NFC finally to arrive on mobiles?

This could finally be the call for true M-Commerce: an impressive list of the silverback gorillas in mobile have apparently agreed to cooperate on NFC (near field communication). Nokia, Samsung and LG from the OEM side, Mastercard on the payment side and a whole raft of large carrier groups, including China Mobile, Vodafone, Cingular, Orange, Telefonica, O2, SFR, SKT, KPN, and WIND signed up. Since the chips are being provided by NXP (formerly Philips Semiconductors) and Sony, it may be expected that Sony Ericsson will also sign up.

This group could finally have enough muscle to push this technology into the market and solve the chicken-and-egg problem: only when a critical mass of handsets is equipped with the technology will it be attractive for vendors and service providers to equip their retail outlets, etc with the respective technology. The three handset makers now committed together represent nearly half of the entire market, which should give this a good push.

So, besides catching the London Tube and buying a Coke, you might also be able to download the latest games, applications and tunes to your phone, always paying by coolly waving your phone and quickly entering a PIN. Bright future...


Vodafone loses brand value

Vodafone has lost 12% of its brand's value, which is now "only" worth some $21 bn, says brand experts MillwardBrown. It's brand value is dwarfed by China Mobile with a cool $41 bn, which makes it #1 amongst telecoms and #5 amongst all brands.

Who holds #1? Google (tempted to say "of course") - the brand is valued at $66 bn and it recorded the highest value rise over the last year with 77%.

In telecoms, a notable mention must be Cingular, a brand that is being eliminated, which added 39% (the third highest climb overall) in value in 2006 and slots in as the 6th most valuable telecoms brand with AT&T, the brand that will replace it, nowhere in sight...

It is NOT (only) the kids playing mobile games

Here's some always again interesting finds on mobile game demographics re-confirmed :

29% of all 25-34 year-old US-Americans downloaded mobile games in 2006, and 27% of the 18-24 year-olds but only 15% of 13-17 year-olds. The older folks also play more: 50% of the two older age groups vs 41% of the teens play mobile games on a daily basis.

The picture is naturally somewhat distorted as proportionately more adults own mobile phones than teens (although the latter catch up quickly).

However, considering that, in the UK, the average credit kids have on their pre-paid phones (which most of them have) is a meagre £5, which leaves little to no wiggling space when compared to game prices of £3-5 per pop: they simply don't have the dough to buy more.

Another re-confirmed suspicion highlights the distribution challenge: 29 million US-Americans play mobile games, only 7 million download them, and that means 22 million play whatever is on their handset - whether it is a good or a bad one. 22 million gamers that do not access all the great games that are out there show that there is a severe disconnect regarding a) discovery and b) marketing and distribution in general. Whilst these will not be the only factors, they are significant.

Apple's iPhone with 10-30% market share? I don't think so

Another survey with interesting numbers: according to this one, 9% of all US consumers are "very" or "somewhat" likely to buy Apple's iPhone. Funny that: The iPhone is initially only available on Cingular/AT+T (cf here), which has a market share of 28%, so just about 1/3 of all Cingular subscribers (or c. 19 million) would have to be interested in buying an iPhone.

Folks, buy Apple stock now. But then (screeech): Apple said they were only targeting 1% of the market, which makes it 1m devices, and AT+T's COO says they have already 1m inquiries ... this would lead 18 million willing Cingular subs + everyone outside the US without the sleek and coveted thing. Not so good...

Isn't all this somewhat weird? The phone costs $499 and $599 respectively (at least according to this), and 1/3 of a carrier's subscribers going for one of the top-priced options would be contrary to everything we've seen so far. Rather unlikely, I'd say. So: if the price was dropped to below $300, an additional 10% would buy the 4GB model and a staggering 20% the 8GB model. Make that 30% market share then - with one device. Woah.

The blurb concludes that Apple should exceed its sales goals for, wait a minute, 2008 (sic!) and then closes with the beautiful caveat "provided the device lives up to consumer expectations". Amen!

If Apple gets it right (which I hope as I like them), then 1m devices in 2007 would not be a bad start (considering it is one carrier and one country), in particular as high-priced as they are. Assuming that they could in fact open the pipeline for higher demand, we could well be seeing one of the top handsets in the market place (so-called blockbuster handsets regularly are between 2-3.5% share of all handsets on a carrier). That would be impressive enough.

Then they would only have to add 3G, I suppose...


Mercedes Markets Mobile

It is another one of these examples where PR speak dilutes the message till no one knows what it actually is but here goes: Mercedes has instructed an agency to increase its use of mobile phones for marketing purposes, and the good folks from the PR agency do not forget to mention that "no other automotive manufacturer in the UK has implemented and maintained such a large mobile presence" So: what does that mean?

They want to "encourage active response from traditional advertising such as poster, print, TV, and DM, via mobile text calls to action, driving users to Mercedes-Benz mobile sites." But how, with what, what for? I don't know and they don't say. Now, mobiles and mobility - there surely is a common theme here somewhere. But will they do more than inform customers via SMS and try this Bluetooth trial? I would really wish they'd be somewhat more aggressive in communicating initiatives.


Cellcom does Mobile Advertising...

Israel's largest mobile operator Cellcom has launched an advertising-funded games service, reports MobileIndustry.biz. The game titles (no word on which ones these are) are free to subscribers and the network has apparently enlisted some of the heavyweights as advertisers: Disney, Nokia, McDonalds, Diadora, Adidas and Samsung are all listed to have "already signed up". Campaigns are apparently being designed by Saatchi & Saatchi, BBDO and McCann, so on that front all ingredients should be there.

Unfortunately, the press release remains a bit foggy on how it is actually done. It talks of "ads appear[ing] as product placement in the game and within different areas of a games environment" and they say that "[t]he digital coupons and product placement methods used in the trial have proven themselves with high conversion rates among [their] clients" but no numbers or more insight is being offered.

With the limited information provided, the question unfortunately remains if this is only a PR coup on the flavour of the month or if it is indeed commercially viable. Next time?

Update: Some results of the trial can now be found here.

NOM is in Europe

One of the best game ever to have been created for mobile phones is finally, finally coming to Europe. I would have loved for us having been the ones to do it but, hey, you cannot always win. In any event, in spite (or because?) of an oddly early 70's design feel and simple graphics, it is a great game that beautifully shows what mobile gaming can do (a view shared by many reviews, such as the ones, here, here and here).

The story of NOM is - for a mobile game at least - very long. The game had been released as early as 2002 by Korean developer Gamevil and has recorded more than 1 million downloads in Korea alone. You could consider it the mother of all 1-button-games, a category considered by many as being the perfect entry point to mobile games (here's a feature on Nom and some other of Gamevil's gems).

So, good folks of Disney's Living Mobile (the lucky ones who got their hands onto it for Europe), good luck with it!


Mobile Ads for PrePay Credit works with Teens

Here is some interesting research on mobile advertising. According to a recent survey, a staggering 82% (!) of 11-20 year-olds would be happy to receive advertising in exchange for top-up credit (76% for discounts/special offers). There was more to report on the survey of course, which you can read e.g. here.

The most interesting conclusion is that the kids apparently fully understand the mechanics of advertising: advertising business is paying for eyeballs. If you want my eyeballs, you have to pay me.

They do not really seem to give a hoot WHAT ads they actually receive (although at least 71% would not mind to receive ads on things of interest to them) but more what they get in return for allowing it. This would appear to create a small dilemma because it is somewhat difficult to communicate to the advertiser that one wants it to subsidise the youngsters' top-up credits ("so who was that ad from?" "Can't remember but was worth 2 quid"). At the very least, advertisers would have to take a different approach to the messages (as in brand message, not as in SMS) and the type of campaigns they create in order to take this into account.

Blackberry Platform Failures...

So, now we had it: no Blackberry connections for "millions" of users. Thousands of appointments unconfirmed because of the inability to get this last-minute change of plan out via e-mail, millions of leading executives severely disturbed and seriously troubled as they could not actually do anything on their way to work (a wonderful little account is here).

So what was it? RIM said it related to a disobedient "new, non-critical system routine" that had to be installed (cf. NY Times). Now, non-critical might sound soothing to an engineer. It will give every the overwhelming majority of Blackberry users, all the politicians, lawyers, marketing executives, bankers, etc the jitters: how bad will it actually be if it is critical???

The outage showed the weakness of the otherwise pretty compelling hard/software combination: it seems to contain so much hard-coded "stuff" that it entangles hardware, network and device so closely that one OEM-side error triggers outage across all networks and all devices, and that is not good! But then: according to Nasdaq, this "not good" is "only" worth $1.88 per share - that's how much the shares lost on Thursday.


Using the Power of Mobile for Good Causes

The New York Times has an article on "cellphone fundraising", which unfortunately focuses on the wrong points: They mainly report about PR-needy consumer-protection associations that quarrel about the fact that users who want to donate $20 to the Red Cross are being charged 4x 15c SMS charges as the agreed maximum donation is $5 (and they would probably be quarreling if there wasn't a maximum for it would drive people into certain poverty).

Folks, you need to get out more! Isn't it great that you can donate money to the Red Cross like this? The administrative costs for a mobile campaign will arguably be lower (and hence the return for the charity higher) than with the use of traditional means. The Red Cross gets more money. Everyone wins!

The concept of cause-related mobile campaigns - and that doesn't only include actual fundraising - is fantastic:

  1. As has been mentioned a gazillion times, mobile phones have the capacity to being the most targeted marketing approach known today. Conversion rates should be very high and acquisition cost per capita therefore very low. E.g. did Rights Group's collaboration with U2 and the ONE campaign exceed 25% response!
  2. People tend to part easier with their money for causes they believe in. In particular calls for smaller amounts as they are already customarily being paid for via mobiles would appear to be attractive.
  3. Premium SMS is one of the most efficient micro-billing tools in the world. It is globally available and simple to use.
  4. The overall cost of premium SMS would need to be lower than those for traditional fundraising.
More power to mobile charity work!


Amp'd ARPU >$100, >$30 on data, >$15 on content

Now, this should be welcome news to the mobile content folks: more than $30 ARPU on data consumption vs the industry average $6.74 (which is what IDC reported), and more than half of that are from content (more than double the industry average).

These are the figures MVNO Amp'd has released. Some juicy mobile content stuff in there:

- 5% of original content sees 30% of all downloads.
- The niche lives: ultimate fighting and super-cross see a lot of traction.
- Amp'd subscribers download more full music tracks than ringtones (which nicely confirms my explanation of that trend set out a few days ago here).


Crazy numbers: mobile marketing worth $19bn by 2011?

According to ABI Research, mobile marketing will be worth a staggering $11bn by 2011. Apparently, by the end of this year, it will already be a rather honourable $3bn market.

Now, I don't have the means (or inclination) to buy the underlying report but at least they divulge that the amount is to include proceeds from mobile search and mobile video, and I suppose one could predict that, in 4 years time, there may well be more advanced devices that will actually make it fun and worthwhile to use them for more elaborate surfing and rich media consumption. Not very specific though. Other than some foggy reference to the wealth of data carriers sit on and "due in part to mobile broadcast networks' presence in all major markets" (doh!), all the rest is apparently, well, apparent...

To me, it's a whole lot crystal ball-type assumptions.


GPS mobile phone showcase - 30% take-up with the right service!!!

And the pretty news comes from Disney Mobile. The MVNO shared some insight on usage patterns of its subscribers, and there is some interesting little pieces of information that would suggest that the combination of a consumer value driver (here: security) with a technology (here: GPS) might make a business:

Allegedly 30% of the their subscribers use its GPS location tracking services (parents can locate their kids via the handsets' GPS functionality), and parents who do so use the feature 14 times per month on average.

56% of Disney Mobile subscribers are adults and 44% are children.

A take-up rate of 30% of a relatively novel service with high service usage (every other day) is pretty impressive for any media!

Final blurb: 30% of location requests were made from the Web and 70% from the handset, demonstrating the cross-platform nature of the application - and the huge potential of mobiles.

US ringtone sales down: Novelty wearing off? Nah!

Broadcast Music (BMI) projects that U.S. ringtone sales will dip to $550m in retail sales in 2007, down US$50 million from calendar year 2006.

Here's why according to BMI: "We believe that the ringtone market's growth has leveled off and the novelty phase has ended." You can read more of it here

I do not think this explanation is accurate. I suspect that it is not novelty wearing off but the kids and technology smartening up: 1) phones and computers often come equipped with Bluetooth now, 2) new phones usually are MP3-capable. The kids have figured out how to transfer their favourite tunes to their phones via Bluetooth.

This might result in sub-optimal loops being cut (i.e. the tones not rolling as nicely as a ringtone as a professionally-made one might) but on $1.99 saving per tone (when the full track costs you a mere $0.99 on iTunes), that is a no-brainer. Also: with programmes like Garage band et al, every kid can cut loops into MP3s, too.

This last bit is perhaps the one that killed it off: if a product is unique in that it is defensible against similar products on other media, pricing is not under direct pressure as it is not directly comparable (e.g. monophonic ringtones and recorded music). If it becomes comparable (e.g. MP3's on mobile phones vs. iTunes), there has to be something special justifying a higher price-point. The higher the difference in pricing, the better that USP has to be. 20-second loop cut by a pro? Not good enough...

Conclusion? Bad piece of pricing policy and marketing, I would suggest. Elementary, isn't it? You've screwed up your own market, folks...


Venture Capital: Kawasaki's hints on how to get to it...

This post is not strictly mobile (it could be used for mobile ventures though, too, and, besides, why does it have to?).

In any event, the intelligent and funny posts of Guy Kawasaki (amongst other things blogger, early-stage VC and previous big gun at Apple) are really good reading. So: here's his take on "How to get the Attention of a Venture Capitalist" although, in this case, the treat of Guy's colleague at Garage, Bill Reichert, might be even more relevant: it should actually helps you to also KEEP that VC's attention, so make sure to also check out Bill's notes on "How to Fix your Pitch".


First GPS-equipped mass market phone out in Europe

It's out of its cage! Nokia tells us it started shipping the brand-spanking new N95, which includes - a first outside advanced markets such as Japan - GPS on board of a mobile phone (next to MP3 player with proper 3.5mm audio connector [!], 3D hardware acceleration, WLAN and a 5 mega pixel camera with Carl Zeiss lense)

Now, not only does the phone have GPS but also comes preloaded with Nokia Maps, an application that has the street maps for 150 countries in (the few remaining countries that presumably include such remote places like Queen Anne land in Antarctica probably don't have streets!).

This would arguably be into the face of Roger McNamee (see yesterday's post on this) concerning the defeat of multi-purpose devices. If the N95 would take over, it would probably be bye-bye to TomTom and other SatNav single-purpose devices. Since you are carrying your phone with you, it would also reduce the risk of your car being broken into: thieves apparently are mainly to into SatNav devices these days...

FHM & Heat bet on UGC - EMAP puts Yospace to work

It took them a short while to wrap the acquisition of Yospace up and digest everything but now EMAP announced they'll be relaunching their FHM and Heat brands on mobile centered around the coveted UGC; and all will of course be driven by Yospace's platform. The blurb published by NMA (you need a subscription to read the full article) reports that "it is still too early to officially talk about the services" [why do they then???] but the intention is basically to leverage the brands to drive user-generated video content.

For those not so familiar: Yospace powers the successful SeeMeTV service of UK operator 3. FierceMobileContent tells you why it's great.

I am curious as to what this will mean other than the EMAP team seemingly struggling to transfer editorial onto the mobile platform in a successful business model...

12Snap back at home...

Neomedia has sold 12Snap back to its management incl co-founder Birkel for $5m (remuneration is $1.1m cash plus debt, services, etc), reports PR Newswire.

That means that Neomedia wiped out a cool $17m value in little more than a year: you may remember they acquired 12snap for $22m early 2006.

All the very best to the good folks of 12snap!!!

Which mobile are you?

Here's who you are according to the mobile phone brand you carry:

Nokia - the choice of family-minded, middle aged managers
Motorola - favoured by fashion conscious under 24s
Sony Ericsson - for ambitious young men trying to make their mark
LG - favoured by mums
Samsung - for young women focused on their career

That's at least what Nielsen Media Research says... I wonder where all the divorced, child-less middle managers are...


>1/3 of mobile handsets were changed in 2006

So this is how fast the hardware landscape can change. Imagine BMW's market share could double (or be halved) in one year. With dynamics such as the ones reported here for the mobile handset sector, this would be entirely credible:

Some 36% of mobile phone users in Argentina replaced their handsets in 2006, according to a recent study by local consultancy Carrier y Asociados as reported by Cellular News.

The study, called Telefonía móvil 2007: Segmento individuos, concluded that replacement of mobile devices was common in all income segments.

According to the study, one out of four mobile telephony users in the country plans to replace their handset in 2007, which would mean nearly 8mn new devices.

"Young people aged below 18 tend to replace their device more than others because they want telephones with new features such as MP3 or cameras," Carrier told BNamericas.

Carrier also stressed that handset subsidies operators offer to clients are crucial to keeping turnover high, although he considered subsidies are lower than a couple of years ago.

Mobile Device Fragmentation?

Interesting discussion by some of the venture capital rockstars on mobile devices:

At the recent Churchill Club’s Top Ten Tech Trends, Roger McNamee (Elevation Partners; previously Silverlake Partners) posed as the #1 trend mobile device fragmentation. He discusses this with Steve Jurvetson (Draper Fisher Jurvetson), John Doerr (Kleiner Perkins) and Joe Schoendorf (Accel Partners).

Click here for the AVI of the discussion. A write-up by DFJ is here.

The audience was divided if they should or should not follow McNamee (last but not least one of the power VCs): The yes/no vote was split.

Test 1, 2, 3 - gosh, it's live...

And with a bolt of lightning, Volker enters the blogosphere...