Will Web3 phones be the next iPhone?

Author: s1, Old Yuppie

Recently, I met with a virtual headset manufacturer. The last time we sat down to chat was about four or five years ago, when the concept of VR/AR was still in its early stages in China. Back then, I thought the domestic market wasn't very optimistic. Seeing them again recently, I was quite emotional; the startup that once required passion to enter has now become a large company that everyone is eager to apply to, with a promising future.

Speaking of the development of Web3-related devices, today I want to talk about the Web3 phone. This phone is not virtual; it is something we can actually hold in our hands.

A few days ago, at an event in London, smartphone manufacturer Vertu launched its latest device, Metavertu, a Web3 phone that can run its own blockchain node and turn photos and videos into NFTs with a single click.

Just by browsing the basic configuration of this phone, you can tell that it’s not something ordinary people can casually pick up like a new iPhone; its main target is definitely aimed at the high-end market.

All models feature a ceramic frame and Vertu's signature sapphire glass screen, powered by the Qualcomm SnapDragon 8 Gen 1 CPU, with a 6.67-inch, 2400×1080 AMOLED display, a triple-lens camera, and a 4600mAh battery. The entry-level model comes with a carbon fiber finish, 12GB of RAM, and 512GB of storage, priced at $3,600. The high-end model has 18GB of RAM and 1TB of storage, wrapped in "Himalayan crocodile leather," 18K gold, and diamonds, priced at $41,000.

If we consider CryptoPunks and Azuki as the Burberry and LV of the crypto world, this phone manufacturer definitely aims to position itself as the Hermès Birkin bag.

Gary Chan, CEO of Vertu, said at the phone launch that the problem with Web3 is its complexity, which discourages new users. They want to reshape smartphones to simplify Web3.

Metavertu can switch between Web2 and Web3 modes, essentially providing us with a standard Android operating system. Users can create a wallet with just a few clicks, with the private key protected by the phone's Trusted Execution Environment (TEE), and access a set of decentralized applications (dapps) through an Android-style interface.

Reportedly, these dapps include VOS, which allows the phone to be used as a "validator, light node, and light client" on the Ethereum blockchain. Another app, Vshot, enables users to mint an NFT by clicking on a photo or video. The phone also features Vtalk, an encrypted peer-to-peer instant messaging app that integrates decentralized social networking functions, including the use of DAOs.

In addition, users can access 10TB of distributed storage on IPFS and Vertu's 24/7 concierge service. This service has even been updated to reflect the Web3 world. The phone manufacturer has also set up a dedicated NFT investment team to help users better and quickly understand NFTs, including guiding newcomers through the process of collecting NFTs and providing advice on which upcoming collections are worth grabbing.

The Web3 phone is not the first of its kind. Earlier this year, Solana Labs' subsidiary, Solana Mobile, launched a flagship Android phone called Saga, which features unique functionalities and characteristics closely integrated with the Solana blockchain, making it easy and secure to transact and manage digital assets (such as tokens and NFTs) in Web3.

Saga has a 6.67-inch OLED display, 12GB of RAM, 512GB of storage, and the latest Snapdragon® 8+ Gen 1 mobile platform, with security features that will implement the seed vault of the Solana mobile stack. By adding a secure element to the device, it separates private keys, seed phrases, and secrets from the application layer while still allowing interaction with applications running on the device or mobile browser.

Saga is designed and manufactured by OSOM, a leading Android development company with a team experienced in creating computing hardware for companies like Google, Apple, and Intel. Alongside the launch of the Saga phone, there was also an introduction to the Solana mobile stack, which is a Web3 layer specifically for Solana, built into the phone.

The SMS will include several products, including a seed vault, custodial solutions, Solana payments specifically for Android through DeFi dApps, and a mobile wallet adapter. These features will enable developers to create a new type of mobile experience. Similar to the new iPhone, it is priced at $1,000 and is expected to be available for pre-order in early 2023.

HTC also released the HTC Desire 22 Pro, designed to complement its Vive metaverse and virtual reality platform. This phone is reportedly designed for immersive experiences in a world where the physical, digital, and virtual are interconnected. It is still unclear how many people are actually using the Vive metaverse, but it seems that the Desire 22 is HTC's attempt to bring users into this Ethereum and Polygon-based system.

Becoming Mainstream? Does Web3 Need to Go Mobile?

Just as previous phones and laptops have moved towards mobility, countless teams in the Web3 world firmly believe that mobile will be the future of this industry. As of 2019, more than 2 billion people accessed the internet via smartphones. The World Advertising Research Center (WARC) predicts that by 2025, 72.6% of internet users, or nearly 3.7 billion people, will access the web via smartphones.

Given that a large portion of the world's population relies on mobile phones rather than desktop devices, the potential to bring cryptocurrency to all smartphone users is enormous. In many emerging markets, people find it easier to access mobile phones than computers, and perhaps builders should consider what use cases users in this emerging Web3 market would want.

I believe that the mobilization of Web3 will be a larger trend and is crucial for bringing cryptocurrency into more mainstream markets. In our Web3 era, at least from our personal experience, all information and social networks prioritize mobile user ends.

Web3 was initially an idea proposed by Ethereum founder Vitalik Buterin, describing a world where ordinary people could use decentralized applications without needing to understand how blockchain works. These applications would be super secure, as all data would be encrypted to nodes and use public key cryptography for tamper-proof access control. Web3 also means that users will be able to own and control their identities and data on decentralized networks.

To promote Web3, innovative communication solutions are needed to enable interaction between distributed systems while scaling to billions of devices.

At this point, many friends may wonder, like I do, whether the bear market is the best time to launch such a phone. I believe that building mobile applications to reach a large number of users through this means, while also establishing social experiences on top, makes sense from the perspective of user adoption.

Regarding the Web3 phones introduced today, I must mention a key player: Qualcomm. The presence of Qualcomm in these two phones is one of the pioneers in the mobile field. Looking back, we can see how important the birth of mobile products has been.

When Steve Jobs launched the original iPhone in 2007, he received more ridicule and misunderstanding than recognition. At that time, it was a big deal—a touchscreen iPod that could make calls and had a browser. Soon after, 3G emerged, and then the development of app stores created a revolutionary business model for mobile devices.

The iPhone was a visionary convergence device. Before it, you had a phone, a Palm Pilot for contacts and notes, a Tom Tom for GPS, an iPod or Mpeg music device, and a very large laptop. The iPhone integrated all these elements into a small handheld device, making it both appealing and easy to use.

Today, the iPhone has proven that those who initially looked down on this concept were wrong. Some of the most important mobile technological advancements of the 1990s can be attributed to Qualcomm. Therefore, Qualcomm's role in these new Web3 phones is quite logical.

Analysis

In the phones introduced today, we can see different companies striving to address the issues of Web3 and cryptocurrency. As users, we can easily complete some NFT transactions with just a few clicks, but the technology behind it may become increasingly complex as the market develops in the future. Therefore, I believe that achieving a simple and enjoyable way to share NFTs will have significant economic value. With a mobile-first environment and Web3-first phones, these potential options have the capacity to further flourish. This also applies to other aspects of cryptocurrency and Web3, including security, speed, access, and user experience.

The next rise of Web3 is forming today, and if phones can be successfully launched, they may become an important change in the way Web3 develops and grows. Saga and HTC have early on addressed several key challenges of Web3 in this strategy by emphasizing user experience and building on current mobile experiences.

However, it is still too early to determine whether this is the right approach. Some people are skeptical about the technological development of such products, and I feel they may be right. But if manufacturers succeed, future opportunities and business models may come closer to mass adoption. This raises the question: which Web3 business models will emerge first in the next cycle?