Quickthink

These are difficult economic times. Check. That means identifying growth sectors is critical to avoid getting further squeezed. Check. So where are the growth sectors?

One is mobile. Check. Apple opened up the market with its sleek product lines and app store. Now the race is on to (1) get you to shell out several hundred dollars/EUROS to buy new mobile devices (already old news), and (2) get you to use more mobile web based services (hmmm … something new).

The Key question - how will firms make money from this? My best guess is that as revenue opportunities from app services get better, and more android phones come out, equipment prices will drop. So hardware sellers (like Motorola, Nokia, Palm, etc.) may get further squeezed. So while the mobile market is growing, this part of it may see tough competition. Translation — no pop in share prices. So where will we find revenue opportunities for app services? Check out this NYT article on how Google looks at this. My guess is that they have researched this more intensively than you or me.

Hmmm … So, just what are Google share prices going to look like in 2011? Good question. A lot depends on android, and some people are bullish about android. Just ask Fred Wilson.

Of course, this is not the only game in town. More later.

FOLLOW - The NYT article mentions the risk to Google that mobile apps may disrupt Google’s core market in search. For more on this, check out Sebastian Rupley at Giga. Bottom line - Sebastian thinks Google is ahead of the curve on this.

2d FOLLOW - Fred Wilson gives the thumbs up to the new Google phone, the “Nexus One”. Another good sign that Google may be ahead of the curve on mobile issues. But I just can’t figure out why Google didn’t send me a Nexus One to test. Ah well.  

This entry was posted on Tuesday, January 5th, 2010 at 1:49 pm and is filed under Business models, Finance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.