Weekly Wrap: Samsung Goes Second
By Carlo Longino, Fri Dec 03 16:15:00 GMT 2004

Samsung overtakes Motorola as the number-two handset vendor, mmO2 signs on to i-mode, municipal Wi-Fi efforts take a beating, and more...

Researcher firm Gartner this week released its third-quarter handset sales figures, and they're the first to say that Samsung has passed Motorola as the second-biggest manufacturer, coming in about half a point ahead of Moto with 13.8 percent market share. Nokia's share rose above 30 percent again, but the real story is the battle between Samsung and Motorola, whose businesses are taking divergent paths: Samsung's margins are shrinking while its volume grows, and Motorola looks to be sacrificing market share to keep margins high.

As mobile phone sales continue to boom, demand is growing for cheap handsets, both in emerging markets where most users have low incomes, but also from users in mature markets interested in simpler devices. But, just as one end of the scale does down the other goes up: more and more advanced features are going mainstream and becoming important to a number of users.

One feature that's failed to set the world alight is MMS. Multimedia messaging hasn't really caught on with users, now one company is hoping an MMS chat service will make some waves. It's hard to see users finding MMS chat rooms very compelling, regardless of their interest in marrying computer-based IM and mobile messaging, since all the benefits of the system appear to go to service providers, not users.

In a move that didn't really surprise anyone, mmO2 announced this week it was licensing i-mode and would begin offering the services in Germany, Ireland and the UK. Existing i-mode licensee KPN is a bit miffed as it thought it had exclusive rights to offer i-mode in Germany through its E-Plus unit there, but it would appear DoCoMo interprets that exclusivity as applying only to the i-mode brand name. It's an interesting move in terms of handsets -- both in helping the i-mode alliance carriers better create volumes of scale, and perhaps also helping NTT DoCoMo source handsets from Western vendors.

Municipal Wi-Fi networks have been in the news a lot lately, given the interest by the city of Philadelphia to build and operate a citywide public network -- plans that were called into question when Pennsylvania's governor signed into effect a law keeping local governments from offering networks that would compete with incumbent providers. But Spanish regulators have shut down a city Wi-Fi network in Barcelona, claiming it was unfair competition to private companies. The rub is that the small, free network only allowed access to about 60 Web sites with information for tourists and local residents.

TheFeature member Russell Buckley submitted a story this week on the integration of mobile phones and traditional radio, surmising that done properly, it's a better combination than mobile television. People are accustomed to listening to the radio or music in the background while they do other things, making it well-suited to the mobile environment, and technological advances and innovation can make the experience more interactive.

New technology that uses liquid-filled chambers juiced with electricity to create tiny lenses that act like bigger variable-focus lenses could drastically improve cameraphone image quality. A small French company, as well as Philips Research, are working on the lenses and say they could appear in products in the next year or two.

Elsewhere on the site this week, TheFeature relaunched with a brand-new design, Mark Frauenfelder gets a feel for haptics, Howard Rheingold takes a look at manufacturers' efforts to send handsets down the fashion runway, and Steve Wallage looks ahead to how mobile operators will fare in 2005.