"Mobile Innovation Economics", Andreas Constantinou, VisionMobile @ Tallinn 21.11.11
More info at: http://www.momoestonia.com/2011/11/monday-2111-tallinn-full-of-great.html
2. Knowledge. Passion. Innovation.
selected excerpts November 2011
Mobile Innovation Economics
Andreas Constantinou
Managing Director
2 Copyright VisionMobile 2011
3. VisionMobile
Distilling market noise into market sense
Research Training Market maps Strategy definition
competitive analysis, open source economics, Competitive landscape maps strategy design, ecosystem
commissioned research, Android commercials, of the mobile industry positioning, product
company due diligence mobile industry dynamics definition
Developer
Economics 2011:
How developers and
brands are making
money in the mobile
app economy
Software Economics in a
HTML5 Telecoms World Mobile Megatrends series
Mobile Industry Atlas, 3rd ed.
and its impact how Internet business models are
1,100+ companies, 69 market sectors
to the mobile impacting telecoms and how to
industry innovate in the age of software
Top-100 analyst blog
4,000+ subscribers
20,000+ monthly uniques
90% mobile industry insiders
Active Idle Screen
Who will own the
screen?
The Android Game Plan
the commercial mechanics 100 million club
behind Android and how tracking successful businesses
Google runs the show in mobile
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4. Trusted by industry brands
Clients
selected
VisionMobile clients
2008-2011
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5. One
Winners and losers in the handset value chain
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6. Top-5 OEM market share takes a nose dive
OEM market is quickly fragmenting
Top-5 OEMs
Market share of top-5 OEMs
80%
59%
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8. What is leading to the growth of smartphones?
smartphone share of total handset shipments
Global market share
and by operator demand
to differentiate against Apple
Smartphone ramp up
led by Apple, RIM
and HTC in 2009
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11. Apps and content create new empires
Apple Q1’2011: 5% volumes, 20% revenues, 55% profits
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12. Android and iOS lead the way
source: Asymco
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13. Android: OEM winners and losers
The winners: The losers:
fast followers ‘old guard’ OEMs
Efficient cost structure and ability to differentiate Cost structure requires high-margins
on top of Android or in hardware Android or Windows Phone is a short-term life
support
low cost assemblers
Cost structure optimised for razor-thin margins
Android is a long-term opportunity for global reach
No Name source: VisionMobile
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14. DELLification in 2015
closely modeling the PC business
Profit pyramid Revenue pyramid
Innovators
Role model: Apple
$50B 5% @ $500
Fast followers
$100B Role model: Samsung
20% @ $250
Assemblers
Role model: Dell
$48B
30% @ $80
Mass producers
Role model: Nokia ?
$27B 45% @ $30 No Name
$225B
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15. Two
Smartphone platform competitive landscape
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17. Three types of platforms
Platform type Purpose Audience Economies of scale Examples
Software Sharing of software Device makers None Symbian, BREW,
platform dev costs and risks Flash Lite
Application Connecting app Developers - Users to devs Android, iOS,
platform developers and - Users to users Windows Phone
users - Devs to devs
Communication Facilitating Users - Users to users Telephone, Fax,
platform communication BlackBerry
between users Messenger
22. What is Google’s strategy?
1. Flatten
Flatten everything that stands between eyeballs and Google inventory. This is based on the economics of
complements; to increase the value of your product you need to reduce the value of your complements. It
explains the Android and Chrome strategies
2. Expand
Expand the footprint of Google inventory (e.g. search-based text ads) across the user journey by introducing
new Google services like Gmail, GMaps, Google Voice as well as Android handsets.
3. Mine
Mine the information available on every user of that inventory. Mining information helps Google to better
micro-target users which directly increases the value of its inventory.
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23. How does Android help Google?
1. Android drives eyeballs to Google apps
Drives eyeballs to Google Maps, Gtalk, and other apps bundled on Android handsets and include ads
Google is also the default (and most easy to integrate) ad network for Android apps
2. Android drives a reduction in handset retail price points
..as price becomes the last remaining differentiation option for handset vendors. The cheaper the handsets,
the more people will buy, and the more eyeballs for Google ads
3. Android drives more telcos to adopt flat data rates
Therefore more people using smartphones, therefore more eyeballs for Google ads
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24. Closed governance is used to control Android
license type
dual license
Foundation (commercial + copyleft)
Qt (58%)
(58%)
strong copyleft
Linux kernel (GPL)
(71%)
weak copyleft
MeeGo WebKit Foundation (LGPL, MPL, EPL,..)
(61%) Mozilla (68%) (84%)
(65%)
permissive
Android (APL, BSD, MIT, ...)
(23%)
Closed governance open governance
open governance index
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25. Source: Google-internal presentation disclosed as a result of Oracle's patent and copyright infringement lawsuit against Google
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26. Four
HTML5 and the impact of web apps
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27. Where are we with HTML5?
…and how long will it take to fulfill its promise?
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28. …but what is HTML5, really?
brings capabilities of web apps closer to those of native apps
Emerging next generation of HTML web language
– Collection of drafts by WHAT WG that merge into W3C specifications
WHAT WG - Web Hypertext Application Technologies
– W3C standard will be completed no sooner than 2013
Driven by leading web and platform players
Main enhancements
– UI tools – plugin-free video/audio
– off-line storage – geo location
– 2D graphics – speed and communication
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30. HTML5 has many benefactors
all pushing HTML5 and web apps for their own unrelated reasons
Apple looking to move the web away from Flash
–
Google searching for more ways to commoditize complements
–
Facebook aiming to break-down Apple/Google silos and distance Adobe
–
Microsoft to leverage web innovation to Windows 8
–
Mobile operators hoping to regain control lost to native platforms
–
Qualcomm working to create competitive advantage for its chips
–
Brands looking use web as a low-cost way to go cross-screen
–
Tool makers facilitating web-to-native hybrid development
–
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31. Can HTML5 compete with platforms?
HTML5 is a complementary technology, not yet a full-fledged platform
App platform ingredients
Software Developer
Monetisation Distribution Retailing
foundations ecosystem
HTML5 ✔
= ✖
✖
✖
fragmented platform
always a step behind native will depend on app store
complex tool-chain waiting for a leader
Facebook? Google? Microsoft? Other?
most appealing to those who do not yet develop for mobile
complimentary tech to those who develops native apps
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32. “We don’t expect developers to choose between HTML5 and native
apps. We expect they will choose both, just as we did. We view
HTML5 as a technology, not a platform.”
June 2011
http://www.insidemobileapps.com/2011/06/17/facebook-html5-mobile-platform-project-spartan/
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