US Mobile Innovation Slow to Develop but Here to Stay

Implications: The US was not initially a leader in mobile, but the Internet is the great equalizer that will propel the US to the top of mobile innovation.

Analysis: The US cellular market had several systemic obstacles that inhibited its development vis-à-vis other leading markets, including multiple standards (e.g., GSM / TDMA, CDMA), many regional operators, charging for inbound calls and SMS (i.e., no calling party pays), no significant pre-paid market.  These hurdles kept the US mobile market behind Asia (notably Japan and Korea) and Western Europe in subscriber penetration and mobile data usage, as well as mobile innovation.   

The great equalizer, though, is the Internet.  As traditional Internet applications (e.g. Email, Instant Messaging, Social Networking, Search, Video, etc.) migrate to mobile devices, and mobile-specific applications continue to gain acceptance (e.g., SMS, GPS), combined with the US entrepreneurial environment, the balance of power in mobile will increasingly be influenced by the US Internet leadership.

US mobile momentum is undeniable and only going to increase.  Despite the traditional mobile dominance and past success of non-US companies including Nokia, Sony Ericsson, LG and Samsung, it is hard to bet against US consumer electronics and Internet powers Google, Yahoo!, Apple and Microsoft in mobile.