Commentary

Meeker: Smartphones To Eclipse PCs By 2012

Morgan Stanley analyst Mary Meeker helped stoke the mobile hype machine last year with her 424-page report predicting more people would be connected to the Web via mobile devices than PCs in five years. The 2010 edition of her annual chart-choked report on Internet trends, unveiled today at the Web 2.0 summit, should keep enthusiasm for all things mobile running high.

The topline data point from the latest report is that smartphone shipments will outpace those of notebook and desktop computers combined in two years, with more than 450 million projected to be shipped in 2012.

The report shows that usage of Apple iOS devices -- the iPhone, iPad and iPod touch with 120 million users -- has ramped up faster than for any previous technology including NTT Docomos's imode Web phones, the Netscape browser and AOL's early dial-up Internet service.

The report also points to Apple and Google's Android platform driving "excitement and momentum" in mobile, with their respective smartphone platforms together accounting for 37% share of the market.

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This year's report may not have quite the impact of last year's because of the steady flow of reports coming out each quarter, month or week tracking things like smartphone sales and mobile OS market share. It's become pretty clear that smartphones are becoming increasingly mainstream devices and that people are using phones more and more for things other than talking. Still, the latest research tome from the so-called "Queen of the Net" should give the mobile industry a fresh source of credibility that will translate into further investment in new mobile devices, mobile advertising and m-commerce.

The last of those categories got a separate boost today from the announcement that Verizon Wireless, AT&T and T-Mobile have teamed with Discover Financial Services to create a nationwide m-commerce network. The initiative, reports of which first surfaced this summer, would use near field communication (NFC) technology to allow consumers to make retail purchases by waving their smartphones over in-store readers.

It's a significant step toward convenient mobile payment, but should be viewed with a healthy amount of skepticism. NFC technology has been around for a decade and prior industry coalitions promising widespread mobile payments have fallen apart over turf battles among partners. So until the carriers' m-commerce project, dubbed Isis, starts to show tangible results and user adoption, it's best not to get too excited.

The announcement, for instance, didn't specify any phone manufacturers or devices that will be involved in the venture at launch -- a key consideration, since the effort requires smartphones equipped with NFC chips.

smartphone chart

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