1. ¹ESADE Business School, Ramon Llull University, Barcelona, Spain
2. ²Harvard Business School, Massachusetts, USA
3. ³Copenhagen Business School, Frederiksberg, Denmark

Correspondence: JD Wareham, ESADE Business School, Ramon Llull University, Barcelona, Spain. Tel: +34 932 806 162; Fax: +34 932 048105; E-mail: jonathan.wareham@esade.edu

Abstract

This paper highlights the over-arching themes salient in the rapidly converging mobile computing industry. Increasingly, the developers of mobile devices and services are looking toward exploratory, non-determinist or, user-driven development methodologies in an effort to cultivate products that consumers will consistently pay for. These include Design Thinking, Living Labs, and other forms of ethnography that embrace serendipity, playfulness, error, and other human responses that have previously rested outside the orthodoxy of technology design. Secondly, the mobile device is likely the world's foremost social computer. Mobile vendors seeking to foster the production, propagation, and consumption of content on mobile devices are increasingly viewing the challenge as a complex social phenomenon, not a merely a well-defined technology problem. Research illustrating these themes is presented.

The mobile computing industry, more than most, suffers a constant obsession with the future. Commoditization, market saturation, and technology and service convergence render the mobile communications business one of the most volatile and precarious in terms of cycle time, customer churn, and obsolete investments. At the core of the industry's preoccupation with prospective market trends is the question of what technologies and services users will demand in the future – a question that has proven to be notoriously difficult to answer.

By our choice of a title for our introduction to this special issue, we intend to highlight that the industry is creative, convergent, and social. This is well known; the industry has thus far been economically rich, and opportunity and economic yield always foster creative competition. We also know that the devices are converging. Functionality that was once offered on a variety of different devices is now available on a single mobile device, which has effectively become a small computer with constrained input and output channels. Perhaps, less obvious is the upstream convergence that has, to some extent, been driven by the downstream convergence of devices. We can see this in the inclinations and activities of many handset manufacturers, operators, content providers, and even traditional retailers and financial institutions. As everyone vies for customer attention (obsessing, e.g., about smart services, as opposed to dumb pipes or commoditized handsets etc.), the boundaries that traditionally defined the industry's sectors are blurring, converging, disrupting, and creating.

Finally – what is also well known, but worth reemphasizing as its full implications have likely not yet been fully appreciated – the emerging mobile device is likely the world's first and foremost social computer. The network externalities of telecommunication predict this, but the creative and convergent evolution in the industry has only begun to leverage the social character of mobile services. By compressing temporal and spatial boundaries of creation and consumption, content on mobile devices is generated, consumed, and propagated in the 'here-and-now.' The 'what am I doing' feature of social websites takes a new dimension when moved to a highly portable device that can quickly change location and social surroundings. By shedding the anchor of physical context, the mobile device creates a possibility of continuous interaction at a frequency not otherwise possible, involving exchange of both explicit and tacit information. Such interaction offers more frequent and richer 'iterations,' however trivial or momentous, in any activity in which we engage, leading – potentially – to unexpected and transformative social possibilities and innovative outcomes (Austin and Bradley, 2005).

In a prescient paper entitled 'The Computer as a Communication Device,' (1968), two Internet pioneers, J.C.R. Licklider and Robert W. Taylor, anticipated a reality that is only now emerging. 'We want to emphasize ... ' they wrote fully 40 years ago, 'the increasing significance of the jointly constructive, the mutually reinforcing aspect of communication – the part that transcends 'now we both know a fact that only one of us knew before.' When minds interact, new ideas emerge. We want to talk about the creative aspect of communication.' Some have suggested that jointly constructive possibilities enabled digitally, especially by highly interactive mobile technologies, might be changing the way we think and learn – perhaps even altering neural 'wiring' – leading to important differences between 'digital natives,' who have never known a world without mobile, interactive technologies, and 'digital immigrants,' who adapt to the advances only haltingly, like an adult learning the language in a new country (Prensky, 2001). Indeed, it can sometimes be difficult for digital immigrants to see any constructive significance amid the torrent of downloading, friending, 'Twittering,' and vlogging; some criticize these activities as narcissistic (Demarco, 2007), and others have asked whether such technologies are 'making us stupid' (Carr, 2008; see Mason, 2008, for a debate on these issues).

The contents of this special issue leave little doubt, however, about the business significance of mobile digitization. The mobile industry has reacted to convergence, commoditization, competition, and social possibilities with a number of creative responses. The papers in this issue illuminate a ferment of creative experimentation with empirical and theoretical evidence. Collectively, the work of these authors suggests that social dimensions emerge as key determinants of the creation, consumption, and diffusion of mobile computing content and technology platforms, as the industry converges into a ubiquitous ecosystem.

The first thing to notice about the current state of the mobile industry is that it is becoming increasingly commoditized. It is growing difficult to sustain competitive edge on handset differentiation alone. Mobile phones, like toasters and microwave ovens, are all now stylishly designed and contain similar chipsets and functionality. Although it would be wrong to suggest that consumers see all handsets as equally attractive – aesthetic qualities will surely continue to matter for such personal and visible devices, just as they do for, say, wrist watches – the large handset manufactures anticipate difficulty relying on high-margin luxury production models. As an alternative, they turn toward the idea that services can help differentiate their offerings. Recent movements in related industries to define a revitalized science of services (IBM, 2008) have emphasized that interaction with the physical device is to a large extent governed or defined by the service or application layer that resides on top of the physical artifact (Spohrer et al., 2007). The appeal of a device depends, therefore, on the way in which it integrates into a larger system of services (Austin and Beyersdorfer, 2007); the locus of competition, whether through functionality or aesthetics, thus moves to a more diffuse realm where appeal depends on nuances of interaction between service components. The industry's perceptive but imperfect comprehension of this shift has led to a sometimes comic frenzy, a quest for the next perfect service or killer application that can be successfully monetized – a service or application users will actually pay for.

To seek the next blockbuster application, the industry has adopted a number of novel methods, noteworthy and often counterintuitive. A migration toward alternative methods of product development has been motivated by several factors. First, many of the most successful applications in the industry have been 'accidental'; that is, applications that have evolved from a user base in a manner totally unforeseen by the original designers of the technology or application. They share this property with a long line of historically significant innovations, from penicillin to corn flakes (Austin et al., 2008); it has long been observed that important innovations tend to contain an accidental component (see, e.g., Mach, 1896). SMS messaging is the most obvious and well-known example of a mobile application with these kind of emergent properties. None of the developers of the SMS messaging protocols ever predicted that SMS texting would be adopted so widely or that it would create what is effectively a new form of communication. But this is exactly what happened – and the fact has humbled the deterministic/engineering dominant paradigm of product development and design. The Internet, as a collective entity, is another clear example of a technology that has escaped the control of the engineers and product designers.

As a consequence, the mobile industry has turned to semi-deterministic, open, or emergent design paradigms that emphasize the role of the user experience in the discovery and development process. The techniques are reminiscent of similar movements in open source (Raymond, 2001), open innovation (Chesbrough, 2006, Chesbrough et al., 2006) and user-lead innovation (von Hippel, 2005), and highlight the serendipitous nature of user-lead discovery (e.g. tools, methods, platforms, communities) in helping to define future applications.

One example of this type of methodological ethos is the Living Labs phenomenon (Almirall and Wareham, 2008). In contrast to a regular laboratory that performs tightly controlled experiments, Living Labs are oriented to quasi-experimentation, exploration, and discovery, with a large number of real users and a variety of prototypes in specific contexts. Ethnographic techniques are employed to observe what users actually do with the technology, irrespective of its design purpose, and try to flush out original uses or applications that might eventually be commercialized. The Living Lab, as an innovation intermediary, is relatively unique, in that it provides participant companies the possibility of exploring, juxtaposing, and combining myriad solutions from an increasingly large number of possibilities (Chesbrough et al., 2006); it is a unique combination of traditional product testing and validation, combined with semi-structured exercises of emergent, user-driven discovery and innovation.

Other examples of this can be seen in Nokia's use of anthropologists to conduct ethnographic studies in markets that are geographically or culturally distant from home (Lakshman, 2007). Ethnographic field research in Uganda has provided insights into mobile use that would likely never be considered in the western world. Limited incomes require that cell phones be shared, often by many people in a family or village. This means that phones need to be redesigned to facilitate the easy switching between multiple user accounts on the same handset and chip. In addition, handsets need to be designed to function in areas without a stable source of electricity (Anonymous, 2007).

A focus on user experience is also prominent in Design Thinking (Rowe, 1987; Brown, 2008). Design Thinking arose from the industrial design community, from its history of studying how people interact with physical artifacts. Design Thinking is evident everywhere in the economy, in automobile manufacturing, kitchen appliances, and mobile devices (Postrel, 2003). Design thinking uses both high and low tech tools to understand the user experience as they interact with a potential design or service. It is concerned less with how to build something than with how the user feels while consuming a product or service. In this sense, it is more based in psychology than engineering. If basic human emotions can be understood, then techniques of ideation, exploration, and creation can be employed to generate alternative solutions that shatter previous paradigms and generate insights that might lead to a future successful product or service. Quite logically, the field of design has discovered that emphasis on the user experience can be extended past physical products, to improve services that combine interactions, physical and emotional stimuli, and engagement with material artifacts. The design industry has been quite successful in improving processes within healthcare, hospitality, education, and other experience-based sectors, including mobile services. If the service layer governs and differentiates the user interaction with an otherwise commoditized device, Design Thinking has been marshaled to explore that next generation of applications that could potentially lead in the industry into its next phase of profitable growth.

The papers in this special issue help us better understand these evolving directions in mobile technology businesses and markets. The issue begins with a paper that maps out and reveals the overall 'shape' of today's mobile industry. Basole's visualization approach includes over 7000 companies with 18,000 relationships between them; it shows the complexity and diversity of device manufacturers, operators, media and gaming companies, billing and service providers, software producers, and other entities converging into a mobile ecosystem. Consistent with the ecosystem metaphor, three important archetypes or roles emerge in the vast network (Iansiti and Levien, 2004; Iyer et al., 2006): (i) the hub (a firm or segment with a disproportionately large number of ties), (ii) the broker (a firm or segment that creates a tie between two sets of firms/segments), and (iii) the bridge (a relationship that is critical to the connectedness of the ecosystem). One remarkable finding emerges from the visualization exercise. There is no clear hub in the mobile ecosystem, which suggests a high level of fragmentation in the industry. This finding resonates with what we have been hearing from numerous application developers and headset manufacturers in industry conferences; the lack of a dominant platform and operating system (OS) standard in the industry complicates their efforts substantially. Transferability and transparency, and even 'application mobility' are obstructed by the degree of heterogeneity prevalent and by the many layers in the mobile industry stacks, whether they originate from the operator, device, operating system, application, or content. This degrades performance for the user, a fact made apparent when users describe their experiences with applications that are well designed, but just too slow to be of substantial utility. Persistent heterogeneity also suggests that claims of 'convergence' might be overstated. While devices are certainly more homogenous in terms of their professed functionality, resistance to common standards is a well-recognized phenomenon in technology markets. If the devices are conceptually more converged (they all profess to offer the same functions), across manufacturers they remain conditioned by the same lock-in, proprietary modifications to standards, and closed platforms that are well familiar to consumers and anti-trust regulators.

The next paper by Maicas, Polo, and Sese looks at another set of determinants of mobile device adoption, personal network effects. Network effects have a distinguished status in the economics and technology literature (Farrell and Saloner, 1985; Katz and Shapiro, 1985). Yet substantially less work has attempted to disaggregate the various components of network effects, from macro-level factors that define social trends, industry standards and cultural norms, and to more personal elements such as community defined patterns and the identification with close networks of friends and colleagues. Indeed, it has only been 10 years since the publication of the seminal piece by Watts and Strogatz (1998) on small world networks, stimulating a stream of research on how smaller, tightly connected communities differ in their structural traits from random networks. Personal elements in network effects are important since most work on network externalities attributes similar value to each user in a network. Substantial evidence contradicts the assumption of similar value attribution, however; many networks exhibit some form of preferential attachment (Barabási and Albert, 1999). In rough terms, when we consider the diffusion of technologies, products or ideas as a process of social contagion, the question of who the signal was received from matters. Evidence that 'friends matter more' appears in numerous contexts, including book retailing via recommendations (Leskovec et al., 2007), online communities (Kleinberg, 2008), or telecommunications (Hill et al., 2006).

The paper by Weidemann, Palka, and Pousttchi expands on the theme of how social networks can be determinative in the use of mobile applications. The authors perform an extensive grounded theory exercise in an effort to formulate a theory of mobile viral marketing. Specifically, the analysis asks, what are the important antecedents to consider when a user receives, opens or uses, and forwards a viral marketing message on a mobile device? They base their findings on in-depth interviews of 57 consumers. Unsurprisingly, recognition of the sender – who a communication comes from – is an important construct in the model. In other words, viral marketing on mobile devices is characterized by the same psychological patterns as traditional word-of-mouth phenomenon. Trust creation, risk reduction, and the perceived credibility of the sender are very important (in part because malicious viruses are common in many mobile applications). Hence, for mobile viral strategies that rely on send-to-a-friend options, much of the logic of small world networks remains valid. This paper, though it arises within a completely different empirical tradition, one aimed at theory building and revision, complements the findings of Maicas, Polo, and Sese. The authors suggest that device and application designers need to think well-beyond functional factors when designing viral mobile services, they need to consider how the consumption and propagation of them will be a fundamentally social process, not merely a technical feature.

The next paper by Bouwman and van de Wijngaert presents an extensive study of the use of mobile technologies in law enforcement. We find this study compelling for a variety of reasons. First, it represents a very detailed study of mobile applications in a sector otherwise underserved in the mobile or even greater body of information systems literature. Law enforcement may not traditionally be considered an information intensive endeavor, but upon closer consideration, their processes and institutions are more similar to, say, hospitals as producers and users of information, than say, factories. Police work in the street or courtroom is a process of collecting information, marshalling evidence, substantiating claims, and considering counter arguments. When these activities are conducted across the spatial dispersion that characterizes much of law enforcement work, mobile technologies are obvious tools that can help increase its effectiveness. Yet how, or even if, police officers actually use mobile technologies when under the pressure of a dangerous moment is a different matter. In addition to providing a fascinating analysis of the determinants of adoption of mobile technologies by police in the field, the paper also offers a novel perspective on what working police actually do, and how mobile technologies can support this. In theoretical terms, the paper courageously and provocatively challenges the Technology Acceptance Model (TAM), and suggests that it has tended to be assessed in relatively sterile contexts. The authors argue that TAM concepts are very general and, that their significance is limited when contextual and task-related factors common in a real working scenario (i.e., law enforcement) are taken into account, which suggests that TAM is a poor candidate to become a universally generalizable theory, at least without substantial refinement.

Our final paper, by Jarvenpaa and Loebbecke, looks at one of the most important sectors for mobile devices, which embodies the convergence of telecommunications, computer technology, and media. Mobile TV is broadly defined as the real-time broadcast of transmissions of content to mobile devices. Service operators and content providers are currently undertaking huge investments in the development of Mobile TV infrastructures. However, this is being done in a shadow of huge uncertainty. Mobile users are notorious for their willingness to experiment with new applications, but after the initial novelty of the experiences fades, they are unwilling to pay for services that go beyond traditional voice and messaging. Hence, initial usage patterns are poor predictors for the likelihood of consumers to integrate the services into daily habits, with continued use, consistent payments, and low churn.

Accordingly, theoretical and empirical research that can explain and predict consumer centric strategies and that can optimize the user experience with Mobile TV are highly relevant for this sector, and, by extension, for other services under development for mobile devices. The authors evaluate the efforts of a leading supplier of mobile services through a framework of consumer benefits experienced in order to offer insight into how suppliers may be able to increase consumer value. The findings suggest three main strategies appropriate for this aim: growing consumers' human capital, reducing demands on consumers, and leveraging synergies. Interestingly, across these categories, a theme emerges that suggests that the consumption of Mobile TV can be a highly social experience. By emphasizing the integration of Mobile TV with existing media infrastructures in the home or across applications, the sharing and evaluation of content, the promotion of user generated content, as well as user interactivity, the analysis also highlights that very social nature of mobile computing. Perhaps there is something inherent of the mobile device that its services should be experienced and created as a social process, rather than a more insular one common in traditional television. Clearly, this theme resonates with the findings of some of other papers presented in this issue as well.

As the mobile computing industry continues its exploration into the future, we can expect that all that is creative, convergent, and social to play an increasingly prominent role in its quest. As both upstream and downstream industries continue to blur boundaries, and mobile computing technologies and services move from gadgetry towards industrial applications in law, medicine, logistics, manufacturing, services, and the public sector, we can expect exciting innovation to continue in this dynamic ecosystem. The only thing that seems certain: that we will be surprised, probably sooner than we think.