A review of the Australian mobile landscape with a look to some European stats as a clue as to what might be happening next. Also, some predications for the future of mobile - 2010 and beyond.

1. AIMIA Digital Summit 2009 The Rise of Mobile An overview of 2009, beyond the hype and some thoughts on the future

2. 2009 – key learnings Mobile internet -> mobile apps The iPhone provides new business And a new business model Mobile advertising – muted promise GFC retreat to conservatism Advertising fears the loss of its audience To varied and diverse devices Entertainment fear the loss of its funding And looks to some new models

3. Where are we now? 24.5m mobile handsets (113% penetration)* 3G handsets – est 12m** or almost 50% Double that of a year ago The iPhone phenomena 35m sold globally, about 1.8% all handsets, Blackberry about 2% Nokia, Sony Ericsson and Samsung still lead*** 800,000 in Australia** Another 250,000 iPod Touch devices use mobile products and service Representing about 4.5% of handsets But around 30-35% of all data/apps/access Mobile internet use: almost 10m active monthly users (40%)*** Half of these estimated to be daily * Telsyte research ** Industry best guess *** AMPLI Survey

4. The market is broad Is it worth the bother? 24.6m mobiles 12m 3G handsets 20% 2G are smartphones 4.5% iPhone/iTouch Addressable market: 15.5m

5. Different Services Different Demographics Younger: create ringtones, use social networking, listen to music (web 2.0 type services). Mobile internet services (browsing, apps and e-mail) skew 65-70% male. Mobile content (games and ringtones) more even gender split MobiLens Data: Three month average ending March 09 across EU5 (UK, DE, FR, ES + IT) - N= 70,964

6. Too many devices (1491 EU) Top 6 devices represent 12.3% of mobile media users, top 20 devices – 26.1%. Apple starting to challenge Nokia’s long dominance however still represent just 5% of mobile media users vs Nokia’s 36%. Sony Ericsson represent 17% of media users. Samsung also represent 17% of media users. MobiLens Data: Three month average ending March 09 Country: EU5 (UK, DE, FR, ES + IT) - N= 70,964

7. Top Apps (Comscore EU study) 62.6% of iPhone 3G users have used an app in a month and momentum is growing. 6 months ago 51% of iPhone owners used an app for news and info. In comparison 21% of Nokia N95 and 37% of Blackberry Storm use an app. Product: MobiLens Data: Three month average ending March 09 EU5 (UK, DE, FR, ES + IT) - N= 70,964

8. Internet = Information Snacking Local information also prominent, e.g. maps, movie listings, business directories, traffic , etc Transactional services starting to emerge – e.g. Auction Sites The combination of local services and transactions will bring about new business models. Product: MobiLens Data: Three month average ending March 09 EU5 (UK, DE, FR, ES + IT) - N= 70,964

9. Top Information Services (Aus) 48% of respondents used an information service of some sort - up 30% on a year ago Most services used at least once a month, with news and weather most frequent use Expectation of future use is high, with 30% growth expected next year also Source: Australia Mobile Phone Lifestyle Index Survey (AIMIA) 2009

10. Hype or future gazing? Mobile advertising will take off But is still likely to be 18 – 24 months away The PC internet indicates (but mobile will grow faster) Mobile is unlikely to be the preferred screen in Australia But it will be increasingly used as the ‘now’ or first device We will move internet habits to the mobile Large, touch screen devices Targeting will make services (and advertising) more relevant to us And this will make it more useful Advertising models from the Internet will not necessarily translate to mobile We need to start looking forward and not backwards

11. IAB Mobile Ad 2008 - £28.6 million 50% from search, 50% from display (banners and text links, tenancy, pre / post roll, etc) Comparisons can be made with the first PC internet ad spend data from 1998: In 1998 there was an average of 7.3 million PC internet users and ad spend was £19.4m In 2008 there was an average of 9.5 million mobile internet users * and ad spend £28.6m The mobile internet has slightly more ad revenue per user than the PC internet 10 years ago Source: IAB Mobile Ad Spend Study 2008/Product: MobiLens Data: Ending Dec 2008 (UK) * Mobile Internet Users defined as those who browse or use an application for news, info or social networks.

12. The future in mobile We talk about internet on a small screen…. But there’s much more to this Mobile offers : The first personal mass media channel Always with us, always on Location awareness Built in payment channel Creative tool for UGC (video, text & image) Near-perfect audience data Able to capture the social context of media Proactive communication tool Based upon Tomi Ahonen – Mobile as the 7th Mass Media

13. Starting to look forward The (PC) internet took off with the advent of broadband and decent speeds 3G is showing us the same thing Operators without decent data plans are hurting themselves and the market Users without decent data plans have lower satisfaction scores and 40% plan on churning Mobile usage and services are growing There is no cannibalisation (yet) – just growth And a hunger for more and better services Apps are showing us that mobile is more than internet A new device with new opportunities

14. Key reasons to be mobile Most ubiquitous device (ever) Responded to very quickly (96% SMS read in <20 mins) On 24 x 7, nearby and accessed often Communication, content and utility Response to mobile advertising incredible: 3% - 7% response rate 10% - 20% conversation rate 6 times the ROI on mobile compared to other forms We talk about ‘conversation’ – this needs to happen seamless and consistently across all devices

15. When considering mobile services Don’t restrict the content Just manage the navigation and presentation Think of your consumer first What will they be doing? Where? Moving? Tailor your sites for your audience Don’t develop just iPhone But question is you should bother with WAP Your consumers are cross-platform (online and mobile) Allow a single log in for consistent experience Personalise, tailor, make unique, deliver Remember your customers and show you remember Learn from what they do to become more relevant

16. Key things: (0,1,2,3) Zero changes to user behaviour (don’t make them act differently for you) One login (remember who they are, regardless of device) Two second respond time Make it simple, make it clean, make it fast Three clicks away (maximum) You’ll lose 10% of users for each added level

17. What will 2010 hold? Mobile advertising will grow Advertisers will look for new engagement Augmented reality will become more common Great for travel, listings and events iPhone will come under greater competition New mobile operating systems (PalmOS, Android) Handset manufacturers (Nokia, Sony Ericsson) More apps and apps stores, for more devices Linked cross-media solutions (internet & mobile) Based on better subscriber/consumer engagement Subscription content? Better mobile TV?

18. Mobile plotting (AR)

19. 2010 and beyond mCommerce will become more common (2011) Screens will get larger (tablet) and smaller (wearable) (2012) Android will become the dominant mobile ecosystem (2012) RFID chips will enable micropayments via mobile (2013) Gestural interfaces will start to penetrate the home market (2013) Mobiles will become smart devices for machine-to-machine communication (2014) We will keep information in the cloud and pull it down to the devices we use when we need it (2014) Optical recognition will be standard, recognising locations and people (2015) Security will become an issue (2015)

20. The mobile future http://www.youtube.com/watch?v=FScddkTMlTc

21. Mobile brave enough for the new world? Jennifer Wilson jennifer@theprojectfactory.com 0414 59 58 57 JenWilsonSydney