A Smartphone in the Hand is Worth

By Paula Bernier (News - Alert)

Editor's Note I know you've been bombarded with news about smartphones lately. But I have no choice. I simply have to write this column about smartphones.

This fall has been all about the smartphone.

While worldwide mobile phone sales totalled 286.1 million units in the second quarter of 2009, a 6.1 percent decrease from the second quarter of 2008, according to Gartner (News - Alert) Inc., the smartphone remains a hot property. The research firm reports that smartphone sales surpassed 40 million units, a 27 percent increase from the same period last year, representing the fastest-growing segment of the mobile-devices market.

You can't flip on the TV without being met by Whoopi, Phil Jackson and some tattooed dude (is that Sandra Bullock's husband?) pushing T-Mobile's (News - Alert) version of the Google Android phone.

But for those that want this iPhone look-alike without using what many consider a second-tier wireless operator, they can now go through Verizon (News - Alert) Wireless, which last month forged "a groundbreaking agreement" with Google around Android. Verizon Wireless and Google plan to co-develop several Android-based devices that will be pre-loaded with applications from both parties as well as third-party developers. The first of these devices are expected out by the end of the year, possibly even before this issue of NGN hits the street. As of mid-October, rumor had it that Dell (News - Alert) and AT&T also were planning to come out with smartphones based on Android. Not one to be left out of the high-tech action, Microsoft Corp. last month made smartphone news of its own, announcing the availability of a new line of Windows-based touchscreen phones. Microsoft (News - Alert) says its partners will deliver more than 30 new phones based on the OS in more than 20 countries by the end of 2009. Customers can buy various applications to run on those phones from the Windows Marketplace for Mobile, Microsoft's version of the AppStore.

Microsoft also has thrown in a few nice features to sweeten the deal. It now offers the Windows phone Custom Theme Creator through which customers can choose the colors and designs of their devices. It has a free service called My Phone (News - Alert) that helps people manage and back up information stored on their phones so they don't lose it if they lose or damage their handsets. And, though I'm not sure if this is new or just something Microsoft wants to emphasize, customers can use PowerPoint and open and edit Word and Excel documents from their phones with Microsoft Office Mobile.

How all this will impact the market share of various handset device makers remains to be seen, but it appears likely to shift the status quo. That's because Nokia (News - Alert), which according to Gartner holds the No. 1 position for mobile devices with a 36.8 percent share worldwide, has focused primarily on low-end devices. And Gartner says Nokia's flagship smartphone, the N97, met with "little enthusiasm at its launch in the second quarter of 2009 and has sold just 500,000 units in the channel since it started to ship in June." Meanwhile, Apple's new iPhone (News - Alert) 3G S sold 1 million units in the first weekend.

I myself am in the market for a smartphone. While I'm currently working on a lovely HP ProBook provided by my employer, pretty much all the personal computing, music, on-demand TV and communications devices (and thus, the content running on them) in my household come from Apple (News - Alert). So, like many before me, the iPhone will probably be my next mobile handset purchase. But competition is good, and I'm sure that the big names like Google (News - Alert), Verizon Wireless, and potentially AT&T and Dell, will use their formidable market power to make Google Android handsets a hit.

Just look at what Microsoft has been able to do with the Zune.