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How to succeed in content services business

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This presentation involves hot Value Added Services topics, focusing on content services. …

This presentation involves hot Value Added Services topics, focusing on content services.
It was prepared in Mar 2011 for VAS Growth Markets 2011 event in Dubai.

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  • 1. How to succeed in Content Services Business -TR Case Studies- Apr 4th, 2011 Baris Akkaya, Content Services Manager @
  • 2. Agenda  VAS and Content Services: Global Outlook  About AVEA GSM Market- Turkey Overview  VAS Turkey-Where is the Golden Mine? Content Services: Hot Topics  Mobile TV  Music Services  Mobile Game  Mobile Application Stores  Location Based Services  Summary and Conclusions
  • 3. Global Outlook: VAS%60 of time spent on Smartphones are new activites and majorly content-based. Source: AppsFire, Jan 2011
  • 4. Global Outlook: VAS Mobile GamingMobile Music Source: ComScore, Dec 2010
  • 5. Global Outlook: Content Services Source: JRC European Commission – Feb 2009• Mobile Music and Mobile Game to lead the content business in the mid-term.• Mobile Advertising and Mobile TV to recover, but will not be the main drivers.
  • 6. Agenda  VAS and Content Services: Global Outlook  About AVEA GSM Market- Turkey Overview  VAS Turkey-Where is the Golden Mine? Content Services: Hot Topics  Mobile TV  Music Services  Mobile Game  Mobile Application Stores  Location Based Services  Summary and Conclusions
  • 7. About Avea 19% Merge of 2 different GSM Operators 81% Privatization of Turk Telekom in 2005 New shareholder structure in 2006 2004 June 11,6 mio subscribers** As of Feb 2011
  • 8. VAS At AVEA Music LBS Mobile TV Social Network Avea biDünya Info & News Operator Services Mobile Game Business Services
  • 9. Agenda  VAS and Content Services: Global Outlook  About AVEA GSM Market- Turkey Overview  VAS Turkey-Where is the Golden Mine? Content Services: Hot Topics  Mobile TV  Music Services  Mobile Game  Mobile Application Stores  Location Based Services  Summary and Conclusions
  • 10. Market Overview- GSM and VAS 3 GSM operators in the market: Avea, Turkcell, Vodafone Mobile Handset Penetration (Sep 2010) As of Jan 2011  66 million GSM subscribers  VAS accounts for 500 M US$, about 6% of all GSM services 25% revenue market share in VAS10
  • 11. Market Overview – Mobile Internet Number of Mobile Internet Users (X 1000) Source: BTK-Turkey, Q4-2010 report • Number of 3G users have almost tripled from 2009 to 2010. (7,1% vs. 19,4%) • Number of Internet-on-your-mobile users have grown from 641 K to 1,448 K.11
  • 12. Agenda  VAS and Content Services: Global Outlook  About AVEA GSM Market- Turkey Overview  VAS Turkey-Where is the Golden Mine? Content Services: Hot Topics  Mobile TV  Music Services  Mobile Game  Mobile Application Stores  Location Based Services  Summary and Conclusions
  • 13. VAS Turkey-Where is the golden mine?Turkish consumers use mobile particularly for social networking and email.However; news, interest, multi-media and gaming are secondary to those. % doing activity Daily Ever 85 69 72 64 66 57 61 55 51 40 29Mobile 52 44 32 15 16 11 20 39 28 29 21
  • 14. VAS Turkey-Where is the golden mine?Engagement levels are high across most activities. However, engagement is higher forentertainment based, visual activities such as online gaming, multi-media and alsopersonal interest. % doing activity daily % highly engaged 59.4 55.6 53.9 54.9 54.4 56.1 56.5 53.7 53.1 51.6 47.6 86 74 78 68 65 63 45 49 25 29 19
  • 15. VAS Turkey-Where is the golden mine?Many activities such as social networking are set to grow via mobile, though this isfrom a very small base. Greater increase on PC Greater increase on mobile* Future increase in activities * Low base for subgroup Global Turkey Male* Female* 16-20* 21-24* 25-34* 35-44* 45-60*
  • 16. VAS Turkey-Where is the golden mine?For social networking Turkish consumer have a greater need for excitement andstimulation. This is also reflect in high usage levels of multi-media and online gaming Personal Admin Global needs: Social Global needs: Under control, on top Sociable, friendly of things Fun, pleasure Effective, efficient In touch, in the loop Confident, assured Turkey needs: Turkey needs: Confident, assured Fun, pleasure Recognised, important Energised, excited Responsible, thoughtful Amused, entertained Online gaming Multi Media Global needs: Global needs: Fun, pleasure Fun, pleasure Amused, entertained Amused, entertained Energised, excited Energised, excited Turkey needs: Turkey needs: Amused, entertained Amused, entertained Fun, pleasure Fun, pleasure Energised, excited Energised, excited
  • 17. Agenda  VAS and Content Services: Global Outlook  About AVEA GSM Market- Turkey Overview  VAS Turkey-Where is the Golden Mine? Content Services: Hot Topics  Mobile TV  Music Services  Mobile Game  Mobile Application Stores  Location Based Services  Summary and Conclusions
  • 18. Evolution of the Content Static Dynamic Centralized Decentralized Walled Social Expensive Cheap Geeky Mainstream
  • 19. Mobile TV Mobile TV to get momentum with interesting and socializing contentHandset Handsets & Network • Bigger screens Client • Higher resolution rates - - Screen Size Screen Size - Download rates • Lower priced - - Resolution Rate Resolution Rate on-the-go - - Handset Prices Handset Prices - Uninterrupted streaming Network - - Handset Client Handset Client - Data Fees • Better coverage • Higher network capacities • Lower data fees - Interesting Content - Socializing • Lower content fees - Content Fees Content CONTENT MATTERS
  • 20. Mobile TV in Turkey How do you access TV channels Would you prefer to watch when no TV is around? free channels via your80% mobile? 60% As of Oct 2010 55% As of Oct 201060% 60% 46% 45% 37% 40%40%20% 20% 0% 0% Laptop Desktop PC Mobile Handset Yes No How do you access TV channels? Would you pay for the 6% content? Antenna As of Oct 2010 100% 71% Satellite 26% 43% 50% 29% Digital or Cable 25% Antenna and 0% SatelliteAs of Oct 2010 Yes No
  • 21. Mobile TV : Turkey and AVEA • All three operators have their own Mobile TV multicasting solutions. • Video on Demand is available only at Turkcell since it has not proved to be profitable line of business yet. • The overall market size is estimated to be 3-4 M $ as of Jan 2011.MOBILVIZYON of AVEA  18 popular national channels live  50 K/mth revenue on average  35% YoY growth in the customer base (~ 160 K customer) Daily/Monthly Subscription Fee + Free URL
  • 22. Music Services
  • 23. Music Services: TurkeyAveamuzik.com ttnetmuzik.com.tr Gncplay.com • 54% of Aveamuzik.com customer are between 15 and 24 years old. • 32% of Aveamuzik.com customers are between 25 and 34 years old. • 56% of youth segment in Turkey finds AVEA brand young and energetic. • 48% of youth segment in Turkey believes that AVEA invests into music.
  • 24. Music Services @ AVEA • Aveamusic.com has 130 K subscribers as of Mar 2011 • RBT service has 250 K subscribers as of Mar 2011. • 90% YoY growth in the customer base (2010-2011) • 40% market share in the mobile music download TARIFFS BEING THE MOST IMPORTANT KEY TO THE SUCCESS AS THE MUSIC IS CONSUMED BY YOUTH SEGMENT AT A VERY FAST RATE.
  • 25. Mobile Game: Global Outlook 2010 – Mobile Games Revenue (M US$) 105 102 165 Apple Store BB App World Source: IHS ISuppli Nokia OVI Store 1.800 Android Market• In-Stat predicts that in game purchases will reach 7,3 billion US$ in 2011.• Juniper Research says mobile game revenue will top 11 billion US$ by 2015.• Juniper Research says ad spend on mobile games will increase tenfold over the next five years. By 2015, ad spend on this platform will reach 894 million US$, up from 87 million US$ in 2010.• Parks Associates in Nov 2010 reported that one in five gamers spends money on virtual items and microtransactions, which are expected to garner 6 billion US$ in revenue by 2015.
  • 26. Mobile Game: Trends1600 1514 • Mobile Gaming makes the 1376,71400 biggest chunk of the content1200 1173,4 2009 revenues in the U.S. and is 1028,51000 2010 expected to keep its position in 849 800 2011 the next few years. 627,7 600 2012 • There is a growing emphasis on 400 2013 monetizing such content through 200 2014 downloads, advertising and in- 0 game purchases, rather than US Mobile Game Revenue (M $) shipping phones with gamesSource: emarketer.com preinstalled.
  • 27. Mobile Game: TurkeyMobile Game market is estimated to be about 60 M US$ in Turkey in 2011.AVEA and Sobee has started the discussions to adapt I Can Football into mobile. • Multi Player Online Game launched by Turk Telekom in 2010. • Has won World Communication Awards in 2010 in Best Content Service category Registered Members : 812.000 Mobile Activation : 357.000 Average Length of Visit : 29 minutesISlash, by Duello Games*, sales has surpassed Angry Birds sales on Turkey app store. • A slashing puzzle game • 3 million downloads from App Store (Sep 2010- Mar 2011) • Priced as 0,99 US$ * Duello Games is a Turkish company.
  • 28. Mobile Application Stores According to Gartner:• Worldwide Mobile Application Store revenue forecast to surpass 15 billion US$ in 2011.• Revenue between 2010 and 2014 is forecasted to grow 1000% and to reach 58 billion US$. WHY IS THAT SO IMPORTANT FOR CONTENT SERVICES? Sep 2010
  • 29. Mobile Applicaton Stores: How can operators get into play? Walled-Garden Store Open Store SIM StoreStrategy • Offers only in-house built • Offer access to • Selling apps or outsourced applications external stores in for featured • Targets niche markets or a addition to the closed phones specific customer segment storefront features • Limits the play ground to a • Revenue from external specific handset stores are sharedRequirements • Very well segmented • High-end service • Advanced customer base Delivery Platform SIM Tool Kit • Building a developer interfaces communityMonetization • Instant M-payment • Instant M-payment • M-Payment • Mobile Advertising • Revenue sharing
  • 30. Location Based Content Services Registered Foursquare Users Facebook Places launched • Social Network Services • Shopping Applications • Location Enabled Search • Mobile Advertising • Personal Navigation According to IEMR report published in Jul 2010; • The global market for GPS navigation and location based services will increase to 13,4 Billion US$ in 2014, a compound annual growth rate of 51.3%. • Location based search and advertising to drive 2 Billion US$ of the above. • The adoption of GPS in mobile handsets is largely being driven by smart phones. • In 2009, more than 40% of all smartphone owners used their mobile devices to get turn-by-turn directions, according to data from Compete, an industry leading web analytics firm. For iPhone users, the figure is even higher at over 80%.
  • 31. Location Based Content Services: Turkey • All operators in Turkey somewhat have Location Based Content Services. • Market growth is driven by smartphones, led by Apple Iphone. • The market size is estimated to be about 5-6 M US$ as of today, since location based advertising has not yet ramped up. • Facebook Places was launched in Turkey in Mar 2011. • Foursquare has 90 K users as of Feb 2011 in Turkey.
  • 32. Location Based Content Services: IBB Cep Trafik • IBB Cep Trafik was first launched in 2005 and was free. • By May 2008, the number of users have reached 400 K. • In addition to original Native Java version WME and Iphone editions have been launched betweeen 2008 and 2009. • The number of users have dramatically dropped as low as to 10 K users in Dec 2009 due to the subscription fee of 5 TL/month. • Nowadays IBB is working on an ad-funded model.
  • 33. Agenda  AVEA  GSM Market- Turkey Overview  VAS Turkey-Where is the Golden Mine?  Global Outlook  Content Services: Hot Topics  Mobile TV  Music Services  Mobile Game  Mobile Application Stores  Location Based Services  Summary and Conclusions
  • 34. ConclusionsAS OF TODAY: Content is now more social, decentralized, but cheaper. Mobile Content revenue will be driven by Music and Gaming services. Fremium apps with in-game purchases will make more than 50% of overall mobile game revenue. Digital music is majorly consumed by youth segment, the price sensitivity is high. Mobile TV revenues will grow in parallel with the handset and network capabilities. Location based services revenue has a big room to grow, mobile advertising seems to be the key revenue stream. Mobile Apps stores are converting the VAS world quickly into an IP space, operators must urgently decide the route to take to avoid ending up as a dummy pipe. M-Payment solutions must be taken into scope immediately.
  • 35. DO NOT... AND Refine your mobile content strategy over time
  • 36. QUESTIONS? THANK YOU FOR LISTENING

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