SOFTWARE MATTERS: The software that runs smart phones is rising in importance because the hardware in many high-end phones is increasingly similar. The companies with the most popular phone software will determine the shape of the industry.

WINNING, LOSING: This trend has been favoring Google Inc. and posing challenges to Microsoft Corp. and Nokia Corp.

DEVELOPING MARKET: One in six U.S. adults had a smart phone last year. That share is expected to grow rapidly in the next few years.

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