Mobile Industry Readjusts to Reality

The Mobile World Congress is underway in Barcelona this week and both vendor and service provider executives are having to adjust to the realities of an economic slowdown. Mobility has been an IT industry bright spot.

However, that brightness is dimming, especially outside the United States where large service providers are seeing a drop in demand for mobile services and handsets. Microsoft CEO Steve Ballmer noted in this Reuters dispatch he is "really tring to figure out how to respond to the global economic downturn."

That's not an easy answer, but certainly in the U.S. market it would help if the handset vendors' service provider partners cut their prices and built more reliable networks. (The frequency of dropped calls in the U.S. compared to Asia and European markets is a scandal.)  The service providers may need to act a bit more quickly than they might think. There was another report out of Bacelona that Nokia and Skype were partnering to integrate Skype on high-end Nokia N-series smartphones later this year. That could decrease revenue even more for the mobile carriers. And it makes the need for product innovation even more essential.

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