Conflict and Convergence in the journey from Mobile VAS to Mobile Internet Ecosystem

1. Suresh Jayaraju
MVAS and Mobile Internet
Conflict and convergence

2. 1 Issues in MVas
2 The New framework
3 Operating in the new frame

3. All is well with MVas India?
Source: IAMAI Mobile VAS Report April 2008

4. Issues
VAS Products Development
- Hurry, innovate Revenue Models /
- Product Planning Business Models
- User experience,
- Reporting
- What's my count today
- Incentivisation
- NPD / R&D
- Squeeze

5. Openness!
Most issues in VAS would cease to exist on open platforms like Desktop Internet
Desktop Internet
• Best products win
• Choose products, not providers
• Competition is just a click away
• Entry with few $$’s MVAS not
• Ad’s reward products Open Platform like
desktop Internet

6. 1 Issues in MVas
2 The New framework
3 Operating in the new frame

7. Emergence of a New Framework
1. Proliferation of Mobile Internet
2. Penetration of Smartphone's
3. Development of Browsers
• It’s a start
• No one size fits all
• Address India’s US and Japan First

8. 1. Proliferation of Mobile Internet

9. Proliferation of Mobile Internet worldwide
By the end of 2009…
200 million 240 million
Computer
Browsers Shipped < Mobile
Browsers Shipped
In 2011, Smartphone
search rates are
expected to exceed
PC search rates of
2007
9
Source: IDC, comScore, IAB and Merrill Lynch Estimates, June 2008, Google Estimate

10. Google India Mobile Internet Growth
Numbers Indexed for confidentiality
250
150
100
Q1, 09 Q2, 09 Q3, 09
Active GPRS users estimated to Google Mobile Search Inventory
be 20to 25Mn growing at 60% QoQ /
40% of Desktop Internet users Quadrupling every year

11. The Metro PCS – “The leader in Unlimited”
• 51% YoY growth in its subscriber base - Q1 ’08 – ’09 ; the fastest % growth among all US
operators
• Mobile Internet Offer:1 month of free web-access at sign-up, Flat rate unlimited data
access thereafter (for $5 per month)
• Metro internet traffic grew >2.5x more quickly than another global carrier with 10 times
as many users and a 3G network, Nearly half of Metro’s subscribers use the mobile
Internet

12. Proliferation of Mobile Internet
Mobile Internet traffic, Algeria 2008 Mobile Internet traffic, Iran 2007-08
Happy GPRS 2
(24x7)
Happy
GPRS
(weekends)
Algeria: Internet traffic spiked when Iran: Irancell internet traffic spiked when it
Nedjma offered its subscribers “3MB introduced its “Happy GPRS weekends”
free every Friday” plan-with near-free Internet access
“Globally, half of all new Internet connections in 2009 will come from a
phone” (eMarketer 2008, 2009)
* Note: (1) In all cases, we have used Google internal traffic data as a proxy for overall mobile browser traffic
(2) Mobile subscriber data used in this analysis is from Informa / WCIS reports + individual company investor reports

13. Mobile Data Plans becoming affordable in India
Unlimited Data Plans- 2009
Mo
bile
Da
ta
pla
n pri
ci n
ga
cro
ss
op
era
t or
s
Data plans at Rs.98/- and 95/- Expected downward spiral on data
unlimited browsing is setting the stage prices
for affordability
• Data Plan < 100 = 5X Google Mobile
• 5 New Operators
• 3G dream
• MNP

14. 2. Penetration of Smartphones

15. Global Smartphone penetration
70% In 2011, Smartphone search
26%
5% rates are expected to
20% exceed PC search rates of
2007
0%
11%
46% 53%
• US smart phone use grew 70% to 34 million
• Smartphones account for roughly 20% of sales in N.A., a
dramatic increase over the past year
• 24% of smartphones in the world are in the US

16. iPhone & Android are Game Changers
Over 30 million iPhones sold to date Several million Android Devices sold
Over 50,000 iPhone apps Ranked #2 in mobile web browsing
In 5 short months
Over 1,000,000,000 app downloads
Over 18 Android devices in market
Accounts for 50% of mobile web traffic
in US in 2009

17. India Smartphone penetration
14
12 Samsung Star
Full touch screen, 3G browsing phone
10
Volumes (in M)
Available at sub Rs.10K in India
8
6
No device above 8k doing 1M+ volume
4
2 1 million
0
0 2k 4k 6k 8k k k k k k k k k k k k
10 12 14 16 18 20 22 24 26 28 30
INR (in k)
Volumes of top devices at each price point, over 1 year
* Source: Operator/OEM survey plus data shared by partners

18. 3. Development of Browsers

19. New Age Browsers - The Start of a Platform Transition
Mobile WAP Browsing Full Scale HTML Browsing
• Optimized for mobile • Comparable to PC
• Minimal navigation • Multiple page support
• Quick loading • Zoom in and out
19

20. What’s interesting about new age browsers
Phones now have
Android and iphone • Eyes,
- Webkit platform , HTML5, • Ears,
- Standardization • Skin
- Web apps • Location
- Rich Media experience • Motion sensor
Google
Voice Search

21. 1 Issues in MVas
2 The New framework
3 Operating in the new framework

22. Open Platforms and Products
Product Development
•Global footprint,
•Competition will be a click away
•Common Open Platform
•Certified tested products
Product Marketing
- Try n Buy
- SPAM?
- Product appeal and features

23. Revenue and Business Models
Direct, Indirect Streams
Multiple Streams
- Ad revenue
- Product sale,
- Subscription
- Pay per view/ Pay per use….
Partners in round table
- Device OEMs,
- Platform owners
- Operators
- Developers
- Content providers

24. VAS was Internet Limited !.....
With Mobile Internet MVAS becomes unlimited

25. Thanks