Mobile Tech » Bold's Audacious Price May Repel All but True BlackBerry Believers

At $300 -- and that's after a contract and a mail-in rebate -- T-Mobile's BlackBerry Bold 9900 is priced in the upper atmosphere relative to other phones in the U.S. market. Its cost of acquisition puts it in the company of the 32 GB iPhone 4, and it's unclear whether it can attract anyone except true CrackBerry addicts unless and until it climbs down from its sky-high price perch.

T-Mobile isn't letting all the other wireless providers have all the fun with the new BlackBerry devices rolling out this month . On Wednesday, the company announced it'll provide Research In Motion's (Nasdaq: RIMM) BlackBerry Bold 9900 for a cool US$299.99 -- after a $50 mail-in rebate and a two-year contract agreement.

Verizon and Sprint (NYSE: S) offer the BlackBerry 9930, the same phone except that it runs on 3G wireless networks. The 9900 runs on faster 4G networks, and it's the first of T-Mobile's RIM products to do so. It will go for $50 more than the 9930.

The smartphone uses the the new BlackBerry 7 operating system and is designed to appeal to users whether they prefer a physical QWERTY keypad or a touchscreen.

Must Have Fat Pockets

Early reviews indicate the 9900 is a solid smartphone choice, especially for longtime Blackberry users looking to upgrade. But what's throwing some observers off is the price. At $300 after a two-year commitment and rebate, the Bold 9900 demands a premium-level price, on level with the most expensive Apple (Nasdaq: AAPL) iPhone on the market and much pricier than other above-average smartphone offerings on platforms such as Android.

Apple's tech teams and marketing 6 Ways to Use Social Media for Business. Free Guide. mavens have positioned the iPhone as a premium handset for several years, and other phones arrive in the market every month with advanced hardware and software. RIM, however, has struggled in recent years with critical hardware reviews and diminished market share.

"This strategy does not suggest they're going to use price as a competitive weapon. I think what we're looking at here is a very wide launch with lots of operators and a focus on upgrading the people that are really committed to BlackBerrys," Matt Robison, analyst at Wunderlich Securities, told the E-Commerce Times.

That core group may not be as vocal as the iPhone consumer base, but it's significant enough to move a decent amount of handsets.

"They've got a pretty good installed base of loyal users, about 65 million globally," Mark McKechnie, telecom equipment analyst at ThinkEquity, told the E-Commerce Times.

Many of these diehard BlackBerry fans will be looking at this product, he said, "and RIM is going to try to skim that part of the market early on. It's going to be a combination of RIM and how hard the carriers push this."

T-Mobile will presumably market to those loyal users first before hoping to expand to the masses.

"I would think they may not be going after a market share or grab. They're going to maximize the value of sustaining their installed base, so a light distribution and initial high prices," said Robison.

Much of that base is overseas and in emerging markets.

For RIM to see a profit lift, though, prices will need to be high abroad as well, though that doesn't seem to be happening everywhere. Vodafone (NYSE: VOD), for example, is offering the 9900 for free.

After Loyal Fans, Crickets

Outside longtime BlackBerry users, the 9900 will need to do something to separate itself from the crowd, merit a premium price, and show it can hold up against cheaper yet reliable brands.

Dedicated users have grown accustomed to the secure e-mail and low bandwidth footprint of the BlackBerry, but that may not be enough for consumers to make a switch with so many other viable products elbowing for notice -- at much lower prices -- in the crowded mobile device space.

"They'll sell some decent volume at these levels, but I wouldn't be surprised to see those prices come down from the initial launch," said McKechnie.

Mobile Tech » Samsung Ought to Be Embarrassed and Ashamed

The injunction that banned Samsung from selling the Galaxy Tab 10.1 in Europe has been partially lifted, but only because the court thought it might not have the authority to issue it. Despite that, Apple's argument still stands true. It doesn't take a genius to realize that the design of the Galaxy Tab 10.1 is a blatant copy of Apple's iPad.

Samsung used to be a consumer electronics brand that I appreciated and admired. I've owned several Samsung products over the years; in fact, I use one every day. I have a Samsung SyncMaster T240HD 24-inch monitor. It's a thing of beauty, actually, with a pleasing clear polycarbonate sort of frame with a touch of deep red layered beneath the clear plastic-like housing. I love it. The display is plenty sharp for me, quite adjustable, and best yet, this unit is also an HDTV and accepts all sorts of video input cables. When I bought it a couple of years ago, I found its overall feature set -- and price -- to be far more compelling than competing monitors and HDTVs in its class.

Then there's the Samsung that produces the Galaxy Tab 10.1 tablet and Galaxy S line of smartphones.

One glance at these products and it doesn't take a genius to realize they are blatant copies of Apple's (Nasdaq: AAPL) iPhone and iPad. Back in 2010 when Samsung announced the Galaxy S smartphone, I noticed the similarities but didn't really care at the time. I have a buddy who works at a cellular service company that didn't sell the iPhone, and he was all excited about getting in the Samsung Galaxy S. "It looks just like the iPhone 3GS," he said, noting the skepticism on my face. "No, really, it looks and feels so much like an iPhone it's crazy."

A week or so later, he showed me one in the store. He was right. Samsung later introduced the Samsung Galaxy S II. The design has evolved, and while it doesn't look exactly like an iPhone 4, it shares far more than a passing resemblance.

Is Samsung Really That Pathetic?

Enter the Samsung Galaxy Tab 10.1. On the company's home page, one of the featured items is this new Android tablet. The page is no doubt dynamic, so it may change before you check it out. When I looked at it, it proudly showed off a floating Galaxy Tab 10.1 with the words "Hello Gorgeous" above it. Gorgeous indeed. To my eye, it looks just like a gorgeous iPad. Sure, the default orientation of the Galaxy tablet is horizontal vs. the iPad's portrait use, but the full-frontal sheet of glass surrounded by an inch or so of black border all wrapped by a metal frame with four curving edges ... looks remarkably iPad-like to me.

No wonder a German court barred Samsung from selling it in the European Union (then revised its ruling to apply only to Germany and German-run businesses when it realized it might not have such wide-ranging EU authority).

But That's Just a German Court

To most consumers, I believe, all the massive patent action that's been going on in the mobile space -- the buying and selling of companies for their patents, the lawsuits and such -- is all just a boring and sad little mess, particularly when the patent trolls do their thing from East Texas. Some of the patents are for "innovations" that are so far from being innovative that it makes an average Joe on the street confused and irritated that anyone could get a patent for them in the first place, never mind that Amazon.com's (Nasdaq: AMZN) Jeff Bezos actually thought that mini airbags would make a great safety addition to a smartphone.

And then there's Samsung, which happens to provide a heckuva lot of electronic components to Apple. Someone at Samsung thought copying Apple's look and feel was a good idea. But it gets worse. Multiple people at Samsung had to either greenlight production or let production continue without stopping it. Maybe Samsung knew a little insider information on the design of Apple's products, and maybe the company didn't share that information with its mobile device designers. Either way, the results speak for themselves: What does this say about Samsung?

To me, it says the guys running Samsung have small imaginations. It says to me they don't respect themselves. And it tells me they don't believe they could create a successful tablet unless they built it with uncanny similarities to Apple's iPad line.

It's just so sad. I expect this kind of behavior and business model from hack-job electronics companies that crank out crappy knockoffs that are sold in shady electronic shops or backwater truck stops.

But Samsung?

I thought Samsung was more creative. I thought Samsung hired smarter talent. I thought Samsung had more pride.

Hello, Gorgeous, indeed.

A Bunch of Lies

If you've been following the Samsung-Apple patent dispute over this, as well as how it was shaking out in Australia, it would appear that there's been some mud-slinging and spin doctoring of elements that weren't exactly true.

For instance, although VentureBeat reported that Samsung told VentureBeat that the company had "no notice" that Apple was requesting an injunction to ban the Galaxy Tab 10.1 tablet in Europe, VentureBeat later reported there were court filings that show Samsung knew what Apple was up to.

On the flip side, some court filings seemed to imply that Apple might have modified an image of the Galaxy tablet to make it look more like an iPad. It's possible, but I find such an intentional move unlikely because even when looked at horizontally, the Galaxy tablet already looks like an iPad clone.

Apple has also caught some flack for "timing" the lawsuit in such a way to cause disruption of Samsung's sales efforts in the EU. I hope it was intentional. If I were Apple, I'd time it to cause as much damage and disruption to Samsung's mobile business as possible -- because you can't bitch-slap a company in person, this is the only way to do it, unfortunately.

All in all, whether or not these lawsuits about the look and construction of the Galaxy Tab 10.1 vs. Apple's iPad fall in favor of Apple or Samsung, one thing is clear to me: Samsung needs to hire a lot of new talent. The company could start with grade school children who were actually embarrassed when they were caught copying the creations of their classmates.

Mobile Tech » AT&T Goes All or Nothing With Text-Messaging Plans

New AT&T customers will soon have fewer options in front of them when choosing an SMS text-messaging plan. They can either pay $20 per month for unlimited SMS service or be charged by the text. The carrier's parring down its options just as SMS use is beginning to flatten out -- and as smartphone apps put new, cheaper communication options into users' hands.

Wireless giant AT&T (NYSE: T) is reportedly planning to scale back its SMS text-messaging packages to exactly one plan: the Messaging Unlimited plan for US$20 per month. New users who do not wish to subscribe to that plan will be charged on a text-by-text basis at 20 cents per SMS and 30 cents per MMS. Starting Aug. 21, the $10 bundle that offers 1,000 messages per month will be gone.

AT&T is keeping its Family Unlimited Messaging plan intact, according to Engadget, which broke the news. Current customers can reportedly keep their texting plans even if they switch handsets.

A request for comment was not returned to the E-Commerce Times in time for publication.

Highly Lucrative

Texting, which generally costs wireless carriers very little to support and carry over their networks, is a cash-cow in more ways than one for these companies. It's a wildly popular mode of communication, not just for young people but also for adults.

One of the findings in a recently released Pew Internet & American Life Project study is that the vast majority of smartphone owners -- 92 percet -- use their devices to send or receive text messages.

Growth, however, does seem to be slowing, according to another set of statistics from CTIA. It found that text messaging grew just 8.7 percent -- for a total of more than 1 trillion texts -- in the second half of 2010 compared to the prior six months.

This trend will more than likely continue, Jefferson Wang, a partner at IBB Consulting, told the E-Commerce Times.

"IBB believes that text messaging should begin to flatten out, with adoption by those under 35 near saturation, but will likely gain popularity with those 35 years and older."

For SMS text messaging to continue to thrive as a revenue generator, carriers need to continue to develop new solutions and simplify the price plans, he said. AT&T is clearly an example, but Wang also thinks AT&T is scaling back its offering to simplify things for the back-end network operator as well.

New Solutions

New product offerings, though, is where the true growth will be -- and hopefully they will be sexy enough to lure the under 35 age group as well.

Wang points to group messaging and location-based messaging integrated with location-based services as examples, as well as the ongoing rolled out of voice-to-text and text-to-voice solutions.
Enter the Social Networks?

It is debatable, though, whether such offerings will be enough to turn the tide against another, far larger and potentially more devastating trend than mere saturation.

Social networks such as Facebook are starting to offering competing services. Last week, in fact, Facebook launched a new mobile app that provides message services as well as group chats between phone contacts and Facebook friends. Twenty-four hours after it rolled out the app, it had topped the list of free apps in the iTunes store.

Other smartphone apps can be used to instantly send and receive messages without incurring SMS fees from a wireless carrier.

The timing of AT&T's new text messaging plan is interesting considering Facebook's new service, which basically sidestep carriers completely, Charles King, principal with Pund-IT, told the E-Commerce Times.

"We may be seeing the end of text messaging as a cash generator for service providers. After all, if you are paying good money for a text messaging service and you have a smartphone, it will be a whole lot more cost-effective to use one of the social networks."

Carriers have been down this road before, though, King noted. A decade or more ago it watched long-distance calling get pre-empted by other technologies.

"Carriers are seeing the ground shift underneath them again," he concluded.

Mobile Tech » The Plight of the Android App Wallflowers

With just a handful of popular Android apps dominating users' attention, what's a developer to do? It's all about discovery, says Nielsen's Don Kellogg. "How can you make it easy for people to find your app? How can you ignite positive word of mouth? How can app stores and other aggregators improve the consumer experience to make it easier for consumers to discover a broader range of quality apps?"

Android device users spend more time on their apps than on the mobile Web, and the top 10 apps account for 43 percent of that time, according to Nielsen.

When the top 50 Android apps are considered, they account for 61 percent of the time Android device users spend on apps.

That means the rest of the nearly 250,000 Android apps available have to compete for the remaining 39 percent of users' time spent on apps.

Does this mean creators of the less popular apps aren't making any money at all? Is there no long tail in the Android ecosystem? And how does this compare to Apple's (Nasdaq: AAPL) iOS app ecosystem?

Earnings on the Android Market

"The top 50 apps on Android are making enormous amounts of money, but even the smallest apps at the end of the long tail can make about US$1 every 7 to 10 days with banner advertising," Estuardo Robles, vice president at Appsgeyser, told LinuxInsider.

However, apps don't depend strictly on ads for revenue -- they also offer in-app sales.

"Time spent in an app usually equates to more ad dollars, and maybe the top 10 properties are generating more ad dollars than the long tail -- but the long tail generates a significant amount of money from in-app purchases," Simon Khalaf, CEO of Flurry Analytics, pointed out.

Mobile gaming revenues will exceed $16 billion in 2016 as in-app payments grow, ABI Research found.

Despite this, Android app devs will make less money on the whole from in-app purchases than devs creating apps for Apple's iOS mobile operating system.

That's because it was only this March that Google (Nasdaq: GOOG) launched in-app purchase functionality, Joshua Greenman, president of Mercury Development, told LinuxInsider.

Android's billing system is clunky, and Android apps generate one-fifth to one-sixth of the revenue an iOS app does, Flurry Analytics found.

Making Money With Android

Instead of trying to get banner ads, Android devs should employ the freemium model, Flurry's Khalaf told LinuxInsider.

"If a developer makes a free version of his Android app with limited features, and offers a paid premium or pro version with more features and options for in-app purchases and so on, we find that he'll make as much money as he'll make with an iOS app," Appgeyser's Robles said.

However, dollar for dollar, iOS apps make more money for devs than Android apps do.

That's partly because Google's in-app billing system is clunky compared to that of Apple's iTunes App Store.

Further, developers' customers often prefer iOS apps, and that takes away developer time from working on Android apps.

"Every customer that approaches me asks for an iOS app first and an Android version later," Mercury Development's Greenman said.

Getting Consumers to Pick Your App

Developers have to focus on quality, design and marketing 6 Ways to Use Social Media for Business. Free Guide..

"You need to ensure quality," Appsgeyser's Robles said. "Otherwise, you will get negative ratings, which will really affect your app."

Design is equally important.

"Put good graphics work into your app icon and description," advised Robles. "The principal way people discover your app is through their eyes."

"The research findings make it clear that it's all about discovery, Don Kellogg, director of telecom research and insights at Nielsen, told LinuxInsider. "How can you make it easy for people to find your app? How can you ignite positive word of mouth? How can app stores and other aggregators improve the consumer experience to make it easier for consumers to discover a broader range of quality apps?"

Then, devs have to promote the app and boost its initial downloads.

"We've discovered that promoting your app within other apps is the most effective way to convert downloads," Robles said.

"It's very difficult to get noticed in this market," Melanie Moffett, marketing manager at Amadeus Consulting, told LinuxInsider.

"You need to have a cohesive marketing plan along with your app, or you probably won't see a return on your investment."