Mobile Internet 2.0, Berlin: Day 1
My notes from todays talks - a bit briefer than normal, mainly because I've been paying attention to most of them...
Overall themes
A few years ago I remember mobility alone being justified as a reason to charge for mobile content. This notion seems to have been dropped, there's an acceptance that "internet thinking" is prevailing.
A few speakers have mentioned the idea that "all the enablers are in place": networks, handsets, etc.
Thomas Husson, Jupiter
iPhone is a positive trend but numerically weak: 200k sold in the UK, 90k by Orange in France, 80k by T-Mobile in Germany. iPhone users in France average 110mb pcm downloads. In the UK 60% of iPhone users download > 25mb pcm.
Web'n'Walk, the flat-rate T-Mobile tariff, has been around for 2 years and has 3m users: 5% of T-Mobile's overall customer base. Flat rate date might be clamoured for in our circles, but it's yet to reach the public at large. Low internet usage on mobile is driven by fear of cost and ignorance of benefits; 57% of consumers aren't interested in anything beyond voice and SMS (corollary: 43% want more). Mobile broadband won't hit >50% penetration until 2010 - in Japan is took 5 years to reach this rate too.
Users aren't prepared to pay for content, so it becomes ad-funded.
Triple digit growth doesn't mean much when you start from zero.
Click-through rates are high due to early-adopter audiences; they will come to track online rates. 47% of advertisers have trouble measuring their mobile ad spend. Now til 2010 will be a period of education; early growth in the mobile ad industry will occur after 2010. Ad spend isn't proportionate to attention given to a medium - TV gets lots of attention and lots of spend; print gets lots of spend and little attention; online gets lots of attention and little spend. In Japan ad revenue is roughly 2.5 euros per customer per year.
Antoine Couret, Bouygues Telecom
Bouyges have 2m I-mode users, 400 official sites, 50% of their I-mode users are active spending 3mb/customer pcm at a flat rate price of 9.9 euros. Previously PAYG customers used to download 1mb pcm.
Wow: only 3mb per month? That sounds v low and works out as 3 euros per megabyte - quite expensive for the user. Not that mb is a great measure of usage when a single video download can severely skew figures
Mainly email and "practical sites". They're now transferring elements of I-Mode to WAP handsets: flat fee, subscriptions for content, portal structure and free-to-receive email. PAYG customers have their bills capped. Content that's free online can't be premium on mobile.
Oliver Schmidt, O2 Germany
Not much that O2 has done with regards to data revenues has worked. This is an exception. They're the #4 operator in Germany with an unusually high 20% data ARPU.
If you price many separate services sensibly, customers still end up being very confused by a tariff incorporating many price plans. So O2 have 3 data plans: S, M, L.S is a PAYG package, time-based for occasional internet use. M is for 3G use on a handset. L is for laptop owners.
A new mobile portal has better UI, more prominent search, multi-column layout. Aims to generate more revenue beyond traffic and guide the customer to the wider internet.
Panel discussion: Gabor Nemeth (Magyar Telecom), Alexander Franz (3 Austria), Dan Rosen (AKQA)
Moderator: what's missing for a company like Coke to go for a mobile strategy?
DR: They're going for it already. Lots of others haven't, they're waiting to go in. There's a lack of good mobile marketing people. Ad inventory isn't as large as some big brands would like.
M: What are the other key enablers we need?
GN: Sub-laptops are important.
AF: As an operator, we're not just interested in selling megabytes.
M: What else would be needed from a brands perspective?
DR: Advertisers want common standards from carriers. We've been having this conversation for 6 or 7 years and it's holding things back. Flat-rate data obviously. iPhone has disproportionate impact - is it the device or the accompanying package of data? It's difficult to separate the two.
M: Why is something as simple as QR Code not simple to implement?
GN: For Hungary, standards aren't the problem. Hungarians don't read Yahoo or Google, they just use their own sites and services. These are our 4.4m customers.
M: But QR code doesn't mean "English speaking content". I hear contradictory things about capacity of the networks: 3 offer to air TV channels and do Skype over the network whilst others say TV and video could threaten networks. Do we have the capacity to grow the mobile Internet?
AF: Maybe for a GSM operator, capacity is an issue. But at 3 we have only a 3G network, so we'll use it as much as we can.
DR: Get things out there, test them, and then worry about monetising. It's possible to hypothesise too much. Top 5 mobile search terms in the UK are "drinking", "supermarkets", "mcdonalds", etc... completely different to the top search terms on the fixed web.
Tim from Youtube: how fragile are the networks when affected by large data traffic?
GN: When there are too many users in 1 cell.