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Issue 8

Thinking about mobile


Where the physical world and reality collide

2010: Year of mobile TV & video Asia to lead mobile Internet growth Mobile marketing booming in Austria Nexus One gets Carrollised G. W Bush & Toe-knee Blair meet Shazam Who’s in this issue... QuickPlay Media, MobiTV, RealNetworks, Shazam, The Times, Nexus One, YOC, Shoutem, Layar, FLO

and more data than you could ever imagine

editorial Nick Lane, Chief analyst/writer Tel: (44) 1483 856 514 Mob: (44) 7976 057 052 Michael Carroll, Contributor Tel: (44) 1483 549 840 James Cameron, contributor AKA Founder and head of strategy, Camerjam Events How to find us: mobileSQUARED HQ Unit 1 24 North Road, Guildford Surrey, GU2 9PU UK ISSN no. 1759-6483 Published in the UK 12 times per year in pdf format No part of this publication may be copied, photocopied or duplicated without prior written permission from the publisher, D2 Mobile Ltd mobileSQUARED is a trading name of D2 Mobile Ltd. The mobileSQUARED team offers unique forecasting, analysis, research and insight on the mobile market, providing highly focused reports and bespoke intelligence. We tailor our approach to the requirements of each project and use our network of global network of contacts. Our extensive market knowledge stems from years covering the mobile industry meaning that we’re in a position to respond immediately to market developments. All rights reserved. Opinions expressed by individual contributors may not personally reflect the views of D2 Mobile Ltd. Whilst reasonable efforts have been made to ensure that the information and content of this publication was correct as at the date of first publication, neither D2 Mobile Ltd nor any person engaged or employed by D2 Mobile Ltd accepts any liability for any errors, omissions or other inaccuracies. Readers should independently verify any facts and figures as no liability can be accepted in this regard. Readers assume full responsibility and risk accordingly for their use of such information and content.

©2010 D2 Mobile Ltd.


It’s only a matter of weeks until the World Cup kicks off in South Africa in June. The footballing festival has been billed as the first mobile World Cup. Its not, but it is the first one that Apple has been involved in. Which equates to the first World Cup where mobile content and services, devices, pricing and user experience have all been taken into consideration. We expect the summer to have an incredibly positive impact on the adoption of mobile content and services before, during and after the last ball has been kicked. This is mobile’s opportunity to truly showcase the development and innovation that has been achieved over the last 24 months. So what have we at mobileSQUARED been looking at this month? Our main feature explores the potential of mobile video in association with this summer’s World Cup. DVB-H was meant to be the real winner from the 2006 World Cup for the mobile industry, when in truth, the technology was available before sufficient devices and—most importantly—consumer demand would equal the excitement generated by the mobile service providers. But essential components have combined in mobile to finally attract the consumer. And what more compelling content than the World Cup, well, for at least 2 billion or so members of the global population. We’ve also turned our research attention to Asia. As we number crunch the subscriber adoption across the continent and apply to mobile data and services, we forecast about 1.4 million mobile Internet users by 2015. That sounds like a lot. It is. But that will still be significantly less than 50% mobile Internet penetration. Forecasts for Asia compared to other markets always seem incredibly high, but more often than people will care to admit is that they overlook the astronomically high population the continent boasts. As we explain in the article, 1.4 billion people isn’t actually that high. And if you want to find out more about the Asian mobile marketplace and its potential, then you need to attend the mobileSQUARED Roadshow: Asia, in Singapore May 5-6th. Look inside for your subscriber discount. We have the latest data from the YOC publisher network, Carroll’s Quest challenges the Nexus One, James Cameron bemoans the arrival of paid-for publishing content on the mobile platform, and Shoutem has five top tips to deliver a compelling mobile social networking strategy. All good stuff.

Nick Lane Chief analyst

contents Page 3

2010 will be the year of mobile TV & video. Honest!

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James Cameron bemoans the threat of paid-for published content

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Crunch: Why is now the time for mobile TV & video

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Your chance to get 30% off a delegate pass Roadshow: Asia in May

Page 9

YOC analysis: How mobile marketing in Austria is going from strength to strength

Page 11

In search of mobile advertising revenues of mass construction: This week our intrepid crusaders reveal their shenanigans in Barcelona

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Carroll’s Quest: Our disgruntled handset analyst scrutinises the Nexus One

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Country Data: Asia to lead global mobile Internet growth

Page 15

Company Feature: The augmented reality world that is Layar

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Walled Garden: How to build a successful mobile social networking site

Sector feature

The year of mobile TV & video has finally arrived. Honest Say it quietly, and don’t repeat in earshot of anyone carrying a straightjacket, but 2010 will be the year of mobile TV & video (MT&V). Honest. It’s been foreseen. And what’s more, this year’s World Cup will be the platform MT&V has been craving – since the last World Cup at least to propel it beyond its niche audience. This year’s World Cup in South Africa has been hailed by numerous mobile executives as the “first mobile” World Cup. While the tournament in Germany in 2006 was pitched as the catalyst to attract consumers to mobile TV services over DVB-H broadcast in Germany and Italy, the technology wasn’t ready and the lack of handsets has since condemned the mobile TV via DVB-H to mobile service purgatory. Just last week, Swisscom announced plans to drop its DVB-H service, citing a lack of compatible handsets (is customers) behind its lack of success. The Swiss operator will now pursue a subscription-based broadcast mobile TV solution to smartphone and laptop users. # So a more accurate term for this summer’s footballing festival, will be the first rich-media World Cup. But why now for MT&V, considering the mobile industry has been proclaiming it as the next best thing since sliced bread for five years? A number of core elements have finally reached alignment, such as ubiquitous 3G and extensive WiFi


coverage, the proliferation of rich-media featurephones and smartphones, flatrate data pricing, and lastly, the growing appeal of the open mobile Internet. Then of course there is what could be described as the most important factor of them all; the mobile industry has stopped trying to become an entertainment provider (and we have explored this critical issue in Crunch on page X). “I think there are a couple of factors to this renewed momentum to video: 3G networks, 3G-enabled handsets and also the media-enabled handsets, so that it is much easier for the average consumer to watch,” says Scott MacKenzie, product director for RealNetwork’s Helix suite of products for mobile video. “It was difficult to watch.” Indeed, early versions of 3G mobile TV have been described as “Powerpoint TV” due to the relentless buffering and overall poor quality. So it is not surprising that mobile TV has not taken off in the majority of markets, especially where the services was priced as a premium service with substandard quality. “Video is the next big

driver of the mobile Internet,” says Randy Cavaiani, vice president of marketing, Novarra. “There are two different type of videos; the video services and the video aggregation sites like Youtube, then there are the videos are embedded in other content, such as the a football video clip with an associated story on” Novarra’s mobile Internet research has revealed that videos viewed increased by 74% between Jan and June 2009, down to more service providers and content providers adding rich content to their sites. While this demonstrates that richness of the Internet is now becoming a critical element of mobile Internet services, the majority of video consumed on Internet is free, and that is a trend that is making

feature the transition onto mobile. According to Harris Interactive, 10% of UK mobile users watch short videos, 5% watch YouTube, 3% watch full-length movies, and 2% stream via the BBC iPlayer. Video is finally coming of age on the mobile platform. Based on data provided from one of Bytemobile’s Western European operators, iPhone video consumption surpassed web consumption earlier this year. Between September 2008 and February 2009, traffic switched from video (35.4%) and web (44.1%) to video (41.3%) and web (34.8%). For example, in the UK video is the fastest growing single application. The videos being consumed are short-form web-generated content, such as YouTube, with revenues being generated from flat-rate data bundles. Research by mobileSQUARED reveals that 2% of consumers are consuming 50% of the network in the majority of developed mobile markets. What’s more less than 1% of consumers are consuming video. By 2014, that figure will be approaching 40%. This does not mean that the mobile industry has finally stumbled on a successful business model for video. It is the opposite. It is the fact that the business model has been removed and consumers can watch free videos, based

on flat-rate data pricing, which is creating this opportunity. Aside from driving the adoption of flat-rate bundles, operators will become more focused on how they can manage this growth from a network capacity perspective, rather than seek content partnerships as happened in 2005-2006. “The landscape of mobile TV and video has cleared up over the last 12 months, in terms of how the consumer value proposition will work,” Mark Hyland, vice president of sales and marketing for QuickPlay Media told mobileSQUARED. QuickPlay Media has launched its PrimeTime2Go subscription VOD service in the US, providing customers with access to 70 prime-time US network shows. Since launch in May 2009, Hyland says customers are downloading 25 episodes on average per month – and the average view is 20 episodes. The service costs US$9.99 per month for unlimited downloads, but he says the service will become “really compelling” when it’s bundled in with other services. “The model is a WifI download,” explains Hyland. “Not that we couldn’t do it over 3G, it’s just that Wifi is now ubiquitous in people’s homes and businesses. Over WiFi, a user can download a 65MB high quality 30-minute TV show in six minutes. Because video payloads are incredibly

large for a 3G network, that encouraged people providing video services over 3G either as very short clips or poor quality. Either way, that was not compelling for the consumer.” Perhaps, one of the drawbacks has been to view the mobile TV experience as standalone. What’s interesting with QuickPlay’s proposition is that it is a cross-platform, cross-device play, storing downloaded content in the cloud. Regardless of whether the consumer is watching a particular program on the TV, PC, laptop, in-car or on their mobile, the picture will be optimised for that device. A programme can be paused while the consumer switches devices before resuming the viewing where they previously left off. In 2010, QuickPlay is looking to expand into Europe, and is exploring whitelabel versions of its service with handset makers and content providers wanting to do a direct offering. The UK is an obvious market because of the success of the BBC iPlayer. Because iPlayer is a free service, Hyland stresses the point of the bundling the service to cover mobile, broadband and set-top TV. QuickPlay’s solution is clearly targeted at catch-up TV or films, and is unlikely to appeal to the sporting community. But it is sports that is driving the uptake of mobile TV services in markets such as the US. “Sports in general for content is huge,” Chem Assayag, head of business development for FLO Technologies in EMEA, Qualcomm, told mobileSQUARED. “We launched a service around the European Championships in 2008 in Netherlands and Switzerland. The goal now is to leverage that. In 2010, we can expect local content providers and broadcasters to leverage the World Cup to create marketing spin and launch new services. So sport and premium content do appeal to consumers.” In the US, Michael Jackson’s memorial and the Presidential inauguration of Barak Obama created vast mobile audiences. As did the PGA Golf tournament in 2009, which doubled the average audience. “Sports, live events, with strong content do create


The rise of MobiTV NFL Channel

Usage Growth

Bundled App

Michael Jackson Memorial

Subscriber Growth

Pre-loaded “Hero Device

March Madness

Source: MobiTV

buzz around viewership,” says Assayag. On average, people watch Jackson’s memorial for 40 minutes, compared to average viewing FLO sessions of 25 minutes a day. “We can see a shift now in terms of mindset and that people do understand,” says Assayag. “We see a huge appetite for content other than sport in terms of usage patterns with things like catch-up. About 90% of people will want to see news etc, and the remaining 10% can access specific content, to could be on 3G but because it is so specific they could charge a premium to access that.” One company that is charging a premium for mobile TV services is MobiTV, and has been actively involved in sports leagues and properties to build apps and experiences around key sporting events like College basketball and football. It launched an app in the US in conjunction with the Winter Olympics, and has similar plans around the World Cup. “We see the World Cup as one of those unique global events that could be a catalyst for awareness and adoption of mobile video formats,” Ray De Renzo, MobiTV’s chief marketing officer, told mobileSQUARED.

MobiTV has now been running for six years, and has amassed 9 million subs, “primarily in the US”. Not surprisingly then, most of its ambitions around delivering live World Cup content will focus on its US customer base. MobiTV streamed over 1 billion minutes of video in 2009, mostly in the US and mostly to smartphones. De Renzo says the length of each streaming session depends on the device. “For users with a device that is less than six months old and has a much better rich media experience, the average session last about 16-20 minutes,” he says. “Roughly 75% of those newer devices are smartphones. We have seen almost double the usage on a smartphone compared to a featurephone. Screen size larger, higher resolution, data plans, more aware of services that are available is what is attracting our viewers.” While streaming content has proven popular in the US, it’s a different story across Europe. “A lot of operators have launched services but the number of subs has remained low,” says Jan Olin, European managing director, MobiTV. “Across Europe, and in particular the UK, the operators have carried out initiatives, but they have not been successful because they have not put

their weight behind it. So it is not surprising that the percentage of users is lower.” Consequently, the operators then enter a something of a vicious circle: without users they will not generate the revenues, and that means they will not invest in the service. The exception in Europe has been France, which has a very successful mobile TV offering. But Olin expects the European stance toward MT&V to change in 2010 because of the array of rich-media devices, allyou-can-eat data plans, coupled with users browsing to find the services they want. “The market is happening here in Europe now,” he says, adding that MobiTV has made the decision to reenter the European market. The fragmentation between countries forced MobiTV to retreat from Europe and re-assess its one-turnkeyproposition-for-all strategy. The company is back, and it’s looking for operator and broadcaster partners. “No-one is really questioning whether users want to view video on mobile,” says Olin. “That has been taken off the table completely. Now it’s about how do you enable this?”


The pitfall for all MT&V services to date has been the business model. MobiTV has experimented with a variety of models around its core monthly subscription fee of US$10 for unlimited access. “That’s the primary business model, and we’ve been innovative off of that,” explains De Renzo. “We’ve looked at transactional, pay-per-view model on iPhone and on a few other handsets. Whenever we broadcast a live Ultimate Fighting Championship event to our mobile platforms, we charge on a per-event viewing fee, have done a season pass or half season pass, or covering a 30-day period. So we have varied the length of the subscription. We’ve also introduced some free services, like a lite version on the iPhone.” MobiTV also offers advertising, and is selling ad inventory. However, while advertising has the potential to subsidise the overall cost of the mobile TV service, the audience isn’t large enough to offset the premium service. “As we get more and higher-value programming content, such as prime time episodic content, it will become increasingly easier to sell prime time ads,” De Renzo says. “On TV, just because the TV is on it does not mean anyone has watched the ad. The real value in advertising on mobile TV and video, is that you can guarantee there is a one-to-one relationship between the mobile and the user and they will be watching.” To make sure a consumer is still watching after 10 minutes, MobiTV can serve an overlay to the screen asking if the user is still watching. It is this level of interaction that is very powerful and starting to attract the brands and media agencies. And the trigger to not only raise mobile viewers, but generate heightened interest from brands and agencies, will be the World Cup. “I think the World Cup will be a profound and impactful event that will bring more people onto mobile video,” says De Renzo. “Viewing will increase during the World Cup. When we isolate average viewing for live sports content it is two-tothree times higher.” All of MobiTV’s major user peaks involve live sports. Active users on NBS can watch multiple viewing sessions averaging 40 minutes. “Live games for the World Cup will be will be taking place in the US at 8am when people are commuting to work, or at work. They will need a viewing platform to watch the live programming. So the time shifting phenomena will have an impact. We will do the live games, we will do replays of the live matches, but all of the VOD and highlight content etc, will be done in an app.” Sport has become one of the driving factors in the increasing adoption of MT&V, and this year’s World Cup will be no exception. With the rise of the mobile Internet and the phenomena that is app stores, MT&V providers have two clear access channels to the consumer. With the removal of previous barriers of devices, networks, pricing, content that consumers want – and pay a premium for can finally be delivered.

The Times should focus on mobile rather than trying to turn an online tanker The free vs. paid-for content debate was re-ignited recently when it was revealed that The Times and Sunday Times websites will charge £1 per day or £2 per week to access their content from June. Last September, News Corp CEO and chairman Rupert Murdoch got the ball rolling when he unveiled plans to extend the Wall Street Journal’s online paywall to Blackberry and iPhone users. We are used to consuming content online for free and once we’re used to getting something for free, it’s very hard to start charging for it. Obviously the success of numerable freemium models out there proves that a hybrid model can be a sustainable model, but by putting up a pay wall (predominantly in the face of Google), News International are taking a big risk. Firstly, an awful lot of traffic is generated from twitter links and blogs and people will cease to link to Times and Sunday Times stories in the knowledge that only those who are paid subscribers would be able to view the content. Secondly, the reading habits of those who view news online tend to consume shorter stories online and read the longer features in the actual paper. Given that online news is effectively a commodity it would suggest that users are far more likely to read the news on the BBC or alternative sites rather than pay to view content on the Times. Not good news for their ad sales team. Also, publishers have been moving heavily into mobile content where users are more willing to pay than online (the success of the Guardian iPhone app is testament to this). Plus, tablets such as the Kindle or iPad offer publishers a big opportunity to create new revenue streams to replace dwindling print revenues. A more prudent move might have been to concentrate efforts and investment on this big growth sector rather than trying to turn the tanker that is free online content. The Times does have a strong brand and will certainly convince some of its readership to pay for the online content, but I suspect the move will do more harm than good to its business.

camerjam 6


How mobile TV & video are coming of age We here at mobileSQUARED always harp on about the commercial-to-consumer services delay. The mobile industry by its very nature has a tendency to overhype services. The launch of 3G, video calling, MMS, mobile TV, mobile video, search, advertising, games have all fallen foul to the curse of the hyperbole. It took 3G (outside of Japan) some four years to get its act together. It’s taken five years for the industry to see a surge in investment in mobile advertising. Let’s not even bother commenting on MMS. Needless to say, the mobile industry has enjoyed something of a renaissance period over the last 12 months following a succession of false dawns. Ironically, the two revenue generators that the mobile industry could have hyped up but didn’t because it didn’t see them coming, were SMS and app stores. The reason for this renaissance is because there is now a compelling proposition for the consumer. The consumer has caught up with the mobile industry. From a mobile TV and video (MT&V) standpoint, the mobile industry has stopped its fantasy of becoming the next Disney, Warner Brothers, or BBC, and the content industry has stopped experimenting with various formats for the mobile screen. Collectively, the mobile entertainment industry has stopped exploring innovative content types to upsell to the consumer. When Fox Entertainment introduced the ‘Mobisode’ to the world based on the hit TV series 24 with Keifer Sutherland, it was initially hailed as a revolutionary concept. So much so that Fox sought to patent the phrase mobisode. But the 24 mobisode was missing one vital component Keifer Sutherland, and the poor-man’s mobile 7

version of 24 paid a heavy price. It’s the equivalent of paying for a ticket to see The Beatles and getting The Bootleg Beatles. The legacy of the mobisode concept was the acknowledgement by the mobile industry of user behaviour at that juncture in the MT&V evolution. Snacking highlighted the process of consuming richmedia content on mobile in short bursts. While average viewing sessions range from 10 to 25 minutes per day depending on the service provider, more importantly, the mobile industry has stopped trying to second guess what content consumers want to see on mobile. From a consumer’s perspective, the mobile industry is now delivering content much more aligned with what consumers want, rather than what we think they want. This is nothing short of a seminal moment with regard to mobile content and has started consumers engaging with MT&V on a global basis. By its own admission, MobiTV says its programming line up four years ago “was really more second-tier cable properties and some independent made-for-mobile content”. Now, it has all the major content providers, delivering live and on-demand content, and live sports. MobiTV adds that it tried to secure the rights for ESPN in the US a number of years ago, it “was all we could do to get a meeting with them”, because they were not convinced mobile was a way people

would watch live sports. ESPN has since had a dramatic turnaround concerning its mobile strategy, and is typical of how major content providers not view mobile as a legitimate platform for reaching their customary audience, but also an audience that they wouldn’t normally reach. But it’s not only sport that has a growing mobile audience. One surprising area of growth is that of long-form content, such as major TV series like Lost. What has made long-form content a reality on mobile is a sea change in the business strategy of the major entertainment studios. Licensing deals with major content providers are now priced at a “reasonable and realistic” rate, which suggests that the studios have finally realised that there is scarce revenue in mobile content at present. At least this presents a business model at a price that could unlock the vast potential of mobile. mobileSQUARED forecasts revenues from MT&V in France, India, Italy, UK and US to generate US$1.26 billion in 2010. Almost three-quarters of the revenues will be generated in the US, with a little over US$200 million coming from Italy. Without 3G, the delivery of MT&V over GPRS across India is significantly constraining the potential of the service and explains why revenues this year will only amount to US$43 million.


In 2005 mobile video and TV were the services to address falling ARPU. In short, they weren’t, and they didn’t. But all that looks set to change in 2010 for one very simple reason: the consumer has caught up with the mobile industry.


Source: mobileSQUARED







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New York , June 29


South Africa

London , Sept 29-30


Cape Town , Dec 7th 8


The continuing increase of mobile marketing in Austria mobileSQUARED has teamed up with Europe’s leading full service mobile solution provider YOC to deliver mobile usage, trends and insight into some of the leading mobile markets around the continent. Using aggregated data from selected ‘anonymous’ publishers from YOC’s European mobile ad network, mobileSQUARED applies its customary levels of analysis to explore usage behaviour, coupled with network and handset data, to deliver insight to assist brands increase the effectiveness of their mobile marketing campaigns.

30% of Austrian mobile handset owners accessing the mobile Internet – approximately 3.45 million users. Within the younger target group (15-29 years), already more than 45% use the mobile Internet. This represents that the Austrian mobile Internet market is undergoing a period of user expansion. YOC Austria believes that the direct impact of the open Internet (primarily driven by smartphone consumption) is also pushing the numbers of mobile usage.

is the second most favoured device to access the Internet, followed by the iPod Touch and a number of Nokia and BlackBerry devices. The device make-up is evenly split between smartphones and featurephones, however there is significant smartphone adoption in Austria. And it is the smartphones that are generating the phenomenally high traffic volumes the Mobile Safari browser is by far the most popular with 38.93% for February, compared to OSS in second place with 10.03%).

Analysis of the top 10 devices accessing the mobile Internet in Austria via the YOC publisher’s network reveals the iPhone at number one. The Google HTC

In terms of Internet access levels by manufacturer in Austria, Apple devices remained consistent between January and February accounting for 39%, with

Source: YOC

In February, traffic across the YOC European publisher network increased 6% month-on-month. Austria experienced a marginally higher than average traffic growth between January and February, with a 7% increase. The growth in traffic had a direct impact on news, media and community sites, search and also operator portals. This trend looks set to continue with


Source: YOC

YOC devices can process WAP push activity. Similarly, a little under 60% of devices can download video, compared to 96% which can support streaming video. This means for any company looking to deliver a rich media campaign across Austria, streaming video has the potential to reach almost 100% of devices. What’s more, both 3gp and mp4 video formats will reach about 90% of users – and is growing monthon-month, compared to a decline in reach for other formats (rm-8, rm-9 and wmv). Delivery of a rich-media campaign requires sufficient bandwidth. In Austria, 84% of the devices have 3G networks accessibility. Source: YOC

Nokia representing a fraction over 20% of devices. In terms of the best of the rest, the number of Sony Ericsson and Google devices accessing the Internet dropped month-on-month, while there was a marginal increase for Samsung and RIM. The type of device is also having an impact: month-on-month touchscreen devices are the most popular for

browsing, followed by the phone keypad, trackpoint and keyboard. Although the iPhone and Safari dominate mobile Internet usage in Austria, the fact that 96% and 87% of devices using content already support Java Script and Ajax, which enables integrating rich-media content on mobile sites. However, only 54% of

Source: YOC

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I would like to think our first undercover mission to find the mobile advertising revenues of mass construction was a success. I and Toe-knee were despatched to Spain for the Mobile Wireless Cellular Congressional Conferential to do some reconnaissance work to generate leads so to ascertain the whereabouts of these revenues and who, if so, was funding them. It was Sunday when I withdrew from Camp David to rendezvous with Toeknee at the Barcelonas aeroportalisation facilitator. Our car was at the aeroportalisation to swiftly transport us to Sonny Ericsson’s party. Sonny spent the whole night holding up mobile phones. Hellfire, I told Toe-knee I did not want to be privy to this kind of Masonic mobile ritual and wished a prompt retreat. As I expected, Toe-knee agreed with me. Kind of left feeling I should have gone to Sam Sung’s party instead. As we made our way back to the hotel down Los Ramblas, I kept having my beehind stroked. It reminded me of Camp David. Next thing I know, a guy is putting his hand in my back pocket. “What in the Barak Obamas?” I yelled, making Toe-


knee jump. The guy ran off. I think he was after my “Former President of the United State of Americanisms” badge of honour, but luckily, I keep that in my other back pocket. I’m not stupid. I did not sleep well that night, and it did not put me in a good frame of intellectualisms for the first day at the Mobile Wireless Cellular Congressional Conferential. An informant of Toeknee’s let on that there was a futuristical company that could extract mobile advertising revenue just by pointing a special phone at the TV screen. For security purposes I cannot – and will not – reveal his actual name, so will call him Al Fisher to protect his identity. He clearly thought he was some kind of magician, which I did not take too kindly to, no sir-eee. When I tracked “Al” down and confronted him by saying “do you admit that your are enabling innocent people to point their mobile phone at the TV screen and they receive free branded content, and you are getting mobile advertising revenues for this – do you deny that this is your company?”

“Shazam” he said, which threw my thoughting process a little. Smart ass magicians. “And did you launch this service during one of the endless breaks during this year’s Superbowl and it was an incredible success? And that your company is demonstrating a fantastic example of true mobile advertising by utilitisarasitionalising the functionality of the celluless device?” “Shazam” Al Fisher said. “Go Shazam yourself” I roared and ordered Toe-knee to join me in standing down. So we were not having a very good experience at the Mobile Wireless Cellular Congressional Conferential after all. We beat a hasty retreat from Spain to re-evaluate our campaign strategy out there. Al Fisher knows where the money is, and there are more of them out there. We’ll find them. And I’m sure Toe-knee agrees. -------------------------“I do.”

Carroll’s Quest Our resident handset expert Michael Carroll, steadfastly refuses to use the iPhone. But his resistance is weakening. So we at mobileSQUARED have set him the challenge of uncovering a handset that rivals the iPhone. Here, he puts the Nexus One through its paces. In the 1970s, magician Paul Daniels (of the “that’s magic” catchphrase fame) frequently made his assistant the “lovely Debbie Mcgee” disappear live on stage in front of a captivated audience, before she returned in a box conveniently positioned elsewhere on the stage. To wit, Daniels would receive rapturous applause. Jump forward 35 years, and the two magicians (or should that be digital alchemists?) captivating their global audience, go by the names of Jobs and Schmidt. At this year’s Mobile World Congress it was the turn of the latter to receive all the plaudits. Google’s CEO Eric Schmidt drew an enthusiastic round of applause from delegates in Barcelona last month simply by pulling a Nexus One out of his pocket – some might say “that’s magic”. But this here mobile handset expert can pull a trick of two of his own. And as I watched the delegates around me applaud the device being hailed by many sectors of the wireless industry as a worthy iPhone challenger, I tapped my shirt pocket where my Nexus One nestled. My initial impression was the device is easily a rival to the iPhone, because it is impossible to use. I was quickly assured by colleagues that my inability to use the phone was entirely my fault. When I complained the virtual QWERTY keyboard was difficult to use, they banged out 100 words per minute. Comments that the virtual keypad was clumsy and unresponsive were refuted with the input of 10-digit numbers complete with international dialling codes in a matter of seconds.

However, my UI troubles had the welcome side-effect of showing me how good the Nexus One’s cloud-based voice recognition application is. I turned to speech input after getting frustrated by my inability to enter a simple SMS, and it proved remarkably accurate given that I have a Scottish accent. My accent has always been the downfall of previous, embedded, voice recognition systems, which didn’t have as large a database of words to work with. Google’s system was probably accurate 50-60% of the time – a nightand-day shift from those older systems. The applications available offer a good mix of fun and practicality. I particularly enjoyed playing with Google Goggles, which scans a picture and automatically searches for relevant Web info, which is then displayed on the handset’s browser. Where the Nexus One falters is in its look and the Android operating system. Put bluntly, neither is sufficiently different from the iPhone. There’s nothing wrong with the Android operating system – in fact it did quite well, with very little lag when opening applications. But it could have been any phone – there was very little to set it apart from other devices. That generic quality could be one reason sales of the device have been slow since it launched in the US in January. The Nexus One is easily on-par with the iPhone, and will certainly make a good alternative to Apple’s device, however carriers might have difficulty persuading consumers of that.


country data

Source: Internet World Stats

Asia to lead mobile Internet growth As part of our research for our report on the Asian mobile marketplace – in accordance with our Roadshow: Asia event – we have spent considerable time analysing the role of the mobile Internet across Asia over the next five years. Our top-line forecasts reveal there will be over 1.4 billion mobile Internet users across Asia by 2015, up from 423.65 million by the end of 2010. By the end of 2015, the number of mobile Internet users will have

increased by 233%. These figures appear astronomical but in truth they merely reflect the size of the mobile market across Asia. The continent already dominates traditional Internet usage, according to Internet World Stats, Asia had a population of 3.8 billion people (56.3% of the global population) and Internet users of 738.3 million – approaching 20% penetration

across the region as of end-Sept 2009. Of these Internet users, 150 million have a broadband connection. In total, Asia represents approximately 45% of the total global Internet population. Over the last nine years, Internet users in Asia have increased by 546% compared to 304% growth for the rest of the world. While fixed-line Internet adoption is set to slowdown, mobile Internet growth across Asia is at the start of a period of rapid acceleration. Mobile powerhouses China and India will contribute over 1 billion mobile Internet users by 2015, while Japan – the world’s most advanced mobile Internet nation – will have a little over 100 million users. For example, China had 747 million mobile subscribers at the end of 2009 – a penetration of 56%. By the end of 2009, there were 233 million mobile Internet users. Figures released by the China Internet Network Information Centre (CNNIC), revealed the true extent to which the mobile Internet is being embraced, with 37 million mobile Internet users added between July and September 2009 alone. mobileSQUARED forecasts that growth to continue in the near-term, before a

Source: mobileSQUARED


country data gradual deceleration in growth from 2012. Similarly, India will experience year-onyear mobile Internet user growth of 100% in 2010 and 2011, before growth as a percentage of total mobile Internet users will slow down, though actual user growth will remain strong throughout the forecast period. By 2015, India will account for 19% of mobile Internet users across Asia, with a little over 264 million. Strong mobile Internet growth is also occurring across the rest of Asia, driven by the uptake of 3G. The next tier in terms of scale will come from Indonesia, the Philippines and South Korea, contributing a combined 121.77 mobile Internet users by 2015. Such is the growth of mobile Internet across Asia over the next five years that almost one-quarter of the global population will be using their mobile devices to access the Internet, and those users will be in Asia. While the figures for Asia appear astronomical compared to other markets around the world, when put in context

Source: mobileSQUARED

they are incredibly feasible. What’s more, by removing China, India and Japan from the equation, the Asian mobile Internet roadmap mirrors Europe in 2008. For example, based on existing US mobile Internet growth, there will be 115 million mobile users by 2015. In the UK we forecast 38 million mobile Internet users by 2015. In reality, the mobile Internet

growth of these mobile powerhouses China and India is in alignment with their total mobile market growth when compared to other developing nations. The only difference is the sheer scale of the population.

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Augmented reality opening a canyon of opportunities The Grand Canyon is not only famous for being the world’s greatest hole, but anyone that has trekked into its depths would have observed at close hand the sheer magnitude of the strata. It represents a physical imprint dating back over 2 billion years, with layer upon layer of geological data. Today, additional layers in a virtual sense can be added in minutes, let alone billions of years, as the digital and physical worlds collide by way of augmented reality. Augmented reality provides a view of the physical world augmented by digital, computer generated imagery, which can be professional or user-generated. Regardless, the ability to point your phone at the Grand Canyon and see messages left by friends appear the

phone’s screen, or geological information referring to particular rock formations, or even an ad, is where the mobile industry finally catches up with Hollywood. Augmented Reality, without doubt would not look out of place in any of Tom Cruise’s Hollywood Blockbusters, or indeed M briefing 007. The only difference is that this time, it’s real… well augmented. Layar is the platform upon which augmented reality is evolving. The platform has two components: the browser to experience the content layers, and the platform to serve and publish the content layers. The Layar website says the platform is where content layers are defined and acts as the link to the actual publisher who hosts its data. The “Augmented reality has a big potential in Hong Kong (HK), though not a lot of developers and companies here are taking advantage of it yet,” Russell Gutierrez from flippingNORMALS, developer of Hong Kong Art walk 2010 layer (left), told the Layar website. “iPhone (and more recently, Android phones) have a high penetration rate of the mobile market in HK so a lot of people potentially have access to the Layar app. One of our main goals is to first increase the visibility of AR in HK, and the only way to do that is to build more interesting layers. One of the next exciting projects we are looking to do involve mapping the street and graffiti art in HK and building a layer on top of that.” Source:


content layer gives the viewer the title and look-and-feel of the layer, supported by the meta-tags and the web service location, which hosts the data. “This is a new medium and should not be mistaken for a functional tool,” says Claire Boonstra, co-founder of Layar, speaking at the MFootball event in London recently. “What we are talking about here is an experience, a new dimension to dive into and immerse yourself. It is an experience which is genuinely engaging.” Boonstra believes the Layar platform will excel as a marketing-based tool and location-based service. “Users can hold up their phone and it will display an image,” such as a company logo or a discount voucher for a retail outlet, she explains. “And by using the digital compass and GPS to accurately position the device, these images can become location-based services and provide additional value to the user based on their location.” Layar is best showcased on Android, and returned to the iPhone in February following a period of “reprogramming”. By the time this issue of mobileSQUARED has been published, it should also be available on Symbian. To date, Layar has over 1,650 active content developers, publishing over 320 “layars” to date (see table). And most attractive of all, there is no charge for using the Layar platform. To date there are over 400 layers – see related column, with 32 layers launched in March alone. To date there are 69 international layers. In February, the first country layers for Russia and Thailand

Layar were launched. But the opportunities for layers are virtually endless. “One example is an extra screen shot of a marketplace in Rotterdam,” explains Boonstra. “The user can experience what a new building will look like even though it will not be finished in 2014. You can see what you can’t see.” Alternatively, Layar will enable developers to recreate the past. By the summer of 2010, all cities will start in 3D, with their history recreated. Users will be able to hold up phone at the Colosseum in Rome and view the iconic stadium as it once was. And it doesn’t stop there. Layar enables the creation of new art, it provides the ability to place 3D objects above your head, and it can also help with the promotion of new artists.

“One area that is being explored is a specific feature with an automatic trigger,” says Boonstra. “When a user walks into a predefined zone, it will activate an automatic trigger and something happens, such as playing a new single from an artist.”

Selected Layar apps

In recent weeks, two TV commercials have featured Layar: Samsung in France and LG in the Netherlands. It’s the first indication that brands understand the potential of Layar. Until there is a tipping point for Layar-capable smartphones, all Layar-based apps will remain experimental, but this really is the first step towards next-generation communications.

AroundTown R’dam (Game) – Rotterdam,

WTC- New York, US Virtual Public Art Project – international HK Art Walk 2010 – Hong Kong Hotels Now! – international UPCOMING – international Netherlands AppAware for Layar - international Explore South Africa - South Africa House Detective – Germany, Italy, Spain, UK SA Golf Courses - South Africa Second Cup locator - Bahrain, Canada, Egypt, Jordan, Oman ,Qatar, Saudi Arabia, Turkey, United Arab Emirates Urban Walkabout – Sidney, Australia Stelling van Amsterdam – Amsterdam, Netherlands Bath Pub Guide – Bath, UK Political Party Time – US Project Noah - international Dutch Highschools – Netherlands Tilburg University – Tilburg, Netherlands Se salgspriser for danske ejendomme – Denmark NWS NEXRAD Level 3 Storm Attributes – Iowa, US MyCosmik Supplies: WiFi hotspots and SIM cards – international Find a Property – UK Aviones LocalizaTodo – Portugal, Spain Discover Shropshire – Shrewsbury, UK Ronalds’ gone mad! – international Avatar - international BE FAMOUS - international LiveSpot Property – Australia, New Zealand Las Vegas Casinos – Las Vegas, US Msaajid – international Rotterdam Culture – Rotterdam, Netherlands Locaties – Netherlands D66 in Amsterdam - Amsterdam, Netherlands WVU Campus Map – Morgantown, West Virginia, US Unife – Ferrara, Italy AMICITI – Valenciennes, France campustukl – Germany dokiru? – international Christian Church Finder- UK ASU – Arizona, US heAR AUSTIN – Austin, US Gids Noord-Holland Noord – Noord-Holland, Netherlands Gids Haaglanden – Haaglanden, Netherlands YouTube - international Samsung Football Pubs – United Kingdom Snowman 3D - international AndalucíaPeople – Andalucía Spain Edukares – Argentina WA FuelWatch – Western Australia


walled garden

Creating a mobile social network; a best practice guide The benefits of social networking as a marketing tool are being transferred to the mobile world. Indeed, anecdotally we have heard from early adopters of our own mobile social network platform that they are finding more and more ‘traffic’ to their sites being from mobile devices, particularly for real-time and locationbased groups, such as sports events. Moreover, the latest ‘white label’ tools make it simple to create private ‘own brand’ networks quickly and easily, without needing large investment or programming skills, and thus circumnavigating the need to use ‘public’ social networks. It’s a bit like deciding to build a swimming pool in your back yard and inviting only friends and family you’d like to share it with, as opposed to meeting them at public swimming pools which are open to everyone and lack privacy. Private social networks also mean that users can have control over ‘look and feel’ and who has access to the site, which is appealing for many niche groups. However, regardless of how good the tools, there are some good basic practices and principles to follow when creating a mobile social network. Much of this is common sense and an extension of basic good marketing practices, whereas some of my advice is about making the most of the new opportunities that mobile and social networking technology developments have made possible. Here are five things I recommend considering when you are starting out on your mobile social network project: Make it easy Accessing a mobile social network should not be a difficult or convoluted experience, so make sure that the platform you are using is optimised to support, for instance, iPhone, Blackberry


and Android. In other words, rather than expecting the user to go to the mobile Internet to access the site, they should be able to download an application straight to their mobile device, eg from the iPhone App Store. This will improve the user experience and encourage usage.

between users is the lifeblood of a good social network site.

Similarly the user interface should be completely intuitive and easy. It may sound obvious, but it is not always the case. Users don’t want to spend time learning how to use the site – they should be able to navigate their way around and use the features straight away.

And be sure that the performance of the platform provider matches your users’ expectations: although some mobile networks still have ‘patchy’ coverage, consumers have become very used to reliable, high quality mobile communications and this extends beyond voice and email to other applications. So, real-time should mean real-time, although of course it is not easy to control the performance of the mobile telecom network.

Who’s who

Location, location, location

The beauty of social networking is that people intuitively trust friends and known contacts more than they do mainstream promotion from vendors, however well targeted or crafted. So make the most of this: identify a group of early adopters or ‘champions’ who will help to quickly populate the site and be interactive. You may know these people already, or you may find them commenting on your organisation or related topics on public social networks. Think about giving incentives: for instance, the more active they are on the network, or the more users they help recruit, reward them with invitations to events. Have a ‘user of the week’. You could even stage competitions. Be creative!

Location-based services are predicted to be one of the fastest growing areas of mobile communications and the latest mobile social networks tools enable you to tap into this rich seam of possibility. For instance, Shoutem customer Houssain Yahfoufi, founder of NFL Shouts says that “we’ve seen that the most traffic on NFL Shouts is during football games, so people can connect with each other at the ground. We call it ‘Watch n’ Shout’ and users can even “shout” pictures from the game.”

DIY tools The beauty of mobile social networking is that it integrates very well with the existing mobile experience: users already use their phones to take photos, for example, so make sure that it is easy for them to upload their images to the site, from their mobile device. Also, ensure that the platform you are using encourages them to be interactive: tools for uploading images, for instance, should be obvious. A lively dialogue

Show me the money If the network needs to be selfsupporting, think about your monetization strategy early on, though at first, you may need to underwrite the entire cost. But looking ahead, a sports mobile social network could target sports clothing brands, charge for premium content and even tie up with the social network platform provider to make extra applications available for a small charge. Viktor Marohnic is CEO Shoutem, www., email viktor@shoutem. com, tel +385 98 183 1622


Asia to lead mobile Internet growth Mobile marketing booming in Austria Nexus One gets Carrollised G. W Bush & Toe-knee Blair meet Shaza...


Asia to lead mobile Internet growth Mobile marketing booming in Austria Nexus One gets Carrollised G. W Bush & Toe-knee Blair meet Shaza...