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September 14, 2013

Mobility Techzone Week in Review

It was Apple's big iPhone event that took place earlier this week that headlines our review this week. Some found the event to be ho-hum - which simply indicates to us that they have no idea how Apple's mobile game plans will play out. Some on the other hand have managed to catch glimpses of where Apple is headed and why this week's announcements of the new iPhone 5S flagship and the new iPhone 5C "cheaper" device are in fact quite important. Our coverage of the event itself highlights some of the important issues and why Apple has, we believe, regained its innovation mojo. We believe Apple is playing a chess game, and playing it exceedingly well, while the likes of Samsung is playing checkers (although it is playing checkers exceedingly well). But the games are absolutely different from each other.

The new iPhones are likely to also boost the use of HD voice. More importantly, the new flagship iPhone 5S has in fact delivered on what until this week had been a rumored fingerprint scanner - the new Touch ID (it may be more appropriate to call it a fingerprint reader given the way Apple has designed it). Our review noted above covers Touch ID and how it works. That said, there are some rumors already emerging that suggest that the scanner may become flakey if a user happens to have a wet or sweaty finger. We happen to have a fix for this - dry your finger off!

We anticipate that the new iPhones will drive significant new device sales, and as this takes place, users of iPhone 4 and 4S models will hand these down to family and friends. We absolutely believe that iOS ecosystem subscribers will increase substantially by the time the 2013 holiday buying season comes to an end. Will those new subscriptions come at the expense of Android? Absolutely.

Interestingly, a new comScore mobile OS usage study points out that between April and July 2013 Android market share declined in the United States at the expense of iOS, which gained market share. The changes were minor but come January 2014 we believe we'll see a tangible market share drop on the Android side and a tangible increase on the iOS side.

One of the factors that will assist in this market share shift is that Apple is actively working with China Mobile to open up the carrier's vast pool of subscribers for Apple - which to date has been closed to it for technical LTE-based reasons. Another factor is that Japan's NTT DoCoMo, Japan's largest carrier, will now also begin selling the new iPhones. The iPhone is already a best seller in Japan, but adding the country's largest carrier to the mix - NTT DoCoMo has never sold any version of the iPhone - is a huge additional step forward for iOS market share.

Looking at other players besides Apple, the giant Chinese company Huawei says that it will continue to build Windows Phone 8-based smartphones. The company believes that WP8 can and will serve as a key differentiator for its products and so WP8 investments will continue. Meanwhile, Google's Motorola Mobility has noted that it is currently selling upwards of at least 100 thousand Moto X super smartphones every week. That adds up to a good number of Moto X sales, which might contribute to overall Android market share – Or not, if the Moto X is stealing that share from Samsung. We do wonder if this is the case.

Finally, it appears to now be the case that the rumored "free" smartphone from Amazon is exactly that - nothing more than a rumor. Amazon itself has denied that any such thing is in the works, but such denials can be deceiving. Amazon can easily put a free Amazon phone out there that would have one and only one real design goal - getting ever more people to spend their money at Amazon of course. We'll see how it pans out, but, whether free or exceedingly low cost, we believe Amazon will sooner or later deliver on this.

And just a bit more on smartphones this week (we can toss tablets into this as well): a new IHS report claims that the market for motion gesture detection sensors is skyrocketing. Led originally by the Samsung Galaxy S4, other companies are now getting into the game, which suggests that we will soon see entire populations of users waving their hands and fingers over their touchscreens instead of, well, touching them.

Another report, this one from Strategy Analytics, claims that the quad core mobile processor market is also growing at a significant rate. We have no doubt of this - every smartphone vendor needs to deliver on this, at least with their higher end devices. Apple, for example, which has set a new standard with the iPhone 5S, has put into play the industry's first 64-bit microprocessor to be used in a smartphone.

With that we'll sign off on what has surely been a smartphone-filled week.

Have a great weekend!

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