Current Trends in the Mobile Phone Handset Sector - Essay Example

Current Trends in the Mobile phone handset sector Mobile phones also referred to as cellular phones, phones, hand phones, or cell phones are phones that have the ability and capability to send and receive telephones calls over radio link and this is usually over a wide geographical area. These gadgets usually do so by connecting to a network, commonly referred to as a cellular network that is usually provided by mobile operators. The access to these cellular networks provided by the various network providers gives access to the public telephone network. In the contemporary world, cellular phones or mobile phones have additional features to complement their telephony andthese features include the support of additional services For example, text messaging commonly referred to as SMS, emails, MMS, internet, gaming, photography as well as video shooting, and short range communications such as Bluetooth, infrared, and Wi-Fi.It is important to note that mobile phones, hand phones, or cellular phones that have the ability to handle quite a range of these computing activities are referred to as Smartphones. The first mobile phone or cellular phone weighed about 2kgs by John Mitchell and Martin Cooper in the year 1973 of the Motorola Company. Later on in the year 1983 DynaTAC 8000x was commercialized throughout the world. From then to the current date subscription to mobile phones or cellular phones has grown from as low as zero to over 7 billion, hence, it has long reached the bottom of the economic pyramid and penetrating almost 100% of the global population with the top mobile phone manufacturers being Samsung, LG, Nokia, and Apple. This research paper shall critically evaluate the various trends available in the mobile phone handset sector drawing out three trends that are considered most important. As technology steadily launches into 2016, and as individuals have expectations and wishes in the coming years, one thing is clear to a majority of individuals, this is the fact that the world is on the verge of global connection, this is greatly attributed to globalization and more and more individuals joining the online world and slowly moving away from a life of disconnection (Grant & O’Donohoe, 2007). Consumers across the globe are adopting cell phones or mobile phones in amazingly astonishing ways and this opens up new ways through which individuals interact with each other, educate each other, shop, communicate and even entertain themselves creating the question, what the future holds for mobile technology. Most mobile phone developers are rushing towards 5G technology with analysts suggesting that these next level network milestone shall be reached between the years 2018 and 2020. This shall be coupled with improvements in size, functionality, and shape of the mobile or cellular phones. It is true to state that the number of mobile phones has long superseded the human population, according to French Steve Amdocs open market president over 90% of their consumers own either a mobile phone or a tablet.According to him, proliferation isn’t the only factor influencing this widely spread of use, however, other factors such as demographics also greatly play a major influential role, below are 5 trends in the mobile phone handset sector. 1. Wearables Mobile phonetechnology is moving into a brand new phase especially when it comes to wearables. Also referred to as fashionable technology, tech togs, or fashion electronics, they are simply clothing designed and accessories having advanced computer technologies and a majority of the designs usually incorporate practical features and functions. This technology has been greatly linked to the field of ubiquitous technology. This technology shares the dream of mending technology into the normal day to day activities of individuals across the globe. This it aims to achieve by making technology passive and cause less frictions when it comes to use. Wearable technology has been greatly put into the mobile phone handset sector. One good example is Twitters advancement. Twitter users across the globe can comfortably put on a pocket tweet that utilizes a java application in one’s mobile phone and a Twitter text bubble on the individual’s shirt. Another good example is the mobile phones created by ZED phones, where they stich head and earphones into headbands and beanies, hence, allowing snow riders, drivers, riders, and even runners to access connection hands free. Sony Ericson a profound mobile phone manufacturing company teamed up with the London school of design and together designed digital clothing. Among those designed and produced include cocktail dresses with Bluetooth technology that makes them light up when a call is received on their mobile phones. Graduate students from Tisch institution of arts in New Yorkmanaged to design a hood cloth that sends text messages programed by the gestures and movements of the individual. The latest advancement in this sector is the invention of Google glass. Google glass is an invention that brings text or any other form of notifications to a user’s eyes, the device is fitted with a 5mega pixel camera and its various functions are activated through voice command showing its incorporation of artificial intelligence. The Motorola mobile company has also not been left behind, the company boasts its latest technology the Moto 360 powered by an android wears. 2. Mobile payments Mobile payments are also referred to as mobile money transfer or mobile transfer. Mobile wallet on the other hand is payment service regulated by specific financial regulations and performed only through mobile phones or cellular phones. This technology allows a consumer to not have to rely on cash, credit card or cheques to pay for goods or services, the consumer can instead use his or her mobile phone to pay for a whole range of goods and services. This technology is being adopted all over the globe and this is being done in different ways. Payments via SMS have been popular and very effective in Europe as well as Asia and it’s because of this that other mobile paying methods have joined to accompany it such as direct billing, mobile web payment (WAP), and mobile payment client (Java ME, Android). In the year 2012, mobile phone company Sony Ericson partnered with western union and this helped expand the direct operator billing operations. This move has realty enabled individuals across the globe to make western union a part of their daily money transaction operations. Given the wide international reach by each of the two companies, the merge was meant to exelerate the m-commerce market also referred to as the mobile commerce market and the existing financial demands in the current market. This trend also features also includes cloud based payment services. Cloud based payment services include PayPal, Go Pago, and Gobalpay. These mobile services use the cloud based approach in mobile payment. This approach puts the mobile payment provider in the middle of the transaction. The most famous feature in this trend is the mobile payment service provider model. Here, the mobile provider acts independently and provides mobile payment services. Here, the service provider is tasked with providing an independent wallet from the users mobile account and the user can transfer the money to another user as well as use the money have to pay for goods as well as services. 3. Mobile technology integration in Vehicles There have been moves that have incorporated mobile technologies in the development of what is referred to as smart cars. Modern cars are being fitted with global positioning applications as well as wireless network capabilities. These additional applications from the mobile technological world help in various ways, they give guidance to drivers when driving, and they help in navigation by showing the route to be followed as long as it’s in the global positioning database. Additionally, cars are now fixed with a broadcast system that relays data in seconds using any available Wi Fi network. This system is very helpful when it comes to tracking and locating lost or stolen vehicles. 4. Mobile selling and Buying Mobile selling is the process through which an individual identifies and buys commodities the mobile phone or cellular handset. Various companies have come up with special ways of advertising their commodities, means of making an order and have the commodities delivered to you (Shankar & Balasubramanian, 2009). On the other hand, there are companies that provide mobile applications that give individuals the possibility to create accounts, take pictures of the commodities they would like to sell and post these commodities on the applications. From there, potential buyers would identify the posted commodities, look at the pictures and if pleased contact the seller and organize for a possible transaction. Good examples of such companies include e-bay, that allows you to bid for commodities posted online, gumtree, etc. Social Networking Social networking is yet another important trend in the mobile phone or handset sector. Social networks are avenues where an individual from all walks of life i.e. different cultures, different countries, as well as races get to interact at the same level. Social networking has been on the verge of expansion and is one of the influencing factors of globalization (Mort & Drennan, 2002). Social networking expansion has greatly been facilitated by the availability or the ever improvements witnessed in the mobile phone or cellular phone industry. Basic mobile phones that did not have the ability to access the internet could only aid or influence social networking by the use of short messages also referred to as SMS’. These were expensive and had geographical limitations. However, with the entry of GPRS enabled mobile phones, individuals with mobile phones could now access the internet and get to use social networks such as Facebook, Twitter, and 2go. With the later improvements in mobile phone internet capabilities, for example, the invention of edge technology, mobile phones could now access the internet at faster speeds hence support more social networking and even video streaming. Currently, the mobile network developers have discovered 3g, 3.75g, and even 3g+ GSM networks that allow mobile devices to access the internet at even faster speeds thus gaining the capability to support more social networking features, for example, internet calls, video chatting and voice note texting, mobile phone applications that have topped the chat in this include Whatsapp, Viber, and Cord. Three most important trends Above are some of the trends witnessed in the mobile phone sector over the recent years. However of the 5 trends there are 3 main trends and these include mobile payments, social networking, and mobile selling and buying. Mobile payments are a very important trend due to its significance and great positive influence in commerce and the world of business. Mobile payments have greatly revolutionized business, making payments as well as cash transfers from one individual to another easy, efficient, and reliable no matter the geographical location. Mobile selling and buying is another very important trend because it has greatly influenced the world of business by bringing the market closer to both parties i.e. the seller and the buyer (Scharl, Dickinger & Murphy, 2005). Additionally, the seller can avoid additional second parties that would eventually make the prices of their commodities go high. This trend helps individuals get acquainted to the internet through cellular phones a skill that is very essential in today’s business world (Hitt, Ireland & Hoskisson, 2012). Through this trend, we have supermarkets, companies, music stores and even taxi companies come up with their mobile phone applications through which the clients can gain access to the products or services from their cellular phones and think about purchasing the goods or going for the services or not. Social networking is the 3rd most essential trend in the mobile phone handset sector. Social networking has played a great role in cultural diffusion and through it different individuals have been able to interact and mingle despite the distance, geographical boundary and race. Social networking is one of the pioneering forces to westernization which is the spread and adoption of western ideas as well as globalization which is the integration of the world economies to form a single global market, where companies, entities, and even individuals can compete effectively. A lot of mobile phones have been used by individuals to record instances where the human rights of individuals was being infringed upon and this images or videos get uploaded into the social networks, this greatly alerts the various bodies to intervene and the salvage the situation (Kavassallis et al, 2003). When it comes to business, social networking is very influential as it can be used for advertising. For example, various companies across the globe have a Facebook and twitter account, hence, through their cellular phones and the persons with concern can get to the companies through their social network accounts. Not only have social networks benefited business entities alone but they have also benefited other bodies which include various armies, for example, the British army, which has a Facebook account and a very responsive customer care. Political parties in different nations also have social network pages, where people with interests can access their information at the comfort of their cellular phone (Haghirian, Madlberger & Tanuskova, 2005). Not to forget to mention, various bodies such as human rights bodies, for example, the United Nations as well as various non-governmental organizations in different countries greatly benefit from the use of social networks, this is because these social networks are avenues through which they get to know who the target or persons of need are and also it’s an avenue through which they would easily reach the world in championing for support and favor in any activity they are undertaking (Barnes & Scornavacca, 2004). Three mobile phone companies A. Sony Mobile Communications Sony mobile communications Inc. formerly known as Sony Ericsson is one of the multinational cellular phone manufacturing companies with its headquarters in Tokyo Japan and it’s fully owned by Sony Corporation. Sony Cooperation was a very small player and contributor to the world of mobile phones in the early 2000s. However, by the end of August 2001, the Sony cooperation and the Ericson mobile network provider had finished finalizing their merge giving birth to the Sony Ericsson mobile phone. Key opportunities and threats and the competitive strategy Sony Employedand suggestions In the early 2000s Sony Erickson employed a strategy in which they planned and commissioned themselves in the production of mobile phones with that had various capabilities, for example, photography, video shooting, video viewing, music downloading and playing as well as the abilityto manage the personal information of the handset owners. During this time the company managed to release mobile phones that had built in digital cameras and color display screens which were a great attractive features during that time and the company had a boom in sales but somehow kept witnessing loses (Ling & Pedersen, 2006). The company has been in the verge of improving its models over the years to make sure that its products remain relevant in the modern competitive market. In the year 2005, Sony Ericsson launched the Sony Ericsson K750i, this was a mobile phone fitted with a 2 megapixel digital camera. It was followed by the Sony Ericson w800i which was the first Walkman phone in the world that could play music for up to 30 hours of battery power conservation. The two models had incorporated advances and improvements in the camera section as well as power conservation not to forget to mention that they were low cost gadgets in production, hence, the company could now effectively compete with other low cost mobile phone manufacturers, for example, Nokia (Leppaniemi & Karjaluoto, 2005). Later on the year 2007, the company launched its first % mega pixel enabled mobile phone and this was the Sony Ericsson k850i, following its announcement, in the year 2008, the company announced the Sony Ericsson c905 that was the world’s first mobile phone with 8 mega pixel capability. Later on in 2012, at the mobile congress, the company launched a 12 mega pixel enabled mobile phone which it named Satio. As part of its competitive strategy, in the year 2005, the company sponsored various movements and institutions across the globe. For example, it sponsored the women’s pro tennis circuit commonly referred to as the WTA circuit in a 88 million dollar agreement that ran for a full 6 years, and the women’s pro tennis circuit was renamed the Sony Ericsson WTA tour. June the very same year, the company announced sponsorship of the two West Indian batsmen Ramnaresh Sarwan and Chris Gayle. Additionally, it moved some of its Stockholm mobile phone productions to India and managed to get two very influential outsourcing partners namely Foxconn and Flextronics, this was a very effective techniques as India was one of the fastest growing economies and still is. Currently, Sony has long gain full custody of the mobile manufacturing company and is greatly improving andits launch of the new Sony Xperia phones has been well received by the market. Now only referred to as Sony mobile communications, the company decided to face out the production of non-smart mobile phones and also managed to get hold of the Gakai cloud service. Suggestions would aim to help Sony think about the common man, not all people can afford expensive smart phones, they could adopt a strategy that would lead to the production of low cost smart phones and target markets such as Africa, Asia, and parts of South America, this strategy has been used by Chinese mobile companies i.e (Linzmayer, 2004). Hauwei, Techno, and Itel. Additionally, they can move their production units to countries where factors of production are cheap, for example, to China, where labor is cheap and the factors of production are readily available, this strategy was adopted by Nokia in India and Apple in China. B. Apple Inc. Apple Inc. is a multinational company based in the United States of America with its headquarters based in California. The company designs and develops consumer electronics. These include computers, computer software and online services. Its best known hard ware technologies include the mac computers, iPod media players, IPhone smart phones and many more (Hawkins & Mothersbaugh, 2009). IPhone is a line of smart phones designed and manufactured by Apple Inc. These phones run the IOSmobile operating system designed by Apple. Apple Inc.’s strategy has been inclined to the production of full feature phones (Ferrell & Hartline, 2012). The phones include a whole range of essential features of the new modern business world. IPhones are built upon a multi touch screen system that provides a keyboard where the user can input the information. The mobile phones have been fitted with various ways through which they would access the internet hence, keep the user connected at all times. Features that ensure this include the Wi Fi networking capability, additionally, the mobile phones can connect to a whole range of networks and this include 1xRTT networks, GPRS, EV-DO which is 3G enabled, and UMTS that is 4G enabled, a far much more faster internet connectivity. To remain relevant in the competitive market, in the late 1990s, apple Inc. begun launching iPhones with various multimedia capabilities, these include, the launching of phones that could take images, and shoot videos that was ushered in by iPhone 3G series. Modern iPhones can take videos, play music, shoot videos, browse videos, send and receive emails, GPS navigations and receive visual voicemails (Gawer, Cusumano & Strategy, 2012). Other additional features include video gaming, social networking, and reference works and this is fully enabled by the phones capability to download various application programs (Cruikshank, 2006). The company established a store that enables one to download applications by the name Apple store which provides more than a million applications by Apple and other third parties ranked highly in the mobile software distribution platform. For a period of time iPhones have been the pioneers in the smart phone industry making Apple at some point to become one of the most valuable public traded companies in the early 200s (Viardot, 2004). However, iPhones dominance of the smart phone industry has over the years dwindled to 15% worldwide since the year 2012. This is because of the entry of Android based smart phones. As part of a cost cutting strategy, Apple Inc. opened up manufacturing plants in China, this would help in the reduction of costs as factors of production in China are cheap and readily available and would help iPhones retain their smart phone dominance in Japan and Australia, where the android smart phones are struggling to access (Lefebvre, 2009). Suggestions for iPhones are inclined to the production of low cost smart phones, which would target the middle class and people of blue collar jobs as well as students in various institutions across the globe. Additionally, the company would try and manufacture non-smart phone phones, which would easily meet the markets of a majority of people in the developing countries i.e. in Africa and Asia, a strategy adopted by Nokia which is now windows mobile. C. Nokia Nokia is a Finnish multinational communications technology company with its headquarters in Helsinki (Dobni, Dobni & Luffman, 2001). It’s one of the greatest contributors on mobile telephony and is greatly renounced for its contribution in the development of LTE and GSM standards. At a specific period in time it was the largest mobile phone vendor in the world, distributing its cellular devices to a wide range of markets in the world (Bauer, Barnes, Reichardt & Neumann, 2005). Nokia’s strategy was the creation of low priced mobile phones as well as high priced smart phones. Its small priced mobile phones were greatly received in the markets of Asia, South America, and Asia. This is because of their cheap prices, longer battery life and better GSM reception (Hotelling, 2013). Nokia’s dominance has also extended to the smart phone industry, and this it has achieved through its Symbian platform. However, this was soon over shadowed by the growing effect of Apples iPhones and the Android phones. To greatly compete in the smart phone market, Nokia entered a pact with Windows to use its windows mobile in its future versions of smart phones in the year 2011 (Kaplan, 2012). However, in the year 2013, windows announced that it was set to acquire Nokia’s mobile phone business. The acquisition would cost windows a total of 7.77 billion US dollars and is now referred to as Microsoft Mobile. As part of its strategy in the early years, Nokia was a very influential player in the development of the GSM 2G networks also referred to as the Global system for Mobile Communications (Persaud & Azhar, 2012). This was a second generation mobile phone technology that gave mobile phones the capability to carry data as well as receive voice calls at the same time. It was the world’s first telephony network that enabled mobile phones to have international roaming. It is this technology that was adapted as the standard European digital mobile technology. GSM’s high quality and crystal clear voice calls as well as the capability to access international roaming enabled for various mobile phone features such as short messaging or SMS’s and this laid a major platform in mobile phone use. GSM came to be widely adopted across the globe and by the year 2008, there were more than 700 mobile subscribers from over 200 countries in the world and its growth was estimated to be at 1.3 million a day. Suggestions for Nokia which is now Windows mobile is for it to adopt the android system into its smart phone sector (Kaplan, 2012). Particular markets such as Africa, India, and South America where android phones have greatly taken over the market having smart phones that have android support would greatly influence their sales. Marketing theories applied in this paper generally focus on competitive advantage. The mobile phone sector is an avenue full of highly competitive multinational giants and a theory should be will equipped to give its users tricks and tactics of gaining competitive advantage over their other competitors (Cruikshank, 2006). Theories should give insight into whom the business competitors are, how a business can be affected by competitors and how to effectively compete in a highly competitive domain. One very important theory is Game theory; this theory assumes that a company is a hyper institution where rationality applies. Hence, it would always strive to make sure that it achieves the most preferred outcomes despite limited resources and available constraints. The theory also assumes that the rivals also behave in a similar manner and it’s up to the company to do all it can to gain competitive advantage over its rivals. The theory suggests on innovation and creativity, hence for the above named companies, coming up with new phones or brand new features in phones would greatly aid in gaining advantage. It also emphasizes on product quality, consumers would prefer mobile phones that last longer and do what they are supposed to do accordingly. The theory also insists on market pioneering, this is a fast mover’s strategy and these market companies should make sure that they are the first to introduce a new product into the market. Lastly, the theory insists on market focusing, this is where a product is designed intended to target a particular market. In the above paper, three major trends in the mobile phone handset sector have been identified. Additionally, three major mobile phone manufacturers have been identified with each one of them having a detailed description of how they have managed to stay relevant in the mobile sector as well as suggestions being offered based on Gales marketing theory. 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