1.
Innovation Norway ICT Summit 2009
– How to build a sustainable mobile application business.
Inge Andre Sandvik. Co-founder, member of board of directors and strategy
advisor @ Mobile Nordic AS and CEO, Founder of Mobile Gaps AS

2.
Agenda
• First little bit about my background and experience from
mobile app start ups.
• Then, tell you little bit about Mobile Nordic
• Share interesting facts about the market
• My view of key identificators and success factors that I think is
important lesson learned.
• The closing with a short story about “from R&D to
commercialization. “
All this in 30 minutes !

3.
Inge Andre Sandvik
http://www.linkedin.com/in/ingeandresandvik http://twitter.com/ingesandvik
iasandvikk +47 90194949

4.
Who would have thought this?

5.
Mobile CTI – 1881 Mobilsøk – A disruptive innovation success story
• Founded by Inge Andre Sandvik and Rudi
Rørstad. Funded by Telenor Venture/Rune
Rinnan trough Opplysningen 1881.
• Timing: Search by SMS was not user friendly
and have limited innovation possibilities, 3G
and smartphones was emerging.
• Disruptive innovation: Price model and ”See
who is calling”
• Assembling is innovating!
• Awarded Norways best mobile service 2006
• Awarded Nordic and Baltic most innovative
service 2007 by TeliaSonera.
Year 1: EBITDA 4 mill NOK
Year 2: EBITDA +10 mill NOK

6.
Mobile Nordic

7.
Next step - Mobile Nordic – going global.
Vision : “the global interactive phonebook in your
pocket”
The company develops next generation mobile web
2.0 applications to simply the way users interact with
their phonebook , call log and messaging services on
the phone.
Develop pro-active applications with high user
retention and usability. The company philosophy is to
have the technology stay in the background and the
customer value in the front.
We want to help the user being more productive and
effective by adding smart tools that create instant
value on top of the existing services on the phone.

8.
View of the market landscape
First generation phone book Social phone book
Information. Communication
Relations & location
Storing, searching To answering the
Who do you know question on how
indexing and and where they are
displaying static you want to
and what they are communicate with
infomation on the doing.
device. your contacts.
Social phone book is typical functionality that is well known in internet
based applications like social network, IM, and VoIP. This is now more
and more integrated into mobile phone applications. These feature and
functions is often refered to as ”mobile web 2.0”
Inge Andre

9.
The evolution of the phone book
Information Relations & location
Personal info and personal The social graph/map of who knows
content on the device who and where they are
The social phone book
Communication
Exchanging or sharing messages,
status, or voice/video.

10.
Market landscape related to mobile social phonebook and how it is
developing
Information Relations & location
Communication
Future
Inge

11.
Global market perspective for mobile applications

12.
Total market of shipped mobile phones world wide
iPhone
Souce: Strand Consulting

13.
Smartphones Market 2008/2009
 Nokia maintains global lead, although its
performance varies by region
 Touchscreens become the preferred interface,
representing 40% of all shipments
 Apple’s success continues, as the iPhone takes
23% of the North American market
 RIM continues to gain share, succeeding with its
push into the consumer market
 Operating system choices are proliferating,
primarily at Microsoft’s expense

14.
Outlook - Smartphone market 2012 by OS
Vendor /OS Units sold Market share (%) Trend
Nokia 203 mill 39%
Android 76 mill 14.5%
Apple iPhone 71.5 mill 13,7%
Windows Mobile 66.8 mill 12.8%
BlackBerry 65.25 mil 12.5%
Various Linux 28 mill 5.4%
Palm (WebOS) 11 mill 2.1%
Source: Gartner.
Android will gain momentum from the growing OEM
customer base and Mobile Operators that will initiate
demand to ISVs to develop more applications on this
platform.

15.
Apple App Store`s incredible growth path

16.
Mobile Apps spoils faster than fish
2 billion downloads does not mean 2 billion
users are using applications frequently or are
willing to pay.
 Mobile market places need to focus on
applications that are being used and where there is
willingness to pay.
 Top grosser in iPhone App store is apps that are
utilities oriented and very popular and known
games with global brands. (EA)
 Top 20 grosser are local relevant applications.
 Based on user returning and frequency is the
advertisement model suited to be profitable for
less than 5% of the applications in the market!
The data in this report is computed from a sample size of over 2000 live
applications and over 200 million user sessions tracked each month across Apple
(iPhone and iPod Touch), Google Android, Blackberry, JavaME platforms .

17.
Analysis of venture investments in the mobile space
Analysis of venture investments in mobile space
– Tracking worldwide mobile-related VC investments from June 07 to Feb 09
– In total 360 deals, thereof 159 in Mobile Apps and 31 in Mobile Advertising
– Average investment per deal in Mobile Apps USD 8.5m, in Mobile Advertising
USD 10m respectively.
With regard to newly established funds of manufacturers an increased deal
activity can be seen with significant average investments per deal, e.g.
- iFund (in cooperation with KPCB): USD 6.85m (6 deals done to date)
- Blackberry Partners Fund: USD 5.7m (3 deals done to date in mobile apps)
-Android Developer Challenge: USD 187.5k (20 projects funded to date) (Source: BrainsToVentures AG)
Prediction! We will see that new startups will need less money because
development time will go down and distribution speed and ease will go up.
We will see more device and mobile operator funded investments in the
mobile app business area.

18.
Most downloaded applications

19.
Biggest movers and shakers in the mobile app market
• Facebook: 65 million users (Aug 2009)
• Opera Mini: 30+ million users (Aug 2009)
• Skype: 3 million users on iPhone (10%) of all total
iPhone users. (Oct 2009)
• Spotify: No 1. free download i iTunes i UK, Spain,
Sweden, Norway and Finland first week after
launch. No 1. in Android Market. (Oct 09)

20.
Key identificators and success factors
(from my point of view)

21.
Key identificators and success factors
Unique market
Great timing Plans & People &
and technology Scalability
skills & execution planning partners

22.
Unique market and technology knowlegde skills
• Major part of all great innovations is a
bi-product of what it was meant to be
used for.
• Skype did not invent, but assembled
existing technology – its allowed not to
invent to make popular products.
• Spotify founder Daniel Ek came from
P2P – who would have thought than
streaming would be his fortune.
Unique combination of curiosity,
dedication, smartness,
understanding the need of coopetion
and innovation surrogacy.

23.
Key identificators and success factors
Unique market
Great timing Plans & People &
and technology Scalability
skills & execution planning partners

24.
Timing & execution (and luck)
• Have there been any new technology
evolutions or innovations that suddenly
open up new possibilites?
• Have there been major changes in
existing user behaviour or buyer
patterns?
• Have introduction of new technology
made old ideas possible to be
profitable?
• Never give up easy, but know when you
are in a dead end.

25.
Key identificators and success factors
Unique market
Great timing Plans & People &
and technology Scalability
skills & execution planning partners

26.
Plans and planning
• “It's important for entrepreneurs to be
able to both make business plans, and
to be able to cut them up for
something new” Marc Andreessen.
• Plans must sell and be clear on what,
when, who and how much.
• It is not nice, but NEED to have effective
web based collaborative tools to be
effective. (Basecamp, Skype , Google
Apps, etc)
• Everything takes more than twice the
time you think and cost more than you
ever will imagine.

27.
Key identificators and success factors
Unique market
Great timing Plans & People &
and technology Scalability
skills & execution planning partners

28.
People and partners in the right place
• Right people at the rigth time.
• Not to many – the three muscateers. (37
Signals – Getting real)
• People that is able to take full responsibilty
over their area and have core competence
that is needed at that stage.
• People with the ability to deliver and make
you better.
• Enviroment can make all the difference . Make
sure you are in a cluster where there is
culture for innovation and sharing .
“If I have seen farther it is only by standing on the shoulders
of Giants.”
(Isaac Newton)

29.
Key identificators and success factors
Unique market
Great timing Plans & People &
and technology Scalability
skills & execution planning partners

30.
Production scalability
• Anyone can build a service that can get hundreds of
thousands users. Very few can build services that scale
for millions of users.
• Architecture - Are we able to scale our production
without escalating our cost?
• Are we able to scale our product development without
the need to go backwards before forward again.
• Billing – Are we able to scale our business to new
markets and bill our customers efficient?
• Technology – Do we have the technology tools in place
to scale? Code, DB, storage, HW, hosting partners,
developers.

31.
Closing
From R&D to
commercialization

32.
From R&D to commercialization
SMS Preview
Instantly preview incoming SMS messages and see
what is sent and who has sent it when the message
arrives without a single click
One simple idea, one developer and one
product developer and millions of users....
• Idea came from a dinner I had with Nokia.
• Development took 2-3 days.
• One of the most popular app in OVI store.
• SonyEricsson is preloading it on their new
S60 top model – Satio.
• Millions for users will use the application
within less than a year after launch.
• Freemium business model.
• Platform for new product innovations and
new revenue streams.

33.
Thank you!