Mobile Devices Seen Doubling by 2020
With the number of cellular connections nearing the number of people on the planet, the fast-growing cellphone industry could hit a wall if it doesn’t convince people to get more than one wirelessly connected device.
So will things really level off?
“We definitely don’t think that’s the case,” said Mike O’Hara, head of marketing for GMSA, a cellphone industry trade group. Rather, O’Hara said, recent research suggests that the industry will go from six billion connections today to more than 12 billion by 2020.
Revenue for the industry could grow to $1.2 trillion, according to a study done by Machina Research for GSMA.
“That’s a significant growth for our industry,” O’Hara said.
GSMA, which puts on the annual Mobile World Congress event in Barcelona, announced its study results in San Diego, just as rival U.S.-based CTIA was kicking off its fall trade show. The event includes a panel with AT&T emerging devices head Glenn Lurie and Qualcomm Senior VP Bill Davidson.
Lurie said we are just starting to understand how big this market is going to be. “We’re really just scratching the surface,” he said, reading from his iPad — one of the most popular of his company’s connected devices. “That ‘next big thing’ is this.”
Qualcomm’s Davidson said he remembers his days at Bell Atlantic, carrying around a wooden prototype of a Sierra Wireless modem several years back, knowing that was going to be the future of the cellphone industry. That said, things haven’t progressed exactly as the industry expected. Early on, it was anticipated that business would be the primary driver of mobile data use.
“It’s clearly been driven by the consumer,” Davidson said.
Lurie noted that AT&T, which started its emerging devices business three years ago, has had to change the way it does business, such as coming up with more flexible business models, rather than just monthly pricing and two-year contracts. A couple of years ago, the cost of a wireless module was a big hurdle. Now, he said, that is not necessarily the case.
The key, he said, is to make such products and their pricing simple.
“If we don’t, we are going to fail,” Lurie said.
This event is still going on. Check back for updates.