All personal opinions of course, but with some level of confidence based on what I see in the market.
Trends and observations:
* MIDlets will increasingly be integrated into phones and hence shipped with the phones. Mainly games of course, but also messaging, social networking and productivity applications. These applications are typically picked among the top applications already available on the market, hence cutting lead time considerably, providing solutions for the current market and getting very high quality.
* The quality of fully embedded applications, especially when looking at new types of applications, are going down (very expensive to develop and maintain), and the quality of the most popular MIDlets are going up, even further fuelling the above trend.
* Increasingly Java ME is also used for developing new applications for embedded use only. The advantages are: much easier to find developers fluent in Java than a proprietary phone platform, easier to deploy on many different handsets (even with differing platforms), easier to test in the field (could be downloaded to the handsets) etc.
* MIDP3 will replace MIDP2. CDC will not. Reasons: MIDP3 is backwards compatible with MIDP2, which is crucial for the developers and the application market, and MIDP3 is optimized for mainstream phones, which CDC is not. CDC is optimized for smartphones, but almost all smartphones are based on Symbian OS, so why develop for CDC (except in cases corporate applications)? There are currently only 3 phones on the market with CDC. Also, SavaJe is gone.
* Application developers, especially those of games but also applications, will continue to develop for MIDP1 as long as many phones still only have MIDP1. MIDP1 is also sufficient for many productivity and corporate applications. It's likely corporate applications will mainly be developed for MIDP2, as companies tend to use later phones.
* More and more applications are developed using any of the porting/de-fragmentation tools as a base. Sun will not resolve the fragmentation issues, but third-party will.