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Nearly 10 years ago, a certain handset maker caused consternation among operators by launching a raft of online services. It wasn’t Apple.
This week marks the 10th anniversary of a momentous event that rocked the global telecoms industry to its very core. That’s right: I joined the ranks of Total Telecom as a young, fresh(ish)-faced junior reporter, hungry to sink my teeth into this complex and groundbreaking industry.
They never said anything at the interview stage about all the acronyms I would have to learn. Weighing the merits of MPLS against PBB-TE (that’s provider backbone bridge traffic engineering, by the way) was a particular ‘highlight’.
10 years later, and the global telecoms industry is a very different place.
Some would argue the seismic waves rippling through telecoms over the last decade have more to do with the unveiling by a certain Steve Jobs on 9 January 2007 of a touchscreen smartphone that drove widespread uptake of mobile data and accelerated the disintermediation of operators, but I think we can all agree upon who is the real disruptive force in this industry. 
However, let’s entertain for a moment the notion that the iPhone somehow had more of an impact on telecoms than a 23-year-old media studies graduate from Kent joining an admittedly brilliant B2B publication, and contrast the handset market in 2007 with the state of play today.
The iPhone hit the shelves in the U.S. at the end of June 2007 (research subscription required). According to Gartner, handset sales to end users in the quarter leading up to that historically significant event were 270.87 million.
As we reported at the time, Motorola, which had been dining out for years on the popularity of its Razr clamshell phones, was clinging on to second place with sales of 39.49 million units and a market share of 14.6%.
Third-placed Samsung was coming up fast. In the three months to 30 June 2007, the South Korean electronics giant sold 36.19 million phones, giving it a market share of 13.4%. Sony Ericsson sat in fourth place with a 9% share and sales of 24.32 million.
None of those three looked like catching Nokia though.
The Finnish handset giant was seemingly untouchable, having added the feature-packed and incredibly popular N95 to its already broad portfolio in March of that year. In the three months ended 30 June, it sold just shy of 100 million handsets, giving it a market share of 36.9%.
It was powered by Symbian’s S60 operating system, which was reliable, intuitive, and had a growing catalogue of third-party applications.
Apple’s App Store, which would forever change the way people use their phones, was still in the works and would not launch for more than another 12 months. Instead, Apple was marketing its first iPhone to people who wanted the iPod and iTunes experience in a sleek-looking form factor that featured arguably the first decent touchscreen to be found on a consumer handset.
The initiative was still very much with Nokia, and Nokia did not rest on its laurels.
Later in 2007 it unveiled ‘Ovi’. Finnish for door, Ovi was the portal for a range of new online mobile services, including email, instant messaging, maps, music downloads, and gaming. It was an app store in all but name.
Mobile operators were rattled. After all, they were the ones who owned the customer; they sourced the handsets; and they were the ones to partner with OTT providers. Not handset makers.
"Nokia is positioning Ovi as a premier portal to what it promises will eventually be a very full set of Internet services," said a research note from Ovum at the time.
As it transpired, Nokia wasn’t the one that operators needed to worry about.
Apple launched its App Store in 2008, turning the smartphone into a gateway for myriad third-party apps and services, and relegating operators to the role of connectivity provider.
Google, which wanted to replicate on mobile the success it enjoyed in desktop-based Internet services, challenged Apple in its own inimitable style, by making its recently-acquired Android smartphone OS available for free to OEMs.
The first Android-powered smartphone, the HTC-made G1, launched on T-Mobile US’s network in September 2008.
Fast-forward to the third quarter of 2016, and the handset market according to Gartner’s figures is a very different place.
Samsung leads the way, selling 71.7 million units in the three months to 30 September, good enough for a market share of 19.2%. Apple sits in second place with sales volume of 43 million and a market share of 11.5%.
China’s Huawei, which was a white label device maker until launching its own range of Android smartphones in 2009, occupies third place with sales of 32.49 million and a market share of 8.7%.
Phone sales for Motorola, LG, Sony Ericsson – which is now just Sony – and most significantly, Nokia, are now either so low or non-existent that Gartner’s ranking does not split them out. Instead they are grouped together in the ‘others’ category, or don’t feature at all. Other names not on that list, the most famous being BlackBerry, elbowed their way into the upper echelons of the handset market only to fall by the wayside again during the 10 years since the first iPhone launched.
The iPhone and subsequent competitors powered by Android have transformed the way people think about phones: from devices used for voice and messaging – that happen to do a few other things like take pictures and play MP3s – to the premier portal to an infinite number of online services.
Nokia anticipated this shift in the industry and tried to capitalise on it. The problem is, Apple just did it better, thanks to the combination of Jonathan Ive’s slick design and Steve Jobs’ demigod-like status.
After a brief absence from the handset market, Nokia phones are set to soon be back on the shelves, albeit developed under licence by Finland’s HMD Global. HMD’s first Nokia smartphone, the Nokia 6, was unveiled on Monday.
Meanwhile, iPhone remains "an essential part of our customers’ lives, and today more than ever it is redefining the way we communicate, entertain, work and live," said Apple CEO Tim Cook, on Monday.
"iPhone set the standard for mobile computing in its first decade and we are just getting started. The best is yet to come," he said.
And I will be here to document it on this very Website. Unless I win the lottery, in which case, I might let someone else have a go.
