Will Smartphones Consolidate or Fragment?

Jan Dawson / May 9th, 2014

With the emergence of wearables as a new device category, we’re witnessing a shift of certain capabilities of the smartphone to separate devices that extend its functionality beyond the device itself. Is this part of a broader shift or a temporary phenomenon that will eventually be reversed?

Let’s look at some of the functions smartphones incorporate – each of them could be done better by alternatives:

Smartphone function alternatives

The best device is the one you have with you

Yet here we are, using our smartphones for all of these things, even when better alternatives are available. Why? What does it tell us about how smartphones and other connected devices are likely to evolve? I think the answer is in this well worn saying about one of these functions, the camera:

The best camera is the one you have with you

This is fundamentally why the smartphone has absorbed all of these functions over time. Yes, alternatives could do the jobs better but the smartphone is always with us, perhaps more than any other object in our lives. Its ubiquity means it’s available when the alternatives are not and therefore becomes our primary device for many functions that would actually be done better by dedicated devices. This started a long time ago with the mobile phone itself as a telephony device. Call quality was terrible compared with landline phones, calls dropped, and it was phenomenally expensive in the early days. But it was ubiquitous. It worked nearly everywhere and allowed us to do things that previously required a wired connection in a specific location – and that’s why it took off despite its obvious inferiority.

Except when it isn’t

However, the counterpoint to this is it theoretically only applies when you don’t have the dedicated device available. What happens when you do? The history of telephony teaches us that, although this was true in the early days, it has long since stopped being true. Statistics are bandied about by everyone who benefits from the trend so it’s hard to be sure about the exact number, but a significant number of calls are now made from within easy reach of more reliable, cheaper to use and higher quality home phones. Convenience and habit now drive us to use the nominally inferior smartphone even when the alternatives are close at hand.

As with telephony, it’s likely this behavior will eventually happen with other functions too. Some smartphone video viewing now takes place within easy reach of large screen TVs, mobile web browsing takes place in rooms that also contain PCs, mobile games are played feet from an Xbox and so on. This behavior is likely to continue to spread. In almost all cases it’s because the smartphone is close at hand and performs these functions more easily and casually than their dedicated alternatives.

The smartphone at the core of experiences that go beyond it

But there are also cases where we do take advantage of the alternatives:

  • An increasing number of smartphone users are finding the 16GB hard drives on their phones quickly run out of room for storing all the multi-megapixel pictures and HD (and increasingly slo-mo) video they capture, and rely on iCloud, Google+, Dropbox and other cloud storage services to offload storage
  • AirPlay, Chromecast and other technologies are allowing people to stream video content from their smartphones to TVs
  • CarPlay allows drivers to use the in-car display and audio input/output to interact with Siri and other functions of the smartphone, and more generic Bluetooth allows a subset of this functionality on most modern cars
  • Fitness trackers are extending both the range and accuracy of data captured by sensors beyond what is possible on the smartphone
  • Wearables are allowing notifications and other functions to be extended from the smartphone to exterior displays.

In all these cases, the smartphone remains an integral part of the experience but increasingly one that remains in the pocket or the center console in the car or on the couch beside us, while the core of the experience happens on other displays, sound systems and devices.

Consolidation or fragmentation?

Over time, as some of these external devices gain greater functionality – their own CPUs, GPUs, wide area connectivity and so on – it’s possible some of the functions performed by the smartphone will actually shift to these external devices, especially wearables, without needing the smartphone as a hub or intermediary. With cloud storage and processing on the back end, these devices could eventually subsume much of what the smartphone does, such as streaming audio and video to and from appropriate endpoints as available. The ultimate vision of the future may be one where we carry just a tiny device providing identity and authentication while making use of ambient audio and visual interfaces, cloud processing and storage.

On the other hand, the smartphone may continue absorbing functions from other devices – just as it has with point and shoot cameras, dedicated eReaders, portable game consoles and others. Smartphones already incorporate enough sensors to capture motion, heart rate and other key data, and this will only increase over time. As prices and sizes for storage, memory, processing and other functions continue to fall, the gap between the capability of smartphones and their dedicated alternatives will shrink, making the alternatives even less appealing except as extensions of the smartphone — such as TV screens and in-car audio systems.

I’d say it’s too early to tell at this point which way these trends will go – whether the smartphone will slowly absorb other functions as it has so many already, or whether the proliferation of wearable devices and their even greater ubiquity will cause a fragmentation of the functions of the smartphone. Most likely it’s a combination of the two. But every smartphone vendor should be thinking very hard about how this will all evolve and what their role will be.

Jan Dawson

Jan Dawson is Founder and Chief Analyst at Jackdaw, a technology research and consulting firm focused on the confluence of consumer devices, software, services and connectivity. During his thirteen years as a technology analyst, Jan has covered everything from DSL to LTE, and from policy and regulation to smartphones and tablets. As such, he brings a unique perspective to the consumer technology space, pulling together insights on communications and content services, device hardware and software, and online services to provide big-picture market analysis and strategic advice to his clients. Jan has worked with many of the world’s largest operators, device and infrastructure vendors, online service providers and others to shape their strategies and help them understand the market. Prior to founding Jackdaw, Jan worked at Ovum for a number of years, most recently as Chief Telecoms Analyst, responsible for Ovum’s telecoms research agenda globally.
  • klahanas

    Very interesting perspective. Perhaps it also begs the related question-“Will Tablets Follow?”.

    The cloud has it’s place, but the cloud is no real substitute for local storage. Not even close.

    -It’s MUCH slower.
    -It’s MUCH less reliable: With mobile connectivity so variable from place to place (even room to room), reliability relative to local storage is a joke. Would we ever tolerate hard drives that worked that sporadically? With SD cards, I keep my entire music library, and downloaded maps with me at all times. I don’t worry if there is connectivity in the middle of nowhere.
    -It’s restricted: Sorry you can only stream that movie, or download that book, while in the US. Even if you’re a subscriber.
    -It’s wasteful: Every time you listen to that song, watch that movie, you are downloading it all over again.
    -It’s MUCH more expensive: When a 1 TB drive costs about $60-$80, with no subscription fee, and no internet charges, there really is no comparison.

    Where the cloud excels is in local syncing among machines (local being the operative word), and backup.

  • aardman

    It is quite amazing how the desire to avoid performing the trivial physical acts of getting up, reaching out, or walking 5 steps governs which gadgets get used.

  • stefnagel

    Smart devices are the hub for what I’d call nearables and farables, sensors and servers. Nearable devices connect to sensors that gather information around us and about us, visually, textually, and aurally. Think camera, biometrics, gps. Farable devices connect us to servers that gather information from somewhere else: tunes, shows, calls. Smartable hubs are just now gaining the capacity to do all this, and to keep it safe with great crypto.

  • VickiBRobinson

    As prices and sizes for storage, memory, processing and other functions continue to fall, the gap between the capability of smartphones and their dedicated alternatives will shrink, making the alternatives even less appealing except as extensions of the smartphone — such as TV screens and in-car audio systems. http://num.to/9177-3842-2981

  • DrewBear2

    In the near-term (decade or so), I think the phone will continue to be the hub. You still need a screen for so many functions and batteries still limit what a wearable can do. Data access? Wifi was supposed to be everywhere by now. Yeah, right.

    A phone has the battery, computing power and data access. It’s extremely portable and has a beautiful screen that can be used in so many ways. The iPhone is barely 7 years old. I’m certain Apple is working on its replacement, but it’s focused on the more immediate extensions to the iPhone’s usefulness. Some of those extensions may require wearables, but a wearable won’t be replacing the iPhone for many years…if ever.

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