Mobilemonday Global Summit KL Bruno Bensaid 20080519
1. Innovation in the China Mobile Industry
MobileMonday Global Summit 2008 – Kuala Lumpur
May 19, 2008
Bruno Bensaid
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2. My profile
• Established in China since 1997.
• VP Business Development for Ventech (China), VC fund focusing on China TMT
companies. 100% sub of Paris-based Ventech, French venture fund focusing on
TMT and biotech. Ventech was elected best VC of the year (2007)
• Founder of Mobilemonday in shanghai (2006). Running 150-people events
monthly covering all angles of the industry.
• Launched and managed Wireless businesses in Shanghai from 2002-2006 (In-
Fusio, Faith Inc, Freever, Open-Plug), consulted to European Telecom operators
• Worked with Cisco Systems @ APAC HQ in Singapore (1999-2002)
• Reachable on linkedin, msn, skype,
twitter, facebook and….phone!
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3. What’s New?
Telco reorganization, 3G, Mobile TV…
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4. China Telecom Industry to Restructure
• Emergence of 3 national champions, with fixed and mobile
capabilities (Government-led reorganization).
To be confirmed:
• China Railcom to be merged into China Mobile
• China Netcom (fixed line operator) to be merged with
China Unicom (GSM network)
• Unicom's CDMA business to be merged with China
Telecom (largest fixed operator)
• TD-SCDMA (China 3G home grown standard) launched
with at least one operator (China Mobile). Other standards
(WCDMA and/or CDMA2000) will likely co-exist too.
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5. 3G finally coming, but the ecosystem is weak
• Large scale commercial trial of home-grown technology TD-
SCDMA is currently conducted by China Mobile in eight
major cities, including Beijing, Shanghai and Guangzhou.
• China Mobile to provide 20,000 trial users with handsets
and data cards free of charge. 40,000 handsets to be rolled
out to paid customers soon.
• Yet, the ecosystem is not healthy. Commit, a TD-SCDMA
design house invested by Nokia, TI, LG (etc) went bankrupt
(May 2008). Government backing to TD-SCDMA is weak.
• Meanwhile, Edge deployed by China Mobile in tier-1 cities,
CDMA1X (Unicom) deployed in key provinces. LTE trialed.
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6. Mobile TV standard Also given a Thumbs Up
• DMB-T and CMMB main standards adopted by SARFT (State
Administration of Radio, Film and Television) for mobile TV.
• 6 mobile TV licenses - SMG, CCTV, Beijing TV, Guangdong
media group, Renmin Guangbo Diantai, China Radio Int’l.
• CMMB used for mobile phones and data connected devices,
with interaction and billing. DMB-T to be used on mobile display
terminals (transportation) without need for interaction.
• CMMB trialed in Beijing, Shanghai & Shenzhen. 90% of Beijing
covered, 20 channels offered. Devices from Lenovo, ZTE,
Innofidei etc shipping. SMG launching dongles in Shanghai.
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7. Market Update
China MVAS growth fueled by commoditized services
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8. Mobile Subscribers growth only getting stronger
• 575 Mil Mobile Subscribers (March 2008). +9.4 Mil new
mobile subscribers in March.
• Net loss of 1.4 Mil subscribers of fixed operators (326 Mil).
• Mobile penetration ~ 45%
• ~ 60 Bil SMS sent per month (+29% YoY)
• 210 Mil Internet subscribers (end 2007), ~ +6 Mil new
suscribers / month
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9. And so is MVAS growth
Wireless value-added
services accounted for
25.7% of China Mobile's
total income in 2007, with
ringback tones, WAP and
MMS services all continuing
to grow.
* Source China Mobile
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10. But Innovation does not drive Growth, Mature Services Do
• Mature, commoditized services are driving growth,
fueled by operators’ walled garden strategies.
• The Most Acclaimed applications and services are not
the most innovative: IM, Digital Newspaper, short
novels/ebooks and Entertainment MVAS dominate
(music, logos/pictures, small videos)
• Operator walled garden strategy successful. End 2007,
China Mobile had 12.81 mln active Fetion (IM) users,
23.55 mln paid mobile newspaper subscribers, and
34.56 mln Wireless Music Club VIP members.
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11. 2007 Most acclaimed Mobile Applications
• 由《通信产业报》主办的“2007中国手机客户端软件TOP50评选”。Out of 50, the top 20 cover:
• 1.手机QQ IM Entertainment
• 2.掌上书院 Mobile ebooks
• 3.PICA IM
• 4.PingCo IM Micro-Blogging
• 5.ucweb优视浏览 Mail / browsing
• 6.百阅 Mobile ebooks
• 7.飞信 IM
• 8.空中-Opera2.0 Browsing
• 9.手机MSN IM
• 10.百灵鸟音乐客户端 wap platform
• 11.手机大头 IM Entertainment Browsing
• 12.掌讯通 Mobile ebooks Entertainment
• 13.掌媒 Mobile ebooks
• 14.维信 Mobile Widgets
• 15.胖葫芦 Mobile Widgets
• 16.网秦手机杀毒 Anti-virus
• 17.凤凰移动台 Entertainment
• 18.MM狂下载 Entertainment
• 19.V8书客 Mobile ebooks
• 20.贝多 IM
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12. Yet, too little innovation could lead to failure
• By end 2007, Fetion (China Mobile IM service) had over
73 million registered users with about 67 million addition
in 2007, but only 12.8 million are active users.
• Despite solid growth, real usage is actually down (10%
only of H2’2007 additions are really active, compared
with 30% in H1’2007).
• Reflects the limited growth potential of Fetion, which
most of users use for free SMS communication between
PC and mobile phone (compared with Tencent’s QQ
complete suite of services using IM as a pillar).
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13. Mobile Innovators in China
Making the Most of 2.5G networks
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14. Mobile 2.0 in China is Late but Youth are driving usage
• Widsets (Mobile Widgets)
reached “only” 3 mil users
by end 2007, in a ~ 50-60
Mil Active Mobile Internet
users population (the real
mobile internet potential
population is 3x higher).
Hard to call it a success!
• But outlook is positive.
Recent research indicate
Youth will drive mobile 2.0
usage:
• 31% Youth used mobile phones to access the Internet in the
past six months (40.2% with College students, the highest
usage among all populations surveyed)
Source: CNNIC April 2008
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15. Barriers to Innovation - I
Political Reasons
• Payment mechanisms with operators are mature and
varied (SMS, WAP etc), but made difficult to implement if
Service Providers / Content Providers have not reached a
“critical mass”.
• Walled gardens is a real threat. Once popular, a service
can virtually be monopolized and run by China Mobile and
kick early entrant out.
• Late entrants Innovators clearly discouraged to operate
independently or face heavy losses in the first years
(leveraging too much on ad rather than paid services)
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16. Barriers to Innovation - II
Technical and Marketing Reasons
• slow speeds are slowing down innovation and adoption
(though the infrastructure is massively upgraded to Edge
or CDMA 1x, and TD-SCDMA now trialed on large scale)
• Flat rates or quasi-flat rates are back, but not
communicated well enough. Data packages are confusing
• No or little service is bundled with data packages (except
overly expensive Blackberry data package and service, a
possible failure)
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17. Barriers to Innovation - III
Cultural Reasons
• Competitors don’t cooperate in China! - Most popular web
and mobile platforms are still proprietary (“silo mentality”).
When API is open, it is limited in scope.
• Few platforms enable mashups and interoperability.
• Older netizens generation is a BBS generation
(anonymous). Moving towards SNS (public) is slow, but
Younger generation, self-conscious and open, will drive
adoption of new services and social networks.
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18. Established Innovators
• Tencent still leading the train of innovation, leveraging
on their integrated suit of free and paid services, across
mobile and online platforms (and in process of opening
their QQ SDK).
• Baidu, online search leader (80% market share)
successfully launched its wap suit of services and is
following with tons online/mobile (just launched an IM
client, Baidu Hi). Expect strong content innovation in
2008-2009, as search is the entry point to other services
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19. 2007 Adopted Innovations
• Mobile Advertising established in the landscape (but no
real expectation on revenue until 2010).
• IM feature a must, in proprietary format or open source.
• VoIP calls, call-back and push-to-talk (Vivame, Bedo)
• Click-to-call very popular (after search results or banner
based, like with MadHouse)
• Photo/video sharing and geo-tagging (more recent)
• Content compression widely adopted
• Mobile Clients, like GGlive (3G.cn) enable rich content
streaming and TV-like experience.
• Free content with advertising (Datuu, 5MM etc).
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20. 2008 Innovation Trends
• For SNS, location-aware features will be key (POI,
discovery of friends in the vicinity etc), using GPS or cell
ID (Bedo, Gypsii, Mimo etc).
• Information organized into CHANNELS:
o Customized Search, pre-arranged or pre-fetched search content
(Datuu, Roboo, Cgogo etc).
o 3rd generation mobile browsers (client-server) enabling content
categorization and behavioral features, helping prioritize content
downloaded (Dratek, Datuu etc).
• M-commerce should emerge (NFC payment trial in
Shanghai, or wap-based m-payment, like with 3G.cn),
But mobile widgets and RSS still niche (Panghulu…)
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21. Tencent
Undisputed MVAS leader
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22. Tencent’s IM “QQ” is China’s youth “email” and much more
• Integrated offer of service leveraging on a rich IM client deployed over 300
mil accounts (84% market share).
Courtesy
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23. Tencent’s QQ Labs at the cornerstone of innovation
• In-house R&D (QQ labs) enabling diversification into casual games, CtoC ,
In large cities, such as Shanghai, Beijing, Guangzhou, Shenzhen,
Entreprise IM, Blogs, wap portal, bookmarks, video download, online and
penetration has reached over 100%. Subscribers growth is now
mobile ad serving etc.
occurring in 2-tier and 3-tier cities as well as rural townships.
Courtesy
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24. Bedo.cn
Pure-IP based location aware SNS
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25. The Essence of Mobile 2.0 Chinese Innovation
bedo.cn is a location based mobile SNS providing the
following IP-based services:
• Communication
o Mobile instant messaging
o Push to talk Location
• Content
o Mobile blog/spaces
o Music/software sharing
• Location
o Local friend finder/matcher
o Geo-tagged contents
o Local events
Communication Content
o Using GPS or free cell-ID
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26. Local blogs are
Bedo.cn - Mobile Interface
displayed as a star
Click star to view the
blog, which could be in Click buddy’s icon to “Radar” – Find who is nearby.
text, photo, voice chat/voice talk instantly
format View her latest blog
Support both GPS phones and non-GPS
updates, sharing phones (via Cell-ID)
newest findings
Find what happened around (blogs,
pictures, events etc)
Click to chat, or push-to-talk;
One to one, or one to many;
Phone to phone, or phone to PC
Chat with MSN/Yahoo friends
Picture sharing and geo-tagging &
mobile blogs
Local weather & nearby
POI advertisement can be
displayed automatically
in the bottom area
Can view the internet
comments/ratings of the
POI service provider
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27. Bedo.cn - Website Interface
• Find who is nearby
• Roaming to any
place through a
nation wide map
• Read local blogs,
events
• Post, reply &
comment
• Update location
through the map
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28. Bedo.cn - PC Client Interface
• Desktop users can also use
a PC client for multimedia
instant communications with
mobile users
• Talk/chat/share with their
mobile friends
• Users can learn:
o presence & distance of
their buddies
o coming up local events
o local UGC blogs etc
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29. Text chat, and Voice Talk!
With advanced voice compression algorithm,
smartphone users can chat, push-to-talk, and share
pictures/videos...
• Chat between Pep, MSN,
and Yahoo users
• Push to talk between
GPRS/wifi phones,
between mobile and PC
(only 0.6KB/second)
• One to one, or one to
many
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30. Free mobile blogs & spaces
Users can enjoy free mobile blogs & spaces,
content sharing etc
• Picture and video
sharing
• Personal spaces &
virtual homes in the map
• RSS subscription
• Music/software sharing
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31. 5th Media Mobile
Idle Screen mobile content channels
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32. A new media, sliding on idle screen
Basic
Slide Through
Content
Channel
Rolling bar for
人姓名 TrackID 可帮助
News, Product
Tips
Click Through
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33. Well-defined Media Rich channels, updated automat. or manually
Sports
Sports Consumers
Consumers Life Style
Life Style Fashions
Fashions
Music
Music Travel
Travel Home
Home Food
Food
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34. User Defined Channels, fed with partners content
Arts
Arts Games
Games Cars
Cars Night Life
Night Life
Movies
Movies Men
Men Women
Women Finance
Finance
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35. Free Content Download, Ticket Selling, Promotional activities
Reservation
Content/ad to be shown
Ticketing
“ 爱 的 契 机 ” 席 琳 —狄翁
2008世界巡回演唱会 1-click to call...
日期:2008.4
场馆:上海体育场、北 1-click
1-click to call...
京工人体育场
票价(RMB): 300, 500, to call
800, 1000, 2000,
3000
立即预定
Music
Games
NO1 胡彦斌 - 男人KTV 哆啦A梦大雄的恐龙官
铃音下载 整曲下载 方 授权手游小恐龙回
NO2 韩雪 - 你不会知道 到白垩纪的日本,途中
铃音下载 整曲下载 经 历的一系列精彩故
NO3尚雯婕 -在梵高的星空 事!画面精美且易上手、
下 多 种道具完美结合,
铃音下载 整曲下载 经 典再现电影故事情
NO4王力宏 - 改变自己 节。
铃音下载 整曲下载 马上体验哆啦A梦神奇
NO5金莎 - 不可思议 的百宝袋
铃音下载 整曲下载
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36. Roboo
New Generation Mobile Search Service
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37. “UGC”-based and Channel-based Search
12 Mobile Search Channels
ringtones; songs/music; wallpapers/screensavers;
pictures; video; games; software; hardware; pages;
eBooks; news; stocks; weather/local life
• Personalized Ad: display proper ads by matching query
with contents, plus phone characteristics, city, popularity,
user profiles (gender, interests…).
• Innovative: user participation (input comments on
search results, upload contents onto search engine!!!)
“human-centered” PopRank algorithm:
• user modeling, user comments / scoring
• matching of user queries with user profiles / phone
characteristics
• content popularity
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38. Roboo Search Channels Overview
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39. Datuu
Fully Automated Suite of Services
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40. New Generation Browsing and Search
• Choice of 200 most popular and up-to-date websites
(appearing in browser and search results)
• Content Filtration - browser and search engine remove
unwanted material and separates text from pictures
into two individual pages
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41. Search-to-listen mobile music download
• Integrated search, stream/download and play-the-track user
experience. Datuu acting as a proxy, not storing songs
• Songs ranked by popularity.
• High compression (from 3Mb to ~500Kb)
• Creation of playlists on the fly
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42. MTI
Location-based hardware solutions
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43. Healtcare and safety location-based Services
• MTI has developed an LBS platform and a cell Capture®
technology and algorithm to catch roaming position without
GPS and Carriers support. It has been used in the Stand-
alone device, Kare® and Smartcard®, to support a LBS
service in positions of vehicle, kid, senior, field-workers,
valuable assets, even pets…All devices are voice enabled
• MTI cooperates
with local carriers
for co-marketing
Kare® and
Smartman®,
billing monthly
fees
Smartman ® device
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44. Kare®: Kid Tracking device
Dad home
Localization of the child
Regular alerts to at any time based on Cell
parents’ phone ID
Hands
free
speaker Mic.
Localization Assistance
Emergency Key (calls pre- 24x7 Customer service
Localization reports sent emergency number)
sent by the child
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45. Kare II®: Device for the elderly
免提喇叭
多功能滚轮
收音机
服务菜单
WAP/Internet
一按无忧键
子女 家庭 电源开关
紧急求助拔销
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46. 3G.cn
Rich Media Mobile Portal
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47. Mobile Portal with Rich Media Client
• No.1 wireless portal in China,
+50 million registered users,
and 8 mil daily users.
全方位的图文资
• Information in text and picture, 讯,超过50个频道
from +50 channels 分类专业提供
广泛深度的互动娱
• GGLive: Live TV client (8 mil 乐,包括社区、交
友、游戏、3G秀等
downloads, 800k daily users) 高品质的影音享
• GGMusic: Music streaming rich 受,包括电视、音
乐、电影、体育直
client, with search and playlist 播的流媒体提供
management.
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48. Most Innovative Rich Clients: GGLive and GGMusic
• Services include: live broadcasting, Movie, Video-on-
demand and interactive entertainment
• GGLive also offers GG radio, live radio streaming
• GGMusic: Online music Streaming, with automatic search
and download of lyrics of played song
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49. Tokiva
MVNO for Global Travellers
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50. An inexpensive suite of communication services
Inexpensive phone calls around the world, using call back. Also integrated with IM, phone book,
SMS. The service was launched in September 2007, with over 700k registered users as of 01/2008.
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51. Patent Pending Technology
Data Channel USPTO Provisional Patent
USPTO Provisional Patent
Voice Channel #60/808560, 60/990996
#60/808560, 60/990996
Internet VoIP Gateway
GPRS Network GPRS Network
Tokiva
Toronto
Mobile Platform Shanghai
Web / SNS Voice Messaging Sharing Billing
Service Service Service Service Service
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52. Pang Hu Lu
Mobile RSS and Widgets
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53. A simple syndication tool, competing with Widsets
Panghulu enables users to subscribe for any digital content and play it on the mobile phone.
Free Internet Resources
RSS Feeds
Other Information Sites
Online Services Automatic Conversion
Gateway
BBS
SNS
Multimedia Compression
Search Technology
Ticket Booking
Handset Adaptation
… Technology
Traditional Media
Publishing
CMS
Broadcast
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54. Business model: ad + revenue sharing
Placing advertisements amidst free contents
Sharing premium content subscription fee with CPs
Sharing advertising revenue with online service providers and CPs
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55. Thank You!
Bruno Bensaid - 布鲁诺 - email/msn: bensaid@fastmail.fm
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