Handhelds give way to “telephony” devices

Voice is still the killer app that’s going to loosen up the purse strings

Last week brought mixed news for the handheld business. On the one hand, IDC reported that handheld sales actually declined about 17 percent (to 7.5 million) in 2005. On the other, some of the big wireless carriers reported that sales of cell phone service continued to grow nicely, with almost 200 million cell phone subscribers in the United States by year end.

Could it be that handheld sales are actually dropping? Turns out IDC was referring only to handhelds that don’t offer telephony -- leaving out many new Treos, RIMs, and the like. And, of course, they weren’t including iPods (14 million were sold during the Christmas season alone) or digital cameras (50 million in the United States, and growing). That’s like saying that computer monitors declined last year, except for the flat ones.

IDC did say that handheld vendors, including market share leaders Palm and HP, have been furiously innovating in an attempt to keep non-voice devices relevant, adding features such as GPS and Wi-Fi to the basic PIM. But, let’s face it, voice is still the killer app for most enterprise and consumer pockets.

My theory: Voice is more productive than data because it takes more time to produce and consume, so people are more selective about how they use it. Although it’s easy to get time-sucked by the flood of marginal e-mails on your BlackBerry, people are more disciplined about how they use voice, and are therefore more efficient with it.

As mobile devices continue to flood the market, there’s a growing dialog about their potential disruptiveness. Apparently, there was a discussion at the recent World Economic Forum on how top execs could get enough time away from today’s flood of data to think strategically. One conclusion, according to a participant: Hit the beach and turn off the devices.

If I sound like a Luddite today, it’s because I shared a cab into NYC last week and was traumatized by my cabmate, a corporate exec spewing a firestorm of gobbledy-speak into her Treo. Presumably talking to a subordinate, she repeatedly used phrases I’d never heard of (“Do we have to think about actioning that?”) as part of an intense dialog that made me want to jump from the cab into the icy East River. Although I do think voice will triumph in the end, this exec should be given a handheld.

Merits of Multisourcing General Motors announced last week that it’s parceling out responsibility for several billion dollars of IT work during the next five years among multiple vendors, including Capgemini, Covisint (a Compuware subsidiary), EDS, HP, IBM, and Wipro. Most of this business had belonged to EDS, which GM used to own. Although EDS retains a large share of the pie, the deal is yet another indication that multisourcing, rather than single-source IT megadeals, is the wave of the future.

According to AMR Research, here’s what GM must do to make the new arrangement work: 1) Do not disrupt current operations during the switch; 2) tap the new vendors’ business process and global delivery expertise (and help them further develop it); and 3) control change requests, which can wreak havoc on fixed price contracts. Let’s hope GM’s progressive moves on the IT sourcing front are also a good sign that the company has the mojo to dig itself out of its current hole in the car business.

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