Users love their iPhone Accessories! Is Motorola strategy right to go negative? ( Recent blast by Motorola on NO Jacket Required!)

When iPhone4 launched, I could not stop thinking how much this design aligned to the thinking of a small device that could be mass-configured with changeable covers.  In many ways it is what Modu wants to become!  As I was a lead architect back in the 90’s when Nokia had the mass personalization effort around changeable covers,  we debated as to what would hold true in the future of personalization.  The mobile world has come a long way since the 90’s, but if you have a chance to watch Frank Nuovo on Charlie Rose in 2000, you will see clearly that Nokia had painted a very good picture of what was to come in the future on personalized experiences. Frank was a thought leader 10 years early…

What I beleive has happened is that we have evolved this  unique opportunity of two different types of devices.  Of course there is the personalization of the services and the overall internet, but I am referring to the Hardware aspects of personalization.  Mixing hardware with Fashion.

1) Devices that have hardware that is designed with fashion in mind that target a certain demographic. Multiple colors of the device, target look-n-feel to meet a certain market segment.   ( Mainly this has been the latest thinking of Android HW manufacturers, RIM, NOKIA, Microsoft)

2) Devices that are skinned down simple designed basics that then offer a chance for mass-customization via personalized accessories ( APPLE, MODU)

While Google Android, Nokia and RIM have gone down type 1),  Have a look at the recent announcement of Motorola with Android blasting Apple because they have a cover and used the Antenna issue as a way to market their products.   In many ways, I beleive this is unique approach as blasting them based on a feature, but why kill the Jacket?  As well, Nokia has recently abandoned the concept of simplicity with changeble covers ( Even though they invented it) to build full design elements to target certain demographics.   Then look at Microsofts KIN.  They build hardware to target a certain demo ( young students) and we saw where that went…

On the other hand we have two unique companies, Apple and Modu.  That are building out a strategy of a simple elegant product that is small and that is a starting block for massive personalization.  Yes, users can have the product on its own as it stands alone in its beauty, but how it fits into the accessory ecosystem is a key part of the overall product strategy.

I was sitting in a cafe recently and across the table from me was a police officer from the NYPD.   He was playing with his iPhone while waiting for his lunch to be served.  The beauty of all of this was that he had a very unique leather, urban with rubber jacket on his device! It matched his personal style and his needs.  iPhone’s basic design can reach everybody and then they have the ability to not only personalize the overall look, while still keeping the product small, but the user can as well customize the screen.    We will see Jackets of all kinds…. Metallica Jackets, New York Yankee Jackets…. Ferrari Jackets, as well as Company Jackets…. so what is wrong with the Jacket?

Even though Apple designed a product that was as small, simple and clean as they could go, with a fundamental beyond-physics strategy of embedding an antenna into the body of the product ( nobody had ever succeeded with this really in the history of mobility) they were bound to take criticism and it was a risk!  But in my mind a very amazing risk in that having this kind of simple product as a base to a variety of other accessories and architectures is an avenue to hardware personalization as a means of fashion.   They pushed the envelop to get the size as small as it could go with such a large screen and keeping the product very thin.  Having the antenna in the body was a very difficult and yet impossible challenge, but it was a method for getting the smallest product possible potentially.

I personally think the view of personalization and small framed designed products with ability to add accessories  is a  key driver to real Fashion statements, mass-customization and mass end-user adoption.   The very simple strategy like in the case of Apple that can scale to build its business for starters, is key as part of this thinking.   I think bringing the Press over the Jacket was potentially the wrong thing to do in the long-term….  Apple should highlight more about the opportunities for customization over the fact they pushed the envelop a bit too far with Antenna design.

So where is MODU in all of this?  I would image these Israeli’s are in the labs looking at the smallest iPhone killer Android device that could be configured or skinned with multiple accessories.  They have done done the small match-box route…. why not the Android with a large screen thin route like Apple?  This would be a very interesting competitor of Apple!

Frank Nuovo, ex-Chief of Nokia Design,  talks about mobile devices as “Objects of Desire” and he personally moved down the Fashion route with his move to run design over at Vertu.  In my mind,  this architecture of design personalization and mobile  has really taken form and that these simple products with less buttons and objects of design can now grow toward multimedia rich and configurable products along with the hardware configurations.  Apple is clearly on the right path as a vision,  lets see if this media and the antenna challenge is not big enough for them to get pulled off this strategic path?

I guess you can say, it is about time! Kyocera launched at CTIA this last spring with their first entry into the America’s after waiting and seeing for many years…NT&T DoCoMo brought Android to the Japanese Market in April with the Sony Xperia and Softbank was soon to follow with their Android device.

From the walled gardens of the different marketplaces to the open platforms, the world has come alive for the cross-border opportunity again.  I am excited to see these high-end toys now entering the states to offer a unique variety to the same old stuff we have seen.  Japan was very strong in the consumer product space in the 80’s and early 90’s, but then it stopped. The re-emergence of the US industry in the consumer space with Palms, iPods and the flurry of electronics from the Korean’s and the Taiwanese seemed to be become the replacement.

So what will be different that will make us want to buy them?  It is not just a hardware game anymore, but a one-stop-shop for all kinds of services.  My feeling is that we will start to see followers to the Google-TV example that started with Sony for a complete array of interesting cross-media interactivity….. Will Hitachi bring back its household goods back with a twist on mobile:  Google-Refrigerator?  What about Casio and their cool G-shocks tied to the mobile device : Google-Watch? and even NEC  following Sony with the Google-TV series?  These are some of the areas where I think the Japanese can really accelerate the convergence of mobile and everything around us.

1) Cross-platform integration into the consumer electronics space

2) Unique uses of mobile wallet and integration between products

3) Cool, fun, innovative designs and market demo differentiation. Highest of High quality….

4) Enterprise products and services for small  and medium businesses

5) Access to the wonderful world of Japanese sourced content.

6) Unique integrations amoungst the Japanese suppliers themselves…. Wii?

7) Cross-Carrier cooperation ( i.e. JIL )

Deep rooted relationships between Japanese companies and Microsoft and Google

9) Heavy industry and mobile. ( Trains, Buses, Elevators, Escalators, Ticket machines all integrated to mobile)

10) ….. or just another Android, Windows mobile device?

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Techcrunch reported last year that NEC, Hitachi and Casio were in negotiations to merge their cell phone operations to become Japan’s second biggest manufacturer, following Sharp. And the new company, which is called NEC Casio Mobile Communications and was established on May 1, just yesterday announced ambitious expansion plans.

According to reports in various Japanese media, NEC Casio Mobile plans to ship a total of 12 million cell phones in fiscal 2012, up a whopping 60% of all handsets NEC, Hitachi and Casio together shipped in 2009 (the companies will merge their cell phone operations on June 1).

All of Japan’s eight (soon six) major cell phone makers are going through a slump currently, mainly due to a shrinking domestic market and rising development costs for advanced cell phones. In Japan, the new company wants to cooperate with all three national carriers (Docomo, KDDI au, and SoftBank Mobile).

In the US, NEC Casio Mobile is said to currently look into building business ties with Verizon and AT&T, according to reports. The company expects 4 million of those 12 million cell phones it plans to ship in 2012 to go to markets outside Japan.

Most recently, the Digital Entertainment Group published this chart that shows the changes in consumer spending. Although there is an increase in spending for Blue-Ray and VOD, if we extract the lines to run until 2012, it appears that there could be about a $3B USD drop in the industry of consumer spending in the home.

Again we are seeing a major shift in an industry that has been pretty well established with hardware and physical goods and the growth curve that existing from 200o~2006 with the shift from VHS to DVD’s is not showing the same spurt in growth like it did before.  We could guess that Blue-Ray and VOD will fill this new paradigm shift, but we must imagine with the fragmentation of media and the rise of consumer spending on mobile could really be the culprits that will this industry as well.

It would be nice to think that the $3B USD that disappears moves toward mobility and other consumer  services, and that the “Connected Home” as a strategy and philosophy will be made up of consumer spending on more of subscription and digital transactions to offset the purchasing culture of hard media.

Major Retailers such as Best Buy and others will really need to look at the strategy of mobile and consumer behavior of on-demand, real-time media with models that tie this all together to the convenience of anytime, anywhere as well, I believe.

In a recent interview on Charlie Rose with Paul  Otellini, CEO Intel Corporation, Paul mentioned that in the next 5 years we will see changes in consumer products like we have seen with mobile devices. Everything will become “Smart” in the next 5 years.  Today Intel has been a leader in providing the brains behind the PC, but with Intel’s strategy behind the “Atom” processor ( A chip that is minimum in size with the most advanced processing power) to become the low-cost solution that powers everything. ” We will see chips in TV’s, in the car, in appliances- for what will be the SMART era”- he stated. ” Today we have over 10K engineers working on these software solutions that the consumer does not see”. As Paul sits on the Board of Google, it is pretty clear that we can see that this might lead to a strong alliance to Android, but most recently at MWC ( Mobile World Congress) in Barcelona,  Nokia-Intel announced their strategic partnership around the next generation OS called- MeeGo.  So there is that angle to think about.  ”No we are not creating another WinTel”- he stated, but the battle will ensue between Android, iPhone and now potentially MeeGo that will be the OS that not only occupies those 1.2Billion mobile devices shipped yearly, but all of the consumer appliances and electrical objects around us.

So where does this leave the Best Buy’s of the World? Yes- they need to grow the Best Buy-Mobile business, but it really opens an interesting opportunity for customer support and services.  In a recent presentation I heard from the VP of Marketing of Best Buy Canada, Angela Scardillo, she stated that the core of their marketing strategy is to build the brand around the “Connected Home”.  What a phenomenal strategy! Geek Squad will now be the customer support function to help us fix all of those problems that the online services have left us in utter abyss? We hope that Google and the rest of them will offer more customer support services instead of inanimate forums to answer questions, but if this does not happen, it will potentially be your local Super Geek ( A close colleague of mine that invented this concept way before Geek Squad) to now come to the rescue.

So I think that this shift has the players and the strategies in place now to really take us forward in this new decade.  The big losers could potentially be the hardware manufactures that will need to look for new avenues to build revenue streams  around ” Smart” objects.  We have seen the release of the iPad from Apple in 2010, but how cool will it be to start seeing the new “Smart” TV’s, Cars, Refrigerators, Washer and dryers, Rice cookers all connected into a grid that is controlled by our mobile devices.