Ultra-mobile device market set for rapid evolution

Growing market for UMDs to become more complicated as shipments grow

The nascent market for ultra-mobile devices (UMDs)—such as ultra-mobile PCs (UMPCs), netbooks, and mobile Internet devices (MIDs)—is already complex, and will become more complicated as it grows according to a new survey from ABI Research.

Over the next five years, ABI expects  the total revenues earned by vendors in the UMD market to increase from $3.5 billion in 2008 to nearly $27 billion in 2013.”

By the end of 2008, ABI predicts that retail sales will account for only 14% of shipments, and UMDs provided by mobile operators comprising 30% of total shipments with the balance sold directly by manufacturers.

Over five years, however, that distribution mix will change significantly as network operators cease subsidising UMDs so as to boost services revenues. By 2013, ABI expects only a fifth of UMDs to be operator-sourced while retail sales are expected to account for 75% of shipments.

In 2013 more than half of all UMDs will likely be powered by x86 processors with the balance based on ARM processors. Significantly, and increasing the attractiveness of price/performance, ABI predicts that in the next five years Linux will outnumber Windows devices by two to one across all UMDs. This is expected to occur despite the higher return rate for Linux products (compared to Windows products) experienced by netbook vendors today.

Some MIDs will offer cellular voice services, foresees ABI Research principal analyst Philip Solis. “MIDs without cellular voice will be seen by users as ‘companion devices’. They will be used in addition to mobile phones and not necessarily carried at all times. Cellular voice-enabled MIDs, in contrast, will be able to replace phones entirely; they will become the new high-end smartphones.”

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