Technology to go smarter, lighter and more green
Mobile search is likely to be the most trendy application as smartphones have become the web search device for users, the Technology, Media and Telecommunications (TMT) arm of business advisory firm Deloitte has said.
In its latest report on trends in the electronic communications segment, TMT has predicted that mobile search will dominate the strategic direction of the smartphone market this year. It also stated that search will become one of the five most-used smartphone applications by the end of this year.
In a year when PCs will go thinner, more focus will on energy-efficient models. While TV and Radio will continue their reign on top of the media, online editions of newspapers and magazines will be mostly free.
Increasing popularity of voice over internet protocol (VoIP) networks is expected to evolve from being niche to a mainstream application with tens of millions of users by the end of 2010.
Saba Sindaha, partner in charge for the TMT industry at Deloitte in the Middle East said: "Telecommunications predictions for 2010 have been largely shaped by the consequences of digitisation and mobile data. The growing importance of mobile search is expected to generate fierce competition among search providers; however, only one or two players may dominate this space in the mid-term."
The rising adoption of mobile VoIP services could cause a fundamental rise in expectations as to what mobile voice can do, said Sidanha, adding: "Operators will need to understand the short- and medium-term implications of this, but also consider companies outside of the sector looking to capitalise on the allure of subsidised or free calls to devices to enable the flow of advertising messages.
"Portals such as Facebook and Yahoo are likely to look more favourably towards mobile VoIP applications as a way to encourage use of smartphone versions of their websites to command greater user loyalty," said Sindaha.
Leadership in mobile search will dominate the smartphone market in 2010, despite modest projected revenues at between $1 billion (Dh3.67bn) to $2bn. However, providers will spend several times that amount to strategically position their companies to exploit future income streams.
By end-2010, search will play a key role in future mobile platforms, with arrangements to share revenues key to a successful business model, and subsidies on smartphones to be co-funded by operators and search engine platforms.
Developers will need to offer various user interfaces for a variety of user environments and consider how best to adapt search to these unique characteristics and the required technologies to integrate and work across a range of application stores.
This year could be an inflection year for VoIP – voice call over the top of an IP-based network – via mobile phone, given the growing number of WiFi-enabled phones, more WiFi hotspots, and the increase of "one-to-many" communication.
Within three years, mobile VoIP could be worth over $30bn globally. If routed over WiFi, mobile VoIP could lessen demands on the cellular network, and smaller operators in markets, where the calling party pays, could see a decrease in overall termination charges.
Allure of freebies
Companies may use the allure of free calls to enable the flow of advertising messages, therefore substantiating the mobile voice market's value.
If mobile VoIP results in declining revenues for operators, investment available for maintaining networks could drop and threaten the rollout of next generation infrastructure. Social network portals could promote mobile VoIP applications by pointing to smartphone versions of their websites.
With nearly 600 million mobile broadband connections, 2010 could see the wireless equivalent of gridlock. Telecommunication technologies that can make existing wireless networks perform better should experience stronger growth than overall IT spending.
Leading pure-play companies in this area should see year-on-year growth approaching 100 per cent, with the average company expected to grow by 30 to 40 percent. Sectors thought to benefit from addressing the data congestion problem are hardware and software markets, including policy management, compression, video streaming, and caching technologies.
Handset-makers, specifically of smartphones, that adopt technologies to reduce network usage relative to competitors will see an advantage. However, without action, techniques such as metered pricing and traffic management may be necessary. Connected portable devices, or net tabs, are expected to offer a more appealing balance of form and function, and are anticipated to be purchased by tens of millions of people.
"The rise of the net tablet could constrain the growth of the nascent e-reader market. For every million net tablets sold there will be a corresponding impact on e-readers. We also predict that in 2010 many enterprise purchasing decisions will be based more on the preferences of individual employees, rather than traditional IT department criteria," said Sindaha of Deloitte.
The firm also forecasts that virtual desk infrastructure, a computing model based on thin or stateless clients, centralised applications and processing power, will be taken far more seriously than in previous years. One million seats are expected to go thin client in 2010, with the largest deployments involving tens of thousands of seats. By 2015, thin client may reach 10 per cent of all enterprise client devices.
Net tabs and netbooks
Net tablets, that are smaller than netbooks, and bigger than smartphones could be the attraction this year. Net tabs will be purchased by tens of millions of people in 2010. These devices have an advantage over smartphones, which are small for watching videos or web browsing, and notebooks, netbooks, and ultra-thin PCs are too heavy or expensive.
The likes of Apple and Microsoft teaming up with Hewlett-Packard, are anticipated to launch their products early this year, following news out of the Consumer Electronics Show in January. Custom-designed tablets are also likely to be released by start-ups, some existing phone and PC makers, netbook leaders, and various smaller manufacturers using open-source phone operating systems.
Since net tabs are designed to connect wirelessly over WiFi, wireless carriers are likely to try to push users off cellular networks and onto WiFi as much as possible. Net tabs are also more expensive than most smartphones, and consumers may demand upfront subsidies.
In the media industry, TV and radio will continue their reign on top while the surprise package will be the humble DVD. The Deloitte report predicts that vending machine sales of DVDs will double in 2010.
Although the web has already become the most efficient means of distributing short-form content, the volume of DVDs distributed via vending machine is expected to double in 2010.
Drivers such as price (as low as $1 per night) and ease-of-use will be key to the success of the DVD vending machine. In most markets, vending machine rentals are likely to be cheaper than post-based rental services or outright purchase.
Vending machines are future proofed for the migration to HD DVDs, which can reach 25 GB in size. The vending machine model is still likely to face some challenges in 2010, as some content owners may delay DVD sales to vending machine owners until after initial release to protect sales.
"This year's predictions cover a range of topics, including the supremacy of broadcasters' programming schedules. More than 90 per cent of television and 80 per cent of audio is expected to be consumed in this manner, meaning linear will continue to rule in 2010, despite the proliferation of non-linear options," said Sindaha.
The web and TV
The concurrent use of the web and TV will take off in 2010. But internet-connected televisions or set top boxes will not be driving this. Rather it will be users combining their existing televisions and laptops, MP3 players or other browser-enabled devices that will drive the convergence.
Websites specifically designed to feed off viewers' eagerness to react to what they are watching should entertain the public, please advertisers and improve broadcasters' revenues.
Although TV and the web will take-off to newer heights they will not necessarily be on the same same screen, according to the report.
Melding web content with television programmes should intensify as concurrent use of the web and TV takes off in 2010.
But do not expect a surge in internet-enabled television sales or an explosion in the use of television widgets; converged web and television consumption is likely to be more pragmatic.
Converged web and television consumption is expected to be based on existing televisions and devices, with "convergence" being user-driven, given the mismatch between the swelling consumer demand for concurrent web and TV usage and the typical ten-year renewal cycle for televisions.
Users will combine existing sets with standalone browser-enabled devices, most WiFi enabled laptops and netbooks, smart phones, MP4 players, and portable game consoles.
As simultaneous web and television use gains popularity, television producers will be encouraged to create websites that feed off viewers' eagerness to react to what they are watching.
In 2010, the newspaper and magazine industry will continue to threaten to charge readers for online content, however that talk is unlikely to be matched by action. Publishers rumoured to be thinking about pay walls may ultimately decide against it.
Publishers who use pay walls need to maintain and publicise the premium nature of their content. Excessive cost-cutting could devalue the brand.
Online readers might be willing to become micropayment customers, but only if the content is good enough and worth the effort.
Clean energy matters
The cleantech sector's performance is anticipated to be mixed, according to Deloitte. Although solar demand is likely to grow strongly in 2010 and 2011, some subsidy cuts and cheaper-than-expected electricity rates may prevent that growth from being as strong as some might hope. The solar technology subsector will be outperformed by the broader cleantech industry.
In 2010, technology's contribution to CO2 reduction could result in electric cars, more efficient airplanes and leaner data centres. Yet there is another largely-overlooked industrial segment that may deliver equal benefit: cement. Cement production represents about five per cent of global emissions but is an essential driver of economic growth.
This year should see the world's first laboratory scale carbon-negative cement plant, with an industrial scale plant expected in 2011. The reduction in global CO2 emissions and construction costs could be significant. The full benefits of carbon-negative cement could be realised after five to ten years.
Moore's Law is alive
Despite forecasts of a gloomier scenario, Moore's Law will probably work in 2010, with advances allowing for greater transistor density. However, this may not yield more powerful chips. Moore's Law – the traditional ability of the global semiconductor industry to double the number of transistors in a square centimetre of silicon every 18-24 months – is not expected to come to a screeching halt in 2010, or even slow down. The increased density is unlikely to be used to produce larger or more computationally powerful chips.
Instead, "good enough" chips that are smaller, use less electricity and cost less money could emerge. With current growth of lower cost laptops and ultra low-cost netbooks, the next generations of PC chips are likely to be optimised for price, with consideration given to power consumption.
Other hot markets - smartphones, and perhaps tablets, will likely be optimised for power consumption, however, performance will be almost irrelevant. Although some chips will be performance-driven, this segment may not see much growth. Many IT applications are large users of electrical power, so more efficient chips are a good thing. New equipment that uses less electricity and requires less cooling may allow for re-architected or larger data centres.
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