According to Forrester Research, 2009 is going to bring more success for the iPhone. That's not a total surprise, after all, the iPhone is a monster growth area for Apple, and once most people try one, it's difficult to imagine using anything else.

But what is most interesting abut the latest report is that Forrester is seeing Apple opening up more sales for the iPhone in the enterprise sector, specifically penetrating 10% of small to medium enterprises. Not bad for a product that was introduced 18 months ago.

From the report:

we will see growth in the mobile "wannabe" user segment as employees bring their personal devices, such as the iPhone, into work and expect organizations to develop ways to support these new devices — even with the slowdown expected in consumer mobile device purchases

More here.

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The mobile market is becoming increasingly interesting, not just because of the iPhone, but also because it is increasingly becoming more like a portable computer with phone capabilities than ever before. From the standpoint of social networks and immersive collaborative applications, the potential for change and disruption brought on by the mobile market is huge.

Gartner has issued a report which indicates that worldwide growth in the mobile market for 2008 is expected to be 11%, which compared to the slew of bad news in the economy in general, is excellent news. While the numbers are interesting, let's focus on the five key trends Gartner has identified in this market:

1. Established Vendors Consolidate and New Players Join the Fray. New device vendors, such as Apple and Garmin, are looking to differentiate themselves, while big-name vendors, such as Motorola, face pressure as market shares decline and design innovation becomes increasingly challenging.

Apple's iPhone has clearly been a market changing product. It will be interesting watch how this area continues to change as the iPhone becomes a platform for RIA's.

2. Device Vendors Build Out Ecosystems. This new market will bring changes in relationships between vendors, operators and content providers. Applications relevant to enterprises, such as location and navigation, will increasingly become available directly from device vendors that are integrating GPS into their products.

Again this is where the iPhone is a market disruptor. If Apple can turn the corner on the security issues for enterprise usage of the iPhone, it will be a big winner. It's not clear yet how others, such as Garmin will fare. But it's clear that established phone providers are going to have to follow the iPhone's lead in this area, or else they will suffer in the long term.

3. Devices Makers Will Focus on Removing Complexity for the User.

4. Mobile Devices Increasingly Become Lifestyle Statements.

Smartphones and cell phones have long been some of the most unintuitive devices to use. Again where the iPhone is setting the market pace is in removing complexity in the interface. This allows users to get to applications quickly and easily. As for lifestyle statements, perhaps, although in the enterprise that will be less important. I think the bigger trend is around the social application potential of mobile, and perhaps that is where Gartner is going with this, although I would say that real time mobile collaboration is going to be far more accurate than "lifestyle statements."

5. High-End Device Platforms Become “Field-Refreshable." As cellular technologies become part of increasingly expensive consumer devices, vendors must manage ongoing support, upgrades and enhancement of drives. Because many users will hold onto high-end devices longer, these platforms will need more life cycle management in the form of upgrades and enhancements.

Gartner is dead on here. The iPhone and its ilk are much more akin to being small laptops, and are treated as such with regards to the ability to upgrade software components easily. Whether hardware upgrades a la the venerable PC are feasible with mobile devices anytime in the near future remains to be seen, but it will be interesting to see if demands for expandability of the hardware grows as the software ecosystems grows in complexity and capability.


EDIT: IDC has added its assessment of the mobile market:

The worldwide mobile phone market continued solid double-digit growth in the second quarter (2Q08) as competition in high-end devices heated up. According to IDC's Worldwide Mobile Phone Tracker, vendors shipped a total of 306.0 million units, an increase of 5.6% from the 289.7 million units shipped during the previous quarter and up 15.3% from the 265.4 million units shipped during 2Q07. Total shipments for the quarter were in line with IDC's expectations, even as vendors cited economic challenges and changing demands within key regions.

"Smartphones are still seeing growth rates hovering around 40.0% year-over-year, while the rest of the industry is growing at roughly 10.0%," said Ryan Reith, senior research analyst with IDC’s Mobile Phone Tracker. "However, grouping 'the rest of the handsets' into one category is doing the industry no justice. The rise of the feature phone has created a battle at the high-end of the market, with the main difference between smartphone and feature phone being the high-level operating system. We expect the competition at the high-end will help drive growth within the market and help move volume to higher-end devices."

Regional Analysis

Despite rising food and oil prices, mobile phone growth in the emerging markets of Asia/Pacific continued to be robust. Nokia reported its highest-ever shipments in India amid subscriber increases in rural areas, while domestic phone makers benefited in China. Pre-empting the threat of the (then) imminent iPhone 3G, converged mobile device vendors in the region, including HP and MWG, also took the opportunity to launch their own offerings in 2Q08.

Volumes in Europe, the Middle East and Africa (EMEA) rose modestly compared with the first quarter, and saw healthy growth from a year ago. In Western Europe, LG and Samsung increased market share with new line ups of medium and low-end products, while in the emerging markets of Middle East and Africa growth continued to be driven by sales of Nokia's entry level phones.

In North America, mobile phone shipments experienced a healthy lift from last quarter, with vendors introducing a number of feature phones ahead of the much anticipated iPhone 3G. In many cases, these offered touchscreen, music, or GPS. At the same time, the converged mobile device market grew faster than the overall mobile phone market and accounted for nearly a fifth of total mobile phone shipments.

In Latin America, mobile phone shipments continued to show positive growth. With the recent and continuous migration to newer networks and new services offered by carriers throughout the region, the main strategy for vendors and carriers in 2008 has been to promote and convince current users to migrate from low-end phones to more complex feature phones. In response, vendors launched a number of new models during the quarter.

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Summary: Research firm Gartner is offering up some "caveats" for iPhone usage in the enterprise. It should be noted that in my view, the iPhone is a strong candidate for being part of an Enterprise 2.0 strategy, but like Gartner, I have some reservations that would prevent me from recommending it yet as an essential part of a fully developed SOA/Enterprise 2.0 approach.

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