iPhone effect makes operators rethink handset strategy

2009: Fewer 'Swiss Army knife' phones

Mobile operators are banking on iPhone-type devices to drive mobile web usage, while next year may also see more focus on handsets that specialise in a particular set of functions.

Speaking at the Informa Mobile, Broadband & TV Industry Outlook conference in London, Mark Newman chief research officer at Informa Telecoms & Media said: "Operators are now embracing the iPhone type model. Operators are coming to accept now that you put a device - and you align your device with your service - with your own brand."

Examples of other operator-exclusive devices are 3 doing a Skype and a Facebook phone; T-Mobile offering the G1 Android phone and Vodafone with the BlackBerry Storm, Newman pointed out.

He added: "With the consumer downturn we're going to see in the high street the mobile operators taking a more dominant position. So we have this nice alignment of the operator, the device, the service and the shop."

Newman predicted 2009 will see the development of "more practical" apps - with interest being shown by operators in the M2M area, as well as health and enterprise.

He added: "We believe there will be more lower-priced mobile internet devices - the iPhone has shown that there's an appetite for full internet browsing on mobile devices. [So there will be fewer] Swiss Army knives and more best in class devices - be it a Facebook phone, a Skype phone, an email phone, a music phone."

On the mobile broadband dongle front Newman warned increasing uptake and usage could have its downsides for operators - as he said there is a risk they have to continue ploughing investment into infrastructure to ensure there is enough capacity to cope with ballooning demand.

"People are using mobile broadband as if it's fixed," he warned and said dongle customers are beginning to ask "some nasty questions" about connection speed, indoor coverage, high bills and support services.