Mobile Payments are Here to Stay

English: An NFC (Near Field Communication) poi...Steve Jobs once said, “We must deliver technology that gets out of the way.” Starbucks seems to have taken this advice to heart in implementing its mobile payments app, attracting over 10 million active users in the U.S alone. Mobile payments now account for over 10 percent of Starbuck’s revenues in the U.S, and are a testimony to the fact that the era of mobile payments has arrived.

Starbucks’s strategy of offering $5 credit to those joining the My Starbucks Rewards program paid off, and generated 500,000 downloads of the mobile payments app within two weeks of its launch in January 2011. The app is extremely user-friendly, and comes with incentives to users for paying through their smart devices.

The app is particularly useful for those who don’t like paying for their purchases using cash. They can simply open the app on their phones which has a barcode; the barcode is scanned by the sales representative and the customer’s Starbucks prepaid account is automatically debited. Customers paying via the app earn points and can easily redeem these points on their Starbucks cards. They can also reload the balance in the Starbucks cards through this app

In contrast to Starbucks’ experience, Google Wallet has been facing an uphill climb. The concept is in tune with the times: allowing users to store credit/debit card information on their mobile devices, and using these devices to make purchases. Despite Google’s massive global presence, Google Wallet has garnered only 10 million downloads in the Google Play Store. Although offered across a number of countries around the world with over 200,000 merchant locations in the United States alone, Google Wallet is still far from a household name.

Jonathan Grudin, principal researcher at Microsoft, contends that right now, there are few incentives for consumers, retailers, and communication companies to create the necessary infrastructure to completely do away with credit card and cash transfer payments.

Mobile payments not only need to provide a great user experience, but users must have the confidence that their trust is protected. At the same time, mobile payments need to add value. Users may not see their smartphones as wallets if they are satisfied with their current payment methods.

In fact, a sound financial system can act as a deterrent to the growth of mobile payments. There is a strong likelihood that mobile payments would be more successful in the developing countries where the financial systems are not as stable as those in the U.S or other developed economies. For that to happen, however, users in these countries have to perceive mobile payments as a more reliable form of payment relative to the existing methods.

Heavily invested in the current payment practices, the credit card industry could potentially come in the way of the widespread adoption of mobile payments, particularly if it sees them as hurting their bottom line. The credit card giants need to be 100 percent assured that they stand to gain from transition to mobile transactions before they will put their weight behind the paradigm shift to mobility.

Notwithstanding the bumps in the way, we at Market Analyst believe that the convergence of physical and digital commerce is simply inevitable. Already, Google Wallet and PayPal are trying to own the space. Still small in number, more and more shoppers are opting to go cashless. Businesses are coming up with ways to accept digital and mobile payments. In the U.S., a number of retailers are looking for ways to optimize mobile payments at check out. With a life style that is changing so rapidly, it is natural for consumers to expect an evolved shopping and payments experience.

A study by at North Carolina’s Elon University predicts a radical change in the way we pay by 2020. In fact, Elon’s Imagining Internet Center believes that mobile money represents more than just a more convenient way to pay. According to the center’s director, Jenna Anderson, mobile payments represent “an opportunity to implement security measures that are lacking in our current financial systems, to offer consumers more control over their spending and to even reinvent the way we think about the concept of ‘money’.”

The number of mobile payment users is approaching 300 million, and in terms of value, mobile payments have surpassed $100 billion. Mobile payments are primarily being used in ticketing, with examples such as that of Starbucks being an exception. However, in the next couple of years, mobile payments will hit the mass market, their use becoming more dominant in the retail market.

To succeed in the mobile payments market, retailers need to be up to the task, making their solutions compelling enough to attract users. Nevertheless, replicating Starbucks’ success story would be challenging. After all, Starbucks has a massive loyal customer base, and its affluent customers are surely more tech-savvy than those of most retailers.

While the odds of predicting how long it will take to revolutionize the entire payment system are probably high, one thing is certain: In the near future, worrying about losing your wallet would be a thing of the distant past.

Blogger: Samar Kaunain

© 2013 Market Analyst, LLC. All rights reserved.

http://www.marketanalyst.net

Artificial Intelligence – Making Machines Smarter!

Simple reflex agent, based on Artificial Intel...

Simple reflex agent, based on Artificial Intelligence: A Modern Approach (Photo credit: Wikipedia)

Mankind has long been fascinated by the idea of intelligent machines. The first manifestations of thinking machines and artificial beings can be seen in Greek mythology in the form of Talos of Crete, the bronze robot of Hephaestus, and Pygmalion‘s Galatea. By the 19th and 20th centuries, artificial beings had become a common feature in fiction. Science fiction further contributed to nurturing the concept of sentient machines, but the fact remains that fiction bears little resemblance to the real world.

The study and development of intelligent machines goes by the name of artificial intelligence. As a scientific discipline, this field was born out of deliberations at a conference on the campus of Dartmouth College in the summer of 1956. The basis of artificial intelligence is using computers to simulate the primary activities that create our intelligence. The real challenge has been to understand how natural intelligence works.

Artificial intelligence has been getting exponentially smarter for decades. It is true that machines cannot yet be programmed to form intuitions about the physical world without complex and extensive calculations. Scientists delving into artificial intelligence hypothesize on how and why we learn and think, and then they experiment with these hypothesizes.

Nevertheless, most people do not realize the extent to which artificial intelligence has been practically implemented, and the rapid advances technology is making. Over the past several years, artificial intelligence has been used to improve existing applications in a number of areas such as medicine and biotechnology, transportation guidance systems, and manufacturing automation.

Artificial intelligence is closely linked with robotics, the science that deals with man-made machines equipped with the intellectual abilities of humans. The goal is not only to give these machines the ability to communicate verbally and to perform various tasks, but to instill in them the ability to reason and to formulate ideas.

Artificial intelligence is being used to enhance the capabilities of smartphones, tablets, and other computing devices by giving them the ability to perform a host of functions on their own. One of the applications of artificial intelligence is intelligent search on the Internet. Google’s Knowledge Graph is the latest refinement to its search engine product that provides users with in-depth responses to search queries by connecting these queries to information-rich topics on people, places, or things.

Japanese electronics company, Sharp Corp., has started releasing products with artificial intelligence that activate on voice command or verbally offer common courtesies when they are used. One of the first such products is its vacuum cleaner, “Cocorobo” that has witnessed strong sales. Others include an air conditioner and a refrigerator that say “thank you” and give instructions on when to carry out maintenance. Upcoming products include intelligent microwave ovens and air cleaners.

Newer cars use artificial intelligence to take tire temperature and other measurements to make driving safer. Emerging developments allow cars to navigate on their own. Self-driving cars are now legal in at least three American states, including California, as well as in the U.K. These types of cars are Google’s pet project, but now other companies, such as Mercedes Benz, are jumping on the bandwagon, and the technology is evolving fast.

The medical field is one of the areas that are in the forefront of embracing artificial intelligence. Medical devices are being introduced that allow a computer to analyze data and make judgments on its own. Artificial intelligence has also been used in deep space exploration and high-complexity data mining and analysis.

Industry observers estimate that the artificial intelligence solutions market is approaching one billion dollars, and is poised to grow exponentially over the next few years. The United States currently represents the largest market for artificial intelligence, but the Asia-Pacific region offers the highest growth potential over the next few years.

Artificial intelligence gives humans tools not only to enhance the performance of machines, but to allow these machines accomplish tasks more efficiently, and without human intervention. However, as more and more intelligence is built into the machines, they will keep becoming smarter and more versatile. Some technologists contend that in not too distant a future, machine intelligence will overtake human intelligence.

Combined with the pervasiveness of mobile devices, artificial intelligence has the potential of impacting virtually facet of our lives. No wonder, IT and software vendors are pouring billions of dollars into commercial solutions based on artificial intelligence. However, unlike a human mind, a computer will never be capable of complex reasoning or able to process a complicated emotion.

Blogger: Unum Shafiq

© 2013 Market Analyst, LLC. All rights reserved.

Market analysis reports on Artificial Intelligence

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What Makes Smart Cities Smart?

Masdar City

Masdar City (Photo credit: GDS Infographics)

Evolving technologies are reshaping our lifestyles much faster than we even realize. The widespread availability of smart technologies has had an impact on practically everything from the way we work to the way we communicate, shop, plan and commute, and its effects can be seen in every aspect of our lives. What once were science fiction fantasies are turning into realities right in front of our eyes.

We are not using flying cars to get to work or wearing silver foil jumpsuits yet. However, we are close to the day when we will see digital billboards communicating with passersby as in the sci-fi movie Minority Report. As the world’s population increasingly becomes tech savvy, the cities need to evolve as well in order to be in sync with the times. Information technology is becoming the fourth utility, and more and more governments and municipal planners are embracing smart city projects.

Globally, as many as 180,000 people relocate to cities every day, and this influx raises several challenges. Increasing urbanization means additional consumption of already depleting resources. Despite shrinking budgets, governments have to provide more and more services even before they can collect taxes. Rapidly growing urban populations are straining inadequate infrastructures. Around the world, most cities have outdated foundations making them ill-equipped to fully cater to food, water and energy needs of their inhabitants.

It is obviously challenging to supplant the existing infrastructures with new ones. A faster, and more practicable, solution is to digitize and modify existing infrastructures so that cities can intelligently cater to new demands as they arise. A number of cities in industrialized societies are already doing so, Amsterdam being just one example. The city won the Smart City Award for its innovative Open Data Program for transport and mobility. Amsterdam’s Department of Infrastructure and Transportation makes traffic and transportation data publicly available. Using a mobile app, smartphone users can easily access real-time transport and travel information on parking (tariffs, availability and time), taxi stands, cycle paths and traffic jams.

In Arizona’s city of Mesa, the police department has reduced crime rate by 25 percent, thanks to an altered smart policing approach. With telecommunications networks breaking down barriers to rapid communication, the police department shares information with police units in almost 50 cities throughout Arizona. In addition to making investigations more effective, this saves the department both time and money.

Existing infrastructures can be improved by retrofitting, which involves simply modifying the equipment that is already in service. The San Francisco Public Utilities Commission, for example, is retrofitting its 1,000 mile waste water system with sensors to spot and repair leaks. This prevents the overflowing of drains in the storm season, and mitigates the risk of mixing public water with untreated sewage.

Off course, a more radical approach to dealing with the rising population and dwindling resources is to build entirely new smart cities. Many of us are in awe of the city of Panem in the movie Hunger Games in which residents are mostly preoccupied with fashion, food, and entertainment. Despite its dystopian view of the future, the movie provides what some would consider a glimpse into the future.

In the modern age, one of the most ambitious smart city projects is Masdar City, currently being built in Abu Dhabi. With a price tag of $22 billion, it is due to be fully functional by 2025. Masdar’s foundations are not being laid just with bricks and mortar, but are being weaved into the city’s infrastructure through social innovation and technology. Deriving energy from a solar farm located outside city limits, Masdar would use low energy appliances, thus saving on energy consumption. Instead of petrol-fueled cars, Masdar will only allow self-running electric cars which drive through specially built tunnels.

Many critics are already questioning the practicality of Masdar, claiming that by the time the city is built, many of the technologies on which its foundations are based will become outdated. On the other hand, proponents of Masdar contend that while sooner or later every technology gets outdated, this should not be reason enough for not ushering new technologies. Whether it is retrofitting existing cities or building new smart cities, the bottom line is that to meet the changing needs of urban populations and strained infrastructures, cities must become smart too.

Blogger: Samar Kaunain

© 2013 Market Analyst, LLC. All rights reserved.

Market analysis reports on Smart Cities

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Augmented Reality

Google Glass

Google Glass (Photo credit: Stuck in Customs)

What does market research on augmented reality have in common with science fiction? Many of today’s hot technologies covered in market research reports, such as augmented reality, are based on things envisioned decades ago by science fiction writers and creators. For example, the original TV series Star Trek inspired the design of the iconic wireless clamshell-shaped flip phone and the first home computer. Augmented reality enhances the perception of reality by assimilating digitized information in the observation of the real world through computer-generated sensory inputs.

Like these and numerous other technologies, augmented reality appeared in fiction long before its development. Author L. Frank Baum, who wrote the Oz book series that includes The Wonderful Wizard of Oz, introduced the idea of augmented reality in 1901 in The Master Key. In his story, a kid gets a pair of specs which show him the good, bad and evil in people. Almost 90 years later, the term ‘augmented reality’ was coined by Boeing® researcher, Tom Caudell, who used it to describe a digital display used by aircraft electricians. Since then, augmented reality has been used in a number of computer programs and technologies, but its full potential has yet to be realized. Destined to bring changes to the world in a dramatically amazing way, augmented reality shows possibilities that are beyond comprehension.

Given this, it’s no surprise that analysts and experts predict tremendous global growth for augmented reality across a variety of markets and industries within the next few years. One of the key factors contributing to substantial market growth is the increasing demand for an enhanced user experience. Consumers are also taking note. The sudden surge in the hype of augmented reality is due in part to smartphone applications that have elevated general public interest. With tech giant Google® at the forefront of what is positioned to be one of this century’s disruptive technologies, its massive project, Google Glass™, is now making headlines. Closer to becoming reality, yet still in the research and development stage, Google Glass is rapidly boosting augmented reality to the stature of awe-inspiring technology with far-reaching effects.

As if taking a cue from the The Master Key, Google Glass is head-mounted wearable technology, with, of course, an appealingly edgy slim and small design. In brief, using Google’s Android® operating system, Google Glass uses wireless Internet access and voice recognition along with a tiny computer display and camera, to augment reality. Visual displays result when a verbal command is given by the wearer. For example, saying, “Glass, take a picture” will capture an image, or “take a video,” will capture a video of what’s in front of you, which you can share and/or store. With the help of Google Glass, directions to a certain location, or information on places, things or a person can be displayed immediately into the glass.

In May 2012, Google released the first Google Glass demo video, a filming experience of recording a 720p HD video with augmented reality display. In February 2013, Google released a demo video to the public showcasing the first sights and experiences of someone wearing and using Google Glass. Amidst the media frenzy and excitement within the technology community and beyond, Google co-founder Sergey Brin, has stated that Google Glass still has a long way to go. In fact, he claimed that despite the huge response from the tech world, the success of Google Glass is far from assured. In Sergey Brin’s own words, “It’s by no means a done deal yet. If it is, maybe I should retire.”

Isn’t augmented reality amazing? Access to information as well as information sharing has never been this readily available. It will change the way we look at the world and how we interact and communicate. What do you envision? Will augmented reality glasses eventually evolve to the point where, as author L. Frank Baum conceived over a century ago, they will enable wearers to see the good, bad and evil in people? Here’s something to think about—what would happen if you combine augmented reality with facial recognition, next generation graph-search technology, and advanced artificial intelligence (AI)? While we may not yet envision the massive breadth and depth augmented reality will have on business and on the human experience, we do know this: augmented reality will open up a world of futuristic possibilities.

© 2013 Market Analyst, LLC. All rights reserved.

Blogger: Unum Shafiq

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Market Studies Available as eBook Reports in an Industry First!

e-books EPUB

In this age of mobility, people expect to be able to access and read information anytime, anywhere on the device of their choice. An eBook is a great example of this concept in play — hence the popularity of eBooks. eBooks allow publishers to go beyond the printed page and truly engage and stimulate the readers.

It is interesting that until now it was virtually impossible to find market research reports available as eBooks, especially when you consider that the market research business is no small potatoes. In fact, it is estimated to be more than a $34 billion a year business.

eBook reading devices such as tablet computers and “eReaders” from Amazon, Barnes & Noble, and Sony are becoming pervasive. The growth of eReaders and tablets, in particular, is driving the eBook market. According to Pricewaterhouse Coopers’ “Global Entertainment and Media Outlook,” in the U.S. alone “around 30 percent of adults had at least one portable reading device [an e-reader or tablet] in the first quarter of 2012.”

eBook reading can be done on smartphones which are rapidly replacing feature phones and are now the biggest segment of the mobile device market. Smartphones provide ease of access, removing the barriers of location and time for users of market research.

No wonder, eBook growth in the U.S. market has been pretty dramatic. The total spending on print trade books is declining, but the e-book market is growing fast enough to offset those declines. Pricewaterhouse Coopers’ projects that e-books will make up 50% of the trade publications market in U.S. by 2016.

In a bid to take advantage of this burgeoning market, we, at Market Analyst, are offering market research reports in both eBook formats — EPUB and Mobi. That makes us possibly the first market research distributor to offer this option of eBook reports.

This is no small deal because it’s somewhat easier to offer a typical book as an eBook, not to mention the resources companies such as Amazon have to ensure the quality of the eBooks, than to provide market research reports in eBook formats. One of the challenges with converting market research reports in eBook format has to do with maintaining the integrity of the reports, which tend to be filled with charts, tables and diagrams. Also, keep in mind that the economics of selling a typical book as an eBook are very different from offering market research reports in eBook formats, given that a market research report is usually purchased by a very limited number of buyers.

Market Analyst is  starting out by offering market research reports from three market research firms as eBook Reports. Not surprising all three market research firms are focused pretty much on the hi-tech industry:  Mind Commerce on telecom, Objective Analysis on the semiconductor market, and WinterGreen on a broad range of hi-tech areas.

We think that is a pretty exciting deal from a start-up market report distributor that can claim it’s already pioneered something different in its market.

Blogger: Sam Masud

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Brazil Serves as a Model for Latin American Mobile Broadband Rollout

English: Latin America (orthographic projection)

In an interview with Market Analyst, Erasmo Rojas, director of Latin America and the Caribbean for 4G Americas, stated last week that he expects Brazil to spearhead mobile broadband deployment in the region. Rojas said Brazil, the host of 2014 FIFA World Cup, will drive mobile broadband network deployment by offering high-speed mobile services, specifically 4G, during the competition for football’s most coveted prize.

Indeed, Brazil has already begun moving in that direction. Just last week, Anatel, the country’s telecommunications regulator, held auctions to dole out 4G spectrum for the rapid rollout of high-speed mobile services. The auction involved two swaths of spectrum for LTE deployment – 2.5GHz for urban areas and 450MHz for rural areas. In line with expectations, the Brazilian government raised $1.4 billion from the auction.

As a result of the auction, all four major telecommunications companies in the country secured licenses to offer LTE services. Both Madrid-based Telefonica SA’s unit Telefonica Brasil SA, and Mexico City-based America Movil SAB bought 20 MHz each of the nationwide spectrum. The other two national carriers, Milan-based Telecom Italia’s unit Tim Participacoes SA, and Rio de Janeiro-based Oi SA acquired 10 MHz each of the nationwide spectrum. In addition, America Movil bought 19 regional frequencies, Tim Participacoes SA acquired six regional frequencies, and Oi procured 11 regional frequencies.

The auctions were not without controversy since critics contended that 4G licenses add unnecessary burden on operators who are still rolling out 3G networks. However, the Brazilian government not only went ahead with the auctions, but set out ambitious targets for the launch of these mobile broadband services.

It wants the license winners to launch 4G services in the six Brazilian cities hosting soccer’s Confederations Cup by April 2013, and in the twelve host cities for the 2014 Football World Cup by the end of 2013. In Brazil, all state capitals and cities with more than 500,000 inhabitants will have 4G by year-end 2014, and all municipalities with at least 10,000 inhabitants will be covered by year-end 2016.

As part of their lucrative 2.5GHz spectrum acquisitions, all the four carriers had to assume obligations for providing LTE coverage in the rural and remote areas of Brazil.  Anatel classifies a rural area as being one that is at least 30 kilometer from any municipality. The operators are required to use spectrum in the 450 MHz band to roll out LTE in the rural and remote areas. Specifically, 30% of rural areas have to be covered by June 2014, 60% by December 2014 and 100% by December 2015.

The Latin American region has generally been slow in migrating to mobile broadband for variety of reasons.  However, the Brazilian lead is expected to inspire other countries in the region to follow suit. As Rojas pointed out, mobile broadband penetration in Latin America is 17 percent today, but it is expected to climb to about 60 percent by 2016, representing an immense opportunity for content, applications, and value-added services.

Rojas is bullish on the Latin American market because the region has not been susceptible to the economic crisis engulfing other parts of the world. Large pan-regional operators, who have 60 percent share of the Latin American mobile market, are strong carriers with the financial stability that allows them to invest in infrastructure, devices and innovation.

Want to learn more about the Latin American mobile market?  Please click here to access our latest portfolio of reports on this burgeoning market.

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What Do Apple’s Quarterly Results Mean?

Impact on Stock Price

True to its form, Apple once again surprised market watchers when it set an all-time quarterly record for the sale of its iPhone, iPad and Mac devices. The disclosure, which came on January 24, 2012 in the company’s release for the last quarter, sent the company’s stock price sky-rocketing, hitting record highs in after-hours trading before settling in at $454.50. This rise in its stock price gave Apple a market cap of $423 billion, topping Exxon Mobile‘s $417 billion, and making Apple the largest publicly traded company in terms of market capitalization.

During the last quarter, Apple shipped 37.0 million iPhones, an increase of 128 percent year-over-year, and it shipped 15.4 million iPads, up 111 percent. With quarterly shipments of 5.2 million, even Macs grew at 26 percent. These results are particularly striking in view of Apple’s weaker-than-expected results in the previous quarter that had led to a slide in its stock price.

Market Competition

Notwithstanding Apple’s solid market position, its competitors are unrelenting in introducing product enhancements designed to challenge its ascendancy. The Android OS, for instance, gets better and better as Google keeps releasing frequent upgrades, the latest being Version 4.x, Ice Cream Sandwich, released in August 2011. Samsung’s Galaxy line-up is based on Android with the Galaxy S II smartphone having an edge on iPhone in some respects. Android has already captured the lion’s share of the global smartphone market.

CES 2012 saw an overcrowding in the tablet market with vendor after vendor releasing new products. Amazon’s Kindle Fire and Sony’s Tablet S are both based on Android, and can give iPad a run for its money.

Research in Motion’s Black Berry OS 7, released in August 2011, offers dramatically improved performance, and the OS is expected to make another performance leap with the release of its next version that will be based on QNX. The company has already released a QNX-based tablet.

Microsoft used CES 2011 to showcase Metro, the design-language created for the Windows Phone 7 interface. The company sees extending Metro and Windows 8 across different device-types as its next big opportunity. Its Windows Mobile platform got a boost with Lumia 900, a smartphone released by Nokia at CES 2012. The smartphone, described by ZDNet as the show’s best mobile phone, uses Microsoft Windows Phone 7.5 Mango.

Apple’s Market Positioning

Apple certainly is not resting on its laurels. Its iPhone 4S, released on October 2011, has been a hit as reflected in the significant sales of the device in the last quarter. Its iOS 5 comes with the iCloud service and offers several advanced features.

In fact, Apple has raised market expectations by providing an upbeat guidance for the current quarter and by announcing that it has some amazing new products in the pipeline. Even without such raised expectations, Apple faced a high bar on its performance with even a minor lapse having costly consequences.

Apple’s Acquisition Strategy

What we see as a problem for Apple is the limited line-up of its products. For a company its size, Apple should have a much larger product portfolio addressing a wider range of market segments. A bigger portfolio will allow Apple to diversify its risks, giving greater stability to its stock price.

There have been several potential acquisition targets, but Apple has not so much as made a move. Research in Motion and Yahoo! are examples of companies that it could have easily acquired but Apple chose not to take any chances. In fact, this strategy has worked for Apple so far. But how long Apple can sustain its current business model is an open question.

Not that the company does not have financial resources. For its fiscal year 2011, Apple had cash and marketable securities worth an astounding $82 billion. With this much cash, Apple could go on an acquisition spree. But its biggest acquisition since it bought NeXT in 1997 for $429 million was that of Anobit, an Israeli chip maker, that it recently acquired for less than $500 million.

Conclusion

Although Apple’s acquisitions have not been unwise, the company needs to revisit its long-term strategy. Its disappointing results in the quarter before last should serve as a wake-up call. Apple’s products are still market leaders, but its competitors are upping the ante, and if the company does not change its course, it may be headed for troubled waters.

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