The following article from Cellular News, a UK website, confirms our observation that hand-held devices will be the major digital device in the next few years. These devices will get very capable, very quickly. The hand-held price point is more favorable than PCs bringing Internet and other applications to a much larger percentage of the the buying public. From a Marketing perspective, we believe hand-helds will provide opportunities for new advertising forms and will open up time and place advertising that will relate to individual tastes, preferences, and current location.

It is interesting to watch UK opinions that tend to favor the Simbian OS over Microsoft. In this artilce they suggest that their pick is Linux. Who would have thought that a robust operating system like Linux (Unix) would ever be running on a pocket sized hand held?

As you read this, keep in mind that both Europe and Asia are well into 3G telephony, and as such have taken their markets many steps into new applications and uses. 3G is slowely being implemented in the USA.

Zelos Group says that it predicts by 2008, sales of full-featured handsets, mobile phones that incorporate full-featured operating systems, will grow to about 290 million, or about 43% of global handset sales. Mainstream adoption of these devices will have a significant, disruptive impact on the entire mobile electronics sector -- in markets for wireless, personal electronics and computing technologies.

"The mass adoption of full-featured handsets will be disruptive," said Seamus McAteer, senior analyst and managing partner, Zelos Group, the report's author. "Consumers will substitute use of PDAs, digital cameras, gaming consoles and music players. An early indication of this is Nokia becoming a leading distributor of digital cameras."

The report asserts that leaders in other portable device categories like Sony, Apple, Nintendo, Hewlett-Packard and Casio will respond to the competitive threat from handset OEMs. McAteer says these vendors will focus on improving the core functionality of special purpose devices, and by adding mobile WAN connectivity.

"As handsets with multiple gigabytes of storage are launched in the next two or three years, it is possible to envision, for example, Hewlett-Packard launching an iPod with integrated W-CDMA transceiver and dual-use headset and speaker," observed McAteer.

Zelos Group expects that shipments of full-feature handsets will overtake shipments of personal computers in 2006. There is no economic reason to question why growth will not be explosive. Full-featured handsets will be available from manufacturers at price points as low as US$157 in 2006 close to the market average selling price for a mobile phone of about US$138 in that year. Mobile handsets are the largest single consumer electronics category driving research and development in electronics, power and display technologies, and the market has become a major battleground for computing operating systems.

"The market for full-feature handset platforms will continue to be highly competitive over the next five years," commented McAteer. "In the medium term, the battle will be dominated by Symbian. But in the long term, the fight for supremacy is far from over."

Based on Zelos Group's analysis, the long-term prospects for Linux as the preferred operating system for connected devices are very strong. Zelos Group scored all mobile platforms across five criteria: business viability, completeness, cost, end user appeal and openness. Linux scored highest on the two criteria that matter most to OEMs and carriers: openness and low cost, whereas Microsoft scored lowest in these criteria.

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