Marketing Ninja

I’m in the midst of writing my business plan for Jiive, and in order to make my business plan anything but laughable in the eyes of potential investors, I have to present a quick background on our target customers and the market itself. Without disclosing the details of Jiive’s business plan, let’s just say that individuals who use Internet-enabled mobile devices, such as Treos, iPhones, and Blackberrys, constitute a portion of our target audience.

During my research period, which I am still very actively engaged in as of this moment, I came across a number of seemingly obvious observations… But finding indisputable data to assert the truthfulness of those observations proved to be a bit more challenging than I anticipated. Therefore, I am going to share the results with you.

Trend 1 – The mobile devices market has been growing steadily for some time

Don’t confuse mobile phones like most common Nokia and Sony Ericsson models for mobile devices; when I refer to “mobile devices” I refer to high end models produced by companies like Palm, Blackberry, and the market’s newest serious member, Apple Computing (Apple released one of the original mobile devices, the Apple Newton, in the early 1990s, but it was largely considered a failure). The first popular personal digital assistant, the Palm Pilot, revolutionized the computing industry in 1996, and in the modern age PDAs have been replaced with so called “Smart Phones” which are simply the integration of cell phone functionality into a PDA device.

Now let’s take a look at the more recent past.

Microsoft Chief Software Architect and Chairman Bill Gates remarked at the Microsoft Mobility Developer Conference in 2003 that “[mobility] is something that probably will be the fastest growing of all of our businesses.” Four years later, the statement holds true for Microsoft according to the Microsoft Mobile & Embedded Devices/Communications Sector (MED/CS) homepage:

The MED/CS group is the fastest growing business line among the seven Microsoft business groups. There are more than a billion addressable devices today and more mobile phones shipped annually than PCs.

But just how fast is mobile devices segment growing, exactly? According to a Gartner PDA Report from the first quarter of 2006:

Worldwide PDA shipments totaled 3.65 million units in the first quarter of 2006, a 6.6 percent increase from the first quarter of last year, according to Gartner, Inc. Gartner’s numbers primarily reflect handhelds and PDA’s (and do not include Treo shipments), however the company does include some RIM smartphone devices that they classify as PDA’s with cellular radios.

These figures do not include the Handspring Treo Product Line sales figures for Q1 FY06, and given that the Treo line was the iPhone of 2006, it would be a gross oversight not to include those figures into our analysis. Thus with a bit more digging through old press releases, I found this gem:

“Treo smartphone sell-through was 470,000 units, which reflects an increase of more than 160 percent from the year-ago period. Our share in the handheld-computer market rose, and we’re excited about our overall product roadmap.”

In the first half of the fiscal year in 2006, SmartPhone sales overall rose by 50% and this trend is predicted to continue.

palm Treo 750 Smartphone

palm Treo 700wx Smartphone

palm Treo 700w Smartphone

Trend 2 – The mobile devices market is expected to begin a new, faster rate of growth

With the release of the iPhone, which sold over 700,000 units in its first weekend alone, a lot of speculation has been drawn to what’s going to happen in the Mobile Device market. Based on previous rate of growth and the iPhone cult phenomenon, there is no reason to believe that this market has anywhere to go but up.

However, appealing to your investor’s common sense doesn’t always cut it, so it’s a good plan to have your business proposals backed with FACTS and NUMBERS, so are some tidbits:

iPhone to drive SmartPhone sales in Asia – June 2007 IT Week

Apple’s Enty to SmartPhone Market will Raise Interest – ARM CEO Says, June 6th 2007, Washington Post. ARM CEO Warren East boldly predicts that the iPhone has the potential to double the SmartPhone sales from 100 million units last year to 200 million units this year.

Trend 3 – More and more SmartPhones and mobile devices are accessing the Internet and at faster speeds

The built-in Wifi capability of the Apple iPhone was one of its strongest sell points, despite the fact that the iPhone relies on a slower, non-3G AT&T edge network. Wireless data speeds are crucial to the success of SmartPhones, and thus developers are doing everything they can to make their networks faster, better, and more reliable. Here’s a relevant snippet from that Smart Device Central article that I linked to:

Meanwhile, Sprint and Verizon plan to roll out EV-DO “Rev A” networks around the start of 2007. EV-DO Rev A offers a significant boost in download speeds compared to the current EV-DO Rev 0, with vastly greater uplink speeds and lower latency. This will enable the use of any application requiring two-way communications, such as VoIP, video conferencing, and push-to-talk.

With SmartPhone network speeds increasing, this means that creating more reliable and richer web services for SmartPhones are a distinct possibility.

Trend 4 – Microsoft is quickly becoming a very big fish in Smart Phone software

Who would have guessed that the world’s foremost software giant for desktop and laptop computing, Microsoft Inc., would make waves in the mobile phone market? According to Gartner research publication in 2005, Microsoft CE holds the lead in PDA operating systems, and one can assume then that Microsoft Mobile versions of Word, Powerpoint, and Excel are among some of the more common applications for Mobile devices. Even if it’s not Word, Excel, and Powerpoint in namesake running on mobile devices Palm OS devices offer support for using Word documents in their own in-house equivalents. The Apple iPhone runs its own versions of Word and Excel.

Microsoft will be as ubiquitous for Smart Phones as it is for desktop computing.

Trend 5 – Smart Phones are going to support much richer web pages in the future

A quick press release from Apple’s iPhone Developer Website should say it all:

Developers can create Web 2.0 applications that look and behave just like the applications built into iPhone, and provide seamless integration with iPhone applications and services including making a phone call, sending an email, and displaying a location in Google Maps. Third-party applications created using web standards can extend iPhone’s capabilities without compromising its reliability or security.

As soon as everyone decides to stop supporting the Wireless Application Protocol (WAP), which is a bane to mobile application designers everywhere, we will be able to embrace a purely XHTML-driven browser family for Smart Phones across a broad spectrum of models, I boldly predict.

Update: Looks like Google has decided that Mobile Content Development is a worthwhile venture. YouTube is already available for the iPhone but Google is looking to hookup Smart Phone users with a service to search for new ringtones and themes over the Internet… I have to ask “do we really need anymore ringtone services” but then I know that Google will probably make infinity billion dollars off of kids buying ringtones on their parents’ dime so I’ll just nod and smile.

-A.S.

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