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CTIA Wireless IT
and Entertainment 2008 Roundup
http://www.chetansharma.com/ctiawirelessit2008.htm
CTIA in pictures
San Francisco hosted the
CTIA Wireless IT and Entertainment 2008
show earlier this week. In addition, there were some pre-show events
like Billboard’s Mobile Entertainment Live and Mobile Web Strategies.
This note summarizes our impressions from the week.
First, Let’s do the
numbers
CTIA released its mid-year survey results. Bob Roche and John-Paul
Edgette at CTIA do a great service to the industry by compiling 6-month
of useful data and making it available at each CTIA. In Summary -
262.7M subs, $14.78B in data revenues accounting for 20.3% service
revenues, 75B TXT messages/month. We released our
US Mobile Data Update for Q208 last month, Global Update coming
later this month.
Overall Impression
– This year’s show was one of the dullest in recent memory, devoid of
any buzz, energy, or announcements. Maybe it was due to the 50,000 other
events happening the same week (many in San Francisco). Or maybe,
Bernanke's
congressional testimony is playing out in the wireless industry. Or
maybe, it is just conference-fatigue.
My week started early as
I had the honor of giving a keynote address to a group of influential
executives at major international operators and agencies worldwide at a
well-organized private event. The topic was “US Mobile Advertising:
Today and Tomorrow.” We delved into what’s working and what’s not
and what will it take to get the industry to the next level, which
players are likely to succeed and why?
Next day, I split my time
between Mobile Entertainment Live organized by BillBoard and Mobile Web
Strategies chaired by our friend Ajit Jaokar. While most of it was
rehash of previous events, presentation by Jouko Ahvenainen of Xtract
was probably the standout for me where he talked in detail about the
importance of “analytics” and “intelligence” in advertising and social
media. One of the interesting announcements/discussion was from Nokia
regarding "Comes w/ Music" to be launched in UK next month - music
subscription is bundled with the device as long as the device is from
Nokia. Reliance Entertainment also announced its aggressive push into
the US market.
Trip down the memory
lane US Wireless Industry is celebrating 25 years of existence.
Steve Largent invited Craig McCaw and John Stanton to reminiscence about
the good old days - $4000 phones, hundreds of dollars of monthly bills,
no roaming, 30 min talk time, obligatory 100 lbs bricksters. Craig
emphasized on innovation while Stanton accurately put his finger on the
big picture – US operators aren’t thinking like global companies or the
media companies and can’t succeed in the new economy over the long haul.
Spot On, John.
My first job was with a
company that wrote the billing software for McCaw Communications in the
early nineties (at that time, I was writing code for fraud prevention
using RF fingerprinting for GTE, Ameritech, Bell Atlantic, Nynex,
Airtouch, and the likes .. those were the days)
Open is in the Air
With each CTIA over the last 18 months, carriers' embrace of “Openness”
is getting tighter and more nuanced. It is amazing how competitive
threat can help disrupt the status-quo. While the keynote session
sounded very scripted, each of the 3 CEOs from T-Mobile (Dotson), Sprint
Nextel (Hesse), and Verizon (Lowell) are putting in place their “Open”
Strategy (the current no. 1 operator was MIA). T-Mobile is launching an
Apple-like App-Store next week with 50-50% rev-share which goes up to
30-70% in favor of the app developer but advertising is allowed (unlike
iPhone Appstore). Streaming is also not allowed.
Tricia at Moconews has more details. The balance between open
network, customer care cost, and application performance can be a tricky
one and everyone is tiptoeing the boiling waters carefully.
My favorite quips:
Hesse – “We have
opened the network, Knock yourself out”
Lowell – “Our
definition of open is irrelevant, it is what the customer wants”
Dotson – “Walled
garden is a thing of the past”
It should be noted that
two of the biggest success stories in the industry - iPhone and
Blackberry are closed systems. Everything boils down to
user-experience and value. We shouldn't lose sight of that in the Open
debate.
Yahoo’s oneConnect
Marco Boerries, EVP, Yahoo! (read
the piece he wrote for our Mobile Advertising book here) gave a
keynote second CTIA running. These guys aren’t distracted by the
Microsoft acquisition drama and remain the bright spot in an otherwise
flailing organization. Over the past few months, they keep on refining
their distribution and monetization strategy but they do need to attract
droves of developers to make the initiative successful. Marco announced
the launch of “Blueprint” – a framework for building mobile Internet
apps and services. The trick is of course to attract developers. AOL is
also pursuing a similar strategy.
Mobile Advertising
There was a lot of discussion around mobile advertising each day with
some new players emerging. Companies like Hipcricket (and many many
others) are making real progress but I get a sense of “being stuck” from
some of the players. Maybe, it is a function of the economy, or perhaps
– fragmentation, lack of education, metrics, is keeping the industry
from opening up.
CTIA released a
whitepaper on 2D bar code scanning. Good to see some progress but
the big question is – who takes the initiative to spend marketing
dollars to educate the consumers and to make 2D bar codes pervasive in
the US.
Carriers are getting more
active in pursuing their mobile advertising strategies but I still see
some fundamental missteps. Keep an eye on some of the work we will
release later in the year to help guide the discussion, hopefully, in
the right direction.
Mobile Social
Networking Lot of discussion around mobile social networking (infact
too much at times, even the mobile email player Visto considers itself a
social networking company now), mobile only social networking,
monetization challenges and opportunities. Most of the players are just
aggressively focused on building an audience as quickly as possible. The
monetization strategies include advertising, value added services, app
store. Verizon and ATT announced their social networking strategies
(built on the back of Intercasting’s platform) which essentially focus
on social networking aggregation. This keeps them pretty safe and
relevant. Current monetization model is that of subscription and maybe
advertising down the road. For mobile only players the models varies
from advertising heavy (Mocospace) to VAS heavy (mig33).
M2M The percentage
of M2M companies in the mix increased compared to last time. For the
first time I saw, carrier booths in M2M pavilion which was quite
interesting. They clearly see this is a growing segment.
Smartphone Mania
Devices like iPhone and Instinct are accounting for a disproportionately
high share of the mobile download business now. And if data services is
the only growth engine, why worry about launching sub-ARM9 devices, the
economics is pointing towards cheaper smartphones on a fast network, it
doesn’t make sense to port to 50 other devices when 80% of the revenue
will come from a small subset of the devices.
For those of you attended
the show, hopefully, it warmed you up for a really great mobile event
being organized by GigaOM –
Mobilize.
Some terrific set of speakers and panels. I will be moderating two
excellent panels (details below).
Your feedback is always welcome.
Thanks.
Chetan Sharma
Disclaimer: Some of the companies mentioned in this note are our clients.
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