Archive for June, 2008

June 16th, 2008

Admob Servces 100M Mobile Ad Impressions Each Day

Admob hit (what I think is) a big milestone in May. They are now serving 100M ad impressions each day to cell phones. (See their May Metrics report) The US represents 45 percent of this traffic. Admob serves ads on to 5000 publisher sites. They are not the only mobile ad network in the US so the number of daily impressions is actually even higher. It’s still a small fraction of the online impressions, but shows the potential of this market.

Their May Metrics report just came out and it’s full of even more detail than ever before – more countries, top handsets by country, etc. – a wealth of information and must read.

We’re seeing a confluence of factors contribute to this growth. Here’s a few:

  • Smartphone sales this year are far ahead of last year’s despite a bit of an economic downturn
  • Flat rate data plans / less expensive data plans
  • More people on data plans
  • Increased adoption of cell phones by teens
  • Apple’s iPhone – good handheld browsing experience (I’m expecting a large uptick in traffic when the 3G version goes on sale next month) – the iPhone already ranks 12th on the list of handsets in the US despite relatively small marketshare
  • Popularity of social networking
  • Better UI’s
  • 3G adoption / Wi-Fi in handsets

We’ll be writing a lot more on this topic this year. Stay tuned.

June 9th, 2008

$199 iPhone – a real price point for consumers

Finally, with a keynote today, the speculation ended on what would and wouldn’t appear in the new iPhone. Lots of press on this topic today, but I’m going to focus on a couple of the highlights for me coming out of the event.

The price point of $199. Wow. A few years ago, only about one-fifth of cell phone owners were willing to pay more than $100 for a cell phone. That percentage has been creeping up year over year. Use of social networks, better browsers and faster network speeds (among other factors) have created an appetite for devices with QWERTY keyboards. Consumers are willing to pay more. Moreover, compared to the prices announced last year, this seems like a bargain. This new price point is a lot more easy to rationalize than the one last year – last year Apple spoke to the notion of phone + portable media player + portable browsing device, etc.

… all of it added up, and it made several hundred dollars seem like a bargain. Consumers didn’t “buy” the story. The $199 price point is a real cell phone price that will be attractive to a lot of consumers. Still missing a great camera, but hitting the target on price and making some of it’s competitors look expensive.

June 9th, 2008

Apple’s MobileMe and 3G iPhone

MobileMe – this was the portion of the announcement that I was most excited about. To date, Apple has been one of the few companies (perhaps only) pulling together the content pieces (photos, videos, music) that increase the switching cost to consumers. When it comes to cell phones, consumers aren’t that brand loyal – at least here in the US in the land of subsidies. Content, however, increases the switching costs – iTunes and iPhoto – combine content and UI familiarity to build a loyal base of customers.

One of the pieces that’s been missing at least from Apple’s portfolio has been a strong social networking play. It’s fantastic to have the sync features across all of my devices. We know consumers want to buy content once, create playlists once, pay for access once, etc. and then be able to access from any device. Apple sets a high bar here that has been challenging to replicate at least with media. (Their “nod” to MS on “Outlook for the rest of us” acknowledges that) Consumers also want to be able to share.

Communication isn’t simply about voice calls and text messaging. We want to be able to share our photos and videos with our friends and family as well. For most users of social networks, this has meant stringing together a lot of pieces today – downloading photos from a phone to a PC and then uploading and then editing and tagging. MobileMe takes us a step in the right direction. Getting a lock on being the hub of a consumers social mesh or network will increase consumers’ switching costs even more.

Next round I’d love to see more “tagging” of media (e.g., names, location, etc.) as well as some help distributing the content/communicate out to my network of friends and family. Media with dynamic content added by the consumer will take the UI to the next level.

Great to see the number of applications growing – and kudos to Sam Altman for his appearance at the WWDC. It’s a very cool application if you haven’t seen it. It’s great to see more and more applications like this available for the iPhone.

As always, great stuff from Apple and I can’t wait to get one of my own to play with.

June 5th, 2008

Smart Marketing Tactics for Verizon/MediaFLO’s Mobile Video

I was watching the Stanley Cup Finals last night. There was a really good mix of ads from Verizon. (I have Tivo, but I slowed down to watch these ads). They were promoting NHL video content during an NHL game. They were promoting goals scored, highlights, etc. The ads featured the phones. Verizon also did their traditional network quality ads, but they mixed in a few promoting the video service. It seemed to be really smart marketing in that they a) were focused on an audience interested in the content and b) that they presented a use case for watching video on the cell phone – watching the goals and highlights or seeing updates during the game. The small screen in this case would complement the larger screen rather than substitute. This kind of marketing should help drive consumer interest.

Saw another story today (see Fierce) on MediaFLO/Verizon/AT&T and the upcoming U.S. Open. “Live” coverage – great idea.

Again, they are showing consumers a use case. Most of us work Thursdays and Fridays. This gives us a way to stay tuned in or watch while at work or away from our TV’s. The Internet could provide some of this, but it’s a use case and provides some context for “why I would want mobile video services on my cell phone” – something that hasn’t been part of enough of their messaging to date.

June 5th, 2008

Verizon’s Bid for Alltel – Implications for Sprint?

I heard the concrete rumors yesterday, but this topic has been one that folks have been speculating about for a long time. All morning long, people have been asking me what it means for Verizon Wireless?

Short answer: #1 wireless carrier in the US with 80M subscribers. Alltel adds 13M to their rising total.

Other highlights:

  • Common network technology and roadmap
  • Both use BREW
  • Similar ARPU though VZ has higher data ARPU
  • Fills in coverage gaps in rural areas
  • Cost synergies – $9B quoted in the press release. Always a lot of work to achieve.

Alltel is substantially smaller than Verizon, but is still a very large company.

Being smaller, Alltel has been nimble and able to roll out new services quickly. They were innovative with their friends/family circle plan being first to market in a category that T-Mobile has now become famous for. They have a great UI on their new handsets. Hopefully, this tradition of innovation with new product roll-outs will continue.

I think one of the more interesting questions could be: what does this mean for Sprint? Do they have enough scale to be cost competitive with the others? It’s a question that I don’t have the means to answer, but I’m sure some of the financial analysts will be. T-Mobile benefits from the scale (to a large extent) of their corporate parent in Europe though they lack the wired (local, long distance, TV) infrastructure and service offerings of AT&T and Verizon. Verizon’s choice of LTE will give them a cost advantage. WiMax still seems to be Sprint’s choice alone.

What does this mean more generally for players who aren’t either really, really large? or MVNO’s? Mixed models will still work. My grandmother’s telco (see blog) that serves a population of several thousand is a profitable entity, but they rent/lease wireless from a larger network operator. Rural operators still have a play.

Will be interesting to watch.

June 4th, 2008

Screenvision Speaks to Audience with Txt’ing

Verizon made an announcement today (see Fierce) that they will be enabling an interactive text polling program to poll users on their music tastes. Results will appear on the screen. There will also be some marketing around Verizon’s Vcast service.

I don’t get the polling on music tastes.

What I wonder about a deal like this is which way the money flows. Screenvision sells advertising, but Verizon and/or Screenvision seem to be adding infrastructure to the theaters that allows the results to appear onscreen. A number of vendors have web-based programs that allow this – they use them with radio DJ’s, TV show hosts, clubs, concerts, etc.

It’s also not clear from the announcement if this will be limited to Verizon Wireless customers. Could also be an equipment/services “play” from Verizon.

I think this announcement has more potential for Screenvision. Rolling out the ability to interact with their audiences could have significant implications. Polling and trivia are entertaining – why not get people to the theater early to eat more popcorn and soda?

Could they actually get their moviegoers to register? (Anyone ever played those trivia contests in bars where they post the leaders and percentage with correct answers?) Few entities (e.g., Fandango) actually have relationships with moviegoers. Could we eventually vote on what trailer we’d like to see next?

There are so many possibilities. And, they are different from TV – with TV, there could be hundreds of thousands or millions interacting with a program (anyone see American Idol’s numbers?). Here you could be networked with theaters across the country, but you could also play against the 50 or few hundred in the theater with you – you could see your competition. There is a long list of possibilities that I can think of – but extending time of engagement with audience, developing loyalty, getting customers to register, developing a better understanding of customers, etc. are all good things and can be achieved with this type of service.

Anyway, seems to be a really smart play by Screenvision.

June 2nd, 2008

Mobile Content: It’s Not Just About Ringtones Anymore

So, we knew this and we’ve been showing this in our forecasts for sometime.

Personalization applications have been phenomenal for wireless carriers for the past few years, but we’ve believed that it would take more applications oriented towards entertainment and utility (e.g., information services, mapping, etc.) to drive demand beyond young adults and teens.

AT&T Wireless released their top ten selling applications and games for Q1 2008. Entertainment takes three if not four of the top spots – depending on how you want to define MusicID. MySpace Mobile – social networking – is the third ranked. One could argue that those with ringtone or wallpaper applications may have downloaded them long ago and are simply adding content. Still, it’s a very different list than we would have seen two years ago.

Q1 Top Selling Apps

2)XM Radio
3)MySpace Mobile
6)My-Cast Weather
7)The Weather Channel
9) eBay
10) Billboard Mobile Channel

They also released their list of top-selling games. Interestingly, they don’t look that different than lists from other carriers that I saw a couple of years ago. I’ve seen some amazing mobile games in the past year – why there aren’t more being sold is an interesting question.

Q1 Top Selling Games

3)PAC-MAN by Namco
4)Wheel of Fortune 2007
5)Diner Dash
6)Midnight Pool
7)Ms.PAC-MAN by Namco
8)World Poker Tour ™ – Texas Hold ‘Em
9)World Poker Tour 2
10) Guitar Hero® III Mobile

June 1st, 2008

BREW 2008 – My Thoughts

I attended my first BREW conference in San Diego last week. It was an excellent event by all measures – good sessions, announcements, and people. It’s easily one of the best wireless events I’ve ever attended.

Qualcomm introduced a number of new components into the BREW platform. I had seen many of these concepts before, but from smaller companies. When I see them added into the BREW platform, I think, “OK, this is going to be mainstream. We’re not simply talking about the dreams of a handful of entrepreneurs.”

One of the first introductions of the week was with Adobe.

Full support of the Adobe three screen initiative with FLASH is big deal. A richer media environment eventually making it’s way on to a lot of cell phones (Qualcomm stated that they had 100M devices in the market) is a good thing and will drive use of data services. Also made me wonder what else Qualcomm has in mind longer term – they had a demo of MediaFLO in the car. Will we see the BREW platform move beyond cell phones to portable media players or into the living room?

Support for off-deck content sales. This should open a lot of opportunities for smaller publishers as well as brands to get their applications on to more handsets.

Widgets … I feel like I’ve been speaking about the power of Widgets to drive adoption of data services on cell phones for a long time. I’ve been speaking about why it’s not a great idea to try to shrink the desktop experience on to a small screen. (See research) However, when Andrew Gilbert and Paul Jacobs say the the mobile browser is not the future and that they don’t believe in shrinking the desktop experience … wow, a lot of people listen. This was one of the best things I heard at the conference. Adding widget support to the BREW platform (with Plaza) should be exciting news for publishers.

Fierce has a thorough write-up of the news.