Smartphones displacing notebook PCs?

The coming crop of smartphones are data friendly, third-party software friendly phones with Wi-Fi. But there’s more! The processing power of the ARM application processors used in phones lags that of mobile PC CPUs by about 7 years, so this year’s phones will have roughly the computing power of a 2001 laptop.

These changes come together to make phones chip away at the uses of notebook PCs. Many people who used PCs only for email now use Blackberries instead. Many phones are good substitutes for personal organizer software on PCs. The iPhone can credibly substitute for a PC for web browsing.

These trends motivated Instat to say last November:

Smartphone use will grow mostly from use as a laptop replacement

According to Gartner, the year-on-year notebook sales growth numbers for notebook PCs from 2004 to 2007 remained healthy: 36%, 28%, 22%. The crossover in unit volume came in 2006, when smartphones and notebooks both shipped roughly 80 million units worldwide. That 22% unit growth in notebook sales from 2006 to 2007 represented a jump to over 100 million units shipped. Compare this to a 70% jump in smartphone unit shipments in the same period, to over 130 million.

Open wireless handsets and networks for America?

I have previously written about OpenMoko. It seems now that it was the drop before the deluge. Google’s Android appears to have gained good traction with Sprint and T-Mobile joining the Open Handset Alliance, with Dell rumored (update) to be planning an Android-based phone, and with Verizon expressing lukewarm support. Nokia has for some time sponsored open source handset software through, but this week it upped the ante with its acquisition of TrollTech. Trolltech is responsible for Qtopia, a semi-open source platform used in Linux-based phones. That makes four credible Linux-based mobile phone software platforms. Update: Make that five – the LiMo Foundation is a consortium of carriers (including NTT DoCoMo and Vodafone), phone makers (including Samsung, Motorola and LG) and others “dedicated to creating the first truly open, hardware-independent, Linux-based operating system for mobile devices.”

But a phone doesn’t have to be open-source to be an open application platform, and this category is just as vigorous, but better established. Nokia’s Symbian phones have always been open to an extent – there are over 2 million developers registered in Nokia’s developer organization, Forum Nokia. Then we have Microsoft. Microsoft claims that sales of Windows Mobile phones are set to double year-on-year, to 20 million units. Windows Mobile provides a sufficiently open application environment that applications like Skype run on it. The iPhone is not yet officially an open application environment, but there is still a healthy slate of applications from third parties for those with the stomach to take the unofficial route. This is scheduled to change in February when the open-ness goes official with the release of Apple’s SDK for the iPhone. So that’s three major open application environments for smart phones.

2008 is also the year that Wi-Fi phones will come into their own. The dam broke with the iPhone. Wi-Fi on the iPhone raises the bar for all the other smart phones, making Wi-Fi a baseline checklist item for the next generation of smart phones. Previously mobile network operators were fearful that Wi-Fi in a phone would divert traffic from their data networks. This fear led, for example, to AT&T’s removal of Wi-Fi from their version of the Nokia E61. But there is now new evidence. At last week’s IT Expo East I heard an unsubstantiated report that 60% of wireless data usage in December was by 2% of the phones: iPhones. If this is even partly true, it would demonstrate that a web-friendly phone will drive traffic on the cellular data network even when it has Wi-Fi.

Open wireless networks for America?

David Hattey, CEO of FirstHand Technologies points out in an opinion piece on CNET that US mobile network operators may be opening up their phones to third party applications. He cites two announcements from last November: Apple’s announcement of an SDK for the iPhone, and Verizon’s “Any Apps, Any device” announcement.

This point was echoed in the New York Times article on the 700MHz spectrum auction that I wrote about earlier today:

The new rules have already begun to reshape the rapidly emerging wireless broadband industry. It prompted Verizon and AT&T to change their policies and open their networks to new applications and devices, just as Google and its allies had hoped.

“The issue has melted away,” Mr. Martin said. “It is no longer as controversial, as the major providers have moved to open up their networks.”

700MHz Spectrum Auction Starts Tomorrow

700MHz is particularly valuable spectrum because it passes through solid barriers more easily than other frequencies. The New York Times has a good background article:

The radio spectrum licenses, which are to be returned from television broadcasters as they complete their conversion from analog to digital signals in February 2009, are as coveted as oil reserves are to energy companies. They will provide the winners with access to some of the best remaining spectrum — enabling them to send signals farther from a cell tower with far less power, through dense walls in cities, and over wider territories in rural areas that are now underserved.

The links to the right will take you to the FCC site for this auction, and to Wired Magazine’s FAQ.

iPhone update reaction

The iPhone update seems weak to have been one of the four main points of the MacWorld keynote. A couple of refinements to Google Maps and some minor eye candy on the home screen. Send SMS messages to multiple recipients – presumably put in at AT&T’s request. Some improvements to the iTunes service.

Apple delivered neither of the two improvements I actually wanted, a voice recorder and text cut-and-paste.

That there was no announcement of a 3G iPhone is not really a surprise. I expect that will be announced the day it is ready to ship. Just as a guess, it seems reasonable to expect it on the one year anniversary of the original product release, in June, or of the European release, in October. More likely October, since Steve Jobs said last September that 3G chipsets wouldn’t be power-efficient enough for his needs until late 2008.

VoWi-Fi for Sony PSP

Sony has added Skype to the PSP. The Sony CES website says:

Call friends, talk trash to fellow gamers or catch up with acquaintances via Skype for PSP system.

PC Magazine says that the PSP supports both SkypeIn and SkypeOut, so the PSP can substitute for a phone when you are at home or somewhere else where you have Wi-Fi access.

This isn’t a breakthrough, just another feather in the scale, tipping us towards a world where just about any connected device can make an internet phone call. The speed of this evolution is governed by the enormous legacy public telephone network; because of Metcalfe’s law anything that aspires to be a useful substitute for the phone system must first interoperate with it.

Sauce for the gander

Qualcomm has a massive number of patents in cellular technology, including most (all?) of the fundamental CDMA patents. Qualcomm owns a substantial number of the patents used in your cellphone, and gleans enormous revenues from licensing them. This is as it should be. Inventors should be rewarded for their creativity. But Qualcomm is notorious for going one step further, claiming that its intellectual property is even more valuable than it actually is, and using its patent portfolio aggressively.

So Qualcomm’s competitors are undoubtedly chuckling over Qualcomm’s comeuppance this week at the hands of Broadcom.

I don’t know the details of this case; for all I know it may be another travesty like the NTP/RIM case, where RIM was forced to pay hundreds of millions of dollars to a patent troll with patents that the USPTO apparently found to be invalid. The huge difference here is that Broadcom doesn’t just own the patents that Qualcomm was found to be breaching, but unlike NTP Broadcom uses those patents in its own products that compete against Qualcomm’s.