Android Smartphone

Android Smartphone Shipments Fall for the First Time

ABI Research reports that certified Android smartphone shipments fell quarter on quarter for the first time in 4Q 2014.

In what is traditionally a shipment spike quarter, certified Android shipments fell from 217 million in 3Q 2014 to 206 million in 4Q 2014, mainly due to Apple iOS’ 90% growth from 39.3 million to 74.5 million iPhones shipped, but also due to forked Android.

“Google’s Android is being attacked by Apple’s iOS at the high end and forked Android (AOSP) at the low end in high growth emerging markets. The Android One initiative has slowed forked Android growth, but Apple’s success has taken the high end of the market away from certified Android’s premium tier vendors.”

Said Nick Spencer, Senior Practice Director, Mobile Devices, ABI Research.

“4Q 2014 has been a seismic quarter in the smartphone industry and many premium tier Android vendors may once again review their operating system and therefore content and service strategies in light of Apple and forked Android vendor Xiaomi’s success. Worrying times for Google’s mobile services and Android, but it presents opportunity for other service providers and even operating systems.”

Added Spencer.

Huawei

Huawei and Ericsson Drive Competitive Advantage in the Managed Services Market

ABI Research has affirmed Huawei and Ericsson are the ones to watch as the Network Managed Services market heads toward USD18 billion by 2019.

Their economies of scale and performance advantages reinforce and grow their dominant market positions. This ground breaking research reviews over 50 managed service portfolio line items, factors in 10 major performance areas, and aggregates into three game-changing strategies for leadership: Operational Excellence, Product Differentiation, and Customer Intimacy.

“Operators everywhere face the challenge of compressed margins and growing costs and by using managed services, they can simultaneously reduce operating expense and improve customer facing performance.”

Says ABI Research’s Joe Hoffman, Practice Director, Networks.

In addition, it’s not just cost reduction, but gaining benefits from the managed service provider expertise. Future growth areas include converging Mobile, Wireline, IT, and Networks silos and the expertise needed to succeed with SDN and NFV.

Companies do well if they can succeed with one of the three broad leadership strategies, and do very well to perform on two. Both Huawei and Ericsson nail Network Fundamentals (Operational Excellence) and leave little room for their competitors.

“Ericsson lays claim to Service Depth (Product Differentiation) with its expansion of managed service offerings. In addition to Network Fundamentals, Huawei leads with Change Agency (Customer Intimacy), and we note its outstanding record of retaining its managed service clients.”

Adds Hoffman.

Although Huawei and Ericsson compete in the super-heavy-weight division, they still have to keep watch on Nokia Networks and Alcatel-Lucent as they hope to “float like a butterfly, sting like a bee” looking for opportunities and lapses in the leaders’ performance.

5G

5G in 2020 Will Be Rare; Over 100 Million Subscribers by 2025

According to a new Market Data forecasts from ABI Research, it will take more than 5 years for 5G to reach 100 million subscriber mark 2 years longer than 4G.

4G subscriber growth was much faster than with previous generations, fuelled by the capabilities of increasingly powerful smartphones and the availability of 4G devices. 5G subscriber growth will likely be a bit more muted at first due to the increased complexity of 5G cells and networks, but will pick up in 2023.

“There are a number of commonalities between countries that are early builders of 5G networks. They have a large population, of which a large percentage is living in urban areas. They also have many companies pushing the envelope with IoT strategies. These countries will drive 5G subscriber volumes. These are the United States, China, Japan, South Korea, and the United Kingdom in order of 5G subscribers in 2025.”

Said Research Director Philip Solis.

It is also important to understand the nuances around 5G to recognize where it is headed.

“5G will be a spectrum of evolution to revolution-it will be an evolution of the way the core network and network topology is transforming now, but it will be clearly delineated as a fifth generation mobile air interface on which the mobile network of the 2020’s and 2030’s will be built.”

Added Solis.

5G will encompass spatial division as the foundation of the air interface, leveraging techniques like massive MIMO-achievable in devices because of the high frequency of spectrum that will be used-and 3D beam forming to form narrow beams that divide the space around a 5G base station. Client devices will have links to multiple cells simultaneously for robust connectivity. Spectrum will be used flexibly and shift as needed between access and fronthaul and backhaul. The waveform and modulation scheme are the least clear aspects of 5G currently.

A 5G network will be a network of small cells and will be practical in urban and industrialized environments for the population density and the reflections in urban canyons; however, expect a scaled down version of 5G to use existing spectrum for macro-cells as well in the longer term. One potentially problematic issue, however, will be regulatory issues concerning concentrated RF beams in centimeter and millimeter wave spectrum.

Huawei and ZTE Top Fiber-optic CPE Market

Worldwide broadband customer premise equipment (CPE) shipments surpassed 146 million in 2013. Broadband subscriber net additions as well as existing customers upgrading to higher quality services will continue to drive the shipment of broadband CPE devices.

ABI Research forecasts worldwide broadband CPE shipments will reach 154.8 million in 2019.

Increasing fiber-optic broadband coverage and adoption have driven fiber-optic broadband device shipment growth; fiber-optic CPE represents 26% of total shipments in 2013. As broadband operators extend their fiber-optic networks, increasing numbers of subscribers are switching from DSL based broadband service to fiber-optic services. DSL broadband CPE shipment dropped over 6% in 2013.

In many countries, DSL operators are committed to upgrade an existing network with advanced technology such as VDSL2 vectoring in order to provide higher speeds. Technology upgrade is expected to drive DSL broadband CPE shipments in the years to come.”

-Jake Saunders, VP and practice director

Cable broadband CPE shipments grew around 2% to 55 million units in 2013. As cable operators push DOCSIS 3.0 deployment, cable broadband CPE which supports DOCSIS 3.0 standard gain market share.

Nearly two-thirds of cable CPE shipped in 2013 were DOCSIS 3.0 standard devices. ABI Research expects that DOCSIS 3.0 CPE will account for over 84% of cable broadband CPE shipments in 2014.”

-Khin Sandi Lynn, industry analyst

ZTE remains top in overall broadband CPE market share in 2013, followed by Arris and Huawei in second and third positions respectively. Huawei and ZTE are also top fiber CPE vendors whose combined shipments represent around 75% of total fiber-optic CPE shipments in 2013.

Small Cells Market Healthy As 2014 Deployments Reach $1.8 Billion

According to ABI Research, outdoor Small Cells sales are expected to show a healthy 2014 growth in equipment revenue at a year on year rate of 33% to $1.8 billion. This growth is the results of efforts made by operators like AT&T, Verizon, Vodafone, Telefonica, Softbank, SK Telecom, and Sprint driving shipments of both outdoor and Metrocell deployments.

“As mobile network operators implement small cell outdoor networks, several success factors emerge as critical for a successful deployment,” says Nick Marshall, principal analyst at ABI Research.

We see multiple solutions for backhaul, power, permitting, and siting employed by the operator community throughout the rest of 2014 and which will increase small cell momentum in 2015.”

In 2014, 4G small cells are the fastest growing small cell type in the market driven by venue and dense urban deployments. ABI Research forecasts the number of LTE small cells to grow by 2X in 2014 and by a similar factor each year through 2019 where the value of LTE small cells will reach more than half of a $10 billion equipment market.

The Asia-Pacific region, given its large size and 4G deployments in South Korea and Japan and the start of commercial TD-LTE operations in China and India will grow to represent over 50% of the worldwide small cell equipment market by 2019.

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