MVAS and Mobile InternetConflict and convergence

Suresh Jayaraju

Operating in the new frame3

The New framework2

Issues in MVas1

All is well with MVas India?

Source: IAMAI Mobile VAS Report April 2008

Issues

Revenue Models / Business Models

- What's my count today - Incentivisation- NPD / R&D - Squeeze

- Hurry, innovate- Product Planning - User experience, - Reporting

VAS Products Development

Openness!

Desktop Internet • Best products win

• Choose products, not providers

• Competition is just a click away

• Entry with few $$’s

• Ad’s reward productsMVAS not

Open Platform likedesktop Internet

Most issues in VAS would cease to exist on open platforms like Desktop Internet

Operating in the new frame3

The New framework2

Issues in MVas1

1. Proliferation of Mobile Internet

2. Penetration of Smartphone's

3. Development of Browsers

Emergence of a New Framework

• It’s a start• No one size fits all• Address India’s US and Japan First

1. Proliferation of Mobile Internet

Proliferation of Mobile Internet worldwide

Source: IDC, comScore, IAB and Merrill Lynch Estimates, June 2008, Google Estimate

200 millionComputer

Browsers Shipped

240 millionMobile

Browsers Shipped<By the end of 2009…

9

In 2011, Smartphone search rates are

expected to exceed PC search rates of

2007

Google India Mobile Internet Growth

Active GPRS users estimated to be 20to 25Mn

40% of Desktop Internet users

Q3, 09

Google Mobile Search Inventory growing at 60% QoQ /

Quadrupling every year

Q2, 09Q1, 09

Numbers Indexed for confidentiality

100

150

250

The Metro PCS – “The leader in Unlimited”

• 51% YoY growth in its subscriber base - Q1 ’08 – ’09 ; the fastest % growth among all US operators

• Mobile Internet Offer:1 month of free web-access at sign-up, Flat rate unlimited data access thereafter (for $5 per month)

• Metro internet traffic grew >2.5x more quickly than another global carrier with 10 times as many users and a 3G network, Nearly half of Metro’s subscribers use the mobile Internet

Proliferation of Mobile Internet

Happy GPRS

(weekends)

Happy GPRS 2 (24x7)

Mobile Internet traffic, Iran 2007-08Mobile Internet traffic, Algeria 2008

Iran: Irancell internet traffic spiked when it introduced its “Happy GPRS weekends”

plan-with near-free Internet access

Algeria: Internet traffic spiked when Nedjma offered its subscribers “3MB

free every Friday”

“Globally, half of all new Internet connections in 2009 will come from a phone” (eMarketer 2008, 2009)

* Note: (1) In all cases, we have used Google internal traffic data as a proxy for overall mobile browser traffic

(2) Mobile subscriber data used in this analysis is from Informa / WCIS reports + individual company investor reports

Mobile Data Plans becoming affordable in India

Unlimited Data Plans- 2009

Mobile Data plan pricing across operators

Expected downward spiral on data prices

Data plans at Rs.98/- and 95/-unlimited browsing is setting the stage

for affordability

• Data Plan < 100 = 5X Google Mobile

• 5 New Operators

• 3G dream• MNP

2. Penetration of Smartphones

Global Smartphone penetration

70%26%

5%20%

0%11%

46% 53%

In 2011, Smartphone search rates are expected to exceed PC search rates of 2007

• US smart phone use grew 70% to 34 million• Smartphones account for roughly 20% of sales in N.A., a

dramatic increase over the past year• 24% of smartphones in the world are in the US

Over 30 million iPhones sold to date

Over 50,000 iPhone apps

Over 1,000,000,000 app downloads

Accounts for 50% of mobile web trafficin US

iPhone & Android are Game Changers

Several million Android Devices sold

Ranked #2 in mobile web browsingIn 5 short months

Over 18 Android devices in market in 2009

India Smartphone penetration

* Source: Operator/OEM survey plus data shared by partners

0

2

4

6

8

10

12

14

0 2k 4k 6k 8k 10k

12k

14k

16k

18k

20k

22k

24k

26k

28k

30k

INR (in k)

Vol

umes

(in

M)

Volumes of top devices at each price point, over 1 year

No device above 8k doing 1M+ volume

1 million

Samsung Star Full touch screen, 3G browsing phone

Available at sub Rs.10K in India

3. Development of Browsers

New Age Browsers - The Start of a Platform Transition

• Comparable to PC

• Multiple page support

• Zoom in and out

Full Scale HTML BrowsingMobile WAP Browsing

• Optimized for mobile

• Minimal navigation

• Quick loading19

What’s interesting about new age browsers

Phones now have• Eyes, • Ears, • Skin • Location• Motion sensor

Google Voice Search

Android and iphone - Webkit platform , HTML5, - Standardization - Web apps- Rich Media experience

Operating in the new framework3

The New framework2

Issues in MVas1

Open Platforms and Products

Product Marketing

- Try n Buy

- SPAM?

- Product appeal and features

Product Development•Global footprint,

•Competition will be a click away

•Common Open Platform

•Certified tested products

Revenue and Business Models

Partners in round table

- Device OEMs,

- Platform owners

- Operators

- Developers

- Content providers

Direct, Indirect Streams

Multiple Streams

- Ad revenue

- Product sale,

- Subscription

- Pay per view/ Pay per use….

VAS was Internet Limited !.....

With Mobile Internet MVAS becomes unlimited

Thanks