Gates and Jobs - the guys who defined the computing industry May 31, 2007
Posted by chetan in : US Wireless Market , add a comment
to 
(Source: Engadget)
TiE Seattle: Content Monetization May 30, 2007
Posted by chetan in : US Wireless Market , add a commentGreat event coming up tomorrow with Cole Brodman of T-Mobile doing the keynote followed by panel discussion. More information here. Hope to see you there.
Surface Computing
Posted by chetan in : US Wireless Market , add a commentSomething new and refreshing from Microsoft this morning
More pics and info at http://www.microsoft.com/presspass/presskits/surfacecomputing/default.mspx
Mobile Advertising Book Progress May 29, 2007
Posted by chetan in : AORTA, Carriers, Indian Wireless Market, Japan Wireless Market, Messaging, Middleware, Mobile Advertising, Mobile Applications, Mobile Ecosystem, Mobile Entertainment, Mobile Search, Strategy, US Wireless Market, Wireless Value Chain, Worldwide Wireless Market , 1 comment so farHave been hiding working on the book for the last few days. Getting close to finishing up two more chapters
Market analysis
a. How big is the market?
i. Trends and forecasts
b. Implications of mobile advertising
c. Addressing the problem
i. The problem of mobile reach
ii. The problem of storefront
iii. The problem of understanding the customer
iv. Push vs. Pull
d. Publishers – the old and new guard
e. What do advertisers want?
i. Advertising industry growth
ii. How does mobile fit in?
iii. What ads might be mobile only? What ads might be multi-channel (Web, Mobile etc)
Mobile Advertising Value-Chain Analysis
a. Introduction: Mobile Advertising Value Chains
i. How does the value chain compare to other advertising mediums?
b. Messaging
c. WAP/XHTML
d. Mobile Search
e. Local Search
f. Downloadables
g. Mobile Video/TV
h. Mobile Audio
i. Mobile Community
j. Directory Assistance
k. Code based
l. Bluetooth, WiFi, NFC
m. Active Screen
n. Differences in value chain across regions
o. Evolution of value chains
p. Takeaways
Thoughts?
Have been interviewing many of the leaders in the space. More on that a bit later.
American Idol and Mobile Marketing May 24, 2007
Posted by chetan in : ARPU, Gaming, Messaging, Mobile Advertising, Mobile Applications, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Search, US Wireless Market, Unified Messaging, Wireless Value Chain, Worldwide Wireless Market , add a commentAmerican Idol was a game changer in the US as far as mobile marketing is concerned. Last night 74M text’d in.
The Mobile Entertainment Forum (MEF) today published a draft Code of Practice (Code) outlining best practices for Participation Television (P-TV) in the United States. P-TV services typically provide viewers the ability to interact with television shows – for example, where viewers are asked to text in votes or enter sweepstakes using their mobile phones. Often these shows integrate enhanced content with premium rate mobile services. P-TV is expected to experience continuing fast growth in coming months.
Had a chance ealier today to talk to Edward Boddington, MEF Americas Board member and Telescope, Inc. Founder. Boddington helped develop ‘Pop Idol’ in the UK, which became ‘American Idol’ in the U.S. (he handed the envelope to Ryan Seacrest last night on ‘American Idol’ announcing Jordin Sparks as the new American Idol).
Some numbers from Ed. $300M P-TV in UK, 30% of it is mobile messaging. In the US, the numbers are in the range of $30-50M though accurate estimates are not available. The final version of the code will be available at www.m-e-f.org within 2-3 months. Thanks to Chris Pfaff for arranging the interview.
Google and Yahoo Phone
Posted by chetan in : US Wireless Market , add a commentA majority of US consumers are willing and ready to purchase a Google or Yahoo!-branded mobile device if and when they become available.
According to a study conducted in April by market research firm the EQUS Group, 55 per cent of respondents say they are willing to purchase a Google or Yahoo! mobile device.
Conversely, only 21 per cent say they are not willing to purchase such a device, while 23 per cent of respondents were undecided.
EQUS also found that 69 per cent of consumers currently use mobile search tools on their mobile phones.
Al Nazareli, CEO of EQUS, said: “Because search functionality is so highly utilised by mobile phone users, Google and Yahoo! are uniquely well-positioned to enter the mobile device market and may have an advantage over other consumer brands looking to enter the space.”
(via Telecoms.com)
Can you hear me now?
Internet Advertising revenues hit almost $17B for 2006
Posted by chetan in : Mobile Advertising , add a commentThe Interactive Advertising Bureau (IAB) and PricewaterhouseCoopers LLP (PwC) today released the Internet Advertising Revenue Report which shows record results for the full year and final quarter of 2006. Internet advertising revenues in the U.S. continued upward totaling $16.9 billion in 2006, a new annual record exceeding 2005 by 35%. Q4 2006 internet advertising revenues totaled $4.8 billion, representing record revenues for a single quarter and a 35% increase over same period in 2005.
The report states that search, display, classifieds and lead generation all continue to grow at a healthy rate with an increase in both performance-based and CPM or impression-based pricing. Consumer advertisers continue to represent the largest category of internet advertising spending.
More details here
http://www.iab.net/resources/ad_revenue.asp
It should be noted that mobile hasn’t even started to appear in these numbers yet.
Alltel deal - quote at GigaOM May 22, 2007
Posted by chetan in : US Wireless Market , 1 comment so farOm did the story on Alltel going private. My quote was in the story
Chetan Sharma pointed out that wireless world is following the rule of three and since Verizon, Cingular and Sprint account for 75% of the total wireless market in the US, the buyout shouldn’t come as a surprise. Alltel has been looking to merge with Sprint or Verizon but both were not interested at this time.
Nevertheless, Alltel isn’t that bad a buy, and has a EV-DO Network in place. Sharma says, “My sense is that the private equity group will continue to operate the company and start offloading bits and pieces (by regions) when the timing is right for Verizon and Sprint.”
iPhone universe - Before and After May 21, 2007
Posted by chetan in : US Wireless Market , add a commentCheck out this insightful post from Tomi regarding iPhone’s impact on the mobile industry. As always, his posts are thought-provoking.
Carnival over at Martin’s
Posted by chetan in : US Wireless Market , add a commentMartin Sauter, author of Communication Systems hosts this week’s Carnival. Great posts. be sure to check them out.
Alltel goes private
Posted by chetan in : US Wireless Market , add a commentAs we discussed in a post earlier this year, Alltel is going private in what is being billed as the largest buyout ever in the telecom industry for $27.5B. Scott Ford is one happy man
RCRWireless News May 19, 2007
Posted by chetan in : US Wireless Market , add a commentOur Mobile Data update for the US market appears in RCRWireless News (sub requierd) this week
Microsoft buys Aquantive May 18, 2007
Posted by chetan in : US Wireless Market , 2 commentsIn a bid to boost its presence in advertising, Microsoft said that it will pay $6 billion to acquire Aquantive, a digital marketing and services company.
Google, your turn.
Mobile Messaging 2.0
Posted by chetan in : US Wireless Market , add a commentI will be blogging at Mobile Messaging 2.0 where fellow bloggers are discussing next generation of mobile messaging. The site is sponsored by Airwide.
In my first post I wrote
As seen in latest numbers, mobile messaging is catching up in the US. The top 3 carriers in terms of messaging volume - Verizon, T-Mobile, and AT&T did over 53B messages (SMS and MMS combined but majority was SMS) last quarter. Verizon alone handled 22.75B. Since penetration is just around 40%, the growth will continue. As new customers come online and begin using mobile messaging, the experience needs to integrate across different forms of messaging - SMS, MMS, Email, IM. The integration needs to be at the technical level and the business level. The pricing structure shouldn’t be cost prohibitve to the user to suppress usage. Technically, interoperability is still an issue with MMS. Realiability needs to improve tremendously. If we are going to be using SMS as part of our emergency infrastructure, best-effort doesn’t cut it. Timely and guaranteed delivery needs to be part of the course.
Check it out.
Zino Society Event May 17, 2007
Posted by chetan in : US Wireless Market , 4 commentsIt was fun doing the keynote at Zino Society event yesterday. The topic was Mobile Industry Trends, Opportunities, and Challenges. Zino Society is a group of angel investors who also love wine. There were four companies presenting for additional funding, all different and unique
Alphabet Lane - House Remodeling Portal
Yapta - Travel Site - Trip Tagging
Celana Bioscience - Predictive Toxicology, and
Just cause - Philanthropy
Yapta looks very disruptive and has a solid team behind the Alaska Airlines veteran Tom Romary. The site is launching Tuesday, so keep an eye on it.
If you are an angel investor in the Pacific Northwest with a special liking for socializing and drinking wine, Zino society is for you. If you are an entrepreneur looking for funding, a good venue to get in front of qualified investors. Let me know if you want to connect with them.
Third Screen goes to AOL May 15, 2007
Posted by chetan in : US Wireless Market , add a commentAfter trying for more than a year, Tom has finally been able to offload TSM. They definately were the first movers and had built a good business but the investors were more interested in flipping the company ASAP rather than build long-term value. Release here.
Who is next?
Nuance to acquire VoiceSignal
Posted by chetan in : US Wireless Market , add a commentConsolidation continues in this young industry.
Nuance Communications, Inc. announced that it has signed a definitive agreement to acquire VoiceSignal Technologies, Inc., creating an organization with broad resources, solutions and expertise that will satisfy the accelerating demand for speech-enabled mobile devices and services. Nuance expects to serve more than one billion consumers within the next three years with voice-based mobile solutions that allow people to simply and effectively navigate, retrieve and transact across the vast and growing universe of content and services available in mobile phones, automobiles and personal navigation devices.
Nuance and VoiceSignal share a vision to make the growing list of mobile device features, content and services available to consumers through a single button and a natural voice command. With proven technology, broad industry relationships, real-world deployment experience and an organization passionate about speech technology, the combined company will be able to develop new and innovative speech solutions and mobile search capabilities to more effectively serve the rapidly expanding market for mobile services and applications.
Nuance should think of itself more than a speech company, look for some other strategic assets to truly become a dominant force in the ecosystem.
PAN-IIT: SaaS event on 5/16
Posted by chetan in : US Wireless Market , add a commentMy friend Anil is moderating this panel at Google campus tomorrow. Terrific line of panelists.
I will try to make it if i get done with my Keynote at Zino Society in time.
US Wireless Data Market Update Q1 2007
Posted by chetan in : 3G, AORTA, ARPU, BRIC, Carriers, European Wireless Market, Indian Wireless Market, Intellectual Property, Japan Wireless Market, Middleware, Mobile Advertising, Mobile Applications, Mobile Content, Mobile Ecosystem, Mobile Gaming, Mobile Search, Mobile TV, Mobile Usability, Smart Phones, Speaking Engagements, Speech Recognition, Strategy, US Wireless Market, Unified Messaging, Wireless Value Chain, Worldwide Wireless Market , 3 commentsUS Wireless Data Market Update - Q1 2007
http://www.chetansharma.com/usmarketupdateq107.htm
US wireless data market continues to grow at a steady pace offsetting any decline in voice revenues. Growth in both enterprise and consumer segments resulted in a $5B quarter for the industry (by comparison, in 2004, the total data revenues for the year were $4.6B). Given that approximately 60% of the revenues are from non-SMS applications and the subscriber penetration of data services is still low, we remain bullish on the US data market. However, as the subscriber penetration crossed 80% this month, the subscriber growth continues to slow down from its highs in 2005.
- US wireless data market got over the $5B mark in service revenues in any given quarter for the first time. Revenues jumped 12% from Q406 and over 68% from Q106 to approximately $5.5B for Q107.
- Overall ARPU remained at the same levels as Q106 and Q407, which speaks to the value of data revenues in the declining voice revenue market. While voice ARPU declined 6%, data ARPU rose 46%. The average ARPU in the US stands at $8.34 or almost 16% of the service revenues.
- The strongest growth was experienced by Verizon whose data revenues jumped 83% from Q106 to $1.6B. While Sprint still leads in absolute data ARPU numbers, Verizon is likely to take that mantle by Q307. Sprint with $9.25 was ahead of Verizon at $8.7, AT&T at $7.88, and T-Mobile at $7.5 in data ARPU
- The % contribution of data to service revenues jumped from 11% to 16% during the last year. Verizon leads with 17.4% with AT&T at 16%, Sprint with 15.7%, and T-Mobile at $14.4 close behind.
- US wireless data market continued its rapid growth in 2006. Wireless data service revenues jumped almost 84% to approximately $15.8B (from $8.6B in 2005). The service data revenues are likely to top $27B in 2007.
- In terms of net-adds, the numbers declined 17% from Q406 to just over 5M new subs dropping the rate from 1.92subs/month in 2006 to 1.66 subs/month in 2007. Some of this is expected due to seasonal boost in Q4 however, the decline in net-adds over the course of last 3-4 quarters is indicative of slowing market as discussed in our quarterly updates last year. With subscriber penetration crossing 80%, sub-5M quarters will become the norm rather than the exception. Carriers will have to focus on increasing customer lifetime value and not rely solely on new subs to boost revenues.
- The overall subscriber penetration currently stands at approximately 80%.
- The top three carriers again surpassed $1B/quarter (in data revenues) mark with ease, in fact Verizon and AT&T crossed the $1.5B mark with $1.6B and $1.5B in data revenues respectively. Apart from Sprint, all remaining top four operators experienced double-digit percentage growth
- Verizon narrowed its distance from AT&T. Only 1.5M subscribers separate the two. In Q106, this number stood at 2.8M. Except for Q406, Verizon has added more new customers every quarter (AT&T took the honors last quarter) for past several quarters. Though industry is waiting with much anticipation the release of iPhone by AT&T, I mean, Apple, it is not going to have much impact on the Q2 numbers.
- Helio and Amp’D boasted $100 ARPU and 100K subscriber base but the burn rate and Cost of Customer Acquisition remains quite high.
- Though the overall penetration of messaging is around 40%, in terms of total number of messages in the network, US had another blockbuster quarter. Verizon with 22.75B, T-Mobile with 16B, and AT&T with 14.23B messages (SMS and Multimedia messaging) were the leaders. Notice T-Mobile’s performance with less than half the number of subscribers compared to its peers.
- Q1 also saw the introduction of MediaFLO from Verizon and Qualcomm with AT&T slated for a Q3 launch. The DVB-H camp appears to be disoriented and still looking to move beyond trials to committed launches. Though potential of mobile video is there, we need to be reminded that the current penetration is 2-3% indicating a long-road ahead. However, the user experience on MediaFLO is stellar and if business models fall in place, the future looks good.
- Verizon indicated over 100M in application downloads up over 36% from last quarter. With growth in data-card usage and other data apps, the revenue contribution from non-SMS apps is close to 60%. Even with many of the application below 25% penetration, these trends bode well for the US mobile data industry and the stability of ARPU in general. We expect the year to end at approximately $11 in data ARPU or 20% of the service revenues.
- Amongst other initiatives, AT&T’s banking effort and Visa’s NFC push are noteworthy.
- WiMAX has started to show on the radar screen though not so much in devices. Clearwire reported 258K , $32 ARPU, and $343 in customer acquisition costs. Sprint is planning to launch some UMPCs and data cards with its WiMAX push later this year. Despite these launches, position of WiMAX in western markets remains tenuous.
- As we move into Q2, while Motorola is recovering from ROKR, iPhone is the one to die for though RIM is ahead of the CURVE, and Helio’s OCEAN has set sail. Nokia’s N95, LG’s Prada, and Samsung’s Upstage are vying for attention. With iPhone announced, media rumor mill focused on gPhone.
- There was tremendous activity in the area of Mobile Advertising. There is a lot of confusion around what it means. All carriers are active in the space. Even T-Mobile is running trials. There is debate around how long the carrier influence on this segment will last.
- Though Nokia continues to struggle in the US market, it shipped over 91M handsets worldwide managing a 35.7% market share at the end of Q107. Motorola’s share dropped dramatically to 17.8% from 22.8% in Q406. Samsung seemed to have benefited from the slump of its rival by upping its mark share by two points to 13.6%. Overall the handset vendors shipped over 250M handsets in Q107.
- In terms of investment, over $1.6B was invested in wireless related companies/startups in Q107. (Source: Rutberg)
- US wireless carriers maintained their strong showing vis-à-vis their peers worldwide. Verizon, Cingular, and Sprint maintained their ranking # 4, 5, and 6 respectively, amongst the top 10 operators worldwide in terms of total wireless data revenue generated for Q107. US is the only country with 3 operators who generated $1.4B or more in data revenues in the quarter.
- For the third straight quarter- TMO US outperformed its parent TMO Germany.
- Internet brands with Google and Yahoo in particular are pursuing an aggressive subscriber acquisition strategy.
Your comments are always welcome.
Chetan Sharma
Ram Shriram on Web 2.0 and advise to entrepreneurs May 10, 2007
Posted by chetan in : US Wireless Market , add a commentSpeaking at the Intel Capital CEO Summit on Wednesday, Ram Shriram, a founding director of Google Inc. and founder of Sherpalo Ventures, offers words of wisdom to entrepreneurs:
- “If you have too much vision and not enough near-term thinking, that’s a problem.”
- “I’m generally looking for people who are not necessarily specialists in their domain. It’s almost better to hire for and test for raw intelligence.”
- “Don’t focus on a business model — focus on the best experience for the end-user.”
- “When the cost of money is low, generally you know within a 24-month period if you will succeed or fail. It’s fairly quick and not painful.”
Source: Tech Confidential Blog
