5. “Phablets” filling in the gap…
Laptop
Tablet
Phablet
0
3
6
9
12
15
18
21
24
27
2011 Q4 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2013 Q2
MillionsOfUnitsShipped
Source: Interna onal Data Corpora on August 2013
"Asia" excludes Japan and includes Australia, China, Hong Kong, India, Indonesia, Korea,
Malaysia, New Zealand, Philippines, Singapore, Taiwan, Thailand, and Vietnam.
Demand For Phablets Is Skyrocke ng In Asia
6. $-
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
2010 2011 2012 2013 2014 2015 2016 2017 2018
(Millions)
Source: BI Intelligence es mates, ABI Research, IMS, Juniper, *Assumes 42$ average selling price for wearable devices
Wearable Device Market Size Forecast
Wearables beginning to take off…
10. We spend 1 hour a day on our smartphones
Other
10%
Visit Websites
15%
Games
9%
Social Networking
17%
Talk
28%
Text
21%
Breakdown Of The Average Smartphone Owner's
Daily Time-Spend
On Average, U.S. Smartphone Owners Spend 58 Minutes Daily On Their Phones
Source: Experian Marke ng Services, May 2013
12. Mobile is the only media time that is growing
45%$
25%$
17%$
9%$
7%$
4%$
44%$
26%$
16%$
8%$ 8%$
6%$
43%$
26%$
15%$
7%$ 7%$
9%$
42%$
26%$
14%$
6%$
5%$
12%$
38%$
20%$
12%$
4%$
5%$
20%$
0%$
5%$
10%$
15%$
20%$
25%$
30%$
35%$
40%$
45%$
50%$
TV$ Online$ Radio$ Print$ Other$ Mobile$
Source:(eMarketer,(August(2013(
U.S.$Consumer$Media$Consump2on$Share$
2009$ 2010$ 2011$ 2012$ 2013$
13. Mobile is enabling new forms of
entertainment, communication,
media, and commerce.
14. Staggering growth for new communication apps…
Instagram
WhatsApp
Snapchat
0
50,000,000
100,000,000
150,000,000
200,000,000
250,000,000
300,000,000
350,000,000
400,000,000
Oct-10
Dec-10
Feb-11
Apr-11
Jun-11
Aug-11
Oct-11
Dec-11
Feb-12
Apr-12
Jun-12
Aug-12
Oct-12
Dec-12
Feb-13
Apr-13
Jun-13
Aug-13
TotalUserBaseSize
Source: News Reports, Company Lis ngs, ComScore, BII Es mates
Total User Base
15. 450 million WhatsApp users, +1 million a day
8
10
11
16
19
200
Ac ver Users
450
0
50
100
150
200
250
300
350
400
450
500
0
5
10
15
20
25
Apr-13 Jun-13 Aug-13 Dec-13 Feb-14
NumberOfAcveUsers(Millions)
NumberOfDailyMessages(Billions)
Source: WhatsApp, News Reports, BII Es mates
WhatsApp Growth
Messages Sent Ac ver Users
16. Similar growth for WeChat and Line…
0
50
100
150
200
250
300
350
400
450
500
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Millions
Source: BI Intelligence Es mates
WhatsApp, WeChat, LINE, Viber Monthly Ac ve Users
(Global)
WhatsApp
WeChat
LINE
Viber
17. Usage of these apps has blown past “texting”
16.2
19.5
4.4
41.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
2011 2012 2013
BillionsOfMessagesPerDay
Source: Informa, April 2013
OTT Surpasses SMS
SMS OTT
18. ~1 billion pictures shared each day
Facebook, 43%
Snapchat, 49%
Instagram, 7%
Flickr, 1%
Top Photo Sharing Sites, November 2013
Daily Photo Uploads Among Top 4 Sites (809 Million Photos)
Source: BI Intelligence
19. ~500 million Snapchat pictures a day
0
50
100
150
200
250
300
350
400
450
Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13
DailyPhotoSharesInMillions
Source: Snapchat, TechCrunch September 2013, CNET June 2013, KPCG May 2013
Snapchat's Daily Photo Shares Are Soaring
20. Over 1/5th of Internet traffic is now from mobile
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Dec-08
Apr-09
Aug-09
Dec-09
Apr-10
Aug-10
Dec-10
Apr-11
Aug-11
Dec-11
Apr-12
Aug-12
Dec-12
Apr-13
Aug-13
Dec-13
Source: StatCounter, December 2013
Global Internet Traffic
Desktop Vs. Mobile
21. Mobile video is booming…
0
1
2
3
4
5
6
7
8
2011 2012 2013 2014 2015 2016 2017
MillionsofTerabytesPerMonth
Source: Cisco, 2013
Global Mobile Video Traffic Will Con nue To Surge
23. Mobile is driving all of Facebook’s revenue growth
Total Ad Revenue
Mobile Ad Revenue
$ 0
$ 500
$ 1,000
$ 1,500
$ 2,000
$ 2,500
1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
Millions
Source: Facebook
Facebook Ad Revenues
24. Mobile is now ~25% of e-commerce traffic…
PC
Tablet
Smartphone
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013
Source: Monetate
Ecommerce Website Traffic By Device
25. (But only 13% of e-commerce sales)
Desktop
E-Commerce Sales
Mobile
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
$90,000
2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13E
($millions)
Source: BI Intelligence, comScore, Federal Reserve Economic Data--St. Louis Fed
U.S. E-Commerce Retail Sales
27. PayPal powers $30 billion in mobile transactions
PayPal Mobile
Braintree Mobile*
$0
$5
$10
$15
$20
$25
$30
$35
2008 2009 2010 2011 2012 2013
U.S.DollarsInBillions
*PayPal counted a small por on of Braintree's transac on volume as its own in the last 12 days of Q4 2013.
Source: PayPal
PayPal Mobile Transac on Volume
(Including Braintree 2013)
28. Starbucks did $1 billion in mobile transactions last year
$145
$207
$244
$272
$340
$0
$50
$100
$150
$200
$250
$300
$350
$400
Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2014
MillionsOfU.S.Dollars
Source: Starbucks's Statements, BI Intelligence Es mates
Starbucks's Mobile Payments Volume
(United States)
29. New mobile car services like Uber are thriving
11,879,718
781,088
4,407,629
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
Jun-10
Jul-10
Aug-10
Sep-10
Oct-10
Nov-10
Dec-10
Jan-11
Feb-11
Mar-11
Apr-11
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Sep-13
Oct-13
Nov-13
Dec-13
PaymentCardsOnFile
Source: BI Intelligence
Payment Cards On File For Car-Hailing Apps
(Cumula ve)
Uber Ly Hailo
30. Apple did $10 billion in app revenue last year
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
2008 2009 2010 2011 2012 2013
(millions)
Source: news reports, company releases
Apple App Store Revenues
By Year
31. Mobile has extended digital day to 18/7
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
Mobile Visits Desktop Visits
Source: Google Analytcs, Business Insider
32. Source: comScore, Telefonica, Macquarie Capital (USA), December 2011
Each device has a different “prime time”
Share Of Device PageTraffic Over A Day:
36. Developed markets are nearing maturity
18%
65%
0%
10%
20%
30%
40%
50%
60%
70%
Jan 10 Jun 10 Nov 10 Apr 11 Sep 11 Feb 12 Jul 12 Dec 12 May 13 Oct 13
(asapercentageofthemobilepopulaon)
Source: comScore
U.S. Smartphone Penetra on
38. Biggest opportunities now China and India
0
50
100
150
200
250
300
China
India
USA
Brazil
Indonesia
Russia
Japan
M
exico
Germ
any
France
UK
Others
Italy
Australia
M
alaysia
Sw
eden
MillionsOfSmartphones
Source: Mediacells via The Guardian
Smartphone Sales In 2014 Will Be Driven By New
Users In Emerging Markets
Sales To New Smartphone Users In 2014 Smartphone Upgrades In 2014
Top 11 Markets
Other Markets
39. China is already twice the size of the US market…
Mobile Users
Total Users
U.S. Users
0
100
200
300
400
500
600
700
June 06 Dec 06 June 07 Dec 07 June 08 Dec 08 June 09 Dec 09 June 10 Dec 10 June 11 Dec 11 June 12 Dec 12 June 13 Dec 13
MillionsOfInternetUsers
Source: China Internet Network Informa on Center
Chinese Internet Users
40. …And the No. 2 market for apps
1,358
294
185 139 130
244
79
507
315
4.30
4.65
2.30
2.12
0.67
1.70
3.43
0.37
2.47
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
0
200
400
600
800
1,000
1,200
1,400
1,600
USA UK Germany France Brazil Russia Australia China Japan
AppDownloadsPerCapita
TotalAppDownlaods(Millions)
Source: XYO, BII Es mates
Total App Downloads vs. App Downloads Per Capita
By Country, April 2013
Total App Downloads App Downloads Per Capita
41. $100
$150
$200
$250
$300
$350
2010A 2011A 2012A 2013E 2014E 2015E 2016E
AverageSellingPrice
Source: BI Intelligence Estimates
Global Smartphone Average Selling Price
Forecast
Prices are dropping fast
55. A majority of users now on “Jelly Bean”
Froyo
1%
Gingerbread
20%
Ice Cream Sandwich
16%
Jelly Bean
61%
KitKat
2%
Android Pla orm Distribu on, February 2014
Source: developer.android.com
56. Apple still very strong in US — but weaker globally
Android
Apple
BlackBerry
Microso
Other
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jan 10 Jul 10 Jan 11 Jul 11 Jan 12 Jul 12 Jan 13 Jul 13
U.S. Smartphone Market Share By Pla orm
Source: comScore
57. In US, Apple also still has edge in ad revenue
iOS
Android
Other
RIM
Symbian
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013
%MarketShare
Source: Opera Media Works, The State Of Mobile Adver sing Q2 2012-Q3 2013
Ad Revenue Share By OS
58. And a big edge in eCommerce traffic…
iPad
iPhone
Android Phone
Android Tablet
Other
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013
Source: Monetate
Ecommerce Website Traffic By Mobile Pla orm
61. The world is now “multi-screen”
Personal Computers
Smartphones
Tablets
Smart TVs
Wearables
0
200,000,000
400,000,000
600,000,000
800,000,000
1,000,000,000
1,200,000,000
1,400,000,000
1,600,000,000
1,800,000,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E
Units
Source: Gartner, IDC, Strategy Analy cs, Company Filings, BI Intelligence Es mates
Global Internet Connected Device Shipments
68. So the money will follow…
Offline
All Other Online
Mobile
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
(billions)
U.S. Adver sing
Source: IAB, U.S. Census Bureau, Stategy Analy cs. BI Intelligence es mates
69. Spending is moving to mobile…
48%
43%
21%
19%
7%
15%
7% 6%
6% 7%
5% 4%
2% 2%
3% 3%
0.5% 0.4%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
H1 2012 H2 2013
%OfTotalDigitalAdRevenue
Source: IAB 2013
US, Digital Ad Revenue By Format
Email
Rich Media
Sponsorship
Lead Genera on
Digital Video
Classifieds
Mobile
Display/ Banner
Search
70. Mobile ad prices are lower but rising
$3.50
$0.75
Desktop Internet Mobile Internet
Effec ve CPM, Desktop vs. Mobile
Source: comScore, Vivaki, Mobclix Exchange
71. US mobile ad spending per sub growing fast
$0.0 $0.1 $0.1
$0.8
$1.4
$4.5
$0.1 $0.3 $0.3
$1.3
$2.8
$9.2
$0
$1
$2
$3
$4
$5
$6
$7
$8
$9
$10
La n America Middle East and
Africa
Central Europe Asia-Pacific Western Europe North America
Source: IAB, IHS
Annual Mobile Ad Spend Per Mobile Subscrip on
By Region
2011 2012
73. And Google owns almost all of it
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Dec08Feb
09Apr09Jun
09Aug09Oct09Dec09Feb
10Apr10Jun
10Aug10Oct10Dec10Feb
11Apr11Jun
11Aug11Oct11Dec11Feb
12Apr12Jun
12Aug12Oct12Dec12Feb
13Apr13Jun
13Aug13Oct13Dec13
Source: StatCounter
Global Mobile Search Market Share
Google Yahoo! bing
75. 6%
9%
19%
2%
4%
7%
7%
17%
7%
22%
0% 5% 10% 15% 20% 25%
Other
Connected TV
Everything As A Service
Indoor Loca on
Distance Learning
Mobile Adver sing
Mobile Health
Mobile Wallet
Connected Car
Wearables
Source: Open Mobile Media, July 2013; n = 50+ Top-Level Mobile Execu ves A ending The Open Mobile Summit
What Is The Next Big Thing In Mobile?
Wearables!
76. Health devices are the most popular
87%
13%
20%
12%
6%
2% 2% 2%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
No Yes Nike+
Fuelband Or
Ac vity
Tracker
Fitbit Bodymedia
Fitcore
Pebble Watch Jawbone UP Recon Ski
Goggles
Source: Bloomberg/Survey Monkey, April 2013
Have You Ever Purchased A Wearable Compu ng Device Or
Received One As A Gi ?
If So, Which One? (US Respondents)
77. Not much interest in smart watches so far
Galaxy Gear
Official Shipments
Galaxy Gear
Low Es mate Retail Sales
Pebble Shipments
May-June 2013
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
Month 1 Month 2
Source: Samsung, New Reports, BII Es mates
Samsung Galaxy Gear Vs. Pebble Smart Watch
Es mated Shipments And Retail Sales - First Two Months
78. 0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Tech-Sensi ve Tex les And Clothing
Headset/Eyeglasses
Sensor-Enabled Wristwear
Medical Devices That Transmit Data
Source: Bloomberg West/SurveyMonkey
Consumers Are Interested In Smart Medical Devices And
Wristwear
Interest in glasses and headgear is only modest
79. They cost a lot, and there’s the creepiness thing
Yes
28%
No
53%
Not Sure
19%
Would You Feel Comforable If Someone You Were
Interac ng With Were Wearing Glasses Like These?*
Source: YouGov, May 2013 *n = 1,000 smartphone owners in U.S.
Image: Google+/Robert Scoble
81. We spend 1.2 hours a day in cars...
Sleeping
7.6 hours
Leisure And Sports
2.5 hours
In The Car 1.2 hours
Ea ng/Drinking 1.1 hours
Household Work 1.1 hours
Other 1.7 others
0
12
24
Source: Bureau Of Labor Sta s cs
Average Daily Time Spent Per Person
U.S. Employed Ci zens ages 25 to 54
Working
8.8 hours
82. So connectivity will soon come standard
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
2009A 2010A 2011A 2012A 2013E 2014E 2015E 2016E 2017E 2018E
UnitShipments(thousands)
Source: SBD,GSMA
Connected Car Unit Shipment Forecast
83. Music, maps, weather, traffic, news are the killer apps
U.S. Connected Cars
Pandora U.S.
Connected Car Ac va ons
-
5,000
10,000
15,000
20,000
25,000
30,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
NumberOfCars(Thousands)
Source: News Reports, Company Statements, BI Intelligence Es mates
Es mated U.S. Market For Pandora In The Car
87. Henry Blodget
CEO & Editor-in-Chief, Business Insider
Tony Danova, Research Analyst
Marcelo Ballvé, Editorial Director
BI Intelligence is a new subscription service from Business Insider
that provides in-depth insight, data, and analysis of the mobile industry.
More info at intelligence.businessinsider.com
Cooper Smith, Research Analyst
John Heggestuen, Research Analyst