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  • 1. Every morning a gazelle wakes up in Africa thinking he has to run faster than the fastest lion in order to survive. Every morning a lion wakes up in Africa thinking he has to run faster then the slowest gazelle in order to not die of hunger.
  • 2. Money. Money! Money…? Mobile services now and tomorrow Prague, November 7, 2007.
  • 3. 1. Money. Prague, November 7, 2007.
  • 4. Mobile Entertainment Market Worldwide Mobile Entertainment Mobile Entertainment Mobile Entertainment Revenues (mUSD) 2006-2011 • Music • Music 90 000 • Games • Games 80 000 70 000 • Adult content • Adult content 60 000 50 000 • Sport, Leisure, • Sport, Leisure, 40 000 Mobile entertainment Information Information 30 000 • TV and TV related • TV and TV related 20 000 10 000 interactivity interactivity 0 • Gambling • Gambling 2006 2011 Today: • 80% of the mobile entertainment revenues are generated in Europe and Asia Pacific • Worldwide total revenues were USD 17.3 billion in 2006, mostly dominated by music, pictures and information services Future: • Worldwide revenues expected to reach USD 76.9 billion by 2011, with highest growth rates in the USA and developing markets • Mobile TV (USD 15.9 billion in 2011) and Gambling (USD 16.5 billion) are forecasted as the largest revenue generators, even with legislative hurdles in the US Source: Juniper Research, 2006 Prague, November 7, 2007.
  • 5. Mobile UGC Market Worldwide Mobile UGC Revenues (mUSD) 2007-2012 Mobile User Generated Mobile User Generated Content Content 6 000 • Dating, chat • Dating, chat 5 000 Personal 4 000 • Personal content • Personal content content delivery delivery delivery 3 000 Social networking • Community services, • Community services, 2 000 Dating, chat Social networking Social networking 1 000 0 2007 2010 2012 Today: • Most of the user generated content revenues are in the mobile dating, personals and chat services, as PCD and social networking services are quite new on mobiles • Worldwide total revenues estimated for USD 576 million in 2007, 10% of which generated by South Korea, the most developed market Future: • Worldwide revenues expected to reach USD 5.74 billion by 2012 • Almost 50% of which is anticipated to be generated by social networking services, followed by personal content delivery Source: Juniper Research, 2007 Prague, November 7, 2007.
  • 6. Market Drivers and Constraints DRIVERS CONSTRAINTS • Anywhere, anytime accessibility (time efficiency) • Pricing is a perennial issue - in order to allow mass market • New way to access fun and relaxation as well as keep take-off all parties must cooperate to significantly decrease informed prices • Good demographic match with prime users of mobiles – • Network and handset limitations youngsters and young adults • User experience and confidence are key features (both in • Increasing mobile and 3G penetration quality and payment reliablity) to generate returning • Networks and new mobile features also drive product costumers innovation • Digital rights requirements by content owners put • Supply side competition – content owners and limitations in some service and content areas application developers constantly need to improve • Localisation and optimisation – the wide variety of mobiles, services while MNOs are looking to increase data ARPU despite standardization efforts, and the need for localisations still remain a constraint • Complex delivery chain – too many participants need to find a way to work efficiently together for delivering services Among constraints pricing is the key factor. • An example for fast and effective market development is China. With ringtone prices lowered to USD 0.1 the ringtone market will exceed USD 1.7 billion in 2007, three times as mush as in the US (by comparison, legal CD sales were USD 120 million in 2006). They also fight piracy that way, as pirates cannot undercut so cheap prices. Source: Fortune, 2007 Prague, November 7, 2007.
  • 7. Mobile Content Market In Hungary Mobile content services in Hungary in 2006: • Sales through MNO WAP portals were HUF 2.1 billion – Operating in a walled garden market environment – Generated by 1 big WAP Aggregator and 30-40 Content Aggregators and Providers • Sales through Premium Rate Services were HUF 2.5-3 billion – Generated by 6-8 big PRS Aggregator and 20-30 smaller PRS Providers + 30-40 media Companies Altogether HUF 4.1-4.6 billion (End User Price) Market share by MNOs: • 45% TMH • 30% Pannon • 25% Vodafone Estimated user numbers: • WAP: 1.1 million users, about 300-450 thousand of which are regular monthly users, with about 150 thousand being regular content user • PRS: 2.5 million users, about 700-900 thousand of which are regular monthly users Prague, November 7, 2007.
  • 8. Issues of the Hungarian mobile content market § There are only few independent content providers and only few independent content brands became popular § High revenue share on the side of operators and content owners § Adoption of smartphones and development of broadband networks are slower than expected § There is no new content type § Different operation systems and differently advanced devices have to be served, the numerous co- existing formats require excessive manufacturing capacity § Due to the size of the market contents that are expensive to produce or purchase cannot enter the market, since the market size does not guarantee the economy of scale (royalties, minimal guarantees, brand fees do not consider this) § Third party providers are often premium rate players at the same time, rate of TV voting decreased, reinvesting revenues in content providing services is less significant § Impacts on revenues due to the narrowing gap between internet and mobile phones are yet unknown Prague, November 7, 2007.
  • 9. 2. Money! Prague, November 7, 2007.
  • 10. vidUP Mobile Video Sharing and Community service PLAY VIDEO CASE STUDY Prague, November 7, 2007.
  • 11. vidUP Mobile Video Sharing and Community service • Key success factors: • Promote 3G networks • Generate data traffic and revenue vidUP 2.0 • Build brand image and user loyalty • Build new or extend existing mobile/web • communities • Analyze user’s behaviour for marketing UGC • Create huge video portfolio at low cost CONTENT DATING, SHARING CHAT • Flexible business models • Key features: • Unlimited file size video upload from mobile phone (Java, SOCIAL WAP, MMS upload) NETWORKING • Automatic content recommendation based on user ranking and view times • Special user generated vidUP TV • Incorporates all web 2.0 community functions: tags, categories, rankings, comments, private video storage • user profile, chat, blog, messaging in vidUP 2.0 (December, 2007) Prague, November 7, 2007.
  • 12. vidUP on t-zones Hungary Facts: • Live on t-zones Hungary since June 2007 • in 5 months ca. 80.000 unique visitors • 2.3 million vidUP wap page downloads, 250.000 video views (download + stream) • Average daily unique visitors: 2500, average daily visits per user: 2 • In the first 5 months users uploaded 2.200 videos to vidUP from their handsets • Share of video uploads by methods: JAVA: 80%; Xhtml: 19%; MMS: 1% • In November vidUP will be available for other operators’ users as well • International negotiations: Poland, Croatia, Bosnia, Montenegro, Macedonia, Germany, Spain, Greece, Thailand Promotion: • Premium placement on operator’s wap portal • Online campaign on most visited Hungarian community sites and video sharing portals • SMS/MMS CRM campaigns • Cooperation with television stations putting interactivity to their TV shows: – Hungarian Music Television VJ Hunt competition. viewers sent their video applications to vidUP. Prague, November 7, 2007.
  • 13. Mobile ScratchCard CASE STUDY Mobile Scratch Card Prague, November 7, 2007.
  • 14. Mobile ScratchCard The Mobile ScratchCard is a mobile Java application combining real ‘scratch’ card experience with quiz games How it works: • 1. Answer questions 2. Scratch the hidden picture 3. Guess what’s on the picture 4. Win! Usage possibilities: • Expand your FMCG product campaign with direct mobile experience • Do a marketing survey combining the advantages of advanced mobile technology and classic marketing research • Add a mobile leg to your existing quiz based TV program Key Success Factors: • Simple to use application, higher game experience than SMS quizzes • Collect user preferences during the game flow automatically • Build user database with preferences without the costs of a traditional BTL campaign • Tailor-made design and content based on your requirements Prague, November 7, 2007.
  • 15. 3. Money… Prague, November 7, 2007.
  • 16. Telco companies are becoming to „SCREEN companies” Mobile phone = additional media surface Mobile user = visitor, reader and viewer Mobile content = text, sound, video, movie + interactivity, community + always available for everyone Prague, November 7, 2007.
  • 17. Is mobile saleable as advertising surface? YES!!!! § Connected to games, e.g.. Mobile Scratch Card § Gift contents, guaranteed promotional prize delivered to mobile (via GSM and Bluetooth networks) § Convenience Java applications (eg. browser) and microsites to support campaigns and prize games § Branded appearance on existing WAP sites § Support of prize games via basic and premium rate SMS § Reinterpretation of classic prize games, games to gain potential customers § New generation games via IVR with associated content downloads § Community and brand loyalty development § White label services (e.g.. vidUp, music store) § Appearance of ad-based MVNOs (free voice minutes for those who accept adverts) § Mobile advert in banner format!! Prague, November 7, 2007.
  • 18. Every morning a gazelle wakes up in Africa thinking he has to run faster than the fastest lion in order to survive. Every morning a lion wakes up in Africa thinking he has to run faster then the slowest gazelle in order to not die of hunger. No matter if we are lions or gazelles. When the sun rises in the morning, we have to run!!!
  • 19. Thank you for your attention! peter.malcsiner@mfactory.hu