In a recent post, I wrote about how smartphones are red hot in Asia, and in China in particular, right now. Well there’s yet another smart ‘new’ category of devices targeting the mobile computing market that is emerging. This category may also take global markets by storm (or maybe not, who knows in this game?): ‘smartbooks’.

No doubt, smartbooks will arouse market interest worldwide. Market demand from Asia is (as with most everything these days) expected to be strong. Taiwan, is both a global design and ODM/OEM manufacturing hub for portable devices and as such has already shown keen interest in this new category. In fact, a number of Taiwan OEMs have already showcased smartbooks at Computex in Taipei June last year.

The devices and their lower price points (sub-US$200, possibly as low as US$100) have also attracted a lot of interest in mainland China. According to Young Liu, special assistant to the CEO at Foxconn, the world’s largest contract electronics manufacturer, the company has had requests from a number of telecommunications companies in China to develop smartbooks.

Qualcomm, which makes microprocessor chips based on ARM Holdings’ semiconductor intellectual property (IP) is at the forefront of popularizing the smartbook. In fact, it coined the name, taking it from the combination of the words that describe the two device categories that it claims this third new category sits between: the smartphone and the netbook. Both computing and cellphone companies are paying attention with Asus, Acer, Lenovo and Toshiba as well as Nokia, LG and HTC all developing smartbooks.
These new devices are based on technology traditionally found in smartphones, such as Qualcomm’s Snapdragon chip. Snapdragon is a beefed-up cell phone processor that runs at 1GHz and includes integrated support for 3G wireless connections as well as WiFi, Bluetooth, and GPS.
Nvidia, also seem excited at the prospects of smartbook devices powered by its ARM-based Tegra chip. The company has forecast that we may see computer makers’ launching laptops that include detachable screens that would be able to independently access the Internet and process data. So you’d be getting laptop with an e-reader type device thrown in.

The phenomenal uptake of web technology globally has fundamentally changed our everyday lives. Consumers’ expectations about what their PCs and mobile computing devices should deliver are growing rapidly. There’s never a dull moment in this industry is there?

SK Telecom announced last week that they plan to sell 2 million smartphones  in 2010. By 2013 they will offer up to 25 models of smartphone and round 40% of those will be running Android OS.

Also at the same time LG Electronics is betting on Android – they plan to rollout 20 smartphones this year with over 50% of these models are based on Android.

Apparently Korean mobile phone manufacturers are still optimistic about Android despite of Google’s launch of Nexus One.  In Hong Kong we notice the price of HTC Android phones like Hero or Magic dropped after Google start selling Nexus One directly.

From Gartner’s projection last Oct Android will be the 2^nd largest smartphone platform by 2012 – around 76 million units a year.  Looks like Apple’s iPhone and RIM’s Blackberry has a very strong competitor moving forward.

Last week there were a few announcements regarding Smartphone :

• Lenovo announced it will buy back its Mobile Handset unit for US$200m. (http://www.lenovo.com/news/hk/en/2009/11/mobile_handset_business.html ).
• Dell launched its Android-based Smartphone with China Mobile (http://www.eweek.com/c/a/Desktops-and-Notebooks/Dell-China-Mobile-Release-Mini-3i-Smartphone-Details-322944/ )
• Acer launched its 1^st Android-based Smartphone (http://www.cnbc.com/id/34167014 )

Noted that PC manufacturers are jumping into the Smartphone market – especially in PRC . The average selling price for a Smartphone is at least US$150 and the margin is over 25%. Compared to just 10% margin for PC the Smartphone market is much more attractive.

Also Android is gaining its market share – according to Canalys (http://www.canalys.com/pr/2009/r2009112.htm ) Android-based Smartphone has  almost 4% share  of over 41M units shipped worldwide in Q3 2009 .  At GIPS we announced 2 weeks ago our customer Nimbuzz will support HD Voice on Android platform using GIPS VoiceEngine Mobile. (http://www.gipscorp.com/pressroom/detail.php?releaseID=458392 ) .

During this year’s P&T Wireless and Networks Comm 2009 exhibition in Beijing  ( 16-20 Sept ) China Mobile showcased  their  Smartphone OS platform  called OPhone :

• based on Linux 2.6 kernel and Android platform
• with support from more than 20 mobile handset manufacturers e.g  Lenovo, HTC/Dopod, Dell, LG etc.
• SDK available for application developers  ( http://www.ophonesdn.com/)
• applications can be downloaded from app store called Mobile Market  ( http://www.mmarket.com )

China Mobile is probably the 1^st mobile operator to try to own the  handset OS platform.  With over  500 million subscribers in China  (as of 31^st Aug 09 ,   http://www.chinamobileltd.com/ ) China Mobile surely have enough bargaining power to demand support of OPhone from handset manufacturers.  Also by owning the OPhone platform  and its app store future revenues from application download can be kept within China Mobile.

I was in Japan last week and noticed promotion of WiMAX service by a company called UQ Communications (http://www.uqwimax.jp/ ). By end of 2009 there will be WiMAX service coverage of all major cities in Japan.

Although many mobile operators has announced plans to deploy LTE ( Long Term Evolution ) but in North Asia WiMAX is already available :

Korea -  the local version of WiMAX called WiBRO  (http://www.ktwibro.com/ktwibro/main.html )  has been in commercial service since Jun 2006 but the current subscriber number is still small – around 220k. Since 2007 there are many client devices with WiBRO support like access card, UMPC, PMP, notebook etc.  Since wired broadband is widely available in Korea so usage of WiBro is still not popular.

Taiwan – WiMAX trial service is already available in Penghu, the Southern part of Taiwan by Tatung Infocomm (http://www.tatung.net.tw/about_01.aspx ) and by 2010 the service will support VoIP on mobile devices.

Early this month PCCW in HK launched their Media Phone service called “Eye2″

This is a wireless Portable Media Player with content from PCCW’s IPTV service. It can also support voice and video call. Looks like this is a trend for fixed line telcos to use “IP Convergence” devices to generate additional revenue from fixed line subscribers. In USA similar services are already available:

• AT&T Home Manager
• Verizon Hub

Traditional fixed line telcos are facing tough competitions from mobile operators and VoIP service providers. By adding value to existing offerings ( in PCCW case the multimedia content ) they can avoid direct pricing competitions while generating additional revenue from existing subscribers.

This week I ‘m in Beijing, PRC  to attend  the NexCom Expo 2009 exhibition ( GIPS has a booth ). Today is the 1^st day and many people visited the show and GIPS booth. In PRC GIPS is pretty well known in the media processing industry and many visitors are impressed by the quality of our products.  One good thing about tradeshow is you can have face-to-face interaction with your prospects/customers and we can get feedback from the market directly.

Just like VoiceCON show  in Orlando 2 weeks ago Unified Communications(UC)  is a hot topic at NexCom Expo.  Cisco and Avaya showcases their products while Microsoft  partnering with D-Link to launch their Response Point in PRC – targeting  Small and Medium Enterprises.

In PRC the key benefits of enterprises to deploy  UC  is to reduce communication costs and improve employee productivity. The will force telcos to also take up UC in order to reduce the lost of revenue from traditional telecom services. Also enterprises will likely to start from expanding their current voice/video conferencing applications into UC.

Despite the economic downturn the video conferencing market in China is expected to grow at 16.6% in 2009 ( CCW Research )

Obviously large enterprises use more video conferencing to reduce business travel and to save cost. We are also seeing SMBs ( Small and Medium Business ) in China are using more video conferencing under the SaaS ( Software-as-a-Service ) model. One of GIPS customer V2Tech is now offering on-demand software-based video conferencing to  around 10 thousand customers in China and Asia.   In particular Desktop Video Conferencing ( DVC)  is ideal as the initial startup cost is lower with better mobility and accessibility.

Also since the 3G license is now confirmed in China so according to CCW Research the 3 operators will focus more on  value-added service targeting vertical industries – video conferencing is definitely one of the service they plan to offer.  We will  see more later in 2009 from China.

Probably due to MWC this week there are some positive news about  mobile data usage published recently.

One is from Nielsen, saying consumers plan to use more mobile data services over the next two years — with a significant ramp-up in the next 12 months.  Mobile Internet is amongst the top data service that consumers will use.  This is good news for mobile operator during the economic downturn as they ‘ve been working so hard to increase the APRU of their subscribers and mobile data is definitely the way to go.

Another is from Cisco Visual Networking Index (VNI) –  by 2013 almost 64 percent of the world’s mobile data traffic will be video .  The shift to more video data traffic is happening in Asia – last Nov when I was in Seoul , Korea  attending  a VoIP tradeshow ( GIPS was exhibiting ) , many visitors asked about supporting real-time video communications on mobile devices.

I have no doubt the technology  for mobile data / video is ready  but we may still need some time for consumers to change their behavior – just count  how many people you know that carry 2 phones with them everyday -one for email ( aka  Blackberry ) and the other one for voice ? I know at least 7 out of a group of 15.  They can just use one phone for both voice and email – but I guess they  don’t want to change ……

2008 was definitely “The Year of the Netbook”, as their shipments exploded like crazy. According to IDC it was over 10M units in 2008. In Asia alone there are already over 10 notebook manufacturers.

With a price tag of less than US $500, coupled with its compact size, the netbook has quickly becoming very popular in the consumer market for casual apps like internet browsing and video- clip watching. Even on my everyday subway commute I can notice the change. There used to be about 4 people playing with their NDS/PSP in one compartment, but now at least 2 of those people are using their netbooks to watch video or play games.  

At their current price points, netbooks are even cheaper than some high-end smartphones (e.g. iPhone and HTC Touch HD etc) .  To that point, service providers (e.g. .g. PCCW in Hong Kong , Chunghwa Telecom in Taiwan)  are treating netbooks as mobile phones, bundling them with mobile broadband services (HSDPA/ WiFi ).

In the past, mobile operators have tried very hard to encourage more data usage on mobile networks in order to increase their revenue streams. However, with certain device limitation, (screen size, processing power) on mobile phones, mobile data usage was still not very popular.

The netbook may now provide the right hardware platform to improve the mobility of certain applications like Desktop Video Conferencing. Every netbook is equipped with a camera (at least 130M pixel) and with an aggressive mobile broadband bundle package (flat monthly rate and speed up to 7.2 Mbps), users can have video conferencing anywhere they like.

Next time you need to attend the midnight video conference call with your overseas headquarters, you don’t need to stay home – just take a netbook and you can comfortably sit in a bar and enjoy …