Mobiles are failing to connect with the online revolution

Screen test: we are not all Googling away on our phones on the train to work and the networks are being partly held to blame
Gideon Spanier12 April 2012

How many mobile phones will Santa Claus be bringing down the chimney tonight? With global sales running at 100 million a month, it's fair to say his sack will be full of them.

There are now about three billion phones globally, three times the number of personal computers and laptops. That would suggest that the mobile has triumphed as the ultimate communication device.

The problem for the telecoms industry is that the triumph has not happened, at least not yet. The broadband revolution of the past 18 months has transformed internet usage on PCs. But where is the mobile revolution in internet and TV, much heralded since the auction of the 3G phone licences way back in 2000? We've all got the hang of text messaging, but why are we not all Googling away on the train to work every morning, or watching the news on our way home?

In tech-savvy Japan, it is a different story. As many as 70% of phone users are now online there. Contrast that with the 15% in western Europe and North America.

By now, we were all expected to be watching videos and buying things with our phones. "Two years ago, this Christmas was meant to be the mobile TV revolution for handsets," recalls Dave Moreau, chief executive of FoneStarz, one of Britain's biggest suppliers of mobile shortclip videos and animation. "We expected that the number of people using it would have another zero on by now - and it hasn't."

Sceptics might start by asking how many people really want to watch video on a tiny screen. But experts dismiss that. After all, the quality on YouTube on a PC isn't always great.

Once users start enjoying the internet on a mobile, their usage jumps and continues to grow, says Richard Blades, commercial director at mobile software firm Novarra, pointing to a video service it introduced in Hong Kong in the past month.

But enjoyment is the key. Poor user experience has been a problem, deterring users and advertisers. As Moreau says: "If you are trying to download something and it doesn't work, then you are going to give up."

Novarra, which collaborates with Vodafone in the UK, is among the firms trying to change that. So, for example, rather than your phone having to do all the work of downloading a web page, Novarra's computer servers at the network's HQ compress the information so it takes up only a tenth of the memory on the handset, maintaining more of the quality.

Another deterrent has been cost. Until recently, the phone networks haven't offered attractive price deals. Now a monthly data package, for internet and download use, is around £7.50. So connection times and cost are improving. The arrival of Apple's iPhone has helped, but it may not quite be a landmark moment. That's because there are hundreds of different types of phones in use. The lack of standardisation makes it difficult for providers to create universal content and advertising. It is remarkable given that just five manufacturers have more than 80% share of the global market.

Tom Thorne, head of mobile advertising specialist CandySpace, whose clients include Xbox and Harper-Collins, says "it's up to the networks" to help sort it out.

Experts predict that mobile internet is going to stay stuck in the equivalent of the "modem dial-up" era, rather than broadband, for a while. Moreau thinks 2009 might be the tipping point. Tole Hart, research director at Gartner, suggests 2010.

Lots of factors will help: faster speeds and better devices and advertising, which will bring costs down, and the push for greater openness, letting consumers visit any site they want rather than a limited selection.

Popular activities such as social networking, email and search ought to translate well to mobile. Even shopping by phone is getting easier - a mobile advert for a DVD might have a link to a trusted site like Amazon, which has your username and credit card details already stored.

"Texting took off because it is cheap and simple to use," says Hart. "That's what the mobile internet has got to get to."

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