With all the new mobile devices coming out, I thought it would be helpful to provide an overview of the mobile data market. I covered some of this information in a post written about a year ago, but this one contains a lot of new information, as well as diagrams. I believe the market for mobile data devices (smartphones, PDAs, mobile gaming machines, iPods, etc.) is as unstructured as most people think it is. Many new mobile products fail because they are not designed for the real market or because they target imaginary customers who don't actually exist in large numbers. I think a lot of people make two big incorrect assumptions about mobile data: First incorrect assumption: Mobile data is for everyone. Most people believe that, sooner or later, mobile devices such as smartphones will be used by everyone. The idea is that they will now be purchased by early adopters, but as prices fall they will soon be adopted by the entire population. The market should look like this: The highest prices are on the right. Smartphone sales start with early adopters on the right, then when prices drop everyone switches to smartphones and starts using all the features. The only problem with this idea is that there is no evidence to suggest that it is true, at least not in the United States and Europe (where I have done research). In fact, almost all the evidence I've seen so far shows that the market is deeply divided into two groups. In a survey, most people in the United States and Europe say they won't pay anything extra for mobile device features other than voice and texting. They will use these features if you offer them for free, but as soon as you ask them to pay, about 65% of the population abandons. This makes them very unpromising targets for device companies that want to sell value-added devices, for carriers that want to sell advanced services, and for software companies that want to sell mobile data applications. Fortunately, the remaining 35% of the US and European populations are willing to pay extra for mobile data features. So the real market looks like this: The people I labeled as "value-added users" are the mobile data market. But that's just the beginning...Second incorrect assumption: There is a market for smartphones. Most people believe that there is only one market for smartphones and that we will eventually see the emergence of one definitive smartphone that everyone uses.