Device Divergence

A few people have mentioned the recent Nokia investor day, where Nokia laid out their plans for the future (for links, see Russell Beattie’s post).

A few years back, I presented at a couple of investment conferences here in Scotland, long before people got interested in doing anything other than speaking and texting with their mobiles ;-). One of the key obstacles at that point was convincing investors, bankers, lawyers, et al that people would be doing these things with their phones, and they’d be doing them a lot sooner than they thought.

However, one of the slides that I originally used (but in the end didn’t) was one which laid out my vision of what would happen to wirelessly connected devices: wireless connectivity in itself would cease to be a selling point; it would just be there.

My idea was that wireless connections (GSM, GPRS, or whatever) would become as ubiquitous as the electric motor, and would find itself into a future GameBoy device, digital audio players, cameras, and other portable devices; and also onto fixed devices such as CD players and TVs. That’s now starting to happen, and with it will come new growth for the mobile device market. There are already 1 billion (give or take) wireless devices in the world (probably way more than that), but with divergence, that will easily grow to at least 3 or 4 billion by 2010. Using different levels of connectivity (eg, GSM in a CD player so that it can query CDDB) means that operators don’t have to throw existing, perfectly functional infrastructure out the window, and they can sell capacity to device manufacturers. So in my CD player example, the device manufacturer would take out a contract to use the network and pay the operator a flat fee or a fee based on usage. This cost could obviously be included in the original RRP of the product, because I don’t want to have different SIM cards and contracts for every piece of consume electronics around the house. Everyone wins.

Now, I’m not for a minute suggesting that I want to use my iPod as a phone, because then I’d look stupid. However, it would be cool if I could download music to my iPod (as I’ve written before), and now O2 have launched a music service that kind of lets you do that. Kind of. It’s going to require a lot of changes in the marketplace for this kind of thing, but that’s coming, believe me.

Anyway, the point is that convergence has never been, is not now, and never will be the focal point of product development. Divergence is where it’s at…