Why Mobile Aps Are The Future

Moneybox
A blog about business and economics.
April 11 2012 9:03 AM

Within Five Years, All Phones Will Be Smartphones

Jenna Wortham writes that the Instapaper acquisition and the stunning growth of Draw Something maker OMGPop signals a new era for business strategy in which developing a compelling mobile app comes first and developing a Web interface aimed at full-feature PCs coomes second. What she doesn't really do is make clear why this happening—the smartphone market will almost certainly be bigger than the PC market very soon.

He's more circumspect in drawing this conclusion, but I think Horace Dediu's chart makes the case perfectly clear:

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The key point here is to look at how much more rapid cellphone adoption has been than home computer adoption. You can look at the even faster adoption ramp for "smart" phones if you like, but I think it's barely relevant. Allready today you can get free-with-contract smartphones running Windows Phone, iOS, or Android so there's no need for the mainstream consumer to get any kind of nonsmartphone the next time their existing phone breaks or gets lost. And a continued downward trajectory of prices for low-end Android phones is an inevitable feature of the ecosystem, so soon the prepaid market will have ample junky Android smartphones. Meanwhile, even if Apple kills the 3GS rather than continuing to drop its price point (not sure why they would do this) the fact that early adopter types upgrade their phones every one to two years means the world will be flooded with second-hand still-functioning iPhones soon.

The result is that within five years, all phones will be smartphones and basically everyone will have one. Traditional computers, by contrast, haven't yet reached 80 percent penetration and it's not clear that they ever will.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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