Mobile Landscape Challenges
- 1. Mobile Landscape: Challenges Atul Satija VP & MD, Asia-Pacific 9/27/11 1
- 2. We’re a Mobile Ad Network London Seoul Berlin Chicago Paris Shanghai San Francisco New York Mumbai Tokyo Bangalore Nairobi Singapore Johannesburg Sydney • 47 Billion Impressions per month • 314 Million Monthly Unique Users • Mobile Dedicated • 350 Employees • 12,000+ Partners • 165 countries; 15 Offices; 12 Countries
- 5. Mobile dwarfs every medium GLOBALLY 480 mn newspapers 1.0 bn active PCs 1.6 bn TV sets 4.2 bn mobile phones Source: Gartner, IDC, BSN Source: KPCB 2011 9/27/11 5
- 6. Impact of the medium SPEED REACH CAPABILITY Grown faster than print, TV and radio > 70% penetration in India Smartest advertising medium • Most personal • Always on • Most interactive • CPU, Touchscreen, Sensors, GPS, NFC… 9/27/11 6
- 7. 1. Mobile Ecosystem 2. Mobile Advertising 3. The Future 9/27/11 7
- 8. 1. Mobile Ecosystem 2. Mobile Advertising 3. The Future 9/27/11 8
- 9. Challenges in Mobile Ecosystem 1 Connectivity 2 Devices 3 Content/Apps 4 Payments 9/27/11 9
- 10. Challenges in Mobile Ecosystem 1 Connectivity 2 Devices 3 Content/Apps 4 Payments 9/27/11 10
- 11. Many operators, many licenses Source: Telecomtalk.info 9/27/11 11
- 12. Many promises Source: RespecJve Brands. Copyright: Owned by respecJve brands 9/27/11 12
- 13. The reality is Service rollouts have been delayed Coverage is spotty within a circle Can you hear me now? Hello? Data speeds are slow Data plans are still unaffordable 1.10 0.93 0.87 Average 3G speed in Mbps 0.27 0.20 Most data plans are more than Rs. 600 pm Airtel Vodafone Reliance BSNL MTNL Source: CIOL, based on test done in Gurgaon region Source: 3Gsimplified.com 9/27/11 13
- 14. Affordability of data plans in India 1% 3% 10% 15% 42% 43% 59% 60% 76% Russia India Brazil China Italy Germany UK Spain US Prepaid Postpaid Source: AC Nielsen Most Indian consumers cannot afford expensive data plans… 9/27/11 14
- 15. Wide gaps in coverage % of customers covered under 3G license % of 3G market share 100% 100% 100% 90% 77% 67% 65% 60% 49% 48% 10% 3% 3% 6% 4% 3% 0.2% 2% BSNL S Tel MTNL Aircel Idea Airtel Vodafone Reliance Tata Teleservices Source: Telcoma 9/27/11 15
- 16. Challenges in Mobile Ecosystem 1 Connectivity 2 Devices 3 Content/Apps 4 Payments 9/27/11 16
- 17. Factors driving mobile purchase Price is top ranked purchase driver in all countries Source: The Nielsen Company Source: AC Nielsen Purchase Drivers Prepaid/Postpaid among youth is comparable to general population rice was the most common consideration Consumers in India n selecting a mobile phone for young are extremely price sensitive for mobile devices … eople, though that is true among ther age groups, too. Adult s in these 9/27/11 17 ountries rated price the most important onsideration, too. Youth aged 15 to 24 ut price as the first purchase driver, with he exception of Russian youth, 21 percent
- 18. Price of mobile devices in India Price in Rs ‘000 49% of mobile phones in retail <4.5 4.5 -‐ 15 >15 stores cost more than $100 30% 19% 33% 51% 16% 14% 8% 8% 9% 6% 5% 2% 0 -‐ 1 1 -‐ 2 2 -‐ 4.5 4.5 -‐ 7.5 7.5 -‐ 10 10 -‐ 15 15 -‐ 20 20 -‐ 25 25-‐ 40 Price in Rs ‘000 Source: fonearea.com 9/27/11 18
- 19. Smartphone penetration as a % of phones 63% 45% 40% 36% 29% 30% 22% 14% 9% India Sub-‐Sahara South East China Brazil Russia US UK Germany Africa Asia Source: GFK Retail, AC Nielsen India’s smartphone penetration rates are lower than Sub-Sahara Africa 9/27/11 19
- 20. India’s mobile landscape – closer look 9/27/11 20 Source: InMobi Ad Network
- 21. Challenges in Mobile Ecosystem 1 Connectivity 2 Devices 3 Content/Apps 4 Payments 9/27/11 21
- 22. Cost of app development is high OPERATING SYSTEMS DEVICE TYPE UPGRADS Hardware OS 9/27/11 22
- 23. Applications - the problem of many Can the mobile web standardize experience and increase content consumption 9/27/11 23
- 24. Content / app innovation Presence and not innovation is the focus 9/27/11 24
- 25. Challenges in Mobile Ecosystem 1 Connectivity 2 Devices 3 Content/Apps 4 Payments 9/27/11 25
- 26. Remote mobile payments by region Figures in $mn $350,000 Africa & Middle East Rest of APAC Indian Sub ConJnent Far East & China $300,000 Eastern Europe Western Europe South America North America $250,000 $8,149 $6,605 $200,000 $4,845 $150,000 $3,457 $2,359 $100,000 $50,000 $28,297 $54,047 $71,741 $0 $89,333 $108,282 2010 2011 2012 2013 2014 Remote mobile payments includes purchase of virtual & physical goods, and cash & credit transfers Source: Juniper Research 9/27/11 26
- 27. Credit card penetration in India Source: Visa 9/27/11 27
- 28. Direct operator billing • Integration a major challenge – Dominant strategy for non-voice revenue still missing • Only 11% of revenue is non-voice – Integration cycles are very long • It may take months for the most persistent merchants • Low payout for the merchant – Paypal (92%) – Credit card/online (85% - 86%) – Direct operator billing (10% - 40%) • Negative impact on mobile ecosystem – Merchants wary of adoption 9/27/11 28
- 29. 1. Mobile Ecosystem 2. Mobile Advertising 3. The Future 9/27/11 29
- 30. Evolution of mobile phones 2. Screens INTERACT 3. Touchscreen Have grown from 1” Now even feature to 4.3” and beyond phones have them VIEW IMMERSE 1. Horsepower 4. Sensors Commercial PCs broke the Accelerometers 1Ghz barrier in 1999 9/27/11 30
- 31. Evolution of mobile advertising Banner ads Rich media SMS ads Rich media Text News Games & 2 Data 3 MulJmedia Movies Immersive 3D 1 Voice 4 Touchscreen & Sensors Ads Content 9/27/11 Technology 31
- 32. Making mobile advertising work Device Content & Apps AdverJsers Consumers CREATIVE IDEAS PEOPLE TOOLS 9/27/11 32
- 33. Content-Ad Gap Content Advertisement Read Read þ Listen Listen þ View View þ Interact Read & View ý 9/27/11 33
- 34. Platform-Tool Gap Horsepower Screens Tools to create and ideas to exploit the Touchscreen plaiorm capabiliJes Sensors ý 9/27/11 34
- 35. 1. Mobile Ecosystem 2. Mobile Advertising 3. The Future 9/27/11 35
- 36. 1 INDIA: Mobile internet > desktop internet • In terms of users within 12 mths and in usage within 24 months • One of the first countries globally to get there 9/27/11 36
- 37. 2 INDIA: Top 3 largest Android+iOS market globally within 24 months 9/27/11 37
- 38. 3 INDIA: iOS+Android mobile internet usage > all other devices’ usage put together within 24 months • Price points dropping into volume bracket • Higher usage per device 9/27/11 38
- 39. 4 INDIA: First $1B rev company to come from mobile internet, not desktop • Any guesses? 9/27/11 39
- 40. Q&A !