Feeds

CTIA: Handset vendors flaunt their wares

Under shadow of market squeeze

High performance access to file storage

Comment The largest US wireless show, CTIA, was held last week in Florida, but proved a relatively low key event in terms of major announcements, though as usual a huge statement of the overall weight and vitality of the wireless industry.

The customary catwalk parade of new handsets, each model designed to push its vendor higher up the rankings and catch the eye of the major cellcos, had an air of desperation about it this year as the whole sector labored under the problems of Motorola, and took stock of the fact that, in a world where sales are increasingly concentrated in the hands of the top five, if Motorola can come a cropper by relying too heavily on low marging phones, so can others - and for vendors outside the magic circle, the effects could be far more disastrous and permanent.

Sony Ericsson, currently the star performer in the top five phonemaker league, is turning to a partnership with tier two manufacturer Sagem to try to move into the low-cost market in order to tap developing markets without seriously compromising its high end image and margins.

Motorola, seeking to redress the imbalance between market share and profit that it has suffered since the iconic RAZR moved into commodity land - with no worthy successor yet in sight - announced a range of new devices, including CDMA and enterprise models.

Arch-rival Nokia elected not to announce new products, but to show off the models it debuted in February at Europe's wireless uber-event, 3GSM - perhaps a tactless move given the Finnish giant's need to improve its US penetration.

Smaller companies, particularly from Japan and China, are facing huge challenges in staying in the market, but Kyocera and Sanyo hope to show how it's done, taking advantage of their experience of mobile internet behaviour, which is highly advanced in Japan, and targeting emerging niches like WiMAX.

The CTIA Wireless trade show provided the usual high profile showcase for new handsets, in a year of particular stress for the phonemakers.

The recent tribulations of Motorola have cast a pall over the whole sector. There is no room for schadenfreude here, the miscalculation at the heart of Moto's setbacks - racing too quickly for market share in low cost areas despite the consequent slaughter of margins - is one to which all the vendors are liable as they try to strike the difficult balance between scale, essential to stay in the race at all, and profits.

Every supplier needs a killer handset to pull in the high budget users and carriers and offset the rise of the sub-$100 sector, but these are hard to create for an unpredictable market and generally have a brief spell in the limelight - Motorola's iconic RAZR, which boosted its margins and profile so effectively, and which it is struggling to follow up, actually had quite a decent spell at the top of the tree.

So the jostling of the phonemakers at CTIA, each trying to convince the world that their new device is the new RAZR, had an air of desperation about it. This was especially true among the tier two manufacturers, whose future is shaky in a market that is all about scale, and where 80 per cent of shipments are from the top five vendors (Nokia, Motorola, Samsung, Sony Ericsson and LG).

The demise of BenQ's European operation, formerly Siemens Mobile and in 2005 still in the number four spot, shows how quickly even large players can come to grief and those outside the top five are even more at risk, with dozens of companies fighting over about 200 million units, while the big guns take the other 800 million.

This at least drives creativity. HTC is building on its close relationship with Microsoft to focus heavily on the relatively high margin enterprise sector, and the emerging category of "ultramobile PCs" or "internet smartphones" (the term depending on your perspective on this market, cellphone or laptop oriented). HTC's new products fall between phones and mini-laptops and are headed up by the Shift, a rectangular device that flips open to provide a seven-inch screen, running full Windows Vista, a 30Gb hard drive, a Qwerty keyboard and tri-band UMTS/HSDPA, quad-band EDGE, Bluetooth and Wi-Fi.

High performance access to file storage

Next page: Kyocera and Sanyo

More from The Register

next story
A black box for your SUITCASE: Now your lost luggage can phone home – quite literally
Breakfast in London, lunch in NYC, and your clothes in Peru
Broadband Secretary of SHEEP sensationally quits Cabinet
Maria Miller finally resigns over expenses row
Skype pimps pro-level broadcast service
Playing Cat and Mouse with the media
Beat it, freetards! Dyn to shut down no-cost dynamic DNS next month
... but don't worry, charter members, you're still in 'for life'
Like Google, Comcast might roll its own mobile voice network
Says anything's possible if regulators approve merger with Time Warner
EE dismisses DATA-BURNING glitch with Orange Mail app
Bug quietly slurps PAYG credit - yet EE denies it exists
Turnbull leaves Australia's broadband blackspots in the dark
New Statement of Expectations to NBN Co offers get-out clauses for blackspot builds
Facebook claims 100 MEEELLION active users in India
Who needs China when you've got the next billion in your sights?
prev story

Whitepapers

Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
HP ArcSight ESM solution helps Finansbank
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.