Big Wins and Epic Fails in the 2011 Smartphone Market

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In every game, there are winners and losers. The billion-dollar battle to be the top smartphone maker is no different. In the previous 12 months there have been some spectacular failures, and some big wins, too.

Epic Fail: AT&T’s Attempt to Buy T-Mobile
In the spring, AT&T tried to become the biggest wireless carrier in the U.S. by purchasing a smaller rival, T-Mobile. This would have been a very significant change in this country’s cell hone market — at least it would have if the U.S. government hadn’t blocked it for being anti-competitive.

AT&T walked away this month with egg on its face, and poorer by about $4 billion. The future of T-Mobile is still up in the air.

Samsung Galaxy S II from T-MobileBig Win: Samsung
For many years, Nokia was the world’s largest maker of smartphones. In the past year or so, however, Samsung has taken that title over. It did so by putting Google’s Android OS onto handsets that consumers bought by the million because of their combination of great screens, excellent performance, and snazzy appearance.

Samsung appears ready to continue this trend in 2012, with the Galaxy S III waiting in the wings.

Epic Fail: HP’s Botched Handling of webOS
webOS didn’t take the world by storm the way Palm, Inc. had hoped it would, but in 2010, the company thought it had found a white knight in HP. Unfortunately, a new CEO at HP pulled the plug on all webOS based smartphones and tablets this summer before giving them much of a chance to succeed.

A hugely successful firesale on HP’s TouchPad tablets showed that there was interest from consumers, and that there had been at least a possibility of the webOS competing with Android and iOS. The operating system was recently made open source, but it’s an open question whether it will ever go anywhere.

Big Win: LTE
For many years, wireless carriers in the U.S. could not agree on a cellular-wireless standard — some used GSM networks, others picket CDMA. This year, there was finally some agreement, and all of the Big Four carriers now either already use LTE to provide 4G service, or are headed that way.

AT&T LTE Network Verizon and AT&T have their LTE networks up and running. Sprint announced recently it is switching from WiMAX to the rival standard. T-Mobile executives have made vague statements about LTE being somewhere in the company’s future, but the future of T-Mobile itself is so up in the air that it’s hard to say when this will happen.

Epic Fail: BlackBerry
The BlackBerry was once the most widely used smartphone in America, but sales dropped like a rock this year. Much of this can be credited to Research In Motion’s inability to update its operating system. The BlackBerry OS is clunky when compared to Android and iOS, and the new version that was released this year, OS 7, was more window dressing than anything else. Even worse, the company has been unable to draw in the third-party app developers needed to make its products seem cool to consumers.

RIM’s hopes are pinned on a new version of the BlackBerry OS, but the recent announcement that it won’t have devices running the new operating system on the market until the second half of next year might be the beginning of the end.

Big Win: Adoption of Smartphones
Five years ago, the only people who used smartphones were business executives and the technorati. These days, odds are your mother has one, and possibly even your grandmother. Prices for all kinds of these devices have dropped to the point where it just makes more sense to replace your old dumbphone with something much more powerful.

Apple iPhone 4SThis is affecting all kinds of other markets. Sales of MP3s are going up because more people have a phone that can be used as a music player, like the iPhone 4S. Cameras in phones are getting good enough that they are starting to impact sales of low-end point-and-shoot cameras. And even the stand-alone GPS is beginning to look increasingly more like a dinosaur.

The Also-rans
Not every trend this year resulted in a huge success or monumental failure. Some are smaller, but still important.

HTC did not have a particularly good year. Samsung is making better-selling smartphones, and there are questions about whether HTC is losing focus by making too many models that are too similar.

AnalysisNokia made a huge bet this spring by switching from Symbian to Windows Phone. As this company’s new models haven’t even been released in the U.S. yet, it won’t be known until next year whether this is a huge win or epic fail. And this is Microsoft’s best — perhaps only — hope of ever making Windows Phone relevant.

Google’s purchase of Motorola Mobility is another development that won’t bear fruit until later. Only time will tell if this was a stroke of genius or a brewing disaster.

Was there a big winner or hhorrible failure in 2011 you think should have made this list? Bring it up in the Brighthand Forums.




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