Editor’s Note: Welcome to our weekly feature, Analyst Angle. We’ve collected a group of the industry’s leading analysts to give their outlook on the hot topics in the wireless industry. In the coming weeks look for columns from Current Analysis’ Peter Jarich, IDC’s Shiv K. Bakhshi, Ph.D., and Enderle Group’s Rob Enderle.
After the CTIA Wireless 2008 show there can be no question that AT&T, the largest carrier in the U.S., is also leading the industry in the embrace of multi-touch technology. Nearly a year after becoming the exclusive service provider for the iPhone, AT&T announced that it would soon become the first operator — if not the first retailer — to equip its retail stores with tables featuring Microsoft’s multi-touch Surface technology.
The table-sized, next-generation kiosk that Surface uses could never be mistaken for Apple’s svelte pocket-friendly device; however, Surface promises to deliver the same kind of fluid delight to the phone-buying experience that the iPhone has brought to the phone-using experience.
A surprise show-stealer unveiled at last year’s “D: All Things Digital” event, Surface uses a combination of video projection and infrared camera technology to create a screen that can not only respond to multi-touch gestures, but which can also react to real-world objects using low-tech printed-dot patterns or high-tech RFID tags or Bluetooth. According to NPD’s Mobile Phone Track consumer survey, 79% of handsets sold in February 2008 included Bluetooth technology.
AT&T’s endorsement of Surface came after its rival, T-Mobile, had already come out in support of the technology. Both GSM carriers see Surface’s potential for enhancing the retail experience. According to NPD Mobile Phone Track data, handset sales at AT&T-branded retail stores comprised 13% of all mobile-phone sales in the U.S. in February 2008. In contrast, AT&T’s online sales comprised only 4% of that total.
At CTIA, AT&T demonstrated how the company plans to exploit Surface’s host of user-friendly capabilities. For example, a coverage map can be zoomed from a national level to street level by spreading one’s hands apart on the screen, as if flattening the wrinkles in a bed sheet. Placing a mobile handset on the table’s surface brings up a series of information cards, which explain key features and suggest possible accessories. Placing one handset beside another on the table allows Surface to call up side-by-side feature comparison columns.
However, many of these slick tricks merely mirror what can be done with physical assets. AT&T could take better advantage of video clips in the interface to demonstrate usage scenarios or for customer testimonials.
Advantages to carriers
Surface’s real-world product interface capabilities are a good fit for the cellular market where carriers have a limited number of small devices with increasingly long lists of capabilities. Surface helps expose and explain advanced functionality that can be buried at the bottom of a feature list, helping operator-owned stores compete more effectively against big box retailers in selling premium handsets. NPD Mobile Phone Track also estimates that the average price of a handset sold at electronic specialty retailers in February 2008 was $135 versus $98 at carrier-owned retail outlets. Surface technology can also help operators promote higher-margin accessories.
Finally, at least in the short term, Surface provides enough novelty value to draw consumers into a carrier store in the first place — a feature not to be taken lightly in today’s hyper-competitive retail world.
Other kiosk solutions might not be as engaging or interactive as Surface, but they could also guide consumers through detailed coverage maps and handset comparisons using on-screen graphics, instead of actual handset models. Indeed, online phone retailers could answer Surface using Flash or a similar multimedia Web technology, which would not require deployment on expensive hardware across thousands of retail outlets.
Yet despite its shortcomings and the threat of lower-cost approaches, Surface will raise the bar in providing an interactive repository for detailed handset and plan information. It will allow AT&T to free up resources for an overall experience that can balance multi-touch with a higher touch.
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