The challenging economy has continued to bite but despite this, it has not all been doom and gloom. Paul Withers takes a look back at the big stores from this year
Amid ongoing economic uncertainty, 2012 has been another tough year in mobile. Former industry-leading manufacturers have continued to fight for their very survival, high street retailers and the dealer channel have again felt the pinch and there have been high-profile casualties in distribution. But in spite of all the gloom, positive headlines have continued to emerge. Here is a rundown of the highlights and lowlights from the past year.
2012, much like 2011, was a struggle for many handset manufacturers. Samsung and Apple continue to dominate the ever-growing smartphone space and show no sign of slipping up anytime soon. Apple continues to impress – and incredibly its iPhone 5 (pictured left) is expected to hit 45 million sales by the end of the month. The same goes for Samsung, most notably with its Galaxy S III (pictured right) which has already totted up 30 million units.
The rest of the manufacturers – most of whom have far more experience in the telecoms space – have continued to struggle.
At the start of the year there were hopes of a Nokia resurgence but progress, particularly in the UK, has been minimal. The one-time giant continued to post quarterly losses approaching £1 billion and is cutting 10,000 jobs by the end of next year. The gamble of Windows is yet to take off.
And 2012 has been yet another year to forget for BlackBerry manufacturer RIM. All the hopes surrounding BB10 disappeared in the first six months when the firm announced the OS would not be released until early 2013 and it revealed it would not launch any new handsets until that time. RIM also cut 5,000 jobs, removing anyone deemed surplus to requirements, as its rival Nokia did also.
BB10 now more than ever needs to give RIM the lift it so desperately needs. It simply can’t afford to get this wrong – especially with Windows waiting in the wings.
The rest of the market has been largely unimpressive. Much was expected of Sony as it entered its first year without JV partner Ericsson. The early signs – a £19 million advertising campaign – looked good. But any initial excitement has since died away. Promotion on the back of the latest James Bond movie, in which Daniel Craig uses an Xperia T, is expected to have boosted trade – although no figures have emerged to back this up as yet.
HTC has again continued to release a range of impressive devices, namely the One S and X, but again is failing to attract anything near the same attention as the market leaders – a position it once had at its mercy. The firm is now making attempts to stamp its mark with Windows Phone.
And what about Motorola? Remember them? In May, when the firm (Motorola Mobility) was acquired by Google for £7.9 billion, there was a feeling it could again become a key player in the mobile space. But this simply hasn’t happened. The only news of note from the firm has been bad – with recent headlines reporting £150 million quarterly losses and 4,000 job cuts. Motorola handsets barely get a mention in the market today in either the consumer or business sectors. It’s difficult to see where it can position itself.
The same goes for LG, which has been virtually anonymous in 2012. The excitement around 3D in 2011 appears to have fallen completely flat, in the UK at least. Back in 2011, LG was pumped for the challenge of re-establishing itself, having sat back too long and provided little more than fighting talk. But this confidence is not reflected in its sales figures, particularly in B2B. Speaking to those in the channel, little is expected of it, or Motorola, in 2013.
Speaking of fighting talk, new Chinese entrants Huawei and ZTE have arguably failed to create the level of impact we were led to believe they would.
In truth, we have seen little to back up Huawei’s claim that it will be a top-three manufacturer by 2015, despite some impressive device releases this year.
However, both companies remain works in progress. ZTE seems focused on the low-end market, having recently launched the sub-£50 KIS device with Virgin. Huawei, on the other hand, seems to be positioning itself in the mid-high end with devices such as the P1 and Honour.
While ZTE has gone silent on its plans, Huawei has shown it wants to make its mark by pledging an investment of £1.2 billion in its UK business, creating 700 jobs.
Perhaps the biggest news from 2012 came from the distribution channel, which has been, and continues to be, dominated by acquisitions by IT firms.
BrightPoint started the year on song – completing a substantial rebrand and with plans to boost sales in new markets. So it was a complete surprise that by July, the firm had agreed to be sold to IT giant Ingram Micro for $840 million (£522 million).
But before the dust had settled on that particular deal, Tech Data – now Tech Data Mobile – announced it had bought out Brightstar’s 50 per cent share in Brightstar Europe for £106.4 million. Brightstar is, however, looking for a quick return into Europe and continues to thrash out a deal to buy out 20:20 Mobile.
The deals clearly illustrated the importance of mobile within the IT sector – as well as illustrating the sheer buying power they possess compared to mobile.
Micro-P will look to continue its own success in the mobile space in 2013, having become an established player in the market with an ever-increasing handset and accessories portfolio.
There have been some casualties too, with Shebang in particular fading badly in 2012. Last year, boss Iain Humphrey restructured the business into six areas to provide greater clarity over its offerings. However, the plan fell apart and a number of industry names such as MDs Tanny Jeffrey, Julian Burton and Jolyon Bennett have all since left the firm.
The company has downsized considerably – selling its Go Mobile retail estate of more than 100 stores to A1 Comms, and speculation remains over its accessories business.
Staff numbers have fallen from 200 at their peak to 32, and the firm has since relocated to smaller premises to concentrate on its MVNO, Go Mobile 4 Everyone.
The high street has seen some significant changes this year – almost all of them relating to the same operator.
Back in February, 31 Orange and T-Mobile stores were closed to make way for the new Everything Everywhere brand. Eight months later, Everything Everywhere became EE and all 700 plus stores in the country have since been rebranded to EE following the launch of its, and the UK’s first 4G network.
Arguably the biggest news story about the operator will emerge in 2013 as it is unlikely EE will retain its present store and staff count – particularly as many EE stores are within spitting distance of one another.
And store consolidation is likely to be a theme for other operators. In August, Vodafone Group CEO Vittorio Colao said he expected the operator’s store numbers to fall in the next three years, focusing on stores offering service rather than purely sales.
O2 made 82 of its stores available to franchise partners. Once completed, around 200 of O2’s 400 plus retail estate will be franchise-run.
In contrast, Carphone Warehouse and Phones 4U claim they have no intention of reducing store numbers – with the latter taking its tally to 650 this year, now just 150 behind its rival.
In our 2012 predictions piece, many contributors suggested consolidation and acquisitions would dominate the news this year. They weren’t wrong.
Rumours reach us almost every day that X is looking to buy Y – and as the year has gone on, more deals have been completed.
Perhaps the most significant acquisition of 2012 was by newly-formed PMGC Technology, which purchased both Phonebox Communications and Premier Mobile, inheriting 54,000 connections in the process.
Premier Telecom, Evolve Telecom and Olive Communications have also hit the headlines by buying companies and their bases.
The need for dealers to include convergence within their sales has become key – and not everyone wants to hang around.
This has fuelled sales, with dealers seeking either to expand or simply exit.
In October, it was revealed that O2’s biggest dealers, its Centre of Excellence and Approved partners, could face increased targets and an eight per cent reduction in ongoing revenues from 2013 to encourage sales of IT and fixed-line products.
Vodafone is expected to do something similar, meaning 2013 could be a pivotal moment for many.
That said, the opportunities for those wishing to adapt and embrace new opportunities are expected to be vast in the New Year.
O2 has spoken at length of its plans to push IT and fixed line, hinting that many new propositions will be available from the New Year.
Vodafone, by comparison, has remained less vocal. But having acquired Cable & Wireless earlier this year, expectations are high.
2013 is certainly lining up to be an interesting year.