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Deloitte identifies the $17 billion dollar mobile market you never heard of
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Deloitte identifies the $17 billion dollar mobile market you never heard of 

Mobile touch commerce

Top on the list of Deloitte’s 2016 Canadian TMT Predictions are changes in the mobile payment space that will revolutionize how people pay for goods and services via the smartphones and tablet devices.

“Last year mobile payments began to go mainstream,” Duncan Stewart, Director of TMT Research at Deloitte in Canada, said today at the release of its 2016 TMT Predictions. “This year we’re seeing a continuation of that trend, whereby it’s getting easier and easier to use your phone to make secure transactions.”

In 2016, he said, people will flock towards companies that offer simpler, faster, and more secure mobile commerce check-out processes

“The days of filling out screen after screen of payment card details and both home and shipping addresses, we predict, are numbered,” according to Stewart.” The check-out process is made much simpler if all you need is your fingerprint to authenticate and authorize payment in just one or two touches.”

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According to Deloitte “mobile touch commerce” will begin its rise this year, with the number of people in Canada using third-party touch-based payment services on their mobile devices increasing by 150 per cent to reach over a million users.

In the middle of 2015, some 29 per cent of Canadians browsed shopping Web sites on a weekly basis. However, only six per cent of those consumers actually made a purchase. The phenomena of “cart abandonment” which plagued traditional online retailers was an issue for mobile retailers as well in 2015.

Mobile touch commerce solves the problem by cutting down the time between browsing and purchasing on a mobile device from minutes to mere seconds.

Mobile games

Mobile game platforms will be another big money maker for companies in 2016. Deloitte predicts that mobile games will generate as much as 37 per cent of sales for software game makers, up from 20 per cent in the previous year.

By comparison, PC-based games will account for 34 per cent of sales while console-based games will make 29 per cent, up just five and six per cent respectively from 2015.

Looking at the number based on revenue per game, by platform, mobile games will still trail PC and console games.

Deloitte predicts $4.8 million per console game (or $145/console games player), $2.9 million per PC game ($50/PC games player) and $40,000 per mobile game ($20 per mobile games player).

Mobile VR

Virtual reality will give rise of a $1 billion global niche and it will be rolling out of the lab and moving to a mobile screen in front of you in 2016. Deloitte estimates that about $700 million of that figure will come from hardware sales including 2.5 million VR headsets and the rest will come from content sales of about 10 million game copies.

Stewart predicts mobile VR will not achieve much traction in 2016 and that initial interest in the technology will gradually fade except perhaps among hardcore gamers.

“Is mobile VR the next big thing?…I think VR is below a niche,” he said. “Yes it’s cool for about the first 30 seconds or 1-1/2 minute but is so is a roller coaster. My feeling is that it will be a bigger market failure than 3D TV glasses.”

Mobile VR technology will show up in high-end smartphones that come with large screens that have a   greater than 400 pixels per inch resolution. Expect VR smartphones to cost upwards of $750.

Mobile ad-blocker

Applications help users prevent mobile advertisements from popping up on their screens will remain but will hardly make a dent on the global mobile ad market.

“Mobile ad-blockers will place less than $100 million of revenue at risk in 2016, or just 0.1 per cent of the total $70 billion global mobile advertising market,” the report said.

Only 0.3 per cent of Canadian mobile device owners will use an ad-blocker this year and just 40 per cent of Canadian mobile devices will come equipped with an ad-blocking feature.

“…the majority of time spent on mobile devices is app-based and ad-blockers only filter out browser-based content. This means that ad-blocking is only applicable to a minority of devices, for a minority amount of time.” Deloitte said.

The $17 billion mobile market you never heard off

Where do old iPhones go? Into the hands of new users, again and again, and again. It’s the same thing for other mobile phones. And this market for used mobile phones will generate no less than $17 billion in 2016, according to Deloitte.

For this year alone, users will sell or trade-in some 120 million used smartphones globally making roughly $17 billion for their owners at an average of $140 per device. That’s a marked increase from 80 million smartphones turning hands in 2015.

Deloitte predicts the market for second-hand, third-hand and even fourth-hand mobile devices will steadily grow and become more organized in the coming years. The firm even foresees the emergence of specialist companies, similar to service providers in the automotive industry that will forecast trade-in values of used phones.

“The value of sold or traded-in smartphones will likely be twice than of wearables and 25 times the value of the VR hardware market,” according to Deloitte. “We expect the practice of selling smartphones could well accelerate through 2020 as both consumers and suppliers embrace the practice of selling or acquiring second-hand smartphones.”

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