I Just arrived here at CES…. Clear day, but cold here for the desert! Definitely Android’s presence at this major Consumer Show will help warm up the mood.  2011 is going to be a great new year in the mobile industry in North America as both Apple and Google battle it out for the leading market share of smart phone devices.

#1- Devices, Devices and more  Devices

We are all looking forward to some of the new devices that will hit the street with Android.  As an open system and an entry platform into the mobile area the competition with ensue between Consumer electronic manufactures, PC manufactures, incumbents and anything you can embed an OS.

The Apple vs. Google’s Android (24.6% vs. 23.5% respectively according to Comscore) competition has first of all made a major dent in RIM’s leadership.  Will Blackberry move from #1 to #3?

At CES this year we expect a fresh taste of many of the new devices to come.

#2-  The blurring line between Smartphones and Tablets

This jostling is not only in the Smartphone race, but in the tablet market as well.  Apples iPad with its 44% marketshare getting nibbled to death from Android’s estimated 39% marketshare by 2010 according to the Piper Jaffray’s estimates.

Although there has been polarization of the different formats, a new breed of formats occupying that middle ground has started.

What makes this interesting is in the multiple forms of display sizes from the 3.5 inch Retina displays, advanced OLED’s all the way up the spectrum to the 10.1 inch and larger.  How will content itself polarize for these different formats? Or maybe not?

#3- Apps and Media Marketplaces

The big differentiator in this new era of advanced internet devices is in the content.   Apple’s leadership in the iTunes marketplace ( more then 300K strong)  has not been threatened yet, but with Android’s openness as the angle for developers to bring in new and exciting things in parallel to the shear volume of content.  The Android Marketplace has will quickly reach the 200k level and continue to grow strongly!  HTML5 mobile apps and content that blend web experiences on native app experiences is something we should keep an eye out for this year with the overall Android App and Marketplace experience.

#4 NFC and the mCommerce explosion

It has been a long-time coming to see this opportunity of Near Field Communications baked into devices.  The quiet release in Google and Samsung’s Nexus S with the Android 2.3 and the NFC chip is an indication that these enablers will be aggressively now released into the market as part of the competition to bring in these new business models. Apple, RIM, Microsoft as well as the mobile operators have all entered this foray becoming the next big battleground for local and location based payments.

#5 Connected and Suggest Advertising

2011 will be a year of advertising innovation beyond the basic impression based CPM models of past.  Android will be a unique platform where Google will bring out is best of ideas of mobile and local advertising that will go beyond the basic behavioral response, but to include the context of location and push.  How will this be mitigated so that our social privacy is not evaded? The debate will continue as the competition ensues.  Google’s Admob vs. Apple’s iAd will be two of the big battle grounds, but expect to see all of the local retailers, commerce and media companies bringing in new and exciting formats to make it more relevant for advertisers in this cross-media, physical and local connection.   The shear volume of Android handsets entering the market should make this a very dynamic addition to Google’s strength, but with Facebook’s Places Mobile Application and the opportunity to bring advertising into this mix as social ads will be another interesting spike in this evolution.

#6  Application Search… the other blurring line

Up until now, Applications have been silo’ed creatures that had activation to content only when downloaded and launched.   I would expect this to be another unique battleground as the plethora of content grows, access in-app will become more and more important as well as the indexing of relevant content on the go.  Twitter search has had the make-up to be the next big thing in the search space, but now will the growth of endless applications paralleling websites as the content for mobility; search will take a potential exciting new direction in the coming year with Applications.

#7  TV and Rich-Media Convergence

Android should make an exciting platform for the future of TV.  In 2010 we saw Google TV, Apple TV and the evolution of real-time video streams anytime, anyplace as a growing trend, now in 2011 with the advances in LTE and more and more content becoming available online this will be another battleground for the mindshare of consumers.

As the Android OS continue to show up everywhere in 2011 ( taxi’s, airplanes, billboards, etc..) this opportunity will make way for interactive video everywhere on the go.  However, how long will it last before content owners hold back from licensing content to Google’s TV initiatives?

This trend is also bringing in new entrants such as Vizio that has been a top Flat-panel manufacturer now entering into the smart device area as well.

#8 Chrome OS vs. Android OS cross-platform

Google has been strategic in keeping these two different platforms separated as they build within the two different marketplaces of mobile and online, but how long will this last. Android platform has been strong with the evolution of the opensource Webkit Browser based on a Safari core.  The Chrome Browser vs. The Safari browser dynamics has now put Google in a unique position for moving forward with its own enablers in parallel with taking the best from both worlds.   2011 will be the year of the Cloud when it comes to the connected OS cross-platform.

#9 Android , Google Music and Content Distribution

It seems like Apple has enjoyed the luxury of being predominant player for the last several years in the mindshare of the music industry. With the shear volume of Android handsets and tablets flooding the market, it would only make sense to see some unique play into the music space by Google.  This space has been a minefield of content rights licensing and business models.  In 2001, the world will begin to relook at the Limewire’s and the Bit torrents of the world that have made such dent on the business models of music.  Intel will launch a new architecture for content protection embedded on its chips that will find their way into the Android devices to come and the App Marketplaces will evolve with new dynamics for business models around the distribution and rights of music to attempt to give content owners more choices in revenue generation.

#10 Social Relevancy and the Android OS

It was rumored in 2010 that Facebook was attempting to launch their own devices the same way Google brought the reference platforms of Nexus One and Nexus S into the market.  There is no stopping Facebook from moving forward with this strategy, but it is clear that further enhanced and improved Social Relevancy will become a key part of the entire OS of Android in the near future starting with Android 2.3.  Facebook and Google have not always shared similar views, but with the large market penetration of Android moving forward they will find the right mix of cooperation strategies that will make this a platform that will leverage social interactions and conversations as a core to the overall user experience.

We have entered 2011 and I have to say the first decade did fly by rather quickly for us in the mobile industry.   I am a big fan of JWT and their things to watch deck.  I thought I would share it and highlight the top 10 in my mind for those realigning and creating a  mobile strategy this year.

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.