Mereja

Author: Tero Kuittinen

  • New twist in the Zynga tragedy

    Zynga Analysis
    Soon after its IPO, Zynga’s share price spiked above $15 in early 2012. Very little has gone right since then. Just last month, Zynga issued yet another warning and its share price now hovers just above $3. On Thursday, Zynga’s latest flagship game, Draw Something 2, dropped out of iPhone’s top-10 paid app chart after having spent only six days there. The original Draw Something spent nearly three months on the iPhone’s top-10 chart in early 2012.

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  • Dawn of a new era: Barnes & Noble cuts Nook price by 63% in the U.K.

    Nook Price Cut
    Cor Blimey — beginning on Wednesday, British consumers are staring at a huge 63% price cut of the cheapest Nook eReader. The Nook Simple Touch price has plunged to £29 from £79. The Glowlight version has dropped to £69 from £109. This is not a permanent price cut, but a part of the Get London Reading literacy campaign. Nevertheless, the move is eye-popping.

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  • Nokia’s Lumia faces a brutal May challenge from low-end Android vendors

    Nokia Lumia Asian Market Analysis
    A month ago, Nokia was surfing a wave of enthusiasm in Asia. The cheap Windows Lumia 620 and Lumia 520 models both debuted in the top 5 of India’s biggest web retailer, Flipkart. Just four weeks later the situation has changed dramatically. Nokia has just one Lumia left in the top 10 chart of Flipkart and both the 620 and the 520 have crashed out of top 10. One major problem: The low-end Android vendors are now offering truly nutty value for money. Nokia’s Lumia 620 is supposed to be an attractively priced budget model at 14,000 rupees ($260) without carrier subsidies, or about half the price of high-end Samsung smartphones. The Lumia 520 is supposed to be deep value at 10,000 rupees ($186).

    But the Micromax Ninja A89 now features a 4-inch screen and 1 GHz dual-core processor and sells for just 6,500 rupees ($121). Under pressure from Micromax and Karbonn, Samsung has dropped the price of its Galaxy S Advance to 14,000 rupees ($260), and this gets you a 4-inch Super AMOLED screen and a 5 megapixel primary camera. Nokia simply has not been able to keep pace with the price aggression of Asian Android vendors this spring.

    The problem is not limited to Lumia models because Nokia’s Asha range of premium feature phones is clearly caught in a similar vise. The relatively fancy Asha 306 has plunged out of Flipkart top 50 over the past couple of months. It offers a 3-inch display and a 2 megapixel camera for under 4,000 rupees ($75), which was a decent deal last summer. But now there are real Android smartphones like the Karbonn A1 offering a 3.5 inch screen and a 3-megapixel camera for the same price.

    Why would a budget buyer with 4,000 rupees opt for a Nokia budget phone if the alternative is an Android smartphone with a bigger screen and a camera with higher specs for the same price? The answer used to be quality. It is widely known that vendors like Karbonn and Micromax offer suspect photo quality and often sub-optimal software performance. But that argument seems to be losing its power as Android price points continue heading south.

    The Lumia 720 is still the No. 1 phone at Flipkart. But in the budget category where Nokia has pinned its hopes for volume growth in 2013, both low-end Lumias and Asha models are withering under the brutal price offensive from Android specialists. Over the coming months, Nokia simply has to come up with a new strategy. Either introduce a cheaper new Lumia range or drop the prices of the 620 and the 520 rapidly and aggressively. The current formula is not working.

  • Android is now dominated by messaging apps

    Android Messaging Apps
    Perhaps the most fascinating trend in App Annie’s new March statistics is the transformation of the Google Play Android app store into a messaging app distributor. No fewer than three out of four biggest revenue generators in the non-game app chart are now messaging apps; LINE at No.1, WhatsApp at No.3 and KakaoTalk at No.4. The iPhone’s non-game revenue chart is a bit lighter on messaging app but still features LINE at No.1 and WhatsApp at No.8.

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  • Twitter Music for iPhone barely outshines Nokia’s last iOS app

    Twitter Music iPhone Top-100
    It is difficult for big tech companies to create hot apps. Very difficult. A few months ago, Nokia’s mapping app called HERE created a big media splash when it launched, becoming a top-5 iPhone app the day after it debuted. It then tumbled out of top-100 in just six days. Twitter’s much-hyped music app annoyingly titled “Twitter #music” managed to cling onto a top-100 position 96 hours longer — it dropped out on its tenth day.

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  • T-Mobile losing its grip on smartphone sales as Sprint reaps the benefit

    Sprint T-Mobile Smartphone Market Share
    The latest Kantar smartphone report had many interesting tidbits about Windows Phone and iOS market share trends, but perhaps the biggest bombshell was buried in the section about U.S. mobile carriers. T-Mobile’s share of U.S. smartphone sales has collapsed to 9.5% from 12.7% in just a year. At the same time, Sprint’s share has climbed to 12.3% from 11.0% over the same time period. This means that in 1Q 2012, T-Mobile still held a narrow lead over Sprint when it came to smartphone sales in America; by 1Q 2013, Sprint had surged to lead T-Mobile by nearly three points.

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  • Broadcast TV’s nightmare begins as mobile apps dominate prime time

    Mobile App Usage Study
    The latest data from analytics firm Flurry research shows that mobile apps are now used by more than 50 million people in America during the most hectic period of the day. And that moment is at 8:00 p.m. — smack in the middle of TV’s prime time. On weekdays, 7:00 p.m. to 9:00 p.m. is the stretch when mobile apps reach more than 50 million U.S. consumers. This happens to coincide with the time most big broadcast television shows air. It probably is no coincidence that while mobile app usage exploded between 2011 and 2013, the most important prime time shows started imploding. “American Idol” is now only a shadow of its former self; its audience collapsed to just 12 million people last Wednesday. “Survivor” has plunged below 10 million viewers.

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  • Chilling deja vu as Apple starts to echo Nokia circa 2007

    Apple Phablet Analysis
    For those who followed Nokia closely in the past decade, some of Tim Cook’s comments are starting to trigger a weird sense of dislocation. “Our competitors have made some significant tradeoffs in many of these areas to ship a larger display. We would not ship a larger display iPhone while these tradeoffs exist.” Is this Apple’s CEO in 2013 or Nokia’s CEO in 2007? The strongest parallel is in the weird way both companies started fighting the consumer preference for larger displays at the peak of their profitability… and then dug in as margins began eroding rapidly.

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  • Messaging mania: Nokia launches a WhatsApp phone while Kik raises $19.5 million

    Messaging mania: Nokia launches a WhatsApp phone while Kik gets $19.5 million financing round
    Nokia on Wednesday launched a WhatsApp phone that includes unlimited WhatsApp messaging rolled into the retail price. And the retail price is just $72. The Asha 210 has a dedicated WhatsApp button that gives instant access to the service. This is a bold move, since it effectively means the hardware  is specifically designed to draw consumers away from SMS services, which are very lucrative for emerging market carriers. This move is the opening salvo in Nokia’s new bid to revive the flagging fortunes of its Asha feature phone line with new software features.

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  • Apple sees big boost from Asia Pacific growth

    Apple sees big boost from Asia Pacific growth
    Apple’s March quarter shows an interesting reversal of certain key December quarter growth patterns: Asian growth outside of China was reignited with real vim, while growth in China is sputtering badly. Apple’s ability to beat both earnings and revenue estimates during the past quarter hinged largely on its big Asia Pacific growth recovery — the annualized revenue growth in Asia excluding China exploded to 26% from just 10% during the December quarter.

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  • iPhone sales projections are now so low it’s ridiculous

    iPhone sales projections are now so low it's ridiculous
    If iPhone sales volumes fall as low as some Wall Street analysts now expect during the spring quarter, the decline would actually be worse than the biggest disasters in mobile phone history, including Motorola’s post-RAZR crash in 2007 and Nokia’s collapse in 2012. Can it really be this bad or are analysts simply locked in a race to outpace the possible upcoming share price plunge?

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  • Google is trying to shrink Motorola into success

    Google is trying to shrink Motorola into success
    It is hard not to admire Sanjay Jha’s cool genius in handling Motorola’s sale to Google. He leveraged Motorola’s old sales contacts in Asia and Latin America to push nondescript models into sales channel, creating an illusion of international traction during 2010 and early 2011. He created a shadow play of a healthy AT&T relationship, feeding expectations of substantial sales growth for Motorola’s business in the United States. For a brief time, Motorola seemed like a company in healthy shape.

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  • Nokia faces the feature phone collapse it dodged in 2012

    Nokia faces the feature phone collapse it dodged in 2012
    In the spring of 2012, Nokia started rolling out a broad new range of Asha feature phones and managed to astonish Wall Street for a couple of quarters. The phones actually sold. Priced at 60-90 euros, they were cheaper than even cheapest Android smartphones and had a sleek, glossy new look. They offered many advanced features like downloadable games and great email support. For a while, Nokia enjoyed an Indian summer — feature phone ASP only declined by -3% during the third quarter in 2012.

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  • Gap keeps narrowing: Google Play now delivering 90% of iOS app download volume

    Google Play now delivering 90% of iOS app download volume
    App Annie’s Market Index for the first quarter of 2013 shows Google Play continuing to narrow iOS’ lead in app download volume and revenue creation. In fact, Google Play delivered nearly 90% Apple’s app download volume in Q1. The iOS platform is still generating 2.6 times the revenue of Google Play, but that gap is narrowing rapidly as well — in the previous quarter, iOS apps generated 4 times the revenue of Google Play.

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  • Designer unveils $15 million iPhone 5 with 26-carat black diamond home button

    Designer unveils $15 million iPhone 5 with 26-carat black diamond home button
    We have seen luxury phones encrusted with diamonds before, and some of them are worth more than $1 million. But a British designer named Stuart Hughes is now raising the bar with an iPhone 5 that costs £10 million, or more than $15 million USD. The gimmick of this particular Apple piece is that its home button is made of a 26-carat black diamond. The marketing babble on the website is satisfyingly nutty: “Diamond is distinctive in the way it reflects light. It has a unique brilliance and also breaks the light up into spectral colours, which reflect within the stone as it is moved.” It is also pretty cool that a product description page for a £10 million device manages to misspell the word “chassis.”

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  • WhatsApp now bigger than Twitter, but lead over rivals no longer seems so vast

    WhatsApp now bigger than Twitter, but lead over rivals no longer seems so vast
    WhatsApp CEO Jan Koum has been talking at the D: Dive Into Mobile conference and he revealed some numbers about the company’s performance. The figures are certainly impressive: more than 200 million users and 12 billion outbound messages per day. In terms of active users, WhatsApp is now bigger than Twitter. Yet the company hit 11 billion outbound messages per day on New Year’s Eve, 2012. In August 2012, WhatsApp announced it was handling 6 billion outbound messages a day. Is the service’s messaging volume growth really decelerating this rapidly? From 6 billion outbound in August, to 11 billion in December, and then to 12 billion in April 2013. These are terrific volumes and they make WhatsApp one of the most fascinating and valuable app companies in the world… but its growth rate now seems to be falling quickly.

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  • Why a Dish takeover of Sprint would be fascinating

    Why a Dish takeover of Sprint would be fascinating
    Pay-TV operator Dish has made a dramatic bid for Sprint in an effort to elbow SoftBank aside. The company’s $25.5 billion bid is 13% above the offer SoftBank had made previously. What makes the situation so fascinating is the strong growth of mobile video consumption over the past year. In a recent interview with AdGent, the advertising platform company pointed out that browser-based video viewing is now the No.1 activity on tablets, growing faster than app usage. In a separate interview, David Steinberg from XL Marketing remarked that mobile video ads now have roughly three times higher CPM than app ads.

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  • Les Fleurs du Mal: France may force ‘brutal’ Apple to embrace ‘platform neutrality’

    Apple France AppGratis Analysis

    Fleur Pellerin, the French junior minister for digital economy, did not mince words when she addressed the Apple (AAPL)-AppGratis controversy on Thursday. She called Apple’s decision to kick AppGratis out of App Store “extremely brutal and unilateral.” France is now planning to demand tighter regulation of “digital platforms” after long seething about the distribution power that American companies such as Apple, Google (GOOG), Twitter and Facebook (FB) have gained over the past five years. France is Europe’s biggest developer of software, but its companies are increasingly being reduced to creating applications for platforms owned by Americans.

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  • Looks like Foursquare isn’t the future of smartphone apps after all

    Foursquare Revenue Analysis
    A couple of years ago, Foursquare was widely viewed to be in the vanguard of smartphone apps. Check in at the Four Seasons Shanghai and post it on Twitter, compete with your friends to become the mayor of your local Irish pub, and so on. What could be more hip? Well… pretty much anything, including virtual beauty shops for fantasy creatures. A new expose by Bloomberg Businessweek drops a major bomb about how incredibly weak Foursquare’s revenue base is — only $2 million in sales in 2012. Betabeat notes that despite its high media profile, Foursquare had only 8 million active monthly users at the end of 2012. In a fascinating turn of events, Foursquare was still able to tap into $41 million in new loans and convertible debt this just month.

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  • Devastating PC decline is literally incomprehensible to industry experts

    PC Sales Decline Analysis
    Despite ill omens, the IDC report about PC volume decline hitting -14% in the first quarter shows once again how much trouble the tech industry is having when it comes to dealing with the ongoing computer meltdown. As I wrote last December, IDC has been completely out to lunch about this key trend for years. In March of 2012, IDC was still expecting “desktop and laptop sales to take off in the second half of 2012.” Last December, IDC cheerfully predicted 1.2% growth in computer sales between 2012 and 2016. Of course, the PC industry is tucking into a majestic swan dive that makes those projections downright surreal. How can one of the most respected research firms in the computer sector be so disconnected from reality? The answer is simple: Analysts from largest research firms simply aren’t allowed to call major turning points.

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