Mobile leads in UK business race

The outlook for mobile business in the UK is bright as smartphones, tablet computers and wearable technology are set to dominate the market, writes James Dean


In the second week of 2007, Steve Jobs strode on to the stage at the Macworld trade show and announced to a packed house that Apple was about to reinvent the phone. Today, health and fitness data, captured by internal gyroscopes, accelerometers and GPS receivers in our mobiles, can be beamed straight into our medical records. Just one aspect of mobile technology, this is a measure of how far we have come in under a decade.

The rapid technological evolution of smartphones, tablet computers and other mobile devices has changed everything. The phenomenon is not just one of mobile communication, but of personal computing, too.

Eric Schmidt, the executive chairman of Google, alluded early in 2010 to the changing landscape. According to Mr Schmidt: “The new rule is mobile first. Mobile first in everything. Mobile first in terms of applications. Mobile first in terms of the way people use things. We have a role now to inform; to educate through all these devices.”

The Google boss has been known to get the odd prediction wrong. In 2011, for example, he prophesised that Google TV, the company’s smart television platform, would come as standard in every shop-bought TV by summer of 2012. Unfortunately for him, it didn’t – in fact, it still doesn’t.

By the end of the year, there will be one smartphone for every five people on Earth

When it comes to mobile, though, he has dug in his heels. “Mobile has won,” he says. “The trend has been that mobile was winning. It’s now won.”

Smartphone sales have outstripped sales of desktop and laptop computers combined for three years now. Annual smartphone sales overtook annual sales of personal computers in 2011, according to research by Canalys, the telecoms analyst. That year, 414 million desktop and laptop computers were shipped – as opposed to sold – worldwide, compared with nearly 489 million smartphones.

There is, though, much more to come. CCS Insight, the technology analyst, predicts that 1.3 billion smartphones will have been sold worldwide by the end of this year, 25 per cent more than were sold in 2013. This means there will be one smartphone for every five people on Earth. By 2018, the annual sales figure will be 1.9 billion, driven by rapid smartphone uptake in emerging markets, especially in India, CCS believes.

There is a similar tale when it comes to the tablet computer, although its rise has been less pronounced. Gartner, the telecoms analyst, believes that tablets will outsell personal computers for the first time next year. By the end of 2015, shipments of personal computers will have fallen to around 350 million, Gartner predicts.

 

FUTURE TRENDS

Global smartphone sales

Marina Koytcheva, the director of forecasting at CCS Insight, suggests there are three key trends to watch out for in the next few years. One, she says, is the growing number of connected devices each consumer owns – currently 3.6, far higher than two years ago, she points out.

“Consumers have changed their expectations about what these devices do,” she says. “They expect a more consistent experience across all their devices. If people own lots of connected devices that do more or less the same thing, they care less about each individual device. They have become a single platform for their mobile activity.”

Second, she says, will be the rise of Chinese mobile manufacturers. “Their share of the global smartphone market is approaching 50 per cent,” she says. “They’re competing against Samsung and Apple by offering high-spec devices at mid-range prices. This has caused a shock to the market. They won’t take huge market share everywhere, but their ambitions are big and they’re currently going strong.”

Linked to this, she believes, will be a polarisation of the smartphone market. “In the last few years, we’ve seen mid-range smartphones disappear,” she says. “You can choose from either the top-spec model or something well below that level. But with the rise of the Chinese manufacturers, there are more phones coming into the mid-range.”

With each consumer in advanced economies using more and more mobile devices, and with consumers in the developing world taking advantage of falling smartphone costs – thanks in part to the new mid-range Chinese models – it seems fair to say that mobile is the future for consumers across the world, not just in the developed world.

 

WEARABLE TECHNOLOGY

Smartphones and tablets, though, are not the only devices that will make up the mobile ecosystem of the coming years. Wearable devices – be they “smart” glasses such as Google Glass or health trackers like Fitbit – will play a larger part.

A report by PwC, the professional services firm, says wearable devices will bring a number of benefits to businesses. Wearables with contactless payment chips will speed up payments systems for retailers. Manufacturers could benefit from hands-free guidance tools. For the service industries, wearable devices could speed up access to information so it is obtainable as near as possible to real time, the report says.

And, of course, there are the benefits to medicine that health data from wearable devices is increasingly bringing. In October, Emis, a medical information company, released an app that links Apple’s new mobile health tracking software, Health, with millions of digital patient records. Doctors are, as a result, able to track the real-life activity of their patients, which gives additional clues about conditions such as diabetes and could potentially lead to better diagnoses.

“In all of these cases, effective implementation of wearable technology stands to benefit both the user and the company driving adoption, increasing efficiency and efficacy,” the PwC report says.

Wearables could also bring benefits to employees of the companies themselves. They could be used to train new members of staff, thereby reducing the amount of human resources given to inducting people to a new role, the report adds.

In the UK, the outlook for mobile business is rosy. Figures from the Centre for Economics and Business Research show 5.6 million people already use their mobile devices to buy goods and services online. This is expected to rise to 20 million in the next six years by which time online mobile purchases will be worth more than £18 billion, up from £4.8 billion in 2013.

Companies that do, or want to do, business online will need to adapt accordingly for a future that is, without doubt, mobile.