Silicon Valley pundit discovers mobile Internet

OK, so this is old hat to my European friends, but …

At last, the year of mobile computing is near
By Chris O'Brien
Mercury News

I can't tell you how many mobile trade shows I attended where the refrain was exactly the same: Next year is going to be the year when the mobile Internet becomes huge! Of course, that next year never seemed to come.

Until now. The mobile Web is here, and it's huge.

More important than its size, though, is the impact it is having and will have on our lives. While Web 2.0 companies get a lot of buzz in the valley's echo chamber, and green technology has been getting some much-deserved hype, I think the greatest area of innovation occurring right now in Silicon Valley involves mobile computing.

We have moved into an era of constant connectivity. And with that comes the expectation that all of our information needs and wants will be instantly gratified.

Because of where we live, we sometimes fail to notice when such trends finally grab hold of the mainstream. This region is thick with road warriors and early-adopter types. And for more than a decade, this crowd has been shelling out big bucks for first-generation devices and services that allowed them to remain hyper-connected at every moment.

But mobile computing has finally outgrown the niche crowd and crossed over into the lives of mainstream users. A survey released earlier this year by the Pew Internet and American Life Project revealed that 62 percent of Americans access mobile data either through a phone or laptop.

I don’t quite get the recent news hook for a March 5 release by Pew. I’d ask the Merc columnist personally — O’Brien and I have been trying to hold a get-acquainted meeting for several weeks — but our meeting today got postpone a second time.

Looking at the original Pew numbers, the 62% figure is a bit misleading, because it includes using a cellphone for just about anything (58% use it for texting or taking a picture), as well anyone who’s used a laptop (or PDA or cellphone) to access the Internet away from home or work (an airport, the library, Starbuck’s). So this is not 62% of America or even 62% of all celphone subscribers paying through the nose for a dataplan.

To illustrate his column, O’Brien talks about his dependence on his Blackberry, and in particular on the navigation services of Sunnyvale-based TeleNav. This highlights another important point: there are so many entries into mobile navigation — standalone, cellphone, car-based — at some point with growth slows down, we know there will be a brutal shakeout and consolidation phase with only a few left standing (and maybe a few others retreating to niches).

Wireless data revenues are still growing rapidly in the US, but the carriers are not reporting wireless data subscribers. Given that wireless is 19% of total — and wireless plans are as much or more than voice plans — that implies a penetration rate of around 15-20% so far. This means we’re entering the early majority, high growth phase. If I had to guess, I’d say we’re 2-4 years away from 50% of cellphone owners using the mobile Web, but falling consumer confidence may push that off by an additional 1-3 years.