phone connected to a mobile network, and in Africa it will be recalled that Bharti Airtel were pretty miffed to discover that a single user might have three active SIM cards due to the highly variable geo coverage and tariffs.
Portio reckon that the number of global mobile devices will rise to 8.479 billion by the end of 2016, which begs the question where this growth is going to come from, given that the developed world has cast itself into a self-inflicted triple dip recession. According to Portio, the growth between 2011 and 2016 has come from Africa (9.4%), Asia Pacific (9.0%) and the Middle East (7.7%). Bottom of the heap – not unexpectedly – are Western and Eastern Europe which saw just 2.1 and 2.4 percent respectively with North America managing just 4.0%.
To quote the report: “The percentage contribution of the Asia Pacific region to the worldwide mobile subscriber base will increase from 51.3% at the end-2012 to 54.3 percent at end-2016; similarly, Africa’s percentage contribution will increase from 11 percent at end-2012 to 11.9 percent at end-2016. The percentage contributions of all other regions – bar the Middle East – are expected to decrease continuously over the same period. The contribution from the Middle East is expected to remain almost constant”.
The other measure that analysts tend to place some store by is the Average Revenue Per User (ARPU) metric. However there is a two-fold problem with a growing subscriber base.
Firstly, those people who could afford a phone in the first wave some years ago are not likely to double their usage when they buy a second phone. Intuitively they can (especially if they are a man…apparently) only make one (effective) call at a time, and therefore whatever their usage of the first phone was, the existence of a second phone will see their usage split between the two, so the ARPU will almost certainly fall proportionally as these extra units are added to the subscriber base.
The second issue – particularly in Africa – is that the people without phones are poor and live in rural areas which don’t have any network coverage. Although there are a number of studies, including one by the GSMA, which have suggested that the arrival of a mobile phone in a rural village sees the GDP of that community rising - the number varies by research study – but the trend is consistent. What it means is that a farmer can select what to harvest based on the price being paid in the market four days travel away, and so improve his returns. But what this must also mean is that as the GDP of rural communities improve so will their disposable income, which in turn will allow more people to buy a mobile device.
TelecomsMarketResearch.com. the industry’s ‘one-stop shop’ for telco data, has found that a remarkable 43 per cent of the mobile phones sold on eBay, the Internet auction site, are being sold with their contacts folder populated, and with well-filled ‘inboxes’ and ‘sent item’ folders, as well as personal images.
But what was surprising was that the cost of each valid name and mobile phone number set was just 86 pence each.
Worse, had the researchers been so inclined, the message folders could have been examined for potential fraudulent activity.
Even better, as all the phones are in fair to excellent condition, they can be re-sold on eBay, and so the names and numbers they contained could have been acquired at no cost or even at a profit.
For the record, there were an average of 7 contacts per phone; 31 messages in the ‘inboxes’ and 43 in the ‘sent items’ folder. One phone still had two unsent messages, and there is a risk that these would have been sent on activation of the new SIM card.
Some of the personal images were also cause for concern, as one in particular was what might be termed ‘extreme’, and given the complete contact folder and large number of items in the inbox, it should have been possible to identify the individual concerned.
Keith Wallace, Director of Research at TelecomsMarketResearch.com noted: “The problem with all technologies is that they require a degree of time and effort to master, and most people just want to switch on and go. In this instance either people assumed that the data was wiped when they removed the SIM card, or perhaps more worryingly, either didn’t know how to bulk delete the contents of each folder or restore the factory settings. I suspect if we were to now confront the original owners with our findings they would be shocked with how much they revealed about themselves, their friends and even their colleagues.”
No attempt was made to examine the messages or the nature of the contacts and all personal data was immediately deleted. For the record, a locked Nokia 6300 (dedicated to one network operator) cost on average £16.52, whilst an unlocked phone cost on average £28.34.
Yesterday we activated the TelecomsMarketReseach ’research fleet’ of newly acquired Nokia 6300s to carry out our own UK Quality of Service tests.
Having set up the first of the Orange UK phones at 12:39, and having not given the number out, the first in-bound call was received at 14:26, just 107 minutes after activation. Even better, the phone hadn’t been topped-up before the call came in.
Unsolicited automated calls are now reaching nuisance volumes. The TelecomsMarketReseach office probably receives 2 or 3 a day on its fixed-lines. The number is usually withheld, and the automated message relates to various mis-selling scams such as Policy Protection Insurance (PPI).But this got us thinking about how our new but unused number had been ‘found’ so quickly after activation, when it appears in no directory and has not yet been used to make a call?
In Nigeria, for instance, it’s common practice for discarded SIM card ‘outers’ to be picked-up off the street and for a scammer to add a ’1′ to the number progressively until he finds an active line. This technique would be easy to computerise and the scammer wouldn’t pay for the calls to non-existent lines. If the number did ring out, that would be a favourable result, and the number recorded for future use.
Our ICT team were a more pragmatic, suggesting that a member of the Orange team had passed the newly activated number directly onto scammers for personal reward. The proof of this would be if it is only on the Orange lines that these calls are received: if the sequential number tactic was being used, then it would apply to all phones on all networks. It will be interesting to see what happens when the second Orange SIM is activated.
There is evidence of a database of ‘easy to buy from Websites’ being traded on the Internet. One of the early TelecomsMarketResearch sites was listed on such a database. This database not only contained the URL of the site, but also ‘recommended’ a product. These dodgy orders were always for the same product and orders were received roughly every four or five weeks.
The dead give-away is that much of the research sold by TelecomsMarketResearch is supplied in the form of an Adobe Acrobat PDF file, and are supplied electronically via e-mail, the buyer receiving a single file, but with a licence that specifies whether it is for single or multiple use, as on a corporate Intranet.
However our ‘clients’ using the database made the mistake of ordering TWO single user licences of the PDF research study, presumably thinking this was the behaviour of a legitimate buyer, rather than a 2-user licence, which would have been more logical and cheaper option. In trying to appear ‘honest’ buyers, the scammers had identified themselves as rogue buyers.
So how do you think the scammers obtain their numbers? Is it off a database? Do they take a known number and work from there? Is it an insider job? Let us know what you think, and we’ll share the pooled wisdom.
The Times newspaper (of London) has published a world fibre optic cable map this week, and right in the middle of the page is a cable that doesn’t exist! In the Saturday Technology section Will McQuhae provides a map filling the centre pages showing the world’s submarine fibre optic cables.
Highlights include the Sea-Me-We-3 cable shown in blue, and billed as the world’s longest cable at 39,000 km, and linking Germany to South Korea and Australia, with 39 landing stations, running from Europe, along the north African coast and into Asia. It also shows the route of the London to Tokyo cable currently under construction and finally utilising the North West passage: Christopher Columbus and John Cabot were on the right track 500 years ago.
But dead centre the map shows a cable linking Luanda in Angola with Fortaleza in Brazil. My normal ‘bible’ on these matters is TeleGeography’s 2013 Submarine Cable Map. That doesn’t show a cable, but a scan of ‘Africa & Middle East Telecom-Week’ found Angola Cables (AC) planning a new submarine cable system to join Africa and South America, under the name SACS (South Atlantic Cable System [Angola–Brazil]), due to go live in 2014. AC was formed in 2009 and is owned by local telcos Angola Telecom; Unitel; MSTelcom, Movicel and Startel. The consortium has invested in WACS and is also operating a data centre at its POP in Luanda.
Telegeography are experts in this game. According to Andrew Blum in his book ‘Tubes: Behind the Scenes at the Internet’ they use a program called Traceroute, originally written in 1988, that traces the paths of e-mails, and only requires the entry of an IP address for the program to list the routers traversed, and the time between each one.
Each year Telegeography selects fifteen locations globally, looking for ‘dead-ends’ with only a few paths to the rest of the Internet – Denmark’s Faroe Islands, for example. It searches for Websites there hosting a copy of the Traceroute program, and then directs the Traceroute hosts to query more than two thousand five hundred ‘destinations’; Websites carefully chosen because they actually live in the place where they say are. Blum notes in his book that the process generates twenty thousand journeys across the Internet.
Latency used to be only an issue for telecoms engineers, keen to reduce the delay between someone speaking and the reply being heard. But Blum notes that a new need has emerged with high-speed automated trading, where computer systems deal based on knowing the market news an extra millisecond in advance. Tata’s route from Singapore to Japan is more direct than its competitors’, which also gives it the fastest travel times all the way to India. However Tata’s transatlantic cable is slow, as Tyco (who laid the cable) originally connected it to a landing station in New Jersey, which, when compared with cables ending on Long Island, is a route between London and New York two hundred miles longer.
Indeed, study of the map in The Times shows that an e-mail from Cape Town in South Africa to Montevideo in Uruguay has to track all the way up to Spain, before heading westwards to Miami and then southwards down the coast. When SACS is lit sometime in 2014, the journey will be less than half the current distance.
The world really is shrinking.
We don’t normally do book reviews, but Andrew Blum’s “Tubes: Behind the Scenes at the Internet”, published by Penguin-Viking ISBN 978-0-670-91898-0′ is a good read, and includes interviews with a number of industry heavyweights. The book describes his mission to actually see the physical Internet infrastructure, and he tours extensively in the States and Europe to visit cable landing stations and the physical peering between major networks in their dimly lit cages. Highly recommended (non-technical) read.
Normally at TelecomsMarketResearch we like to think we keep our fingers on the pulse of the mobile market but just occasionally we get stumped by the blooming obvious.
Having bought a job lot of SIM cards and Nokia 6300s for our planned network tests, there came the moment when we started to unit the cards with their new phones.
The Vodafone card snapped out, and was popped into the SIM card holder and the battery replaced.
What’s the number? – send a text to my own phone and read it off. The text didn’t go. Checked the Vodafone Website, and discover that the Vodafone the credit check is *#1345#. No credit.
So called Vodafone and the number check is *#100#. Worked a treat.
Not quite the Telecoms Market Research we had in mind, but once in a while it’s worth going right back to basics. Just four more networks to go!
Tecnotree – a vendor normally associated with the global provision of telecom IT solutions for the management of products, customers and revenue – has sponsored a series of market surveys, the second of which was published last week using research conducted in February 2013. Entitled ‘Subscriber perspective to customer loyalty’, the study examined 9 markets: 3 in each of Africa, Latin America and Europe.
In the UK 42 percent of respondents had switched mobile operator in the last year, placing it second from the bottom, as only Brazil had a lower figure at 29 percent.
Of the nine nations studied, the most loyal market was Kenya with a figure of 70 percent. A conclusion might be that UK mobile operators treat their customers less well, or that Kenyan operators simply give a better service.
There may be grains of truth in both propositions, but the reality is probably more the nature of the players and less about good customer service. In the UK the market was liberalised with unbundling of the local loop. In this process the incumbent British Telecom lost its mobile arm to Telefonica’s O2, and four players on the world stage set up shop: Orange (France Telecom); Vodafone; T-Mobile and Hutchison’s 3. As each has national coverage and a strong retail network, there is little to choose in terms of service levels, and this is reflected in subscriber numbers, with, prior to the formation of Everything Everywhere with the merger of T-Mobile and Orange in2010, each of the ‘big 4′ had between 20 and 27 percent of the market.
The research found that mobile operators drive loyalty via device upgrades and better tariffs, supplemented by a bundled service offering, and a broader ‘all of the above’ tactic, and this finding certainly sums up the UK market.
Kenya has a different dynamic, which is a dominant mobile operator with a USP. Despite three competitors (Esser’s yu; France Telecom’s Orange; and Airtel) Safaricom still dominates with some 64 percent of the market. Whilst there is a benefit for new subscribers in joining the biggest operator in terms of both lower on-net rates and network peering issues, the dis-benefit might be a less flexible attitude to tariffs.
In Safaricom’s case, it developed a killer application in time to contain its competitors. Safaricom’s launch of the Vodafone-engineered M-PESA mobile money service has empowered the unbanked citizens of Kenya and now businesses being signed-up to take payment by M-PESA are promised that 7-8 out of every 10 customers will have M-PESA.
So maybe the higher level of loyalty in Kenya is more about financial enfranchisement than better customer service or veven better and newer devices and bundles. The full report can be downloaded here.
