over the air emerging markets - raj singh
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Emerging Market Opps (presented by Raj Singh at Over The Air)TRANSCRIPT
Emerging Markets Over The Air (London)
Sep, 2010
Raj Singh
www.rajansingh.com
@mobileraj
Agenda
• Market data
• Case studies
• Your input!
Let’s make this a discussion
What the Telecom Analysts Think?
Where Are the Subs?
270M
55K
174M
747M
488M
45M
200M
110M
78M
Population ≠ Money
PCs Versus SIM Cards
Maybe Start With Youths?
Average Selling Price
Interesting Correlation
Smartphones Versus Featurephones
The Role of Mobile in Emerging Markets
ME & Africa Wins
App Retention
Mobile Advertising
Many Business Models
Advanced Markets Emerging Markets
Premium Apps
Mobile Ads
OEM Licensing
Operator Licensing
Virtual Goods
Free
Branded
Gift Cards
Common Misconceptions
• Low price, high volume?
– iPhone users :)
• Data is expensive?
– Nigeria charges $1-2 / month for unlimited data
• 3G isn’t there?
– Parts of Africa are deploying 4G; not stymied by backward support of 2G
• Ad dollars are low?
– In India, ad dollars on mobile are higher than on PC
Case Study: Nokia Music
• Music publishers do not make money outside of the top 5 countries (piracy!)
• Nokia launches Come With Music – All you can eat full-track download
when you buy the phone
– Nokia adds $50 to the BOM and pays $30 to the publishers/labels (estimated)
• Available in 10+ emerging countries and growing
Biz Model: Consumer pays, music publishers get rev-share
Case Study: Mig33
• Mobile social network
• 40M registered user predominantly in SE Asia
• Revenue model driven through the exchange of virtual goods via operator billing
• WAP and J2ME lead!
Biz Model: Consumer pays, operator rev-share
Case Study: Mobile Retail (China) • Operators are the bank
– China Mobile bills through national bank
– Vivo links with Caixa (Brazil national bank)
• mCommerce in emerging countries first?
Biz Model: Consumer pays, operator (and retail?) rev-share
Case Study: Micro-Prenuer
• Mobile devices were too expensive in villages in parts of Bangladesh
• Govts in partnership with Grameen Phone give females, subsidized mobile devices
• Female micro-prenuers would rent use of the phone to other villagers (eg one phone roped to a pole in the middle of the village)
• Enabled wealth amongst poorer female population
• Brought mobile phone access to the village
Biz Model: New local economies
Case Study: Mobile Health (Turk Telekom)
Pharmaceuticals Hospitals
Physicians
Patients
Public
Ministry of
Health
Turk Telekom
Biz Model: Consumer, Operator pay
Case Study: Opera Mini / Vodafone
• Opera Mini’s proxy based approach compresses data before it’s sent to the device
• Significant benefits for low-speed networks and/or prepaid markets
• Of Mini’s 60M+ subs, a majority are in emerging markets representing 25B+ pageviews
• Vodafone has launched Opera Mini on it’s emerging market handsets
Biz Model: Operator pays or Free; Search/Advertising
Case Study: Mobile Browsing
• Mobile is primary browsing device • Not everyone can afford internet on
their phone so it is often shared amongst family members
• Some emerging market phones have integrated projectors so the screen can be projected onto a wall (to make a more enjoyable browsing experience)
• Phone can be used with a Bluetooth keyboard and mouse to simulate a desktop PC experience
Biz Model: OEM; Operator data revenue
Case Study: Mobile Payments and Banking
• Much of the emerging market lacks banking infrastructure
• Operator stores could facilitate banking transactions through a partnership with a real bank in Kenya (powered by M-Pesa)
• Consumers have more trust for the operator than their bank since it is a brand they use daily and they are already used to depositing money onto their SIM card
• M-Pesa has 10M registered users and claims to manage almost 50% of all commerce in Kenya
• 17K M-Pesa agents compared to 840 banks and 150 ATMs
Biz Model: Free, Operator rev-share
Case Study: Microsoft OneApp (South Africa)
• Feature-phone app targeted at data-cost sensitive markets (prepaid markets)
• Similar to “SMS browsers” but does use highly compressed data for transport
• Access most popular services (eg Facebook) like Opera Mini but with even more compression; uses server-side rendering (Microsoft DeepFish)
Biz Model: Consumer pays data, operator rev-share
Case Study: Nokia Life Tools (India)
• Suite of services / information targeted at India’s farmers
• Real-time prices for subsidies (eg fruit, wheat)
• Real-time prices for farmer’s needs (eg pesticides)
• Weather reports for farm planning
Biz Model: Consumer pays data, operator rev-share
Case Study: USSD (Brazil)
• 2G networks and prepaid data make browsing the internet expensive
• Mobile-XL, Shorthand Mobile, Eyeline.mobi offer J2ME apps that effectively create a UI using SMS for transport (instead of data)
• Think front-end UI to SMS services like Google Search
• Great success in 2G countries – drives cheaper SMS volume
Biz Model: Consumer pays SMS, operator rev-share
Case Study: Facebook Zero (And Friendster)
• Philippines and others charge for 1-day of data access (50 cents est.) for unlimited access to a service (eg Friendster)
• Significant revenue stream for Friendster and other popular services (represents more than even the desktop website in advanced markets)
• Operator drives data subs with longer term goal of moving to post-paid and de-commoditizing (with dual-SIM phones)
• Facebook offers same promotion (like Friendster) but forgoes the rev-share
• Facebook Zero takes it a step further; use FB to get subs hooked to data!
Biz Model: Free!
Case Study: Blackberry Messenger (Colombia)
• Even SMS can get expensive
• Use BBM and I can message my friends for free
• Offered via operators for a monthly tariff
• Has had great success and why BB is the #1 smartphone in much of SA
Biz Model: Consumer pays for BBM plan, operator rev-share
Case Study: SMS GupShup (India)
• SMS driven social network launched in the past 2 yrs (when Facebook, Orkut and others were already present)
• Represents 7-8% of all SMS volume in India
• Revenue generated via SMS group sponsored ads
Other Case Studies
• Dual-SIM phones (commoditize operator) with flash lights
• Youth journalism in Kenya
• Send email via SMS in the Philippines
• Bicycle charge kit to recharge your phone
• Mobile banking in South Africa with MTN
• Telemedicine in India
• China to be Android’s #1 country
Biz Model: Consumer pays, operator rev-share
Why Go Emerging?
• Younger and larger audience = larger social graph
• Very high mobile engagement
• Less competitive
• Cheaper data (no phone subsidies), and fast(er) networks coming!