With this edition of Africa Telecoms focusing on the VAS industry in Africa, smartphones and their associated software like those produced by RIM becomes critical. With the November launch of BlackBerry App World in South Africa, has RIM seen a large uptake of downloaded apps? Can you divulge any of the figures associated with BlackBerry App World in South Africa?
BlackBerry App World™ offers a wide variety of applications across categories such as games, entertainment, instant messaging and social networking, news, weather, and productivity. Social networking apps like Facebook®, MySpace™ and UberTwitter are very popular among South African users. Other favourites include instant messaging apps like BlackBerry® Messenger and Google Talk™, news and information apps like Viigo™ for BlackBerry® and TIME Mobile, and weather apps like WeatherEye BlackBerry®. Since the global launch of BlackBerry App World in April 2009, we have seen subscribers download tens of millions of applications, such as multimedia, social networking, e-commerce, gaming and location-based applications and services, including 20 million downloads of Facebook and MySpace; and four million downloads of instant messaging clients. It is important to note that what is critical is quality applications, and not quantity. You need applications that are relevant to the mobile experience. Research shows that 99 percent of downloaded applications are discarded or ignored after just four weeks; as such the focus needs to be on SuperApps – those applications that once you start using them, you will wonder how you ever lived without them.
Is BlackBerry App World available in any other African countries besides South Africa? If so, has the download of apps in these markets been as successful as South Africa? Then, does RIM have an expected launch of BlackBerry App World to the broader African Market?
BlackBerry App World was launched in South Africa in November 2009. We are working hard to make BlackBerry App World available to our customers in other African countries. We have not yet issued a timeline of when regional versions of BlackBerry App World will launch in Africa.
With the prepaid market in Africa being substantially more predominant than the postpaid market, do you see this as a benefit or a hindrance to RIM’s penetration in Africa? And what is RIM’s strategy to tackle lower ARPU and prepaid markets in Africa?
The BlackBerry® Internet Bundle is available on contract and prepaid in various African countries. We believe that the prepaid BlackBerry service plans enable the network operators to reach an even broader audience in Africa. Internet penetration in general is low in Africa – the bottom line in terms of strategic focus is affordability and accessibility, not only in terms of the device but especially in terms of data costs. We believe the BlackBerry proposition will democratise online access for Africans in general.
Is RIM working with mobile operators directly in the development of software and apps for BlackBerry devices to ensure they become and remain locally relevant?
Our strategy has traditionally been carrier and mobile network operator led, and our alliance strategy is open ended – any partner is free to develop and grow applications. We believe this strategy ensures relevancy across all markets and assists operators in growing their businesses and customer relationships.
Is RIM currently working with any local African developers on any apps that would be designed in Africa, for Africa, by an African?
There are over 175,000 registered developers participating in the BlackBerry Developer programme worldwide. RIM has had a thriving developer community for many years, with well over 100 000 downloads of RIM’s Software Developer Kit to date.
Do you have any specific strategies that are implemented to assist the mobile operators to improve customer retention? There has been a contention made that device manufacturers are trying to retain their own customer loyalty. Is this feasible and will you be competing with various mobile operators for customer retention?
To date RIM has sold over 75 million BlackBerry smartphones and has over 36 million global subscriber accounts. We don’t seek to own customers, but rather to manage good relationships – we believe this allows mobile network operators to move beyond being simple vendors and to take up an active position with the customers. So, yes, we do have a very clear strategy aimed at allowing mobile operators to improve their retention and relationships with customers. The BlackBerry solution has proved to be a sound retention strategy for mobile operators around the world.
At the recent GSMA Global Mobile Awards in Barcelona, RIM introduced BlackBerry Enterprise Server Express, could you give us a brief run down on the product and the direct benefits this could have for an African SMME market?
BlackBerry® Enterprise Server Express is free new server software that wirelessly and securely synchronises BlackBerry® smartphones with Microsoft® Exchange (2010, 2007 and 2003) or Microsoft® Windows® Small Business Server (2008 and 2003). The new BlackBerry Enterprise Server Express software will be provided free of charge and provides users with secure, push-based, wireless access to email, calendar, contacts, notes and tasks, as well as other business applications and enterprise systems behind the firewall. It’s a cost-effective solution that allows companies of all sizes to support enterprise-grade mobile connectivity for all employees without compromising security or manageability.
Any major plans for the FIFA World Cup?
We believe that the forthcoming 2010 FIFA World Cup holds incredible business and marketing opportunities for South Africa and all companies that do business here. We believe that a vast number of BlackBerry users will travel to South Africa this year and we are in discussions with our partners in South Africa to ensure these visitors will have a seamless BlackBerry experience. We will make full use of the opportunities it presents.
Can you highlight some unexpected success stories and highlights since the launch of RIM in Africa?
The BlackBerry solution is available in over 30 African countries, in partnership with over 60 carriers. We believe that affordable smartphones, such as BlackBerry devices, coupled with services such as the BlackBerry Internet Bundle have the potential to bring Internet connectivity to many small businesses and consumers in Africa who could not afford it in the past. These smartphones are giving a whole new segment of Internet users access to communications, multimedia, navigation and personal productivity applications that allow them to stay in touch with everything that matters at work and at home. RIM is well positioned in this space due to the affordability and ease of use of the BlackBerry solution. As an example, the full BlackBerry solution offers South African end users unlimited ondevice Internet browsing and email access from their smartphones from as little as R59.00 a month (on contract and prepaid).
The BlackBerry device commands a phenomenal 20.8% share of worldwide smartphone sales, making it the second most popular platform after Nokia’s Symbian, and is the most popular smartphone among business users. To what would you attribute this success?
RIM has pioneered push email, making it work over the very first wireless networks, forever changing the way we work and communicate. RIM made smartphones before anyone even knew what a smartphone was. In the last quarter, approximately one in six phones shipped worldwide was a smartphone, according to the IDC. Business users are adopting the BlackBerry solution because of its reputation for enterprise-class security and reliability, coupled with its rich communications features and business applications. The BlackBerry solution also integrates seamlessly with the email servers and corporate applications that business customers use. We have focused closely on communicating how the BlackBerry solution delivers return on investment (ROI) to enterprises. It enables business users to boost productivity by enabling them to perform their duties more efficiently, and by adding more productive hours to their workday. It also allows mobile employees to remain productive when they’re away from their desks. That means workflow no longer needs to come to a grinding halt when someone involved in a business process is away from the office.
The BlackBerry device offers consumers the ability to converge all their devices into one unit. How do you see this convergence developing in Africa specifically?
Our focus is on simplicity, ease of use and accessibility – we will continue to focus on servicing this demand in Africa, as well as in the rest of the world. In the last quarter, approximately one in six phones shipped worldwide was a smartphone, which indicates that people are looking to take control over their business and personal lives with converged devices. Africa is no different from the rest of the world in this context – ease of use and affordability will remain key.
It is rumoured that RIM will be releasing up to 16 new devices in 2010. How many of these products will reach Africa?
We work closely with our carrier partners to make all of our latest devices available. When a new product is ready to be launched with one of our carrier partners we will issue a joint press release announcing the launch of the new product.
To what do you attribute the BlackBerry Messenger phenomenon and do you envisage this being as successful in Africa as it has been in Europe and the US?
BlackBerry® Messenger is a unique instant messaging service designed especially for the BlackBerry smartphone user. Wherever you are in the world, BlackBerry Messenger enables you to instantly chat, send and receive pictures and much more in real-time, making it the ultimate tool for people who want to keep in contact on the go. BlackBerry Messenger is proving to be very popular with users in Africa as well. The fact that it is included in the BlackBerry Internet Bundle and doesn’t cost users anything extra makes it a very effective and affordable way to communicate.
RIM recently launched the new WebKit browser. Initial reports look very promising, and with the ability to integrate via an update, will the WebKit browser be available in Africa?
On 15 February, Mike Lazaridis, President and Co-CEO of RIM, provided a sneak peek of what the RIM engineers have been up to. RIM has not yet issued a timeline of when the WebKit is going to launch. We will keep you updated accordingly.
Does RIM have any plans to develop a phone specifically for the African market, particularly in the light of competitor activity in the smartphone handset arena?
We believe that our current value proposition is perfect to address the African market. It is one of the most affordable ways to get connected to the Internet in Africa.
Kindle for BlackBerry. Is this the future for mobile devices, and where do you see the tipping point for Africa?
Mobile applications are changing the way we work and play. Today, the smartphone isn’t just about taking and making calls, or sending and receiving text messages. It’s a constant companion that keeps you in touch with everything that matters in your business and personal life. From productivity tools to personal navigation, and from social networking to shopping online, smartphones today offer an incredible range of features and functions. Many of these tools – like media players, GPS, and email – are available out of the box while countless others are available through third-party software vendors. As the number of smartphones in circulation grows, we can expect to see a larger variety of increasingly sophisticated applications reach the market. Soon, the device will become the remote control of our lives, giving us access to every business and home entertainment tool from wherever we are.One of the traditional obstacles to wider use of online applications for smartphones lay in the tariffs for mobile data. But mobile data is now affordable through offerings such as the BlackBerry Internet Bundle.
Mobile/wireless connectivity is at the core of BlackBerry’s mission. This must tie in perfectly with the company’s goals for Africa. Where do you see the growth potential for this iconic brand across the continent?
We plan to continue to lead and drive the smartphone market by offering customers innovative products and real value for money. RIM will keep evolving the BlackBerry brand, and offer smartphones with new features and functionalities that make life easier and more productive for professionals and consumers alike. We will focus on our core strengths – such as our industry-leading push email functionality and the robust security built into our products.
This issue of Africa Telecoms is focused on New Technologies. With your area of expertise being Mobile and Wireless, how would you describe the current condition on the Mobile and Wireless market when talking about Innovation?
Innovation is still very rapid and operates at several levels: Device hardware is evolving rapidly, for example we’re just seeing mobile devices with multicore processors exceeding 1 GHz, we’ll likely see several new types of display including 3D displays on a few mobiles in the next year or so, new sensors, new types of wireless such as Bluetooth 4, perhaps WiFi Direct protocols, wireless HDMI connections to screens and so on. We have economic evolution as well as technological evolution. Nokia is selling smartphones at EUR 115 retail (before tax), which means we’ll likely have sub EUR 100 smartphones next year. This makes smartphones accessible to a much wider range of people. Networks are also evolving. Many operators are on some form of HSPA. A few have started very early LTE deployments, and we can already see the next long term step on the roadmap which is LTE-A. We’re also seeing rapid innovation in mobile applications and services. Apple has over 300K apps, Android around 100K. Increasingly apps don’t just stand alone but integrate with innovative cloud services. We’re seeing growth in a wide range of mobile services such as payment, context, music, social networking and mobile advertising. I expect rapid evolution in all of these areas (and more) to continue for at least 5 years.
We would like to know from you what you believe will be the next big New Technology in the Mobile and Wireless space?
I don’t see any single “next big” technology. There are probably 20 technologies which are important including context, platform independent AD tools, Bluetooth 3 and 4, mobile HTML5, near field wireless, M2M, LTE, mobile augmented reality, haptics and new screen technologies. I think that in the mobile space, innovation often happens not from one single technology, but a combination of technologies. For example look at augmented reality (AR) tools such as Layar or Wikitude. These enable all sorts of new applications and visualisations such as location aware competitions, marketing, games, geotagging to name but a few. But AR itself is built on a set of underlying essential technologies such as GPS, e-compass, graphics accelerators and tilt sensors. So, in my opinion many of the innovations come from combining technologies rather than from a single technology. However, if I had to identify one technology which we don’t yet have, but when it arrives will be very influential, it would be indoor positioning. The holy grail in this area would be a technology that can locate your position indoors (where GPS doesn’t work) to within 1 metre or so. This would enable a wide range of applications such as indoor navigation, indoor AR, finding products on shelves in shops as examples. Sadly, we don’t yet have any single technology that looks as if it will become a dominant standard, although companies like Nokia have demonstrated some interesting possibilities.
In a recent Blog Post you spoke of the “Rule of 3” used in economic theory being applied across many industries. Specifically, you mentioned computers, PC’s and Mac’s for normal people and Linux for Geeks. Do you think this will be the case in the Operating System arena for Mobiles? And, if so would you care to take a guess at what they might be by 2020? Why do you think this will be the case?
I think mobile OSs will eventually consolidate to around 3 strong leaders, however it will take a long time; I don’t see it happening before 2015 at the earliest, probably later. At the moment the best candidates for the long term “top 3” are Symbian, Android and Apple iOS. But the game is still on and many things could happen before the market stabilises, so it’s not a very safe bet!
Mobile Operating systems are clearly a topic of interest worldwide with some interesting information coming out of Gartner over the last few weeks, specifically with declining Symbian and RIM market shares to increasing Android market share. What do you think the main drivers is in the world of Operating Systems?
I see this not so much as an operating system battle but an ecosystem battle. An ecosystem is bigger than an operating system, and it encompasses users, developers, applications and devices as well as the OS. What will determine the long term fate of the operating systems is the strength (or otherwise) of their ecosystem. A strong ecosystem means lots of applications which makes the platform more attractive to users, which in turn makes developers rich and attracts more developers. It’s a virtuous cycle. Ultimately, however good the OS if you don’t have applications and services the device can’t succeed.
Considering this, do you feel there is space in the market for new operating systems or is consolidation going to take place?
I think in the long term we’re going to see consolidation as I mentioned above. However, in the short term the market will get very competitive indeed. 2011 will likely be the most competitive year ever for platforms and devices because we will have a new Symbian version, the first release of MeeGo, a revitalised webOS from HP, Microsoft phone 7, new iPhone versions and new Android versions. It would be extremely difficult for a new platform to make much impact in such a crowded and competitive space. However, the competition isn’t just around OSs, because new “platforms” are emerging above the OS. E.g. I expect HTML5 will become a popular mobile app delivery platform, some of the AR tools I mentioned earlier are becoming “platforms” of a sort, which just complicates matters further.
A final question on the Operating System front. Do you think Open Source or Proprietary Systems will win the battle and why?
Both will co-exist because they have different, but viable business models. For mass market platforms with many manufacturers, open is attractive because the cost of OS licenses can be an issue and an open source approach allows manufacturers to differentiate their products. However the closed model such as that used by Apple or RIM also has advantages because it ensures a consistent end-to-end experience that includes the device and the services in the cloud.
There are many new areas of technology in the Mobile and Wireless space. Some of the ones that we think will have an effect in Africa specifically include:
a. Mobile Health
b. Mobile Government
c. Augmented Reality
d. Machine to Machine
Would you care to comment on their viability in Africa and what aspects do you think are interesting in these areas? Then, I would also like to know over and above these what else do you think will take Africa by storm in the next 2-5yrs?
I agree that healthcare is a huge mobile opportunity, and we’ve seen mobile phones used for clever applications such as eye tests, health education and support for remote health workers. Perhaps my only concern is price, most citizens won’t be able to afford a high end smartphone so there are still some challenges with what can be delivered. I mentioned AR above, I think it will become a major platform for delivering applications as it’s very user friendly, however it does demand top-end expensive smartphones and high speed networks which limits the opportunities a bit. M-governmwnt is also an opportunity although some applications like m-voting can be challenging for reasons of security and authentication. M2M is interesting but the opportunities in rural areas where signal coverage is poor are limited and in my opinion, although we have seen some examples in emerging markets such as India for water pump control. Another area which I think has great potential and where I’ve seen some very interesting leading work carried out in South Africa is mobile learning, i.e. using the mobile phone either to deliver lessons or to support the learning experience.
Tablets seem to be a technology that are taking the world by storm at the moment with the launch of the Apple iPad, the Cisco Cius and the up coming launches of a number of other including Research in Motion’s (RIM) Playbook. Do you think that this is a viable alternative for Third World Economies like Africa to personal computing (granted if the cost of the devices where to come down)?
Personally, I don’t think the hardware is the big issue. We have had low cost hardware for a while, e.g. the OLPC project. You can build cheap netbooks for the same cost as a cheap tablet. In my opinion, people are getting sidetracked by the hardware hype and forgetting the big issue which is the ultimate goal. The challenge is to deliver applications and content that benefit society, the hardware really doesn’t matter. Added to which many of the new generation of tablets aren’t designed for use in challenging environments such as villages without power; it takes a lot more energy to charge a tablet than a phone for example, and it’s easier to break a tablet when you drop it.
Taking a more global look at the Mobile and Wireless Technologies sector what do you think will be the biggest challenge facing the industry in 2011?
I think 2011 will be one of the most competitive years ever - as I mentioned above. For many of the platform vendors this will be a year when they have to run flat out to stop competitors getting ahead. It will also be a challenging year for network operators because the mindshare is owned by platform and device manufacturers such as Apple or Android, or app stores. It’s becoming increasingly hard to convince consumers that the network matters much.
Moving on from that what do you feel is the biggest opportunity that has arisen and can be commercially exploited in 2011?
I don’t see the market having a simple single opportunity. I think it’s a market of many opportunities at many levels. Mobile is still in the discovery phase of the market, in a sense now we’re moving beyond voice and SMS, yet we’re still trying to find out what mobile phones are for. App stores are discovery machines which let thousands of developers experiment with new services and along the way we’ll find out what’s popular by a sort of Darwinian process. Personally, I believe that one principle underlying many of the most successful new mobile services of the next few years will be context. i.e. applications which are hyper-personalised, sensitive to your location, behaviour needs and habits. For example; in a few years I expect my handset will beep one day and say something to me such as: “Did you remember It’s your wife’s birthday? I see from your mobile payment history today that haven’t bought any flowers, but the traffic is bad so by the time you’ve driven home your favourite florist will be closed. However, there are three flower shops within 500 metres of where you’re standing and one of them got great ratings from two of your friends on Facebook.” We can’t quite do all of this in 2011, but we’re certainly seeing the beginning of apps that can combine location, Facebook data and so on. I think context this is a huge opportunity that will continue to evolve for 5 to 10 years, but even now it can be used to deliver suggestions which are personalised and relevant. And that, after all, is what you want from the personal device in your pocket.
Building the Third Ecosystem
Stephen Elop, the new CEO of Nokia, has his work cut out for him. Reinventing Nokia as a smartphone manufacturer is only part of the challenge – a broader objective is in stopping Google from dominating the market.
On 21 April 2011 Nokia and Microsoft ratified the partnership that they announced in February. The Finnish cellular giant has hit an all-time low in terms of its smartphone market share with its Symbian operating system being displaced by Google’s Android that is now the leader with an estimated 33% global market share. With Microsoft in tow, it’s all eyes on Nokia’s new CEO Stephen Elop and the company’s next move that will be a Windows Phone-based device promised by the end of the year. I met with Elop in Dubai in March to discuss his strategy for re-establishing Nokia in the smartphone market and perhaps diversifying its product range. Emerging markets and new revenue streams were also put on the table – but Elop pointed to a more serious war underway in terms of mobile ecosystem providers. The agreement Elop has struck with Microsoft goes beyond Windows Phone. The two companies will also work on a new advertising platform that will make its way into Xbox LIVE, Windows Live, Bing and other Microsoft product sets. This platform will provide Nokia with a fresh revenue stream and should be music to Nokia shareholders’ ears. Nokia as a smartphone manufacturer is only part of the challenge – a broader objective is in stopping Google from dominating the market.
In with the old
The focus, however, remains on Nokia’s core business as a device manufacturer. Success in this space will depend on the company attracting developers to its platforms, and this includes existing systems. Developers I have spoken to are not convinced. They see Symbian as a dead-end street. If anything, they are looking to Windows Phone as a potential platform – but many will switch to developing for Android or iOS instead. Winning them over – or back – has to be a preoccupation for Nokia and is something Elop is fully aware of. “I think the best message for a developer to embrace, if you like, is to look closely at the strength that Nokia has, and what we bring to the market as it relates to Symbian today, and in the months and years ahead – because Symbian still has a large role to play even as we transition and focus on other things in the future,” he says. “For example, in my recent travels, which have included the Middle East and Africa, where we are today, last week in Russia and so forth, there is a wide range of markets where Nokia the brand and Symbian the platform are remarkably strong,” continues Elop. “And as we’ve described, we expect tens of millions of devices still to ship in the months and years ahead. There’s a tremendous opportunity there for developers, because when you look at the absolute scale of the operation, you say ‘wow, there’s something really there’, and so we’re definitely encouraging developers to continue with that, while also recognising that we hope to create a new opportunity around Windows Phone in the future,” he adds. Another challenge facing Nokia is how it will differentiate itself from other Windows Phone manufacturers. Services would be an obvious way to achieve this and Nokia has a powerful set of services grouped under its Ovi brand. However, the Microsoft agreement will see Nokia handing its services over for integration into Windows Phone and to the benefit of all manufacturers shipping the operating system. It seems a curious move at first, until Elop outlines his objectives. “First of all, the highest order point of differentiation that we need to focus on is Windows Phone versus Android versus Apple,” he explains. “Our number one competitor isn’t a Samsung or an HTC or whatever – it is Android. And so as we proceed in the months ahead, our expectation is that we have to take steps to ensure that the Windows Phone ecosystem is very strong and very powerful. Whether it’s us or even our competitors within Windows Phone who have access to some of the best technologies, we want to make sure that the platform holistically is very strong,” says Elop. “Now that being said, we have a number of different areas, be it in services, in hardware or in software, that can and will contribute to our efforts to ensure that we can differentiate,” he continues. “While mapping and navigation and location-based services are something that are crucial in the ecosystem, we will also make sure that we do unique and differentiated things on our devices, within that ecosystem, so that we work to stand apart from everybody else. But again, I emphasise, our principle competition is Android.”
Turning it around
Windows Phone had a less than ideal launch phase and uptake has been slow, to say the least. Last year Microsoft’s global market share in terms of smartphones was estimated at 5%. This year it has actually lost ground and dropped to 3%, according to Canalys. Elop and his colleagues at Nokia obviously think that this can be turned around. “I think there’s an opportunity to first of all differentiate on the range and quality of services that are provided within that ecosystem. For example, Microsoft brings certain properties – take the Xbox gaming environment, which in certain environments is a very powerful capability,” he says. “I think that we also bring a quality of mapping and location-based services that is better than and is differentiated from everything else, so there are elements of that. But when you look at it from a developer perspective, there’s actually a range of things you consider: does it have breadth, are there lots of people using Windows Phone devices? Well, not today – but clearly with the relationship between Nokia and Microsoft, we believe that there will quickly be tens of millions of people who are using these devices,” states Elop. “There needs to be great monetisation for the developers,” he adds. “Nokia brings operator billing with more operators in more countries and regions around the world than anyone else by far, and that we will bring to the ecosystem for general use,” he promises. “Developers need great tools; they need a solid development platform. Clearly that’s part of it already in terms of what Microsoft brings to the table. And then of course developers need the support from the vendors, such as Nokia. For example, here in Dubai today we’re asking what we can do with developers to help them build local applications and local capability,” he says. “At Ramadan, for example, there were applications supported and encouraged by Nokia, delivered by our development community, that were unique for this region at that time of the calendar. And it’s those types of things that we will do to ensure that this is a great platform for developers to target as they go forward.”
There has also been speculation that Nokia is working on a tablet device. In the past we have seen diversified products from the company, such as its Booklet 3G laptop computer. Elop sees potential for other devices in the future, but isn’t sold on tablets unless Nokia can do something wholly different with the form-factor. “We are building and contributing to this ecosystem with the belief that the opportunity is much larger than mobile phones, smartphones – however you would characterise them,” he explains. “The challenge I have for our team is to make sure that as we enter adjacent markets, that we have a unique and differentiated position. Today you can go and buy one of 150 or 180 – I’ve lost count – different tablets out there that frankly you can’t tell apart, and most of them aren’t particularly useful for much,” says Elop. “There are a couple that are very successful and we know who some of those are, at least one of them, and that’s fine. But Nokia has to look at itself – its market opportunity, the strength of its ecosystem, the geographies where it has strength – and consider what we can do that sets us apart and goes after a unique opportunity.” He continues: “We have some specific ideas, but are not announcing things there today. It’s not just about tablets – there are other devices, platforms, things that can be done, that take advantage of the ecosystem, and contribute to the ecosystem, and these are places where you may see us play in the future.” Nokia is also looking to emerging markets as a key strategy for the future. In these markets it has tried to play a more meaningful role than some of its competitors who are very good at talking the talk instead of delivering real value. I ask Elop whether Nokia has placed an emphasis on hyper-localised content that is not only designed for particular regions, but is actually developed by local developers. “You’ve just described a key element of our strategy, and that is the local aspect,” agrees Elop. “Local content, local applications and local services are hugely important to our efforts to differentiate. And indeed the strength of the Nokia brand in emerging markets and Africa and other places is largely because we have delivered more than anyone else on the promise of a great experience that makes sense within your local environment,” he adds. “While other ecosystems and players churn out devices at a furious rate, we’re far more focused on making sure that you have a great experience that connects you. You know our overall statement about the company – ‘connecting people’ – well, that’s about connecting people with their community, with the environment in which they operate, with opportunity. That’s what Nokia is focused on. “And so, when you think about it, yes we’ll have great devices, we’ll have wonderful software and services that go with that, but to the extent that we deliver an experience that is unique and differentiated in the environment in which people are working … you’ve seen it already,” he says. “And we can go so much further with that. That’s part of the excitement that travelling around to these different regions is: you feel that, you meet people whose lives have been changed by the experience. And that’s not just about placing a phone call, or doing an SMS, it’s the whole experience.”
The next billion
Nevertheless, manufacturers still have a long way to go in terms of scaling prices for the broader market in developing economies. Nokia has managed to get its non-feature phones down to ridiculously low prices, but smartphones are still just out of reach of the average emerging market user. This is changing rapidly, however. Elop believes that affordable devices in terms of these markets is around the corner. “I think it’s much sooner than people realise. The rate at which price points can be addressed, starting at the high end and moving well down, with smartphone experiences or ‘smartphone like’ experiences even plunging below the prices [$100 mentioned in discussion], I think there’s a lot of opportunity there,” he says. “There’s work that we’ve already done to bring some elements of a ‘smartphone like’ experience to very inexpensive handsets. The thing that I keep in mind, and this is particularly true in a region like Africa, is that today 80% of the world’s population is within cell phone signal range,” continues Elop. “They’re close enough to a tower, and yet only 20% of them have had an Internet experience. And that’s why we’ve called this strategy ‘the next billion’. How do we bring the next billion to their first Internet experience, to give them their first banking experience, using their device? Some of that is smartphone capability, some of it is lower in the price point than that, but I think you’re going to see things come down much faster than anyone would have previously predicted,” he says. “And in our relationship with Microsoft that was a key part of the conversation with them: to make sure we jointly agreed to that, understood how it would be done, and could begin the engineering work to make it happen.” Elop reinforced his previous statements that the first Windows Phone-based Nokia product will be on sale before the end of 2011. One can only imagine the kind of frenetic work underway behind the scenes at Nokia to pull that one off. The smartphone market is inherently frenetic. Apple set the pace when it committed to annual iPhone updates. The market scrambles to keep up and revisions come hard and fast. Android seems an unstoppable force at the moment, but Elop apparently sees it as inevitable that Google is kept away from a dominant market share. Microsoft and Nokia need each other and may just be the perfect combination to bring the fight to Apple and Google. By this time next year we should know for sure.