All Things Digital

The mobile market is heating up to a roiling boil, isn’t it? This morning Nokia (NOK) said it plans to acquire the 52% of mobile software outfit Symbian that it does not already own in a cash deal valued at about $410 million. But rather than roll up the company’s operations into its own, it’s turning them over to the newly formed Symbian Foundation.

A not-for-profit venture, the Symbian Foundation–which includes Motorola (MOT), Samsung, Sony Ericsson (SNE) and LG Electronics (LGERF.PK)–will steward the Symbian OS as a royalty-free open mobile platform. And that’s a pretty big deal, because Symbian is by far the world’s leading smart-phone software platform. It controls a 60% share of the market with 200 million handsets running its software.

Strategically, the formation of the Symbian Foundation and the opening of the Symbian platform is an aggressive pre-emptive strike against Google (GOOG), its Open Handset Alliance and its open-source Android mobile platform. Perfectly timed too, since Android seems to be falling behind schedule. “It offers us an opportunity to innovate faster on a bigger, united, more widely accepted platform,” Kai Oistamo, head of Nokia’s devices business, told Reuters. “It also enables us to deliver new products, we believe, faster to the market. I’m convinced we will sell more products.”

After seven months in beta, the latest iteration of the application that reignited the browser wars is finally here. Firefox 3 debuts today and to mark the occasion, Mozilla, the nonprofit behind the popular open-source Web browser, is rallying users to help it set a Guinness World Record for highest number of software downloads in a single day.

There isn’t yet a Guinness World Record for most software downloaded in a single day, so Mozilla will truly have rewritten the record books if it manages to set one. The group’s hoping for 5 million downloads–not an unreasonable figure, given that Firefox 2 was downloaded 1.6 million times the first day of its release. Indeed, Mozilla’s already well on its way to reaching that goal: 1,721,775 users had already pledged to download the browser upon its release today at 10 a.m. PDT.

What can they expect from Firefox 3? More sophisticated bookmarking, endless customization possibilities, an “awesome bar,” more robust malware protection and a browsing experience that Mozilla claims is seven times speedier than Microsoft’s (MSFT) Internet Explorer. Said Walt Mossberg, “Firefox 3.0 is the best Web browser out there right now” and that it “tops the current versions of both IE and [Apple's (AAPL)] Safari in features, speed and security.”

Clearly, Firefox 3.0 is a force to be reckoned with now more than ever before. As of May, the browser’s worldwide market share was 18.4%, while Internet Explorer’s stood at 73.8% according to Web metrics company Net Applications. Where will it stand after setting that world record?

Turns out the long-playing (LP) record album may not be as much of an anachronism as once thought. As CD sales slip into the mud, and digital music outlets pop up on the Web as quickly as Starbucks stores, vinyl is staging a comeback. According to the Recording Industry Association of America, vinyl LP shipments spiked 36% from 2006 to 2007, to 1.3 million units. CD shipments dropped 17.5% during the same 2006-07 period, to 511 million.

Now, given the vast discrepancy between LP and CD units shipped in the past year, it’s entirely unlikely vinyl will ever claim a significant share of the music market–unless Apple (AAPL), for some reason, develops the iPod Phono. But it may well remain a niche market for some time to come thanks to audiophiles who prefer the LP “experience” and its so-called truer sound.

And so today Best Buy (BBY) is testing vinyl sales at some of its stores, as is retailer Fred Meyer (KR). “It’s not just a nostalgia thing,” said Melinda Merrill, spokeswoman for Fred Meyer. “The response from customers has just been that they like it, they feel like it has a better sound.”

Despite their best efforts, Microsoft, Yahoo and Ask.com just can’t seem to narrow, even slightly, Google’s massive lead in online search.

Google’s (GOOG) share of the U.S. search market increased to 68.29% in May from 67.9% in April and 65.13% a year ago, according to market research firm Hitwise. Meawhile, Yahoo’s (YHOO) share fell to 19.95% from 20.28% a month ago and 20.89% a year ago. Microsoft (MSFT) didn’t fare much better. Market share for its search service fell to 5.89%, from 6.26% in April and 7.61% a year ago.

Clearly, the search wars are over–at least for the time being. If search is a natural monopoly business, then Google would appear to be its presiding monopolist.

Coming as it does after news of Microsoft’s plan to bribe consumers to use its search engine, reports of Google’s (GOOG) continued dominance in search aren’t all that surprising. Google’s share of the U.S. search market in April grew to 61.6%, up from 59.8% in March, comScore announced today. And it grew at the expense of rivals Yahoo (YHOO), Microsoft (MSFT), AOL (TWX) and Ask.com (IACI). Yahoo’s share dropped 0.9 percentage points to 20.4%, Microsoft dropped 0.3 to 9.1%, AOL dropped 0.2 to 4.6% and Ask dropped 0.4 to 4.3%.

A pretty dismal showing for the other four “major” search engines, which apparently bleed and sweat search market share. As noted here last week, the IT industry used to say that IBM (IBM) wasn’t the competition; it was the environment in which you compete. Today the adage seems equally applicable to Google, which dominates the search market just as IBM once dominated the computer industry.

If the old media advertising economy is in the toilet, then its new media counterpart is sitting atop it.

According to figures compiled by the Interactive Advertising Bureau, spending on Internet advertising in 2007 rose to $21.2 billion, up 26% from the prior year. That’s a record high and one that exceeds the $20.9 billion spent on print, radio, outdoor and cable TV.

Unsurprisingly, keyword search, Google’s (GOOG) cash-cow ranch, generated the most revenue and claimed the largest market share–41%. Display advertising followed with 34%, classifieds at 16%.

(Image Credit: Tyler Jordan, eVisibility Insider)

We see little to stop Google from reaching 70% market share eventually; the question, really, comes down to, ‘How long could it take?’ ”

–RBC Capital Markets analyst Jordan Rohan, March 2006

Not long at all, really.

They’re not the competition; they’re the environment in which you compete. The IT industry used to say that about IBM, but today the adage seems equally applicable to Google (GOOG), which dominates the search market just as IBM (IBM) once dominated the computer industry.

According to new metrics from Hitwise, Google’s share of the U.S. Internet search market grew to 67.9%–a 4% increase year-over-year. Google’s growth apparently came at the expense of rivals Yahoo and Microsoft. Though it claimed the second-largest share of the search market, Yahoo (YHOO) slipped to 20.28% from the 20.73% share it held a year ago. Microsoft’s (MSFT) Live Search, ranked third behind Yahoo, fell to 6.26% from 7.77% in that same period.

Seems the two companies’ recent efforts to differentiate their search offerings from Google’s haven’t done much to boost their respective market shares. Nor will they ever if the Google juggernaut continues as it has. As Credit Suisse analyst Heath Terry once noted, search is a natural monopoly business and there’s a decent chance that over time, Google will continue to gain share until it’s claimed most of the market.

And that may happen sooner than we think. Google’s closing in on 70% market share already. “By this time next year,” Silicon Alley Insider’s Henry Blodget writes, “Google’s search business will be larger and more profitable than the most profitable and legendary monopoly in history–Microsoft Windows.”

With its curvier edges, stylish silver trim, half-VGA 480-by-320 pixel screen and improved iTunes compatibility, Research in Motion’s (RIMM) new BlackBerry Bold should be a big hit with IT operations professionals convinced the iPhone isn’t an enterprise-class mobile device but driven to near-aneurysm by discontented employees demanding them.

The device is largely as expected–an iPhonish-looking thing with both GPS and Wi-Fi, 1GB of permanent flash memory, a 2-megapixel camera, full HTML browsing, 3G support on GSM networks with HSDPA access and, of course, the BlackBerry’s one-trick killer app: instant, secure email. That’s a compelling combination for business users and casual ones not easily swayed by the iPhone’s hype juggernaut as well. Indeed, Citigroup analyst Jim Suva says it could boost RIM’s quarterly shipments by 200,000 to 400,000.

But perhaps not without a bit of struggle. The BlackBerry Bold won’t ship until as late as August, which means Apple (AAPL) could beat it to market with the enterprise-friendly 3G iPhone it’s rumored to be uncrating at its Worldwide Developer’s Conference in June. Which has got to worry RIM. After all, the first-generation iPhone had claimed a 28% market share by the fourth quarter of 2007. That’s still less than the BlackBerry, which holds about a 41% market share, but the iPhone hasn’t even been on the market a year.

Was he inebriated? Do you even know anyone who owns a Zune?”

–-Apple CEO Steve Jobs on Microsoft’s claim that the Zune is now a worthy alternative to the iPod.

Despite its feature differentiations and, er, “distinctive” color palette, Microsoft’s (MSFT) Zune has yet to prove itself the iPod killer it was once touted as. Since its launch in November of 2006, the Zune has sold 2 million units. In comparison, Apple (AAPL) in its last quarter sold 10.6 million iPods–quintuple Microsoft’s cumulative sales to date. Zune’s market share in this space during the first quarter: 4%. Apple’s share: 71%.

Clearly, the only thing being killed by Microsoft’s iPod killer are Microsoft’s chances for unseating Apple in a market that would seem–according to relatively flat year-over-year iPod sales–to have peaked without it.

Now here’s something you don’t hear every day: Google is losing search market share to Yahoo in the states. According to a new quarterly study by SEO outfit SearchIgnite, spending by search advertisers on Google (GOOG) slipped to 70.4% (down from 74.5%), while spending on Yahoo (YHOO) grew to 24.2% in March from 19.6% at the end of the fourth quarter. Breaking it down month-by-month, Yahoo saw gains of 79.2% in January, 37.3% in February, and 43.9% in March.

A surprising trend, given the general state of affairs over at Yahoo recently and one that may, may, bode well for the first-quarter results the company is due to report on April 22. In the face of Microsoft’s (MSFT) hostile takeover offer and its claims that Yahoo’s business is on a fast downward spiral, Yahoo CEO Jerry Yang has insisted that the company will meet its first-quarter projections.

That may well be the case, if SearchIgnite’s metrics prove accurate. Said Roger Barnette, president of SearchIgnite, “If these numbers are an accurate reflection of the market, it could lead Yahoo to surpass expectations.”

Meanwhile, spending by search advertisers on MSN declined to 5.4% from 5.9%, quarter over quarter. No wonder Microsoft wants Yahoo so badly.