Mobile Advertising Book Update: Manuscript Complete and Shipped August 29, 2007Posted by chetan in : Mobile Advertising, Worldwide Wireless Market , add a comment
Joe, Victor, and I met in Jan 07 to kick-around the idea of writing a book on Mobile Advertising. In Feb, we put together a proposal and sent it out to some publishers. In two weeks, we signed John Wiley & Sons as our publisher. We started researching and writing in April. Fast Forward five months.
We just finished the manuscript and shipped it to Wiley.
Done! at least the first round. It has been an intense exercise. I will share more in the coming weeks and months but for now, I will leave you with the draft table of contents (subject to change):
1. History of Advertising
2. A Perspective from the World of Web Advertising
3. A Five Points Framework
4. Global Wireless and Advertising Market Overview
5. Introduction to Mobile Advertising
6. Challenges And Accelerators for Mobile Advertising
7. Mobile Advertising Models
8. Case Studies from Around the World
9. Technology: The Lifeblood of Digital Advertising
10. Navigating the Privacy, Security, Trust, and Regulatory Minefield
11. Mobile Advertising - What Comes Next?
13. Conclusions and Recommendations
Now, let me go and get some sleep ..
Carnival of Mobilists #87 August 22, 2007Posted by chetan in : US Wireless Market , add a comment
over at Darla Mack. Check it out.
Mobile Advertising - WW August 15, 2007Posted by chetan in : US Wireless Market , 1 comment so far
Wireless Week did a cover story on Mobile Advertising. Worth checking it out.
US Wireless Data Market Update - Q2 & 1H 2007 August 12, 2007Posted by chetan in : 3G, AORTA, ARPU, BRIC, Carriers, European Wireless Market, Indian Wireless Market, Intellectual Property, Japan Wireless Market, Messaging, Mobile Advertising, Mobile Applications, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Search, Speaking Engagements, US Wireless Market, Unified Messaging, Wireless Value Chain, Worldwide Wireless Market , 7 comments
US Wireless Data Market Update - Q2 & 1H 2007
US wireless data market continued its impressive growth reaching $5.85B in service revenues for the quarter. Data and Voice ARPU increased 8% and 1% Quarter/Quarter (Q/Q) respectively. Given that majority of the data revenues now comes from non-messaging applications and services and the subscriber penetration for such services is just getting into the inflection zone, we remain bullish on the US wireless data market. The introduction of iPhone in Q2 marked a new era of UX-driven devices and applications.
- US Wireless data market grew 7% Q/Q to $5.85B in Q207. For the first half of 2007, the US wireless data service revenues stood at $11.35B jumping 81.6% from 1H06.
- Overall ARPU increased by $1.05 Q/Q to $53.62 due to strong data performance and stable voice ARPU. The untold story has been the surprising resiliency of Voice ARPU over the past 3 quarters. Data ARPU grew 8% from Q107 and 19% from Q406 to $9.04. As estimated in our Q107 update, Verizon overtook Sprint in data ARPU with a 13% increase from its Q107 numbers to $9.84 while Sprint’s data ARPU increased only by 5% to $9.75. AT&T’s data ARPU increased by 11% to $8.77 and T-Mobile’s 4% jump accounted for its $7.8 data ARPU for Q207.
- The strongest growth continues to come from Verizon, accounting for almost 31% of industry’s data revenue in Q207. Its data service revenues jumped by 13% Q/Q to $1.8B. Verizon was followed by AT&T at $1.65B, Sprint at $1.2B, and T-Mobile at $613M.
- The % contribution of data to service revenues jumped from 14.5% to almost 17% in Q207 and is certainly going to cross 20% by the end of this year. Considering the market was only at 6% in 2004, it is a significant improvement in 3 years. Verizon led in % data contribution to ARPU with 19% followed by AT&T at 17.3%, Sprint at 16.3%, and T-Mobile at 15%.
- As we have been discussing in our quarterly updates, the net-adds continue to decline for the industry. The current net-adds rate for the year is 1.65M subs/month down from 1.92M subs/month in 2006 and 2M subs/month in 2005.
- The US wireless industry crossed 80% subscription penetration in Q207. Though the growth rate has expectedly slowed down, there is still plenty of room for growth over the next five years.
- The top three US carriers again maintained their respective rankings amongst the top 10 global carriers in terms of data revenues. For the year, Verizon with $3.4B, AT&T with $3.2B, and Sprint with $2.4B in service data revenues stood at #4, 5, and 6 respectively with Verizon closing in on KDDI for the number 3 spot.
- AT&T stemmed the tide of losing customers to Verizon with the strongest performance in terms of net-adds in Q2 adding almost 1.5M new subscriptions. While the distance between the two giants is getting closer, AT&T is likely to stay perched at the top with most subs in the US market for the remainder of 2007. iPhone mania and 3G penetration helped in gaining new subs.
- Q2 marked the demise of another high profile MVNO – Amp’D. Boasting $100 ARPU in Q1, the company couldn’t control the burn rate and cost of customer acquisition resulting in a spectacular crash.
- Q2 also saw the folding of the DVB-H camp in the US with the mobile broadcast market firmly in the hands of MediaFLO.
- Non-messaging data revenues continue to be in the 50-60% range for the US carriers. T-Mobile recorded $644M or 53% of its data revenues from non-messaging applications and services during 1H07.
- Verizon recorded 10B TXT messages in June setting a record of messaging volume at a single carrier. For the quarter 28.3B TXT messages were sent on its network. AT&T recorded 18B TXT messages for the quarter.
- There was tremendous activity in the area of Mobile Advertising with the acquisitions of Third Screen Media, Telephia, and ScreenTonic. We just finished a comprehensive book on the subject. More details in the coming months.
- In 1H07, 203 private companies announced $2.3B in venture financing down from $3.6B in 2H06 and $2.9B in 1H06. Source: Rutberg. Mobile TV/Video, Mobile Personalization, Mobile Search and Advertising, Semiconductor, Carrier infrastructure, Device design and development are hot areas. M&A activity also picked up quite significantly. Intel Capital and Sequoia Capital opened their purses the most. We also saw 7 major IPOs with Aruba performing the best and Glu performing the worst. Other notables were Clearwire, Airvana, and MetroPCS.
- Nokia eclipsed 100M unit sale in Q207 for the second time in history (first being in Q406). Its 1H07 tally stood at 191.9M followed by Motorola at 80.9M and Samsung at 72.2M. Nokia’s share of the market went up to 37.9%. Motorola lost significant ground dropping 3.2% Q/Q to 12.4%. Samsung gained as a result and ascending again to the number 2 spot with a 14.1% marketshare. Sony Ericsson with 9.4% and LG with 7.2% rounded up the top 5. Samsung benefited from its Ultra edition, Sony Ericsson from its Walkman/Cybershot, and LG from high-end Chocolate/Shine models.
- Despite the sale of over 426M handsets by the top 5 manufacturers, the talk of the industry for 1H07 was the imminent launch of the iPhone. It captivated and mesmerized the media like no other device in history. Despite some limitations, device was an instant hit and a game changer for the industry.
- 86-88% of the handsets sold in the US are now replacement devices. Globally this figure stands at just over 50%.
- GSM Association announced the 200 millionth 3G mobile subscription. As estimated in our widely referenced 2005 paper on 3G, 2007 is proving to be the inflection year for many western nations including the US where the penetration crossed 15% in Q2.
- WiMAX gained headlines with some significant announcements in Q2. Clearwire-Sprint partnership on network expansion slightly reduces the risk for both players. Clearwire increased its subscriber base to 299K with ARPU at $38. Sprint-Google announcement on applications and open APIs was quite telling. FCC’s 700 MHz auction drama kept the lobbyists gainfully employed though its impact on the industry will be marginal.
- T-Mobile has had good success with its myFaves launch. Since Oct, they have added 2.5M users which add $4/month on average to the plan. If only carriers could extend this interoperability to content.
Global update (more details in our worldwide wireless data market update coming out soon)
- The worldwide markets continue to grow at an explosive pace reaching 3B subscriptions by Q207 up 13% from 2006 levels. Significant growth is coming from India and China with both countries registering close to 7M net adds on average in Q2. India recorded 7.34M net adds (its highest) in June. In Q3, China will cross the amazing 500M subscriptions mark which is more than the next two big markets (US and India) combined. India will cross the 200M mark in Q3 and will cross US in 2008. US will cross 250M by Q4. Overall, the world market is almost at 50% penetration.
- NTT DoCoMo continues to dominate the wireless data revenues rankings with over $5.5B in service data revenues however Q/Q growth has dropped to single digits. DoCoMo crossed 70% in 3G penetration and is expected to cross 80% within 9 months.
- Most of the major carriers around the world have double digit percentage contribution to their overall ARPU from data services. Operators like KDDI, DoCoMo, and O2 UK are topping 30%.
Your comments are always welcome.
Crunch time August 3, 2007Posted by chetan in : Carriers, Mobile Advertising , 3 comments
We are in the final phase of getting the manuscript of Mobile Advertising completed. It has been a long, intense, fun past 4 months. It is great to work with brilliant co-authors. We talked to over 50 executives around the world, probably talked to another 50 friends and colleagues. I think we have developed a comprehensive treatment of mobile advertising and what this new medium means to the industry. But, for right now, we are slogging away to meet the deadline. I will share more once we get past our milestone and have some more time.
In the meantime, there has been a lot of interesting developments - earnings season, the gPhone, 700MHz auction, Sprint/Google WiMAX annoucement, and others.The most interesting one is the WiMAX annoucement as it is indicative of the future trends. Google is trying hard to get to the consumer devices. Since it is facing so much resistance from the operators, it decided to build their own phones. I am doubtful if they will actually release this into the markets and succeed.Google is not Apple, it’s core competance is in search and software, not in building consumer electronics. They are of course going after the ad dollars but the mobile advertising space is much complex and convoluted than the Internet advertising space. Google doesn’t have to sell PCs or laptops to get the online ad revenue. Secondly, will they be generous in rev share with the operators who might allow them to run the device on their networks. History has shown that not to be the case. The whole 700MHz debate is moot. It really won’t impact the way business is done. If FCC really wants to do something for consumers, there are other ways it could have done it. There is fair amount of drama going on witht he 700MHz football.
Anyway, hope you are having great summer. I will be back with some more updates over the course of this month. Have a great weekend.