From MacsOnly.com
[9/14] iPhone seen as Consumer Precursor to 95 million Ultra Mobile Device Market
A whole new class of "always-on" Internet-connected products, collectively termed "Ultra-Mobile Devices" (UMDs), will become popular over the next five years, according to a new report from ABI Research (Mobile Inernet Devices and UMPCs). By appealing to a wide range of buyers they will reach shipments of nearly 95 million units by 2012, and should prove extremely profitable for their makers.
"UMDs are a very exciting, potentially very lucrative area," says ABI Research vice president Stan Schatt. "What makes this market so intriguing is that products will assume so many different forms. That product differentiation will be an integral part of the ultra mobile device marketing plan."
UMDs are of two types, Mobile Internet Devices (MIDs), which target consumers, and Ultra Mobile PCs (UMPCs), which run Windows and business applications and are aimed at business users. The former, with their lower prices and wider appeal, will make up by far the majority of the devices shipped. Apple's iPhone may be seen as a precursor of the MID. Both UMPCs and MIDs will feature multiple wireless connectivity technologies – Wi-Fi, WiMAX, and cellular – to maintain "any time, anywhere" Internet connectivity.
This diversity is also reflected in the range of applications that will be offered: Web browsing, music, navigation, voice, and data communications including email and IM, photo/video, and vertical commercial applications will all be popular. Apple's iPhone has applications in all of these categories.
ABI Research identified several user-types who will find varying combinations of these applications appealing. These include "Frugal Generalists", "Lifestyle Boomers", "Soccer Moms", "Gen Y Social Networkers", and "Multimedia Enthusiasts." ABI Research also believes the ultra mobile device ecosystem will ultimately contain hundreds of vendors – chipmakers, display and device manufacturers, application developers and service providers – and the new report offers strategic recommendations for all of them. But maybe not, if Apple can help it.
Apple has a real head start with the iPhone and the iPod touch. We may now be seeing the real reason for the iPhone's early price drop to $399, i.e. an all-out attempt to make the iPhone (and iPod touch) in the consumer end of the 95-million UMD market what the iPod is in the music player market rather than a reaction to flagging initial sales as we surmised from the iSuppli sales reports. Of course, it is also consistent Apple's official statements on the price drop. This may also mean that we will see more rapidly the iPhone 2.0 as Apple fights to dominate the UMD consumer market.
