Mobile Revenue - where's the money?

1. Mobile Revenue - where's the money? By Emilia Kaszubowska Cindy Strong-Jones

2. Mobile computing services boomFEB 2009 • Revenue from European mobile computing business will increase at a compound annual growth rate of 4% over the next four years • Europe as a region has the highest adoption of mobile computing services at 121% penetration, rising to 135% by 2012. • Adoption and usage of mobile e-mail and Internet services

3. PhoneApplicationRevenue • Half of Mobile Phone Application Revenue from Location-Based Services • 13 million mobile consumers downloaded a mobile LBS application • LBS accounted for 51% of the $118 million generated in revenue by downloadable mobile applications such as LBS, weather applications, chat/community, and personal organization tools.

4. Nokia ContentDiscoverer • On-device content portal for S60 and Series 40 devices • It is built on Symbian and Java™ platforms. • mobile user :access to a catalog of content such as ringing tones, video, and applications • Operators: integrate multiple delivery systems • Developers: distribute their offerings • http://www.nokia.com/developers/marketplace/nokia-content-discoverer/flash-demo

5. Success stories Mywaves Video Service • user-generated & branded content • Reaches30 Million Mobile Viewers • < 3 years has become one of the largest mobile entertainment • Make money by advertising and sales of related items • Global Mobile 2008 Award for Best Mobile Video Service • 60 percent of users use Nokia

6. Success stories SpotJots • blogging and social networking application • Free access to SpotJots.com • Money: selling premium services for an extra $2 a month • Free account- see only 200 jots • Nokia introduced SpotJots to several key players in the LBS space, and have lobbied on SpotJots behalf

7. MOTODEV MotororolaSolutionsCatalog • Effective marketing and merchandising tool • Billions of subscribers can learn about your products. Increased sales opportunities. • Direct tie between your product and the powerful Motorola brand.

8. Mobile Games Market Overview Strong growth and innovation in the wireless communications industry has led to the emergence of the wireless entertainment market. Factors such as the rapidly increasing availability of multi-media capable phones, unprecedented growth in the number of wireless subscribers and deployment of next generation wireless networks are responsible for the enormous growth being experienced in the wireless entertainment market.

9. Mobile Gaming Market Size Sources: ARC – arcresearch.com; Screen Digest – screendigest.com; IDC – idc.com; Instat/MDR – instat. com.

10. Slice Share of World Wide Gaming Although Japan and Korea represent the vast majority of revenue generated by mobile game sales, Screen Digest predicted that The Americas and Europe will play an increasing role in the growth going forward and will lead the world in mobile gaming revenues.

11. Mobile Developers Mobile Developer-They remain the creators and producers of the initial game concept to the final playable and released gold master code.

12. Porting Service • Porting Service - Many developers aren’t prepared for the job of creating individual game builds for the hundreds of devices in the marketplace. Just acquiring the handsets themselves is a challenge, not to mention the large commitment to testing and QA required. Then you need to consider localization normally into the five primary EFIGS languages (English, French, Italian, German, and Spanish). This makes the number of SKU’s (stock keeping unit) potentially staggering. • Depending on the complexity of the game, the porting process usually exceeds the initial development costs. There are a few companies which have technology that helps to ease this process through automated tools such as Tira Wireless. This is likely to become the trend due to the high cost of porting without a process that addresses handset diversity.

13. Publisher/Device Handset Manufacturer Publisher - The mobile publishing business is more a mirror of the traditional video game business. They acquire the rights to different IP and typically fund development of the game through internal or external studios to bring it to market. They also typically fund the porting process and manage the delivery of the game to the carriers e.g Gameloft, Mforma, Digital Bridges (now “iPlay”), Device/Handset Manufacturer - The handset manufacturers are the mobile industry equivalent of game console Manufacturers. The leaders, in terms of global market share are Nokia, Motorola.

14. Carriers • Carriers -Carriers wield significantly more power in the mobile gaming space than retailers do in the traditional game business because they have a monopoly over their very large customer base. Carriers don’t only provide the storefront but also drive pricing, technology specifications (e.g., 3D API’s, digital rights management, community infrastructure), determine/enable various business models (e.g., subscription, one-time download, micro-payments), and they provide the network that connects it all together. No other player in the value-chain touches so many aspects of the user experience. Without strong carrier partnerships a publisher and its products simply will not make it. This group includes the large multinational carriers such as Vodafone, T-Mobile and Orange • Independent Channels -This category refers to all web, WAP (“wireless application protocol”) and SMS (“short message service”) sales channels not owned by the carriers.