Info Imaging Explosion

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Analyst house Current Analysis placed a really good by-lined article in Wireless Week as part of the show daily of the recent CTIA event in the US. The article is very US focused but provides a great overall picture of the current coming and goings in the info-imaging space.

Say “Cheese” (Just Don’t Say, “Print”)

By: Brad Akyuz and Avi Greengart Analyst, Mobile Devices; Principal Analyst, Mobile Devices
March 16, 2005

The world’s first mobile phone integrating a digital camera module was commercially introduced less than five years ago. Today, built-in cameras are standard features for all handset segments other than cost-sensitive entry level phones and security-conscious enterprise devices. Once captured, users can share and/or print the photos, opening up a whole new revenue stream for wireless device and service vendors, as well as cross-category players in the printing and imaging arena. Currently, the cameraphone printing business is extremely small, so vendors are trying various strategies to simplify or enhance the user experience: image transfer/print via proprietary Web services, Bluetooth, moblogging tools, IrDA, MMS, PictBridge, and more. Which approaches make the most sense?

Carriers, of course, would prefer that the images move around their networks – generating revenue. Globally, multimedia messaging service (MMS) is the most popular method of transferring photos where users can send a captured photo to another MMS-capable phone or a designated e-mail address. In the U.S., proprietary services have been more popular, particularly as Sprint bundled Web services with its flat-rate multimedia messaging service, PCS Vision. MMS can also be used to transfer captured images to online photo albums (sometimes called moblogs, or “mobile blogs”), giving users the opportunity to share special moments with friends and family (or the whole world). Every major U.S. wireless carrier provides users with a personal moblog to store, share, and print pictures, and in almost every case, these Weblogs are powered by an imaging vendor with printing capabilities.

There are also methods of image transfer that bypass the carrier (and carrier charges) altogether, such as Bluetooth, IrDA, and memory cards. With Bluetooth now found on notebook PCs, HP and Epson offer Bluetooth-enabled printers or add-on kits for select models. Handset and printer vendors are forming alliances such as the Mobile Phone Imaging and Printing consortium, and HP and Epson have developed Bluetooth photo printing applications that allow users of select Symbian-based smart cameraphones to wirelessly print photos from their Bluetooth-enabled printers.

Another transfer option is infrared wireless technology (IrDA). Fuji just recently introduced a new portable photo printer (MF-70) that creates a credit card sized photo from an IrDA-enabled cameraphone in about 20 seconds. Finally, a number of high-end phones feature an external memory slot enabling users to transfer or print images stored on them by removing the card and inserting it into a compatible printer or photo printing kiosk.

There are two major barriers that prevent these methods from serving the majority of cameraphone users —compatibility and carrier restrictions. Of the 73 cameraphones available in the U.S., only 25 have removable memory or support Bluetooth. Worse, only a handful of these Bluetooth-enabled cameraphones are actually capable of directly printing captured photos from a Bluetooth printer. It’s not enough to have Bluetooth, the phone must also have rich Bluetooth profile support. In the case of IrDA, Fuji’s new printer is compatible with only select Nokia, Siemens, and Sony Ericsson phones, and because CDMA phones typically do not have built-in IrDA, the technology is unavailable to half of the U.S. market. The other roadblock is the wireless carrier’s unwillingness to support any method of image transfer that would cut into their data revenues. Verizon Wireless and Sprint PCS both block Bluetooth on their devices from doing much more than enable wireless headsets.

But the poor quality of the images captured by today’s cameraphones neatly solves any argument over the best way to ease image transfer and prin ting: it doesn’t matter. Even if the process is painless and transparent, consumers will avoid printing fuzzy, off-color pictures. Even at 1.3 megapixels, none of the cameraphones on the market are on par with a low-end digital camera when it comes to image quality.

Cost is one factor – vendors are pressured to keep prices down despite adding features, and quality suffers with cheap CMOS sensors. Consumer reliability expectations are a larger element: to ensure the phone still works after being dropped, cameraphone lenses are plastic, and auto focus and optical zoom are omitted. Strobe flashes are left out due to battery concerns, making indoor images dark and murky. Finally, the images are highly compressed to conserve storage and network bandwidth. As such, most cameraphone images look terrible, and they stay right where they originated – on the phone.

However, this is poised to change over the next 12 – 18 months. Device manufacturers have alread y begun to improve the optics embedded in their mobile phones. Sony Ericsson recently launched its first megapixel cameraphone, the S710a, boasting good optics, a CCD sensor, and a camera-first design forcing users to use both hands while capturing photos (partly eliminating user-induced shakiness). Samsung and LG have 3 and 5 MP cameraphones available in Korea, and have announced their intention to bring them to the U.S. market in 2005.

Over the next 12 months we see the market splitting between carrier-centric and device-centric approaches. Moblogs printing services supported by carriers will be the mainstream method given the carrier-centric nature of the U.S. market. These carriers – likely Verizon and Sprint – will use the ease of use offered by proprietary approaches as a way to generate consumer revenue from 3G networks. Branded service providers such as Kodak can profit by enabling the carriers’ back end. However, this will be balanced by device-cen tric alternatives (such as removable memory, Bluetooth, and, increasingly, PictBridge) which will appeal directly to early adopters. These carriers – likely Cingular and T-Mobile – will still insist on handset-resident software that steers consumers to carrier-branded services, but the focus will be on attracting high value subscribers with the more flexible, differentiated devices.