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5 telecoms trends to watch in 2011

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Tim Walter, General Manager for Product and Marketing at Nashua Mobile (Image Credit: File photo)

Expect 2011 to be an exciting year for the telecommunications industry as a host of new products from the world’s handset and computer manufacturers hit the South Africa market and as competition among the country’s service providers and operators heats up.

Here are a few trends we’re expecting to see shape the South African telecommunications market in the years to come.

The year of the tablet

Tablet computers will break down the door to the mainstream this year, following the breakthrough success of Apple’s iPad launch in 2010. According to the Yankee Group adoption of tablet computing around the world is outstripping that of HDTVs, handheld gaming consoles and MP3 players. The analyst firm expects the tablet market to grow in value $16 billion in 2010 to a massive $46 billion in 2014, despite the fact that average price per unit nearly will half over that time frame.

Many industry watchers predict that tablets will change the way that consumers access data for work and fun while staying mobile and accessing their social networks.

South Africa – where the iPad was officially released at the end of January- is finally seeing a slice of the action this year. Samsung has also already released its Galaxy Tab to the local market. Hopefully we’ll also see the local launch of the Motorola Xoom (chosen as the product of the year at the recent Consumer Electronics Show in Las Vegas), BlackBerry’s offering – the PlayBook, the next generation of iPads and many other Windows and Android tablets during 2011.

This will be good news for hotspot and mobile data operators since consumers will be using even more data on the move.

Android on the rise

The Android operating system has already seized 25% market share across the world and looks likely to grab market share from the likes of Nokia and BlackBerry smartphones in South Africa this year. Android is building massive momentum around the world – technology analyst Canalys says it is growing at twice the speed of its competitors.

It shouldn’t be too surprising that Android is outpacing the growth of its rivals since it is supported by multiple hardware manufacturers while the BlackBerry smartphone and Apple operating systems are found only on BlackBerry smartphones and Apple devices.

Android brings together the mobile world and the software innovation that powers Google. Increasingly, applications are harnessing the power of the cloud to perform functions that a phone simply doesn’t have the processing muscle for. A good example is Google Goggles, which matches pictures taken on the phone against a database of images stored on Google, and then returns a wealth of contextually correct information to the user.

There is still plenty of space for Android to grow its penetration in South Africa. The Android operating system is already available on handsets from Sony Ericsson, HTC, Samsung, LG and Motorola, among others.

Nokia gets its groove back

Nokia has – so far – been one of the big losers in the transition from cellphones to smartphones. But I am going to go out on a limb and predict resurgence for the handset manufacturer in 2011. Nokia’s hardware is still among the best in the industry and the company could bounce back if it successfully brings its software up to date.

Symbian is in for a facelift this year and Nokia has already launched its first version of the Meego operating system for high-end smartphones in the Nokia N8.  This could finally bring Nokia’s software up to speed with the latest iterations of iOS, BlackBerry OS and Android. Analysts also seem impressed with the moves new CEO Stephen Elop is making to turn the company around.

ADSL becomes a must-have

Falling prices of ADSL data, paired with growing interest in rich online media services, online gaming and other demanding consumer applications will drive growth of the ADSL market this year. It’s not that users will be replacing their HSDPA modems with ADSL connections – rather that the mobile connection will be used away from home, while the ADSL connection will be the always-on link that connects the home to the internet.

In addition to uncapped and high capped data products, the prospect of local loop unbundling and pressure on Telkom to scrap the telephone rental component of ADSL (the much-hated Telkom tax) could see access prices drop this year or in early 2012. As a result, ADSL will be the must-have connectivity product for the middle-class home.

Tariffs keep dropping

Voice calls will keep getting cheaper this year.  In the mobile market, a more aggressive Cell C and a new entrant in the form of Telkom’s 8ta could shake pricing up.  Interconnect tariffs are set to drop again in March, which may give some operators and service providers scope to slash retail call rates. Telkom, meanwhile, will find itself under pressure to drop its retail rates to compete more effectively with voice-over Internet protocol services and providers.

Although these drops will lead to an initial reduction in people’s mobile phone bills, expect to see minutes of usage will gradually increase, allowing both consumers and business users to get more use out of their phones at the same (if not less) cost.

By Tim Walter, General Manager for Product and Marketing at Nashua Mobile


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