Donovan: 2011 Will Be a Big Year for Mobile

Smartphone adoption shows no sign of stopping its upward climbFor those that have been waiting for mobile to develop intro a truly digital channel, the time has arrived

Verizon iPhone 4
Don Emmert | AFP | Getty Images
Verizon iPhone 4

2010 was a blockbuster year for the mobile industry, with strong growth across every important sector in the US market. Smartphones are now owned by one in four mobile phone subscribers and four of the top five most-purchased devices were in this category.

Half of the mobile phones in people’s hands connect to 3G or 4G networks and the combination of more powerful devices and faster network access has had the expected result: More and more consumers are using these devices to access content and connect with each other in new ways.

Nearly half of the mobile population accessed mobile media at the close of 2010, using the browser on their phone, downloading and using apps, and purchasing content. Looking ahead, there are several key trends that will continue to shape the growth and trajectory of the mobile market.

Mobile Media on the Rise

Just a few years ago, mobile devices were considered only a platform for voice communication as a portable extension of a home phone. In a relatively short period of time though, mobile has evolved into a full-scale media platform with the potential to drive tremendous consumption.

CNBC - Ctia Wireless 2011- The Wireless Connection
CNBC - Ctia Wireless 2011- The Wireless Connection

Consider this: In the past year, mobile browser and application users climbed over 80 million, representing one third of all mobile users. Nearly one in three mobile users access email on their mobile devices, while one in four use social media and one in five access search.

Fueled by smartphones, 3G/4G and unlimited data plan adoption, mobile media growth shows no signs of slowing in 2011 as consumers increasingly reach in their pocket or purse to consume content.

Devices Continue to Get “Smart”

Smartphone adoption shows no sign of stopping its upward climb as more and more Americans join the growing smartphone consumer base. At the end of 2010, 43 percent of new device sales were smartphones and in short order a majority of the new phones purchased by consumers in the US will be in this category.

Phone technologies continue to advance, improving the user experience across devices with such features as HTML5, 4G, improved video/photo systems, GPS-enabled capabilities, and other functions, as manufacturers, carriers and operating systems continually up their game in this rapidly advancing market.

The big growth story of 2010 was the rise of the Android platform which became the most widespread smartphone platform at the beginning of this year.

But as last year’s introduction of the iPad made clear, what’s shaping up is a battle between technology platforms and their related content ecosystem and here Apple continues to have the lead in the US market.

Mobile Advertising Ecosystem Begins to Develop

While still in its infancy, mobile advertising will become an increasingly important component of the mobile landscape in 2011 as the opportunity to reach a growing number of mobile media users provides an attractive environment for advertisers.

There are many layers to mobile advertising, from banner advertising to in-app ads, as well as targeted or location-based services, such as SMS or push notifications. As the ecosystem begins to mature, expect to see more and better quality ads appear on your mobile device throughout 2011.

M-Commerce Takes Shape

Accessing real-time price and product information while in store will be a continuing trend as savvy shoppers turn to their mobile device more frequently during the buying process. As consumers grow increasingly comfortable with their mobile devices, we can expect to see more purchasing occur on mobile devices as brands roll out convenient features such as one-click purchasing and address consumers security concerns.

Although still in its infancy, mobile wallet capabilities (using mobile phones in place of debit or credit cards for in-person purchases), are beginning to come onto the scene. For instance in early 2011, Starbucks announced that customers in thousands of locations can now pay for items with their phones via an application that can be scanned across a reader at check out.

Will this behavior become as popular as it has in places such as Japan where 1 in 10 mobile users make purchases with their mobile wallet? Many retailers are keeping a close eye on the possibilities.

2011 holds much promise for the entire mobile industry and should be an exciting year for brands and consumers alike. For those that have been waiting for mobile to develop into a truly digital channel the time has arrived.

To download a complimentary copy of comScore’s 2010 Mobile Year in Review, click here

Watch CNBC's coverage of the 2011 CTIA Wireless convention on Tuesday, March 22 and Wednesday, March 23 from Orlando, Fla. Technology correspondent Jon Fortt will report live from the convention floor, Jim Cramer will host a special edition of "Mad Money" on Tuesday at 6pm ET, and Michelle Caruso-Cabrera will co-anchor "Power Lunch" from the event on Wednesday at 1pm ET. _________________________
Mark Donovan is Senior Vice President for Mobile at comScore.