Round Table: 2009 in the rearview mirror, Pt. 1

Dave Webb (Editor, ComputerWorld Canada): What was the biggest story for 2009?

Brian Jackson, (Staff Writer, It’s fresh in my mind because of the WIND Mobile launch, but I think that it’s fair to say that cell phone competition was the biggest story of the year for us to cover. We had the launch of Bell and Telus’ new HSPA network and that meant that Rogers could no longer claim (as we’ve seen in several court challenges) to have the most reliable network, the fastest network, the most good-looking network, even. All of that was out the window. Then the coming of the new entrants. Finally, we’re seeing that all that spectrum that was bought in that advanced wireless auction a year ago come into the market with Globalive being allowed to launch. Dave Wireless is coming, and Videotron, Shaw, and Eastlink are all readying their own wireless entries, so it’s a completely different ballgame for the incumbent carriers. It’s changed pricing, and the options Canadians have for wireless, and that’s been the story of the year, I think.

DW: My take on that, though, is that we’re going to be back to three within a year-and-a-half. I mean, it’s happened historically in the past. You look at WIND Mobile’s offerings — they just aren’t going to fly. I think that maybe a Videotron or a Shaw might survive, but I see the others getting absorbed.

Rafael Ruffolo (Staff Writer, ComputerWorld Canada): What about DAVE Wireless? DAVE Wireless just got $75-million of new cash. I don’t know where they found it, but I’m sure it will help develop a niche offering. That’s what they’re trying to do. Obviously, they won’t be one of the Big 3, but something like that can stick around and have success if it keeps its sights set fairly low and doesn’t go after the big guys.

Jeff Jedras (Senior Writer, Computer Dealer News): I think you’ve seen in the airline industry that, if you have the right model, you can survive. A company like Westjet has built a thriving business over the years by being able to be more nimble and adapt than Air Canada, which is saddled with legacy regulations and union contracts. You can see the same in the telecom industry. While Bell and Rogers have to attempt to provide service across the country, a carrier like DAVE or Globalive can just focus on the much more lucrative urban markets.

RR: This is a huge space that is going to play out in 2010. A related space is the smart phone market. One of the trends that I think we’re going to see in 2010 is so many new smart phones coming out of the woodwork — more, even, than we saw in 2009. Android is probably going to have three dozen new phones over the next 12 months, and I really think that the Android platform is going to be the platform to beat over the next two, three, four years. It’s going to give BlackBerry a run for its money, and it’s going to give the iPhone a run for its money.

Kathleen Lau (Senior Writer, ComputerWorld Canada): I think with the availability of new platforms we’re going to see vendors offering more mobile app options, because that’s what users want, and how, apparently, they want to digest their information, so I think vendors will start responding through a mobile channel.

DW: Yeah, I think with Android, the availability of the platform is huge. I’m curious as to how the Palm Pre is going to play out, because I have a soft spot for Palm. Back in the old Palm Pilot days, they could’ve really invented this space if they’d had their eye on the ball. And I’ve seen the Pre; I haven’t had a chance to use it, but it knocked my socks off.

JJ: I was surprised, as I actually thought Palm went out of business five years ago. I haven’t heard from them, so I think this is the last gasp from a dying giant that has seen the tide of history pass it by.

BJ: I’m going to agree with Rafael. I really do think that it’s going to be all about the Android. The Palm Pre was a big phone this year, but it’s all old news. It’s on the CDMA network, and next year is going to be all about HSPA, and the new networks that everybody has launched. A big problem with the Android platform so far has been its fragmentation: what version are developers going to use? 1.0, 1.5? It seems like Google has taken a bit of a tighter control on the reins now by going with Android 2.0. They’re going to be criticized, too, for closing off their open-source approach a little bit, but I think it will benefit the platform in the end as we see Android 2.0 really be the platform that gains a lot of steam this year.

DW: Honestly speaking, this is certainly true for the enterprise, but I’m curious as to how much you think it applies to the consumer market. Is it really all about the apps when it comes to smart phones?

RR: Look at the way a lot of the cell phone-makers actually advertise their phones. It’s all about the apps. Apple, obviously, has got their slogan, but in the Pre commercials, and even some of the BlackBerry commercials, there is a heavy focus on the apps. This apples to the enterprise market as well, but we just haven’t seen killer business apps yet. I think, as these phones get better, and companies spend more time, there’s going to be killer business apps.

KL: I think we can only really have a killer business app if we have killer hardware. What people tend to say is that we don’t have the right devices to support those apps and support that kind of functionality that we really want to use, so I think the hardware vendors might push the software vendors to develop good apps, but I think it’s also the other way around. They’re being pushed, but they’re also pushing to develop really good mobile devices as well.

JJ: There are large portions of the consumer market that couldn’t care less about apps. I spoke this fall with a product manager for Samsung and they were launching one of their new phones and he said that the fastest-growing consumer market segment for them is the texting segment. This is a new segment of the consumer smart phone arena where it’s not really much of a smartphone. It’s a phone with the QWERTY keyboard to enable texting but it does not run an open OS. It runs a proprietary OS, more like a straight cell phone would, and its use is primarily in the young teen market, who just want a phone to send texts to their friends. They don’t care about different apps or anything, and this market segment is a very fast-growing market segment. More vendors are starting to develop pieces of hardware specifically for this market. And I think that you will see this wider array of hardware for specific use-cases rather than a few products that you choose from.

BJ: We see all these ridiculous milestones advertised by these different cell phone manufacturers. First Apple had 50,000 applications available and now they have 100,000 applications available. Too bad that 98,000 of them are no good, right? But I think that applications will be less of a differentiation point between mobile platforms now that everyone has a mobile storefront off the ground. And let’s face it. People only want to do a certain set of things on their mobile phones: probably those sets of offerings that are available on every platform, and people will start thinking less about what they can do on the iPhone versus what they can do on a BlackBerry or a Palm Pre.

DW: Rather than it being about the apps, how much of it is about the operating system? Now this is not a transparent thing to consumers — they wouldn’t be able to tell you that it’s the operating system that’s driving them crazy, but how much of the iPhone’s success is that it’s much more intuitive and comprehensible than Windows Mobile?

RR: One hundred per cent. The reason why it isn’t more successful is because of that. If Windows Mobile had a killer OS that just made the phone work well, it would be popular. That’s the reason why. If Microsoft wants to fool itself into thinking, ‘Oh, it’s just because Apple can market better than us,’ it’s partly because of that, but it’s partly because of the better OS, and it being the better phone altogether. It’s hard to get away from it, but it extends back into the apps. If you take a cell phone and think of it as a PC or a laptop, the apps are just the software you go out and buy to make the experience better. So when you buy QuickTax for your computer, you can buy the equivalent eventually on your cell phone. These cell phones have almost become like mini-laptops, so the OS is huge.

JJ: Comparing it to Windows Mobile isn’t really a fair comparison, because Windows Mobile just sucks. There are many operating systems out there, but Windows Mobile is just horrible. I don’t know why Microsoft is still continuing to develop it. If I was Steve Ballmer, I don’t see why I would continue on with Windows Mobile. I think the hardware vendors are moving away from it. No one is buying it. It’s done.

RR: He mentioned that in Toronto. Someone asked him, “Why are you still basically investing any money in this?” And he just admitted, it’s a huge market, we can’t not play in this market.

JJ: The rest of the operating system market is becoming a lot more alike, and everyone is copying Apple and the iPhone in terms of the interface. Google Android is very similar; they’re all learning, and Microsoft has stolen from Apple for years, with Vista and the Mac OS, so I think that, over time, as everyone becomes more like Apple, I think the OS will become less of a differentiator. It’ll just be there and people will expect the phone to do certain things.

KL: I think that Microsoft completely realizes that the iPhone interface is exactly what people want because even when they released Windows Mobile 6.5, they said they’re trying to make it more interactive, more user-friendly, and with touch-screen functionality. I think Microsoft knows it, so they will eventually go in that direction as well.

BJ: Let’s not forget that Windows Mobile has Version 7 probably coming out next year, so maybe it will change people’s perspectives on how Microsoft has been doing in that space.

JJ: If we can close on a channel angle, in the malls you’re going to see a lot more competition in the cellphone arena next year. It began when Bell bought The Source by Circuit City to get hundreds of storefronts in malls across Canada. The Source had an existing contract with Rogers and that ends at the end of this year. So beginning in January, you will begin to see The Source stores be transformed into storefronts for Bell. And the Black’s chain was bought by Telus; they’ve already begun to push their products out at the Black’s locations, so you’re going to see a lot more competition for the consumer eye in the malls next year.

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Jim Love, Chief Content Officer, IT World Canada

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