2005 Wrap Up. 2006 Predictions.
29th December 2005
The final part of our 2005 wrap up looks
at the state of major mobile manufacturers and how they
fared in 2005 - and what possibly lies ahead in 2006.
As we said for last
year's predictions, these can be inaccurate but
a lot of fun!
2004 was a grim year for Nokia with
a poor product range and declining market share, but
in 2005 they turned everything around and came up with
a range of innovative products that clawed back market
share and re-established Nokia as the clear number one
in the market.
In particular, the N-series (for example
and E-series (such as the E61) range
of phones show that Nokia is technical innovative. The
Series shows that Nokia have regained some marketing
sense too. In fact, it's been hard to fault any of Nokia's
releases during 2005 - they've produced a full range
of handsets from budget phones to WiFi and 3G enabled
smartphones. They've broken away from their "candy
bar" only designs to incorporate several sliders,
although clamshell phones are still rare in the Nokia
line up. The Nokia
770 shows some clever thinking too.
Although Nokia brought out a lot of
handsets that we didn't expect, frustratingly they didn't
bring out devices that we were expecting - no
3G versions of the 9300,
for example. Also, the N-Gage series of handheld gaming
units tanked during 2005 and the N-Gage
QD has virtually vanished from the stores, with
no developments in this area expected now until 2007.
The current strategy appears to be working
well for Nokia, so we don't see a major change during
2006. Nokia's challenge though will be to get all the
new products it announced for early 2006 to market in
time. We predict that Nokia will cement its position
as market leader during 2006.
Motorola's market share increased during
2005 and the RAZR
has proved a huge hit. So, at first glance it appears
that Motorola is doing well - however, we believe that
the truth is something very different and that Motorola
is in a deep crisis.
Apart from the RAZR, Motorola has very
few truly successful phones. Many handsets were announced
months ago and still have not made it to market (for
example the Motorola
E1120 announced in February 2005). The flagship
smartphone had a disastrous launch and eventually sank
without trace. And worst of all, the long awaited ROKR
music phone was a flop and was not well received by
the press or the public.
It's not just handsets releases that
Motorola are struggling with - they recently removed
EDGE from many upcoming models because they couldn't
make the technology work. There's a severe shortage
of smartphones and 3G phones in Motorola's range too,
showing that this is a company that it not even coming
to grips with the underlying technologies.
Elsewhere, Nokia keep producing warmed
over versions of the V500 to bulk out their product
range, plus a variety of dirt cheap phones that presumably
exist only to give Motorola some market share. Motorola
have upgraded the RAZR line with the V3i
to keep it going into 2006 which should at least mean
that they'll remain dominant in the fashion phone market.
We said last year that we expected improvements
with Motorola during 2005 because of management changes
- but in fact things are getting worse. Handsets such
as the sorely overdue E1120 are a huge embarrassment
for the company, so Motorola's latest idea is to announce
handsets immediately before they are announced, rather
than a year ahead. This is really only papering over
the cracks rather than addressing the issues.
We have no faith that Motorola will
improve during 2006, and it will increasingly become
dependent on a few popular phones combined with ultra-low-cost
devices for the prepay market. We expect to see a significant
downturn in market share during 2006. On the bright
side, Motorola did acquire
the remains of Sendo which might start to give it the
"can do" attitude that it will need.
Samsung lost market share during 2005,
despite having a wide range of interesting products
pitched at the midrange market. Leading the pack are
the competent D600,
devices. As in 2004, Samsung still suffer from a confused
portfolio of phones with similar specifications, combined
with a naming convention that seems to defy logic.
The muddle is easy to demonstrate -
are all basically the same device with slightly different
specification levels. But that's only the start of it
- a confusion of E-series, D-series and X-series handsets
show a complex range that must surely reflect a lack
of focus at Samsung.
To be fair, Samsung does seem to be
getting its range together a little better. If.. and
only if.. it continues to make improvements during 2006,
then it should be able to take the number 2 slot from
Sony Ericsson's W800i
is our favourite device of 2005 as it's a good combination
of style, technology and marketing, but it's probably
the more "sober" variant - the K750i
- which has had more of an impact on the marketplace.
Sony Ericsson have been fairly quiet
during 2006 though - they've announced far fewer handsets
than the competition, but by and large these have tended
to be more sophisticated devices with a bigger profit
margin than some rivals. The successful W800i has also
spawned the W550,
Walkman phones too, plus the upcoming P990
However, Sony Ericsson need to work
hard to keep the buzz going around its brand. For quite
a large part of 2005, Sony Ericsson has been very quiet
on the news front. Nonetheless, they have some cracking
handsets coming to market which should at least ensure
continued profitability, even if concentrating on higher
end devices does sacrifice some market share.
As expected, Siemens disposed of its
mobile phone business in 2005, although this time last
year most people were predicting a tie-up with the Chinese
Ningbo Bird company rather that Benq. Although Benq
still uses the Siemens name, it has indicated that it
wants to move on fairly quickly to having all handsets
branded "Benq" as soon as it can.
Presumably, the hope with the Benq-Siemens
tie up was to emulate Sony Ericsson. However, the range
offered by Benq under the Siemens brand during the later
part of 2005 have been frankly awful with one or two
exceptions. There are a wide variety of very cheap devices,
with no smartphones at all and not much to show in the
3G area either.
Benq have acknowledged the shortcomings
in their range though, and promise to have a significantly
more diverse portfolio for 2006. It's still early days
in the new organisation, and it's worth bearing in mind
that Sony Ericsson struggled in its early days too.