View From Above

April 28, 2014  7:45 AM

Saying so long to View from Above

Ron Miller Ron Miller Profile: Ron Miller

Good bye signAlmost 3.5 years ago, I started writing this blog and today represents my last post. At the time, I wanted to explore the cloud-mobile connection, and I still believe to this day, that while each can exist on its own, they work so much better together. That much hasn’t changed since I wrote my first post in December, 2010.

But the notion was a tad radical back then. The iPad hadn’t even been around for a year yet. The cloud in the enterprise was still somewhat foreign, not withstanding, but over the years, many now recognize the power of this notion, that when you put content in the cloud, you can access it from anywhere, any time, from any device –and that’s still as powerful as when I first conceived of this blog.

Millions of people now own smartphones and tablets. And the idea of apps connected to the cloud has completely transformed the way we do business. In fact, today people expect their business tools to work as well as the ones on their smartphones and that’s proven to be a mighty high bar for business to reach. Businesses appear to have mixed results with their attempts at creating mobile apps so far.

But while they struggle to find their way in this mobile-cloud world, their users are already there using free and low-cost tools, not because they hate IT, but because IT isn’t giving them what they need to do their jobs. This idea, sometimes called The Consumerization of IT, has completely altered IT’s role inside organizations and the repercussions of that change are still being felt.

Meanwhile, the cloud with its cheap, elastic resources gives anyone with a device –whether mobile or a desktop or laptop –the ability to access software, infrastructure and developer resources for a minimal investment. In days gone by, you would need ridiculous amounts of capital to build out your own data center. Today, you can go online and get what you need for an increasingly low price. That means anyone can try a business model with very little risk, and that’s putting pressure on just about every business.

While the cloud transforms the competition and end users, IT meanwhile has struggled to come to grips with it and how to take advantage of these devices. Without BlackBerry, IT has ceded control of mobile to users, and the Bring Your Own Device idea means that folks are free to use the phones, tablets and laptops that they like instead of the stodgy ones given them to by IT that were often obsolete months after they were issued.

Of course, for every new idea, there are unintended consequences too, and IT still has a job to do. They just have to learn that it’s about protecting the data today, more than the device, and that’s not always easy to understand.

Over the next several years, I think most of this will be worked out. We will see companies developing their own mobile apps as a matter of course. We will see them using cloud resources in great numbers and we will continue to see the power of using the mobile and cloud together. I’ll still be watching, but it won’t be from this space. So long and thanks for a great run.

Photo Credit: Sarah Joy on Flickr. Used under CC 2.0 license.

April 21, 2014  6:37 AM

Amazon won’t win smartphones with 3D gimmicks

Ron Miller Ron Miller Profile: Ron Miller

Teenager in 3D glassesBack in 2011, I participated in a press tour at CeBIT, the mega technology trade show that happens yearly in Hannover, Germany. Among the cool stuff they showed the press was the LG Optimus 3D phone that promised 3D without glasses on a smartphone. It looked pretty cool, a great bit of tech fodder for the journalists there, but it never went anywhere with consumers, who it seemed were unimpressed with 3D viewing.

So it goes with mobile. You just never know what’s going to capture the attention of a fickle and often hard-to-please market. That’s why I wasn’t exactly knocked out when I read a recent TechCrunch report (where I’m also a contributor) that Amazon plans a phone with…wait for it…3D effects. I don’t think a lot has changed in the 3 odd years since LG announced its 3D phones and I don’t see a public clamoring for such a device.

Now, it’s worth noting that Amazon is going for a different 3D effect. If I recall correctly the LG model was about watching video in 3D without glasses. According to TechCrunch, the 3D effects are going to be driven by head gestures and only a couple at that, out of the box (although it doesn’t go into great detail about how that will work).

I have to admit the effect sounds cool as far as it goes, but is it cool enough to drive people to buy Amazon phones in large numbers? In other words, is it enough to get them to switch from the comfort of the Apple or Samsung phones? I doubt it. It might be enough to get some early adopters and tech geeks to try one to see what the fuss is about, but unless this is truly ground breaking (and it’s always hard to know just how the final product will look when it comes to unnamed sources), this is probably not going to have the impact of even say the Kindle Fire.

It’s worth noting that Amazon keeps sales figure close to the vest so it’s hard to ever know with any authority just how well they are doing, but the Fire appears to be selling at least OK as Android tablets go. But I see very few of them in the wild in my checks of devices. And  as James Kendrick, who is as big an authority on the tablet as you are likely to find put it, the iPad is everywhere; Android tablets not so much. He writes, “While I see iPads everywhere I go, the Android tablet is nowhere to be seen. Not even models from giant Samsung are evident.”

So as hard as Amazon has pushed the Kindle Fire, and as much sense as makes to have a device that links to all of the great content on, including their music and video services, the buying public doesn’t seem to be biting.

And Amazon faces an even stiffer battle in the mobile phone market. When Amazon came out with the Kindle Fire, while iPad had a big head start, the tablet market was still very much being defined. Today, the mobile phone market is far more mature and they face an entrenched market with two highly established leaders with loyal followers.

That’s not to say that people will never switch and break that hegemony, but a few cool 3D effects are probably not going to give them the market lift they are hoping for. I understand why they want to try this, but I think the effort is doomed from the get-go.

Photo by Evan on Flickr. Used under CC 2.0 license.

April 15, 2014  10:54 AM

Microsoft might not win mobile front end, but has a good shot at back-end management

Ron Miller Ron Miller Profile: Ron Miller

Nokia 1520 smartphones in various colors.The new version of Windows Phone OS, 8.1, was released yesterday to the developer community and early reviews say it’s enterprise friendly, but is that enough in an age when people are choosing their own devices?

It may very well be as Simon Bisson wrote on CITEworld (where I’m also a contributor) that Windows Phone OS is the new BlackBerry, at least where the back-end administration is concerned. I can’t speak to directly to the IT-friendly features, but Bisson tested them out and he was impressed with what he found.

That’s all well and good as far as it goes. Of course, IT wants to protect the company’s assets as people go out in the world with their smartphones, and even in the age of BYOD, that remains very much part of their job description.

But here’s the thing:  This *is* the age of BYOD and that means employees and not IT are selecting their phones, and as we’ve pointed out here before, when given the chance to choose their phones, employees tend to choose iPhones or Android phones (usually Samsung if marketshare statistics are accurate).

Microsoft isn’t wrong of course to take this approach, and you will very likely hear the IT community applauding loudly, but end users want what they want. That’s the whole point of BYOD and as long as they are making the phone choice instead of IT, that’s probably not going to change very much.

You’ve seen the marketshare statistics. I’m sure I don’t have to rehash them at this point, but outside of some isolated pockets of popularity, phones running Windows remain under 5 percent worldwide and a few features that make IT happy aren’t likely to change that figure substantially.

End users like to choose a phone because of what’s on the front end facing them. Even though they should probably care about the back end administration, it’s not what they think about when they buy a phone. It’s very much about how they interact with the phone. They probably aren’t thinking, “Gee, this phone would be a great choice because IT will love it.”  I just don’t see many people having that on top of mind when they’re making their phone purchase.

Unless we are going back to the days when IT starts picking phones for people, and folks carry a phone for work and one for themselves –and I don’t see that happening –the fact this update is friendly to IT just isn’t going to matter very much in the scheme of things.

I’m not suggesting by the way, that IT concerns don’t matter because of course protecting the enterprise is important, and Microsoft has been smart enough to create a mobile management suite that works across devices whether that’s InTune for mobile management or Azure Active Directory for identity management in the cloud, as just a couple of examples.

This might not help Microsoft sell more Windows phones, but it could make their backend mobile administrative tools more attractive to a broader group, especially in companies that use a lot of the Microsoft enterprise software stack anyway. And that may be good enough for Microsoft in the long run.

Photo Credit: Microsoft. All rights reserved.

April 11, 2014  9:18 AM

Counting down until BlackBerry’s end of days

Ron Miller Ron Miller Profile: Ron Miller

Chess boardAs I watch BlackBerry these days, I’m frankly astonished it’s still here. The company that once ruled the smartphone market in its hey day, has watched its marketshare slip to levels so low, they barely register. The question at this point is how this company is still standing?

We have watched the once proud BlackBerry (nee RIM) stumble and bumble through attempts at touch screen smart phones and hard keyboards and back around again. We have watched the parade of CEOs and we seen them grasping at strategies, any strategies to find something that would stick.

Food writer Anthony Bourdain once wrote (and I paraphrase from memory) that once a restaurant starts making changes to the menu or the hours it’s open trying a variety of ways to make the business work, you know it’s in trouble. That’s how I see BlackBerry these days, desperately trying to change their menu and nobody is coming to buy their food.

Unfortunately for them and the few hard-core fans left out there, nothing has seemed to work. How low can you go? We saw this week that BlackBerry has yet to hit rock bottom when CEO John Chen decided to cut ties with T-Mobile. As my friend and colleague Wayne Rash wrote on eWeek, Chen was clearly putting pride before profits in his decision to drop T-Mobile.

At this point, Chen can’t afford the luxury of dropping anyone, even if he’s upset that T-Mobile is apparently no longer making BlackBerry phones available in their stores, and have actively marketed iPhones to BlackBerry customers. I get how this could upset Chen, but as Rash pointed out he’s putting pride before common sense here. Rash also pointed out that the deal could be salvaged, but that remains to be seen.

It would be reasonable ask if it even matters because Reuters reported this week that BlackBerry could be considering exiting the handset business. That wording suggest that BlackBerry actually has a choice in the matter because if nobody is buying their phones, they have little recourse, but at some point, to stop selling them. Quoting Chen himself in the Reuters’ piece, he seemed resigned to the situation, “If I cannot make money on handsets, I will not be in the handset business,” he told Reuters, adding the timeframe for such a decision was growing short.

As though to prove my restaurant comparison, Chen talked about a number of approaches including small acquisitions, strategic partnerships and machine to machine (M2M) communications. I wrote recently about their strength for now at least in the car OS market as they struggle to find a new identity.

Chen was frank in the Reuters article acknowledging his predecessor’s errors and that he had little time left to waste to right this ship if it was going to be righted, saying “You have to live short term. Maybe the prior management had the luxury to bet the world would come to it. I don’t have the luxury at all. I’m losing money and burning cash.”

At this point, it seems some sort of ending for this company is inevitable and we are only counting down to the end days while Chen tries all manner of strategies to help his struggling company survive. Unfortunately, it seems at this point, he can only hope to make it more attractive for a potential suitor.

(c) Can Stock Photo

March 31, 2014  12:48 PM

BlackBerry struggles to find a new identity

Ron Miller Ron Miller Profile: Ron Miller

BlackBerry cell phone around 2010It can’t be easy for BlackBerry CEO John Chen. He basically took over a sinking ship, a company that once dominated the smartphone market finds itself dropping well below 5 percent market share. Clearly it can’t survive simply as a handset maker, but could there be another way for the company to redefine itself?

It’s no secret that BlackBerry was once the darling of big business, but that was in the days before iOS, Android and BYOD, and despite a still fiercely loyal base of users, BlackBerry has watched while its market share plunged and the company desperately tries new phone strategies. Just last week, CEO John Chen suggested that BlackBerry would go back to its roots and offer a new high-end phone with a hard keyboard, but that clearly didn’t work with the Q10 last year, so it’s unclear how it would work going forward, even on a redesigned phone.

And even while BlackBerry tries to find ways to staunch the bleeding, even its most diehard customers in finance appear to be moving on. A recent survey found that a third of respondent companies had already abandoned BlackBerry and 41 percent of others are exploring alternatives in preparation for moving on. Even the government, the other hardcore customer is looking at alternatives.

Just last week came more bad news in the form of BlackBerry’s latest earnings report, but even as CEO Chen pleads for shareholders to be patient, it’s hard to imagine after watching the company decline for so many years, that there’s much of that left.

Against this back drop, was there any good news for BlackBerry?

Well as a matter of fact there is a glimmer of hope for the beleaguered phone maker. Bloomberg reports that BlackBerry’s QNX operating system is the system of choice for many of the world’s car makers including Ford and BMW. And this is an area that both Google and Apple would desperately like to exploit. Chen sees an opening in the car market along with the burgeoning connected device market (also known as the Internet of Things) and the data these devices are going to be producing.

But the question remains whether BlackBerry can make this pivot and find a way to transform itself.

When I attended Mobile World Congress in February, a BlackBerry spokesperson also suggested that the phone maker would be trying to enter the low-end phone market in attempt to jump start marketshare anyway it could.

BlackBerry desperately needs to lead something and the developing car market is a good start. It’s hard to imagine at this point that they can hope to capture any significant traction in the phone market, even with the new strategy to capture low-end market share, but if the company can begin to expand in different directions, it offers some hope that they can find a way to redefine themselves as a software and services company, a direction Chen has suggested could offer a future for the company.

At the very least, Chen could make the company more desirable for an outside buyer and provide a way to maximize the shareholder’s return on investment. For now, Chen continues to push buttons and pull levers and hope for the best. What else can he do?

Photo Credit:  m lobo on Flickr. CC 2.0 Attribution-ShareAlike License

March 27, 2014  9:02 AM

Cloud competition is a beautiful thing

Ron Miller Ron Miller Profile: Ron Miller

Two young men in wrestling match.Scott Boras is the premiere agent in Major League Baseball. His players tend to make top dollar, and there is nothing Mr. Boras likes better than when two big market teams like say the Boston Red Sox and the New York Yankees have their eye on the same player and that starts a bidding war which drives up the value of his clients even further. Competition you see is a beautiful thing when it comes to ball players maximizing their value on the open market.

Competition in technology has the opposite effect though. Instead of forcing the price up, it forces them down. If one major player makes a price adjustment, it’s pretty much a given that the others are going to follow.

We saw that in force this week when Google and Amazon, two companies going toe to toe in infrastructure services both announced aggressive pricing changes. On Tuesday, Google got the ball rolling when it announced a set of price cuts on its Compute Engine services, designed to draw people from competitor Amazon Web Services. Google was offering a 32 percent price reduction for on-demand instancing and 85 percent on its BitQuery service. It was clear Google was going for Amazon’s throat with these moves.

But not to be outdone, Amazon held a press conference of its own the next day and announced, you guessed it, a series of price cuts. Nancy Gohring, writing on CITEworld (where I’m also a contributor) did a nice job of breaking down the price war and offering some means of comparison

Competition has always been a positive force for markets. It fights complacency, drives innovation and as we’ve seen, brings down prices.

Amazon had a massive head start in Infrastructure as a Service game, just recently celebrating its eighth birthday. As I wrote last week about AWS’s birthday, it really was a game changer:

“And this week, that little service that could turned 8 –and it’s a huge force that helped change the way we think of provisioning hardware, software and programming platforms. It helped change the business of enterprise computing and created entirely new businesses.”

But being first is never enough. It only gives you the advantage of having a head start, but that advantage can melt away pretty fast when a company the size of Google decides to get involved. Google up to this point has been content providing other cloud services, especially around software, but now it has set its sights on infrastructure and just by virtue of its sheer size and reach, it’s an immediate and formidable opponent for AWS.

But just because Google is big and rich doesn’t mean it can come in and take over the market. It still has some things to prove and IT pros who were afraid of the cloud aren’t very likely to be warm and fuzzy about Google, a company that many still don’t trust with software, nevermind their hardware infrastructure.

Google has lots of cash though and it can afford to undercut Amazon and that could draw some customers away in the short term, but Google is still going to have to do more than cut prices. It’s going to have to aggressively innovate and prove to a skeptical public that it’s committed to this project for the long term.

Amazon might have changed everything, but Google is trying to sweep in and take away some of its customers –and as the competitive fires heat up, one thing is absolutely clear –consumers are going to win.

Photo Credit: Ron Wise on Flickr. Used under CC 2.0 license.

March 19, 2014  11:22 AM

Microsoft finally readies Office for iPad…two years too late

Ron Miller Ron Miller Profile: Ron Miller

two stacked iPad boxes.Over the next couple of weeks, the Microsoft hype machine will be out in full force. It started quietly like a slow moving train leaving the station at the SharePoint Conference a couple of weeks ago. It picked up speed with the OneNote announcement this week, and it will reach warp speed next week when Satya Nadella himself, the new face of Microsoft, is expected to announce Office for the iPad.

You will hear many people say positive things about how Microsoft has new leadership and new direction. You will be told that this is the beginning of the beginning of a new day at Microsoft. You may even believe it because you will hear it a lot from a lot of people who should probably know better.

But when you get down to it, and you look under the hood, and you peer closely at what’s going on, you will see there’s not much to see at all. Sure, Microsoft is presumably coming out with Office for the iPad –see the machine is cranking already –but sorry to be the bearer of bad news,  no matter how much that hype machine spins the news, it can’t get around the fact Microsoft waited way too long for this announcement.

It should have released this two years ago. No, it should have released it three years ago, but Steve Ballmer was probably too fixated on fighting Apple, his Don Quixote-esque quest, to see that if you want to be the software of choice, you have to be on the machine of choice –and people were moving to the iPad in huge numbers. Perhaps Steve was too blinded by his odyssey to see that.

But in 2014, a full five years after the release of the iPad, it’s way, way, way too late for Microsoft to play catch-up now. In fact, no matter how loudly that hype machine drones to the contrary, people simply don’t care enough about Microsoft Office anymore, not the folks who have moved on from a PC-centered world, and if the numbers are true, that’s a lot of people.

Microsoft wants you to believe its Reagan-esque message. It’s morning in Redmond. A new day is dawning, but when you wake up the day after the announcement and the hype machine is jacked up like a meth head, nothing much will have changed.

Microsoft is not exactly a dead company walking, but its best days were over a decade ago when it ruled the desktop world. It still thinks of the world as a desktop, even as it gives a new cloud and mobile message.

The fact is I don’t need a monolithic desktop-style office suite to do my work on a tablet, and if I did, I wouldn’t use a tablet, I would use a laptop. Microsoft’s cloud and mobile strategy to this point sounds great on paper, but when you look at it closely, you see it’s just desktop Microsoft in a different guise.

Look, disrupted companies have come back from the abyss. IBM looked dead in the water in the 90s and it managed to reinvent itself, only to be disrupted again today. Adobe just announced a good quarter as its move from desktop to cloud seems to be working. It could happen that Microsoft suddenly gets it and puts out products for the cloud-mobile paradigm, but don’t expect Office for the iPad to change all that much –no matter what that old hype machine might tell you.

Photo Credit: niXerKG on Flickr. Used under CC 2.0 license.

March 18, 2014  7:15 AM

Let’s put an end to the cloud-mainframe comparisons

Ron Miller Ron Miller Profile: Ron Miller

Mainframe computers

There was an SNL skit in the 1990s with Mike Myers called If it’s not Scottish, it’s crap, and when people mixed up Scotland and Ireland, he would angrily point to a map and say “There’s Ireland! There’s Scotland! There’s the bloody sea! They’re different!” I feel that way when I hear old-school IT pros try to argue that the cloud is just an update of mainframe time-sharing.

Can we please put that comparison to rest. While they both involved sharing in a sense, they are not really related at all, anymore than Scotland and Ireland are.

Don’t make me pull out my map and pointer.

Mainframes in the 70s were huge computers and when people needed computing power to do anything, they got in line, paid a fee and they got their few minutes of power for whatever time they got access. Computing power was a scarce resource. Memory and computing cycles were expensive and you used what you needed and nothing more (and there probably wasn’t a lot left over even if you did need more).

In other words mainframe system sharing was based on an expensive scarce resource where little computing power existed.

Now, let’s compare that with the cloud.

The cloud developed at the same time computing power was growing ever cheaper. It provided infrastructure (servers, memory and storage) for pennies on the dollar. Instead of being expensive and scarce, it was cheap and abundant. If you needed more, you paid for more. So if you had an event like an election or a Black Friday when you knew you would require much more server power temporarily, you could easily scale up for that event, pay for the extra resources and scale back when the event was over.

Imagine requiring 100 extra servers for a two-day period. It would make for awkward planning in a private data center, or it would be impossible. No CIO in his right mind is buying a bunch of servers for a temporary event, only to put them in storage when the event is over. It’s simply not going to happen.

And it’s not just infrastrastructure, programmers can build programs on cloud development platforms and have access to a bunch of services such as security and authentication and not have to build them from scratch. They only have to connect their application to those services, a much faster, easier and cheaper development path.

And of course, there’s software as a service. Instead of worrying about seats and licenses you will probably never use, in most cases you buy only the number of seats your company requires and as your company grows or shrinks –because that happens sometimes too –you only pay for what you use.

The breadth of the cloud is completely different from the mainframe. The costs are turned on their head and you have access to as many resources as you need and competition is actually driving costs down over time. Just last week, for instance, Google dropped its storage prices in response to a similar move from Yahoo!. That’s competition working for you as a consumer.

How low did they go? They dropped the monthly price of a 100 GB of extra storage from $4.99 to $1.99 and a terabyte from $49.99 to $9.99. That’s a steep and significant price drop and it comes from abundance and competition, the opposite of what we saw with the mainframe.

The mainframes might have also involved shared computing resources, but it was an entirely different level and scale and today’s cloud tools provide companies with the ability to build businesses for a fraction of the cost it would have if they were required to build their own data center. The Mainframe provided computing resources where little existed, but it didn’t have the disruptive force that the cloud has precisely because it’s so cheap and so widely available.

What’s more, mobile and apps have developed in large part because of the cloud and the ability to store and access content across multiple devices from anywhere at any time. The cloud pushed this development.

Mainframes in the absence of PCs simply provided some computing resources for the few where none existed. The cloud provides resources for anyone in virtually endless abundance.

As Mike Myers might have said, “Cloud, Mainframe, resources, different!”

Photo Credit: (c) Can Stock Photo

February 28, 2014  9:40 AM

Microsoft, Nokia and the struggle for marketshare

Ron Miller Ron Miller Profile: Ron Miller

Green bus with Nokia X on backIt’s no secret that Microsoft is on the verge of completing a deal to buy Nokia’s handset division, but Nokia raised eyebrows this week at Mobile World Congress when it announced an Android phone running Microsoft services.

The announcement triggered questions about Microsoft’s mobile strategy moving forward, and highlighted their continuing struggle to gain additional marketshare.

I spoke to Greg Sullivan, who is a 24 year Microsoft marketing veteran. Sullivan was honest about the challenges Microsoft faces in an entrenched mobile market, but he was quick to point out Microsoft’s successes and he was proud of the device ecosystem that’s built up around Windows 8.

While Sullivan pointed to the huge growth numbers last year and the gains in certain markets, it’s hard to get around the 3.5 percent worldwide share reported by IDC in its most recent report. The situation in the US is even worse with Windows struggling mightily to gain any traction, but Sullivan says Microsoft isn’t about to back down any time soon.

“Here’s what we believe: If you are in third place, you have to be faster than the guys in front of you. We agree there are challenges. It’s an incredibly dynamic and competitive market. We are doing what we need to do to grow share.”

The question is whether that’s enough.

But Microsoft continues to push buttons and pull levers and hope that the market begins to develop for them. One way to do that is to offer a variety of phones at different price points. It’s clear that Android was able to scale quickly by open sourcing the OS and watching as manufacturers all along the pricing spectrum built Android devices. This helped grow their market very rapidly.

“One of the strategies, is for our platforms to enable scale through a broader range of devices along the price curve,”  Sullivan told me. This could be the thinking behind the extremely low-priced Nokia X line, 3 phones that run 89, 99 and 109 Euro respectively. While Sullivan and the Microsoft PR team were quick to point out at the beginning of the interview, they couldn’t address this approach because they are still separate companies, a Nokia spokesperson told me the phone had been designed to run Microsoft services and the shareholders should be pleased by this approach. Nokia also saw these phones as a gateway or feeder system to the higher end Windows phones as emerging markets where they are marketing these low-end phones mature.

Sullivan told me that when Microsoft bought Nokia they weren’t just buying the Nokia Windows phone division, they were buying the whole package which includes many phones that aren’t part of the Windows ecosystem. He pointed out that Nokia was selling millions of non-Windows phones before the acquisition was ever announced, and the X Line is simply an extension of that.

“[The X line] makes it more interesting because it’s Android, but if you look at the larger picture, [Nokia] sells 100s of millions of devices that don’t run our OS, and that [has the potential to] bring millions of people into the Microsoft system and act as onramp for Windows phone.”

Microsoft is clearly not going to cede the mobile market to Apple and Google without a fight, and as a colleague and I were discussing earlier this week, having a healthy Microsoft mobile product line is good for competition, but getting over 5 percent is looking like a struggle for now, even while Microsoft is hoping they can attack the low end of the market to build share moving forward.

Photo Credit: Ron Miller. Used under CC 2.0 license

February 18, 2014  6:12 AM

IDC: China smartphone growth slows for the first time in over 2 years

Ron Miller Ron Miller Profile: Ron Miller

Chinese woman looking at her smartphoneChina is such a huge country, it probably seems like a bottomless pit of market potential to smartphone manufacturers, but nothing goes up forever, and  growth took an unexpected tumble last quarter, as IDC reported, smartphone shipments to China dropped for the first time in 9 quarters.

Let’s start with the raw numbers. According to IDC, manufacturers shipped 90.8 million units to the Asia/Pacific region last quarter compared to 94.8 million in the previous quarter, a 4.3% quarter on quarter drop.

Engadget kindly broke down these numbers a bit further by phone manufacturer.

For mainland China, Samsung was the big winner with 19 percent. Lenovo was second with 13 percent, Coolpad (which I’ve never heard of) came in next at 11 percent, followed by Huawei at 10 percent and Apple at 7 percent. No, that doesn’t come close to 100 percent and the remaining phones were lumped together under Other with 40 percent of the phones shipped to mainland China apparently from a variety of manufacturers with percentages too small to measure on the pie chart.

Whatever the reasons, and IDC offers several theories as to why the shipments dropped, they predict it’s likely temporary glitch, but there is also the possibility that China could be reaching market saturation. In spite of the population figures, those who have the money to buy smartphones, might have already done so or moved onto other devices such as phablets, leaving smaller screens behind (at least for now).

So where will manufacturers begin to look for growth areas? India is looking like the biggest up and coming market rising to the number 3 market in 2013, passing the likes of Japan, the United Kingdom, South Korea, Germany and France, all of which ranked hire just a year ago.

For companies marketing low-end phones, this could bode well, but for a company like Apple, which lives at the high end of the market, and has not traditionally sold well in India because of the high price of its phones, it might not be great news.

Apple signed a couple of key deals toward the end of last year with Chinese providers, which on their face would seem to point to market growth for Apple in China, but if the market is shrinking that could have an impact on Apple’s ability to grow its worldwide market over the next couple of years.

There is also the matter of Lenovo buying Motorola Mobility, which could give it further inroads into the higher end of the Chinese smartphone market in the coming year giving Apple more competition from a local company, possibly making China an even bigger challenge market for Apple. The Moto X is the most sophisticated Android phone I’ve seen to this point and perhaps the fact it’s so customizable could appeal to that market.

It’s clear that Asia represents a huge market for smartphone manufacturers to sell their wares, but it is also a tremendous challenge to conquer these markets and find a balance between phone quality and market demand to take advantage of the numbers that await them. The winners are obviously going to have great gains because even a small percentage of China and India represents huge numbers.

Photo Credit: (c) Can Stock Photo

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