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Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
Mobile Breakfast 2013 - Henry Blodget Presentation
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Mobile Breakfast 2013 - Henry Blodget Presentation

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  • 1. Become a member today! #thinkMobile
  • 2. The Future Of MobileHenry BlodgetCEO/Editor, Business Insider
  • 3. Digital is changing…
  • 4. Now twice as many mobile devices sold as PCs Global Internet Connected Device Shipments 1,200,000,000 1,000,000,000 Tablets 800,000,000Units 600,000,000 Smartphones 400,000,000 200,000,000 Personal Computers 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: Gartner, IDC, Strategy Analy cs, company filings, BI Intelligence es mates
  • 5. PC sales, meanwhile, flat to down Global PC Shipments By Manufacturer100,000 Windows 8 released iPad released 90,000 80,000 70,000 Other 60,000 50,000 Apple 40,000 Acer 30,000 Dell 20,000 Lenovo 10,000 HP 0 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 Source: Gartner, IDC
  • 6. Tablets alone will overtake PCs in 2-3 years Tablet Shipments Forecast 450 400 350 300(millions) 250 200 150 100 50 0 2010 2011 2012 2013E 2014E 2015E 2016E
  • 7. So the future is mobile G-20 Internet Access 3,000 2,500 2,000 Consumer Mobile Broadband 1,500Connec ons (milions) 1,000 Mobile 500 Fixed Fixed Fixed 0 2005 2010 2015 Source: Boston Consul ng Group, Mary Meeker, Kleiner Perkins, Morgan Stanley Research, Berg Insight
  • 8. Where are we in thesmartphone revolution?
  • 9. Still lots of “dumbphones” to replace Global Smartphone vs. Mobile Phone Users, 2012E 7,000 6B Mobile Phone Users 6,000 5,000Global Users (millions) 4,000 3,000 2,000 1B Smartphone Users 1,000 0 Smartphone Mobile Phone Source: Strategy Analy cs, Interna onal Telecommunica ons Union Note: Some users own more than one device
  • 10. Smartphones 44% of mobile sales last quarter Global Mobile Phone Sales 500,000 450,000 400,000 350,000 300,000 (thousands) 250,000 200,000 Feature Phones 150,000 100,000 50,000 Smartphones - 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 Source: Gartner
  • 11. But!
  • 12. Growth slows after hitting 50% penetration
  • 13. Major markets are past halfway point American and European Smartphone Penetra on 70% 66% 64%Percentage of mobile popula on owning a smartphone 60% 54% 53% 53% 51% 51% 51% 50% 44% 42% 40% 40% 38% 37% 34% 35% 30% 27% 26% 25% 20% 10% 0% Spain UK U.S. Italy France Germany Source: comScore Dec. 2010 Dec. 2011 Dec. 2012
  • 14. Underpenetrated segments are older… Smartphone Penetra on By Age100%90%80%70%60%50%40%30%20%10% 0% Ages 16-24 Ages 25-34 Ages 35-44 Ages 45-64 South Korea China Australia United Kingdom United States Italy Russia Brazil Turkey India Source: Nielsen, Feburary 2013
  • 15. …and poorer. Smartphone Penetra on By Age And Income (U.S.)90% 81%80% 76% 74% 72%70% 67% 60% 61% 59% 58%60% 51%50% 47% 46% 42%40% 34% 31%30% 25% 22%20% 16%10%0% Ages 18 - 24 Ages 25 - 34 Ages 35 - 44 Ages 45 - 54 Ages 55 - 64 Ages 65+ < 50k 50k - 100k 100k+ Source: Nielsen Mobile Insights, Q1 2012
  • 16. We’re starting to see the slowdown in U.S. U.S. Smartphone Market: Year-Over-Year Net Adds 40 35 30 25 Users Added 20(millions) 15 10 5 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2008 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012 Source: comScore, Nielsen
  • 17. The big opportunity is now in emerging markets BRICs: Mobile and Smartphone Penetra on 1,400 1,344 1,241 1,200 1,090 1,000 1,090 800(Millions) 600 400 259 222 228 197 200 142 48 33 14 0 China India Russia Brazil Popula on Mobile Phone Subscrip ons Ac ve Smartphones (Year-End 2012e) Sources: Carriers, governments, Flurry, TomiAhonen Consul ng, Umeng, Cybermedia Research, BII Es mates
  • 18. And they’re growing rapidly Brazil, China, India Take An Increasing Share Of Global Smartphone Shipments 1800 1600 1400Millions 1200 1000 800 600 Rest Of World UK 400 India United States 200 China Brazil 0 2011 2012E 2016ESources: IDC, BI Intelligence
  • 19. China is now the world’s largest smartphone market Global Smartphone Shipments 250,000 200,000 150,000(thousands) 100,000 Rest Of The World 50,000 China - 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 Source: Gartner, IDC, Strategy Analy cs, Canalys, BII es mates
  • 20. This shift to emergingmarkets has hurt Apple.
  • 21. iPhones are still very expensive iPhone Average Selling Price$700$650$600$550$500$450$400 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2008 2008 2008 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012
  • 22. And folks in emerging markets don’t have much money BRICs: Smartphone Penetra on As % Of Mobile Subscrip ons 25%Penetra on As % Of Mobile Connec ons, Year-End 2012 Es mate 20% 20% 15% 14% 10% 5% 5% 5% 0% China Russia India Brazil Sources: Carriers, governments, Flurry, TomiAhonen Consul ng, Umeng, Cybermedia Research, BII Es mates
  • 23. That’s why Apple needs a cheap iPhone
  • 24. The tablet market is lessmature than smartphones
  • 25. U.S. tablet penetration now ~25% U.S Smartphone and Tablet Owners 140 120 100 80(millions) 60 Smartphone Owners 40 20 Tablet Owners 0 May-10 Aug-10 Nov-10 Feb-11 May-11 Aug-11 Nov-11 Feb-12 May-12 Aug-12 Nov-12 Source: Pew Research Center, comScore, U.S. census bureau Note: Includes smartphones owners over age of 13 and tablet owners over the age of 18
  • 26. Current owners are affluent U.S. Tablet Penetra on By Household Income 50% 47% 45% 40% 36%% of U.S. adults that own... 35% 32% 30% 27% 25% 22% 20% 20% 16% 15% 10% 10% 10% 9% 8% 8% 5% 4% 4% 3% 3% 0% Nov 10 Dec 11 Jan 12 Aug 12 Source: Pew <$30,000 $30,000-$49,000 $50,000-$74,999 $75,000+
  • 27. And older U.S. Tablet Penetra on By Age 35% 31% 30% 27% 27% 25%% of U.S. adults that own... 25% 24% 20% 15% 15% 14% 13% 10% 10% 8% 7% 6% 6% 5% 5% 4% 2% 0% Nov 10 Dec 11 Jan 12 Aug 12 Source: Pew 18-29 30-49 50-64 65+
  • 28. But prices are falling fast… iPad Average Selling Price$700$600$500$400$300$200$100 $0 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012
  • 29. And, globally, tablet sales are just getting started Global Tablet Shipments 60 50 40(millions) 30 20 10 Rest of the world 0 China 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 Source: Analysys Interna onal, iSuppli, IDC, BII es mates
  • 30. What do people do on mobile?
  • 31. Mostly, they play games and social-network Global iOS & Android Time Spent Per App Category Other 11% U li es 10% Games 43% Entertainment 10% Social Networking 26% Source: Flurry, November 2012
  • 32. Tablets, especially, are gaming devices
  • 33. Mobile users also listen to music Pandora Mobile Usage 100% 77% 75%% of Traffic from Mobile 50% 25% 5% 0% 2008 2009 2010 2011 2012 Source: Mary Meeker, Kleiner Perkins, companies, BII es mates
  • 34. And consume content Top Mobile Categories By Audience Growth, Oct. 2011 vs. Oct 2012 (U.S.) 40,000 35,000 30,000Audience Size (thousands) 25,000 60% 20,000 51% 56% 46% 15,000 46% 47% 62% 48% 10,000 53% 50% 5,000 0 Books and Retail Payments Lifestyle Credit cards Mens Travel Service Beauty and Kids and Shopping Magazines magazines fashion Family Guides Source: comScore Note: Includes both mobile web and app audience Oct. 2011 Oct. 2012
  • 35. Mobile is now 15% of global web traffic Global Internet Traffic: Mobile vs. Desktop100%90% Desktop80%70%60%50%40%30%20% 15% Mobile10% 4% 1% 0% Dec 08 Apr 09 Aug 09 Dec 09 Apr 10 Aug 10 Dec 10 Apr 11 Aug 11 Dec 11 Apr 12 Aug 12 Dec 12 Source: StatCounter
  • 36. Mobile users watch video U.S. Video Engagement, Monthly Minutes Per Ac ve User 472 425 378 324 276 231 152 110 93 63 Mar 2011 June 2011 Sept 2011 Dec 2011 Mar 2012 Google Internet Sites iOS & Android Photo & Video AppsSource: Flurry Analy cs, comScore Video Matrix
  • 37. ~8% of online video hours are now mobile Mobiles Share Of Online Video 9% Combined Mobile 8% 7%Share of all hours watched online 6% 5% Smartphones 4% Tablets 3% 2% 1% 0% Jan 12 Feb 12 Mar 12 Apr 12 May 12 Jun 12 Jul 12 Aug 12 Sep 12 Oct 12 Nov 12 Dec 12 Source: Ooyala, 2012 Global Video Index
  • 38. Mobile movie and TV viewing is growing Time Watched By Video Length And Device 100% 90% 80%Percent Of All Hours Watched 70% 60% 50% 40% 30% 20% 10% 0% Desktop Smartphone Tablet Connected TV Video Length > 10 min 6 to 10 min 3 to 6 min 1 to 3 min < 1 min Source: Ooyala, Q4 2012
  • 39. Mobile users read news and books Daily Tablet Reading Ac vi es By Age (U.S) (Percent of tablets owners who use a tablet to...) 43% 38% 33% 32% 24% 17% 17% 16% 10% 6% 6% 2% 18-29 30-49 50-64 65+Source: Pew Research Center News Books Magazines
  • 40. They shop U.S. E-Commerce Sales $80,000 $70,000 $60,000 $50,000($millions) $40,000 $30,000 Total E-Commerce Sales $20,000 $10,000 Mobile $0 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 Source: comScore, Federal Reserve Economic Data--St. Louis Fed
  • 41. Mobile now drives 20% of e-commerce traffic Ecommerce Website Traffic By Device100% Tablet 90% Smartphone 80% 70% 60% 50% PC 40% 30% 20% 10% 0% Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Source: Monetate
  • 42. Some mobile commerce revenue is incremental eBay Mobile Transac on Volume* Grew To 13% Of Total100% 2% 4% 5%90% 9%80%70%60%50% 93% 87%40%30%20%10% 0% 2011 2012E Desktop Volume Mobile Volume Cannibalized From Desktop Incremental Mobile Volume Sources: eBay, Morgan Stanley Research *Volume is Gross Merchandise Value (GMV), or value of all merchandise transacted
  • 43. They use smartphones and tablets to make purchase decisions U.S. Mobile Commerce Ac vi es 45%Share of smartphone or tablet owners who have.. 40% 39% 39% 38% 38% 35% 34% 33% 30% 30% 25% 24% 23% 22% 21% 21% 20% 19% 19% 15% 10% 5% 0% Researched Compared Purchased goods Found store Found coupons Checked product Made shopping product features product prices or services loca on or deals availability lists online Source: comScore, December 2012 Tablet Smartphone
  • 44. People use mobile to pay for stuff… PayPal Mobile Payments Processed $16,000 $14,000 $12,000 $10,000 TotalPayment $8,000 Volume(millions) $6,000 $4,000 $2,000 $0 2008 2009 2010 2011 2012
  • 45. Mobile is now 10% of PayPal’s payments PayPal Payments Processed $150,000 Mobile $120,000 $90,000 TotalPayment Volume(millions) $60,000 $30,000 $0 2008 2009 2010 2011 2012
  • 46. Square processes $25+ million a day Square Es mated Daily Payment Volume and Revenues $30,000 $25,000 $20,000 Payment Volume(Thousands) $15,000 $10,000 $5,000 Revenues $0 3/11 4/11 5/11 6/11 7/11 8/11 9/11 10/11 11/11 12/11 1/12 2/12 3/12 4/12 5/12 6/12 7/12 8/12 9/12 10/12 11/12 Source: news reports, company releases
  • 47. And some “native” mobile apps are really exploding…
  • 48. Angry Birds downloaded 1+ billion times 1,000,000 Angry Birds Downloads 900,000 800,000 700,000Total Downloads (thousands) 600,000 500,000 400,000 300,000 200,000 100,000 0 Mar-10 May-10 Jul-10 Sep-10 Nov-10 Jan-11 Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12 Mar-12 May-12 Source: News reports, company releases
  • 49. Instagram 100+ million active users Instagram Es mated Users 100,000 90,000 80,000 70,000 60,000 Total Users 50,000(thousands) 40,000 30,000 20,000 10,000 0 3/2011 4/2011 5/2011 6/2011 7/2011 8/2011 9/2011 10/2011 11/2011 12/2011 1/2012 2/2012 3/2012 4/2012 5/2012 7/2012 7/2012 8/2012 9/2012 Source: news reports, company releases, BII Es mates
  • 50. BOTTOM LINE:The growth of mobile =more usage, new apps
  • 51. Each device has a different “prime time” Share Of Device Page Traffic Over A Day:Source: comScore, Telefonica, Macquarie Capital (USA), December 2011
  • 52. Mobile has extended the digital day 1,600,000 Mobile Visits Desktop Visits 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0Source: Google Analytcs, Business Insider
  • 53. Usage is up across the board… U.S. Mobile Content Usage 80% Sent Text Message 70% 60%% of mobile popula on that has... Used Downloaded Apps 50% Used Browser Accessed Social Network 40% Or Blog Played games 30% Listened to music 20% 10% 0% Feb Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May June July Aug Sep Oct Nov 10 10 10 10 10 10 10 10 10 10 11 11 11 11 11 11 11 11 11 11 11 11 12 12 12 12 12 12 12 12 12 12 12 Source: comScore
  • 54. Smartphone owners consume a huge amount of content Smartphone Content Consump on 80%Percent of smartphone owners who have recently accessed... 70% 60% 50% 40% 30% 20% 10% 0% Social Networking News Apps Streaming Online Music Video / Mobile TV South Korea China Australia United Kingdom United States Italy Russia Brazil Turkey India Source: Nielsen, Feburary 2013
  • 55. Mobile consumption share is growing U.S. Consumer Media Consump on Share50% 45% 44%45% 43% 42%40%35%30% 26%26%26% 25%25%20% 17% 16% 15% 14% Tripled since 200915% 12% 9% 9%10% 8% 8% 7% 7% 7% 6% 6% 5% 4%5%0% TV Online Radio Mobile Print Other Source: eMarketer, October 2012 2009 2010 2011 2012
  • 56. So mobile advertising will be huge, right?
  • 57. Hmm…
  • 58. Yes, there’s a gap between time and ad spend 2011 U.S. Ad Spending vs. Consumer Time Spent By Media 42% 43% 25% 26% 22% 9% gap 15% 11% 10% 7% 1% TV Print Web Radio Mobile Ad Spend Per Media Time Spent Per MediaSource: Mary Meeker (KPCB), eMarketer, IAB
  • 59. But there are reasons for that gap …
  • 60. The screen is really small.
  • 61. The mobile ad ecosystem is complex…
  • 62. And bad mobile ads are…INTRUSIVE
  • 63. So mobile monetization still lags the desktop Effec ve CPM, Desktop vs. Mobile $3.50 $0.75 Desktop Internet Mobile Internet Source: comScore, Vivaki, Mobclix Exchange
  • 64. Overall, mobile is still a tiny fraction of digital ad spending U.S. Digital Adver sing Revenues $40 Mobile $35 $30 $25(billions) $20 $15 $10 $5 $0 2007 2008 2009 2010 2011 2012E Source: IAB, BIA-Kelsey, BII es mates
  • 65. And a blip in the larger picture U.S. Adver sing $180 $160 $140 $120(billions) $100 $80 Offline $60 $40 All Other Online $20 Mobile $0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012E Source: IAB, U.S. Census Bureau, Stategy Analy cs. BI Intelligence es mates
  • 66. It’s also growing more slower than TV and the Internet in the first 5 years Compara ve U.S. Adver sing Media Annual $ Revenue Growth (First 5 Years)$5,000 $4,621$4,500$4,000 $3,698$3,500$3,000$2,500 $2,162 $2,162 $1,920$2,000$1,500 $1,171 $1,012 $907$1,000 $806 $500 $358 $392 $267 $80 $160 $55 $0 Year 1 Year 2 Year 3 Year 4 Year 5 Broadcast TV Mobile Internet Source: IAB, McCann-Erickson, BIA-Kelsey, BII es mates Note: Adjusted for infla on
  • 67. But!
  • 68. “Native” mobile ads are finally appearing• Ads in timelines• Sponsored content• Geo-located ads• Shareable ads• Activity-linked ads (e.g., ads in natural pauses during mobile game use)
  • 69. Tablet screens are bigger!
  • 70. Most “mobile” ads are still web search and display ads viewed on mobile Es mated 2012 Mobile Ad Spend By Format Messaging 9% Search 49% Display 42%Source: eMarketer, September 2012
  • 71. Google completely owns mobile search Global Mobile Search Market Share100% Google90%80%70%60%50%40%30%20%10% bing Yahoo! 0% Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec 08 09 09 09 09 10 10 10 10 11 11 11 11 12 12 12 12 Source: Global StatCounter
  • 72. Facebook has a nice chunk of mobile display Facebook Controls Almost One-Fi h Of U.S. Mobile Ad Display Revenues 100% 90% OtherPercent Of Na ve Mobile Ad Display Market Controlled By .... 80% 70% Apple (iAd) 60% Millennial Media Twi er 50% Pandora 40% 30% Google 20% Facebook 10% 0% 2011 2012 2013 2014Source: eMarketer
  • 73. APPS
  • 74. Almost 1 million available apps Available Apps, iOS vs. Android (thousands) 800 700 650 600 500 425 400 350 250 250 200 160 80 28 20 2 Mar 09 Dec 09 Aug 10 May 11 Jul 11 Oct 11 Jun 12 Jan 13 Android iOSSource: Apple, Google, Flurry, news reports
  • 75. App downloads should hit 55 billion this year Apple App Store Downloads60,000,000,00055,000,000,00050,000,000,00045,000,000,00040,000,000,00035,000,000,00030,000,000,00025,000,000,00020,000,000,00015,000,000,00010,000,000,000 5,000,000,000 0 1/1/11 2/1/11 3/1/11 4/1/11 5/1/11 6/1/11 7/1/11 8/1/11 9/1/11 10/1/11 11/1/11 12/1/11 1/1/12 2/1/12 3/1/12 4/1/12 5/1/12 6/1/12 7/1/12 8/1/12 9/1/12 1/1/13 2/1/13 3/1/13 4/1/13 5/1/13 6/1/13 10/1/12 11/1/12 12/1/12
  • 76. People spend more time on apps than mobile web Total Mobile App And Web Dura on On Android And iOS 160 140 120Minutes Spent Per Month (Biillions ) 100 80 60 Apps 40 20 Mobile Web 0 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Source: Nielsen Smartphone Analy cs
  • 77. App revenue growing fast, but still not huge Es mated App Store Revenues $6,000 $5,000 $4,000(millions) $3,000 $2,000 $1,000 $0 2008 2009 2010 2011 2012 Source: news reports, company releases Includes app revenues on all major mobile platforms
  • 78. Most app downloads are free Mobile App Store Downloads, Free vs. Paid: 2011 Total Downloads Free Downloads 89%Source: Garner, September 2012
  • 79. “Freemium” is the dominant model
  • 80. Games are the biggest money makers
  • 81. Mobile is a “platform market”
  • 82. “Platform markets” standardize around one or two platforms
  • 83. In mobile, it’s a two-horse race race Global Mobile Pla orm Market Share100%90% Other80%70%60%50% Windows40% Blackberry Apple30%20% Android10% 0% Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Source: Gartner, IDC, Strategy Analy cs, BI Intelligence es mates, and company filings
  • 84. Android is winning in smartphones Global Smartphone Market Share By Pla orm 100% 90% 80% Symbian 70% 60% Other Share of 50%Global Unit Microso Sales 40% Blackberry Apple 30% Android 20% 10% 0% Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Source: Gartner
  • 85. Especially in China Chinese Smartphone Market Share By Pla orm100% Other90%80% Symbian70% Apple60%50%40% Android30%20%10% 0% Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Source: Analysys Interna onal
  • 86. It’s the same story in tablets Tablet Market Share By Pla orm Windows100% Blackberry Nook90% Kindle Fire80% Android70%60%50%40% iPad30%20%10% 0% Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Source: Es mates based on informa on from IDC, Strategy Analy cs, and company filings
  • 87. Android is now the biggest platform of all! Global Compu ng Pla orm Market Share100%90% Other80% Blackberry70% Apple60%50% Windows40%30%20% Android10% 0% Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Source: Gartner, IDC, Strategy Analy cs, BI Intelligence es mates, and company filings
  • 88. Despite this, Apple dominates app revenue App Store Es mated Revenues By Pla orm $6,000 Other $5,000 Android $4,000(millions) $3,000 $2,000 Apple App Store $1,000 $0 2008 2009 2010 2011 2012 Source: iSuppli, Forrester Research, company releases, BII es mates
  • 89. Apple also sends most m-commerce traffic Ecommerce Website Traffic By Mobile Pla orm100% Other Android Tablet90% Android80%70%60% iPhone50%40%30% iPad20%10% 0% Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Source: Monetate
  • 90. And developers strongly prefer Apple New Project Starts, iOS vs. Android 20 18 16 31% 14 27% 25% 12 Total NewProject Starts 10 (thousands) 27% 8 37% 69% 6 75% 73% 4 73% 63% 2 0 1Q11 2Q11 3Q11 4Q11 1Q12 iOS Android Source: Flurry Analy cs, January 2011-March 2012
  • 91. Why?
  • 92. 1. Android has a fragmentation problem Android Pla orm Distribu on, January 2013 Jelly Bean Eclair 10% Donut 2% 0% Froyo 9% Ice Cream Sandwich 29% Gingerbread 48% Honeycomb 2%Source: developer.android.com
  • 93. 2. iOS is where the money is Cross-Pla orm Revenues: iOS vs. Android iOS Android 24%Source: Flurry Analy cs, June 2012
  • 94. 3. And Apple has wealthier users Annual Household Income Share By Pla orm100%90% 24%80% 41%70%60% 37%50%40% 36%30%20% 39% 23%10% 0% Android iOS Source: comScore, February 2013 <$50k $50-$100k $100k+
  • 95. Developers’ interest in Android has waned Developer Interest In Pla orms100% iPhone90% iPad80% Android Phone70% Android Tablet HTML560%50%40% Windows 8 Tablets Windows30% Phone20% Kindle Fire10% Blackberry 0% 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 Source: Appcelerator
  • 96. For manufacturers, mobile hasmeant a windfall for a select few
  • 97. Namely, Apple and Samsung Opera ng Profit Share By Vendor80% Apple70% Nokia60%50%40% Samsung30%20% Sony Ericcson10% RIM LG HTC 0% Motorola-10%-20% 2007 2008 2009 2010 2011 2012 Source: Company releases, Canaccord Genuity es mates
  • 98. But Chinese manufacturers are starting to take off Smartphone Shipments By Chinese Manufacturers 30,000,000 27,000,000 24,000,000 21,000,000 18,000,000Units Shipped 15,000,000 Lenovo 12,000,000 9,000,000 ZTE 6,000,000 3,000,000 Huawei - Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Source: Gartner, Strategy Analy cs, Company Es mates, IDC, TomiAhonen Consul ng, Canaccord Genuity, Business Insider Intelligence Es mates
  • 99. Last question…
  • 100. Should you be “mobile only?”
  • 101. No.
  • 102. People like big screens
  • 103. You should be “multi-screen.”
  • 104. Digital is now a 4-screen world…
  • 105. Maybe 5 or 6 screens soon…
  • 106. So you should be everywhere!
  • 107. Thank you very much.
  • 108. Henry Blodget Founder, CEO & Editor-in-Chief, Business Insider Marcelo Ballvé, Editorial Director Alex Cocotas, AnalystBI Intelligence is a new subscription service from Business Insiderthat provides in-depth insight, data, and analysis of the mobile industry.More info at intelligence.businessinsider.com

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