Mobile industry treads water in Barcelona as innovation slows

Network vendors enthusiastic for 5G even as use cases remain unclear

“Meet the new phones, same as the old phones” (with apologies to Pete Townsend for the paraphrasing) is a refrain that comes to mind at this year’s Mobile World Congress in Barcelona, with much of the telecoms industry seemingly stuck in a holding pattern.

The show’s standout flagship phone launches, Samsung’s Galaxy S9 and S9+, bear more than a passing resemblance to their immediate predecessors from last year. The other device that has really got people talking is the retro refit of a 20-year old phone, the Nokia 8810, unveiled by the brand’s new owners HMD Global.

The above generalisation of course doesn’t tell the whole story; the Galaxy S9 range has a few significant upgrades from last year, not least in the camera department, while the 8810’s exercise in nostalgia (now available in banana yellow!) was accompanied by four all-new Nokia smartphones.

Yet it’s hard to escape the conclusion that manufacturers are struggling a little in the innovation department this year; LG’s sole offering in Barcelona was the awkwardly named V30S ThinQ, a minor update on last year’s V30. Sony’s new Xperia XZ2 and XZ Compact are fine but hardly earthshattering; Huawei meanwhile gave us a new laptop and some tablets, keeping fans waiting for the launch of its new P20 smartphone until next month.

The slowdown in innovation has hardly gone unnoticed by customers. Industry analysts Gartner last week said that global smartphone sales fell for the first time ever last quarter, with users waiting longer to upgrade their devices as newer updates fail to impress.

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Mobile operators meanwhile are bracing themselves for the next big thing in the form of 5G, the new network technology that promises (on paper at least) downloads up to 50 times faster than the fastest 4G networks. Infrastructure providers such as Ericsson and Huawei have been particularly bullish about the technology’s prospects in Barcelona this week, and are eyeing mass rollouts internationally from later this year.

Venders may be gung-ho about their new kit, but operators are still unsure about how they’ll make money from it. As du CEO Osman Sultan pointed out earlier this month, consumers have grown accustomed to fast, always-on data on their phones, meaning operators will need to get creative to generate a return on investment from the new technology.

The Internet of Things, the rapid and seemless interconnection of devices embedded in everyday objects, is seen as the operators' best hope, enabling smart city projects, increasingly automated industrial processes and increasingly smart transportation. It all looks good in the many slick corporate videos playing on the exhibition stands; whether such applications will generate significant revenues for operators however remains to be seen.

The industry will surely find its innovating mojo once again in due course; the fast mobile internet promised by 3G technology in the late 90s took several years to be effectively monetised by operators, only really taking off thanks to the combination of Facebook and the iPhone around 2008. Smartphone manufacturers, meanwhile, are no doubt working on that next killer feature that will have us begging to upgrade our phones before we strictly need to.

In the meantime though, a tweak here and a minor upgrade there is the name of the game for the mobile industry in Barcelona.

But hey, while we wait, there’s always a banana-hued retro phone to make us smile.

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