Object of the Research
Do you own a cell phone? Is it your first cell phone? How long do you have your cell phone? Where are your outdated cell phones now? Do you want a new cell phone? What kind of cell phone do you want next? Why? The object of this paper is to predict how the usage of cell phone might evolve in the near future.
I will approach this object by:
· looking into the history of cell phone;
· analyzing the trend in the history of cell phone by applying Christensen’s theory
· Predicting the future usage of cell phone.
Thesis
From the birth of the first cell phone in 1973 to today, in only 35 years cell phone has walked out of lab and become the most necessary personal communication device today. In 2002, “No wonder you can’t walk around without being stepped on by someone who’s busy hollering into a cell phone. A Scarborough Research study finds 62 percent of U.S. adults now own one cell phone. That figure has risen sharply during the past two years, which saw a 29 percent increase in ownership.” 7 years later the percentage of cell phone ownership has almost reached to 100%.
On the average of every 2 years, Americans will upgrade their cell phone. Where did those old cell phones go? For cell phone software, hardware, and service providers and for cell phone consumers, they might want answers to the following questions:
· What is the future of cell phone?
· Where will it go?
· How will cell phones impact people’s social behaviors in the future?
In this paper, we will analyze the history of cell phone and predict its future by using the methodologies presented in Christensen’s book “Seeing What’s Next: Using Theories of Innovation to Predict Industry Change”. The methodologies include:
· Look for the Signals of Change;
· Analysis the Competitive Battles
· Make Strategic Choices.
Disruptive Innovation Theory:
“An innovation that is disruptive allows a whole new population of consumers to access a product or service that was historically only accessible to consumers with a lot of money or a lot of skill.
Characteristics of disruptive businesses, at least in their initial stages, can include: lower gross margins, smaller target markets, and simpler products and services that may not appear as attractive as existing solutions when compared against traditional performance metrics.” (Christensen, 2008)
The Evolution and Trend of Cell Phone Usage
What is the most commonly used communication device today? One of the answers would be cell phone. Cell phone has become a personal communication device that impacts people’s life worldwide. Unlike other inventions, it only took cell phone a little more than thirty years to get to the kind of popularity it enjoys today.
Contents
1973 1st cell phone – People to People communication.
1984 1st commercial cell phone – real device rather than just idea
1995 Camera Phone – consumer cell phone with richer communication content
2007 iPhone – Intimate Personal Device
Different cell phone usage in different countries.
Differences in Services and Plans
Prediction 1 – Cell phone is a personal statement
Another signal of change: Recycling – a sign of disruptive innovation
Prediction 2 – Cell phone is Green, Simple and longer life time
1973 1st cell phone – People to People communication
The cell phone was born in 1960′s with the idea that people want to talk to people, not to a place or a car. It took a decade for cell phone to finally emerge out of the lab and metamorphose from a concept into a real device because it took that long to build the infrastructure and to develop the hardware technology.
1984 1st commercial cell phone – real device rather than just idea
In early 1970’s, cell phone entered into the consumer market for the first time. There were quite a few cell phone manufacturers in the world at that time, but cell phones were still very expensive and pretty big. For example, the Motorola DynaTAC8000X weighted 2 pounds, offered just a half-hour of talk time for every recharge and was sold for $3,995.00. At that time, USA average wage was 16,822.51. This cell phone’s price is about three months of wages of an average American. Because the cell phone is relatively expensive, it was mainly for business use. Cell phone was only a new business communication tool introduced at that time.
1995 Camera Phone – consumer cell phone with richer communication content
In another decade or two, the development of cell phone technology, in both hardware and software, unleashed the cell phone’s growth. Today in the Americas and most of Europe and Asia, almost everyone has at least one cell phone. Cell phone has developed from a basic communication device to a device that provides multiple functions, which include text messaging, camera phone, video capturing device, GPS, and Personal Digital Assistant.
Cell phone has become more than just a personal device; the multiple functions of a cell phone have made it become closer to people’s life.
In 1990’s, the cost of cell phone was greatly reduced and more and more personalized and enriched features were embedded in it. Cell phone became a personal device instead of just a business device. With the advances in technology, cell phone also provided a wide range of communication experiences. For example, the first camera phone that allows people to share pictures with each other through the cell phone showed up on the consumer market in 1995.
1995-2005
In this decade, even more personalized functions are introduced into cell phones. Most of these functions are made possible by a combination of both hardware and software innovations. In addition to the camera phone that was mentioned in the above paragraph, smart phone and GPS phone have also become available.
Smart phone is a personal digital assistant with an embedded Operating System. There are several operating system providers: Microsoft Windows Mobile OS, BlackBerry and etc. On the other end, many cell phones also come with embedded GPS systems; and they work like the other GPS devices.
“Mobile phones have taken on the role of providing truly portable and individual communications and computing. Unlike many devices, however, mobile phones can be used anywhere and anytime. Consequently, they are used in social situations such as restaurants and theatres where co-located people can be bothered by their use. How people perceive the impact of mobile phones in these situations may vary by user factors such as age, gender and work status, and by the country in which the user is located.” (Nickerson, R., Isaac, H., & Mak, B. 2008, August).
By providing the smart phone with built-in operating system, it opens the doors for all kinds of software development to introduce even more features. These features provide the consumers with a broader range of communication experiences.
Cell phone is not just that simple voice communication device anymore as at the time it was created for the first time. It provides a variety of multimedia communication channels, including text messaging, email, photo and video communications.
Cell phone also provides functions that go beyond communications. The consumers can use cell phone as a camera to shoot pictures and videos on the go. The consumers can also use cell phone as a GPS device to navigate and look for directions or use its online function to check for real time traffic. It has also become the consumer’s personal navigation device. The consumers can also use cell phone as their personal computer for personal documents, writing, calculating, internet surfing, gaming and online banking.
“Around the globe, various initiatives use the mobile phone to provide financial services to those without access to traditional banks through m-banking/m-payments systems.” (Donner, J., & Tellez, C. 2008, December).
In some Asian countries, cell phone has become the first device that brings internet surfing experience to consumers. In these countries, personal computers are too expensive for the ordinary consumers. They also provide more functions than people really need. The consumers choose cell phone as their personal computer because it is affordable and has the most useful and sufficient features, compared to PC.
Because it is providing functions that enrich communications as well as enrich personal computing experiences, cell phone is getting closer to people’s life. Cell phone has become the most commonly used personal device.
2007 iPhone – Intimate Personal Device
The most recent revolution in cell phone industry is the iPhone. It allows more intimated interactions between the phone and its owner. In year 2007, iPhone was invented. Since then, the “relationship” between the cell phone owner and their cell phone device has become closer than people could ever imagine before. The most highlighted feature of iPhone is its new user-friendly input system: touch screen. People can simply use their finger to touch the cell phone screen to perform the input that would be more rigid and complicated if using the traditional user input method. Examples of other new user inputs methods are:
· people can blow into the iPhone to simulate a musical instrument.
· People can shake the iPhone to simulate the way they play a dice.
· People can tip over the phone to perform a drinking action with the cell phone device simulating a coffee cup. The screen will display the surface of coffee drops while people drink over the iPhone.
There are also some other fun interactions with iPhone. For example, the screen of the iPhone screen can simulate the water surface. When the user’s finger touches the screen, it creates a wave on the water surface, and the fish in the water also respond to that wave.
Apple also released a software SDK which allows developers to write more software for iPhone device. Thus, there are many online software stores for iPhone. We hear people discussing iPhone software development in online communities. We see more and more specialized online iPhone software development communities established and people are very active in sharing their ideas in these communities.
Summary
Cell phone was born as an anytime, anyplace, people to people voice communication device. Since the hardware and software for cell phone have both advanced very rapidly, for every decade that has passed by since the birth of cell phone, there has been a revolutionary change in the usage of cell phone. These revolutions are:
· cell phone has enriched communication among people by providing rich media communication contents;
· cell phone has become a multi-purpose digital personal device in lieu of just a communication device;
· cell phone has become an intimated personal digital companion and a personal style statement instead of just a device.
Every decade, cell phone moves closer to people’s lives.
Different cell phone usage in different countries.
Although cell phone has become a very common personal device that people use every day, there are still big geographical differences not only in the hardware/software technology, but also in the services and network infrastructure. The differences in the local policies impact people’s cell phone usage as well.
For example: for some people in Asia, cell phone is the first device that gives them internet experience.
“Cell phones and text messaging have influenced people’s daily life and changed their ways of communication and interaction. Given the continued introduction of new technology, and especially the adoption of new, more technologically advanced cell phones, it is likely that more people will adopt cell phones for mobile email.” (Li, Y. 2009, February).
In some countries in Europe, cell phone is people’s fashion statement. They can express their personality with their choices of accessories for their cell phones. When people come to a round table meeting, they usually bring their cell phones with them and put them on the table. From their choice of cell phone and how they decorate them, you can get some idea of their personality, preference and so on.
In May 2008 and in the American state Ohio, a very creative example of how to use cell phone was reported– a cell phone system was setup for a museum to broadcast their information to their customer.
“A cell museum information system implemented by the Western Reserve Historical Society in Ohio. The system allows visitors to interact with exhibits through cell phone-led tours. Through their cell phones, visitors may be able to call a local number and listen to detailed information about the exhibitions along the tours. Other features of the tour are presented.” (Fay, K. 2008, May 26) For the next billion cell phones that will be sold between now and 2010, 80% of them will be sold in developing world. This is not only creating new business opportunities in the developing world. It also dramatically impacts the life of those people who never had resources in terms of communication or electricity or education. (Nicholas P. Sullivan, 2007)
In Jamaica, mobile phones have become central to the survival strategies of the lowest income population. (Miller, 2006)
In Europe and Asia, the most commonly used cell phone network protocol is GSM. In North America, the most commonly used cell phone network protocol is: CDMA. As worldwide travel becomes easier, faster and cheaper we see that the differences between these networks are becoming smaller. Cell phone manufacturers have also started to offer cell phone models that support different networks and thus allow the users to switch easily when they are traveling.
Difference in Services and Plans
Cell phone services and plans are different in different countries under different policies. In USA, the service providers are the main driver. Each provider provides its own selection of cell phone models with a service package and a contract. Usually the term of the service contract lasts from one to two years, thus the price of cell phone is usually relatively cheap. The drawback of this service model is that it limits the customer’s choices of cell phone devices. The options are only available within the offering of the service provider that they choose. Switching the service usually requires the customer to choose another cell phone device from the other service provider. This model tries to tie people with a service provider. If people constantly change their provider, with this model people will end up with more outdated cell phones.
In Europe and Asia, cell phone service providers and cell phone device businesses are independent from each other. People can purchase a cell phone and then sign up for any service from a provider that they would like to choose.
The statistics shows that both models work well in their own culture environments. It also shows that the change of service and policy is becoming more global. What is the future of the cell phone service and devices? Are similar services coming together or will there be multiple different service models even in the same region for the convenience of the customers?
In Africa, cellular coverage is expected to reach 85% of the continent by 2010. The characteristics of the African market have forced companies to become more creative with their business practices. Vodacom allows its customers to use their phone like a debit card for Wizzit, a mobile phone bank. This is called m-banking. (Hesse, B. 2007, May)
Though the usage pattern of cell phone is different in different countries, from the big point of view, the trend of cell phone goes towards enhancing people’s communication and their personal life without geographic limitations.
Prediction 1 – Cell phone is a personal statement
Conclusion1:
1. Cell phone will be people’s personal statement, with customized hardware, shape, color, and customized software features for individual customers;
2. People will choose and upgrade their cell phone software more often;
3. People will also upgrade their cell phone hardware every one to two years.
4. People will own more than one cell phone for different purposes.
Through analyzing cell phone’s history and applying Christensen’s theory, I am predicting that in the next decade or so cell phone will become people’s personal statement. Advances in flexible materials will allow extensive customization of cell phone hardware. Some possible scenarios are:
· Slim like a credit card, cell phone can be carried in a wallet.
· It may also be shaped like a wrist bend, so it will be easy to wear and talk into.
· People can also choose to wear their cell phone like a necklace hanging on their neck.
· Other choices can be like the GPS device molded into the car dashboard that we have already seen today.
· People can choose different colors and materials for their cell phone devices.
· People can also customize the software on their cell phone in the same way they customize their service plan today.
People can choose to upgrade their cell phone every one to two years to reflect their updated needs.
People can own more than one cell phone for different purposes: for example, one cell phone is used for business and one for personal life. According to their personal choice, people can customize their cell phone into an all-in-one device like a Swiss knife or a single purpose device just to satisfy one specific need.
Another signal of change: Recycling – a sign of disruptive innovation
By now, it seems to be time to close up this article. But a big question rose up: since people have already been updating their cell phone every one to two years, where has these retired cell phones gone? Statistics shows that there are millions of retired cell phones in the world that are not being used.
“The number of used cell phones is growing by 130 million each year, according to Earthworks, yet EPA notes that only about 20 percent of unwanted phones are recycled annually. Recycled cell phones can be refurbished and reused or dismantled for components.” (Nation’s Health, 2008, March Retrieved April 8, 2009 from Business Source Corporate database). ”
The ever increasing number of retired cell phones creates a problem for this world. Retired cell phones become a new kind of garbage that needs people’s attention and proper management.
“Recycle” becomes one of the direct answers for this question.
Signals of Change
The concept of recycling cell phones was introduced in early 1990’s when cell phone was still relatively expensive comparing to today’s cell phones. There were two main motivations for this kind of recycling business. The first is to reduce the manufacture cost of cell phones by using recycled parts from retired cell phones. The second motivation is for the protection of our environment.
This type of business died soon for two major reasons:
· First, the manufacture cost of cell phones was significantly reduced in the past few years. And it does not cost much to get a new cell phone, so people don’t bother to recycle the old one before getting a new one.
· Second, it costs more to recycle than to buy a new one. Recycling technologies also lagged behind those for building a new one. It is easier and cheaper to just buy a new cell phone than to recycle the old one.
My research has shown that after another decade, more and more new concepts for recycling are being introduced for cell phones.
Once again, people start to think about the recycling phones. Today people believe that recycling cell phones is not only about reducing the price, but mostly for the protection of our environment. Today “Recycle” is not just about recycling the cell phone device itself, it is also becoming more creative and more diversified. It is more proper to call the new cell phone–“Green” phone–than “Recycled” phone.
The reason we call it “Green” is because the idea is to make cell phone environment-friendly. Some of the Green phone ideas are related to the batteries, the shell materials, and the software features of a cell phone. For example:
· leverage the natural solar power resources for cell phone battery recharging;
· use recycled materials to manufacture cell phone’s hardware so that the cell phone itself can be recycled without damaging the environment.
Another example:
“National Cell Phone Collection Program (NCPCP) has initiated a recycling program for cellular telephones in Canada. The initiative aims to reduce the risk of soil and ground water pollution from hazardous substances produced by this device, including arsenic, lead and polybrominated diphenyl ethers. NCPCP refurbishes and remanufactures the phones and sent to developing countries.” (Safyan, S. 2006, November)
In 2004, California enacts the first phone recycling law.
“CALIFORNIA OFFICIALS AND environmental groups are hoping a new law will help prevent cell phones from landing in the state’s landfills. In late September, California Gov. Arnold Schwarzenegger signed the Cell Phone Recycling Act of 2004 (Assembly Bill 2901), which requires cell phone sellers to take back and recycle old phones at no cost to consumers, beginning on July 1, 2006.” Ursery, S. (2004, November).
Green ideas are also seen in the software for cell phone like blood pressure measurement, temperature measurement and so on.
In the January 2008 issue of PC magazine, the cover story was an article named as “Future Concept Design – Mother Nature’s Cell”. In this article, it introduced a company that designs cell phone made from sustainable materials like recyclable metal and starch-based polymers. The cell phone also has a wind-up power system and some healthy features.
“The eco-friendly cellular phone Frog Phone from Frog Design Inc. It is made from sustainable materials like recyclable metal and starch-based polymers. It is powered by a rechargeable nickel-zinc battery along with a wind-up power system. Features of the Frog phone include an intuitive interface to calculate the carbon footprint for multiple products. It also has a food check sensor that provides safety information for food and surrounding air. The widget, Trash Talk, included in it helps people track how much trash they generate.” FUTURE CONCEPT DESIGN • MOTHER NATURE’S CELL. (cover story). (2008, January 8).
Frog Phone is a signal of change: overshot customers. The provider provides the product: Frog Phone which is more than any existing cell phone provider or service is providing. Frog Phone is more than good enough.
Another overshot signal of change is introduced in 2005 in cell phone’s battery.
“Introduces the Green 8, a thin foil sheet used in the battery compartment of cell or cordless phone, from Eco-Restore. Design to neutralize the electromagnetic radiation emitted by cell phones; Capability of absorbing harmful emanations; Availability of the product.” Cell Phones Might Give You More Than Convenience. (2005, Summer2005).
In year 2006, the first cell phone with solar charged battery was introduced to the market.
Competitors Battle
At the 2008 CES, Nokia introduced Nokia Green 3110, built with 50% renewable bio-material. Concerns for this new model were more focused on its price. Will this cell phone be too expensive for people to accept? People will not consider recycling cell phone unless it has attractive price and people can afford it.
In 2008, Nokia also offered postage-paid return labels for people to recycle phones regardless of the manufacturer to encourage cell phone recycling. (Alleven, M. 2008, April 2).
At 2009 CES, Motorola Renew was introduced with 100% recycled material with cost of $9.99 and a two-year contract. This is a very attractive price with better technology, comparing with the Nokia Green 3110, a model for just the year before. Motorola Renew really makes Green cell phone a practical product that people can purchase both for personal communication and for the environment protection.
This heavy battle in the field of Green cell phone between these two major cell phone manufacturers is the symptom to watch for to apply Christensen’s theory: descriptive innovation. When we see the competitive battle in the field, that field has a chance to become the next wave of trend.
In year 2008, the economy crisis started to hit this world. Economy crisis is becoming a big factor that is stirring up this already hot battle. In this economic situation, people are more cautious about their purchases. People are adjusting to a more frugal living style to fit for the difficult economic situation. Buying a green cell phone is not only a good deed that people can do to address the environment protection problem, it is also much cheaper both in hardware and in services comparing to other fancy PDA cell phones. Green phone will become next wave in the trend of cell phone.
Prediction 2 – Cell phone is Green, Simple and longer life time
In summary, in the next ten years, cell phone will go green and simple, based on the following four reasons:
First, people are not just thinking of themselves anymore, they are also thinking of environment. They are not only using cell phone to enrich their own communications and to to enrich their personal life for themselves, more and more people are also start to think about the Earth, the environment and what they can do for this world.
Second, more creative ways of recycling are being introduced instead of just recycling the cell phone devices. Cell phones are manufactured with recycled materials, cell phone accessories are made of environmentally friendly materials, and cell phone has more Green features that help people improve their own health and the health of this planet.
The third reason is the improved recycling technology makes green phone practical and affordable.
The last reason is that the crash of the world economic has changed people’s life style. They are more willing to choose cheaper Green phones and keep them for longer periods of time over the more luxurious and fancy PDA cell phones with expensive service plans and needed to be updated every one to two year or so.
Conclusion 2, in another decade, Green phone will be the next wave in the trend of cell phone. Green phone that is built with recycled materials has simple features or green features andhas cheaper service plans will become trendy and people will also hold their green phones for longer periods of time, say 3-5 years.
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