Although U.S. trade negotiator Richard Fisher called the mobile Internet arm candy, the delicacy may have to improve into an eye candy for Americans to call it sweet. But, so far, it is not tasty enough because it is not big enough. The size of the computer screen, that is.
That may not wholly explain why consumer interests in the mobile Internet in Europe and Asia are several steps ahead of the United States. But analysts and the actions of vendors point it up as important.
The explanation is as much commercial as cultural.
“I am purely speculating, but I will guess that some of it is cultural,” said Todd Koffman, an analyst with Raymond James, which just published a study on handsets in the United States.
America is a big country, and it is accustomed to the philosophy that big is beautiful. The evidence is not hard to find: Americans drive big cars on big roads. They own big homes, eat big burgers and watch big-screen televisions. There’s Montana’s Big Sky, California’s big budget and everything is big in Texas.
According to the Koffman-led Raymond James study, “A Handle on Handsets,” the demand for “hot brands” from the various vendors increased in the fourth quarter of 2000, which indicates consumers are still looking for the convenient handset, with 40 percent of respondents saying they gravitate toward popular brands.
The problem with small screens is the small amount of real estate they provide, and regular Internet surfers who love games, music and commerce have to strain their senses to enjoy the bounties of the wireless device.
But Koffman believes that with NTT DoCoMo’s recent deal with AT&T Wireless Services Inc., i-mode service, with more than 16 million subscribers, will make inroads in the United States and open the floodgates to mobile Internet in the country.
Nancy Benovich-Gilby said she thinks the dominance of Japan in wireless Internet may also have been reinforced by a self-fulfilling prophesy, with carriers and application service providers deepening the gulf between the United States and the other regions because the market overseas is stronger.
“Also, the carriers have their acts together,” she said, noting that short message service was put in place initially in Europe.
Manufacturers have been trying to increase screen size within the limits of the gadgets. One approach has been to reduce keypad size or shed keypads entirely. Some mobile phones now have liquid-style panels in place of keypads to present a sense of largeness and room to roam in the gadget.
Samsung is planning to launch a keypadless mobile phone predicated on the Palm platform by the second half of 2001.
This is in line with a furtive trend in the industry that includes Motorola Inc., Handspring, Groupe Sagem, Nokia Corp. and Panasonic. Motorola rolled out an all-screen, Internet-powered phone in Asia in 1999. Handspring also has launched a screen-only phone, while Groupe Sagem’s keypadless product is based on Microsoft Corp.’s pocket-sized platform.
The products, as with most innovations, will target upscale, professional consumers. Most are priced in the $400 range.
“Over time, the screens will get larger and have high-resolution content,” said Koffman.
Many vendors are counting on the rollout of third-generation technology with still pictures, video, music with enhanced speed to surf for data and secure voice on the Web. J-Phone, a Japanese company, is marketing camera phones, which are impaired because of their poor picture quality. 3G technology could rescue products like that.
If, as some analysts believe, U.S. consumers embrace new technologies more slowly than their counterparts in Europe and Japan, price is one language they will understand.
“It is a question of pricing,” said Koffman.
U.S. companies can win over consumers by matching the kind of pricing offered for Internet offerings in Japan.
Japanese newspaper Yomiuri Shimbun has attracted as many as 195,000 subscribers to its mobile Internet site for a fee of $1.80 per month.
