The Android is born!

From a feature, performance, and look standpoint, observers have expressed their own preferences, some of them preferring the open approach of the T-Mobile G1, and others preferring the sleek look of the iPhone. But the most important is that these two smartphones actually represent totally different business approaches. Apple approach is to provide a predictable user experience by developing an extensive control over all stakeholders. Google comes up with a more liberal approach, just giving guidelines to both handset and applications developers.

The first issue Android is facing is the need to build a critical mass. Android will only succeed if enough handset models are available with a large variety of specifications. The second challenge the Android environment will face is to ensure a total compatibility between every hardware and every software. We all know that the more open the specification, the higher the incompatibility risk. Given the handset industry and market environment, we believe these obstacles can be overcome, and within a couple of years, there will be a wide variety of Android-based handsets, supporting a large variety of applications.

Now, how does this impact our industry? A wider handset choice will undoubtedly increase handset purchases, and as these handsets will undoubtedly be attractive, they will encourage churn. Handset consumption and churn are two positive factors for the SIM industry.

On the other hand, since the beginning of the GSM standard, standardization bodies have been the theater of influence wars between handset vendors and SIM vendors to attract a larger share of added value and the most rewarding part of customer experience. With a fast development of the smart phone market, the SIM industry needs to react quickly and reestablish its position vs. the handset industry. The SIM industry should focus on what it does the best: provide security. And an open platform just boast the need for security.

Thierry Spanjaard
Chief Editor
Smart Insights