I just spent a fascinating two days at the Sofitel Hotel in Redwood City, CA; the site of the 2009 Dow Jones Wireless Innovation. The 200+ Attendees were a combination of VC’s, reporters and executives from established mobile industry companies and startups who are setting the stage for the next generation mobile space that is one of the world’s “shining spots in an otherwise black economy.”
Both days started and ended with keynotes and panels, and sandwiched presentations from 60 of the brightest star’s of mobile startups.
In the opening keynote and panel, the stage was set with thoughts of the likes of Apple, Google and RIM helping shift power from the carriers to the handset manufacturers with application stores and such … fueling increased product and mobile application development and user choices. It was agreed that this creates a very dynamic tension in the industry, with the winners being the consumer’s useability as well as opportunity for innovative application development startups!
Growth of new subscribers is absolutely slowing, from high double digits to 3 to 5%. We are shifting focus from new subscribers, to “How do I keep my customers” and “How do I create more value for my customers.” The future is a handset that becomes the “control centre for a digital lifestyle.” Dan Schulman, CEO, Virgin Mobile US.
Here’s some meandering things I found interesting … and continues to reinforce that this mobile business is very global, and successful companies in this space can come from anywhere. Canadian firms take note!!! You don’t need to be in Silicon Valley to win!
Dan Schulman, CEO, Virgin Mobile US:
– says growth of new subscribers is absolutely slowing, due to handset market saturation as well as the recession. They are shifting focus from new subscriptions to ‘How do I keep my customers’ and ‘How do I create more value for my customers.” In essence … carriers are more than ever focused on reducing churn.
– Smartphones, apps and data are the wave of future growth. Virgin Mobile is in a sweet spot for data … convergence of good SMS usage, social network usage and LBS services.
– Just at the beginning of apps … the future is that the handset becomes the “control central for a digital lifestyle”
– Expecting weaker carriers in industry to start really struggling and expecting downward pressure on pricing as they play price games during the share shift
– The handset is a very intimate device … people don’t want spam or unsolicited ads so they’ll be policing this carefully
Marcelo Vieira, GM, Smartphone Business, Texas Instruments
– The new Palm Pre is the first device running their new OMAP3 technology, which allows for a multi-tasking environment
– Showed several devices from their lab … holy crap … when 4G networks hit, these devices will be available (takes 4 years of design and go to market to release new chipsets) … 4.9″ screens, HD output, 12 MPixel camera’s, and a projector inside the device (projectors will be as common on phones in the future as digital camera’s on now). We saw a projector demo …
– Ease of use, innovation and stickiness of apps will become increasingly more important.
Anthony Lewis, VP, Open Development Verizon
– There will be much more “machine to machine” wireless interaction going on. For e.g. Health Care devices that read labels and tells you if it’s ok with medication.
– His advice was that app and hardware developer need to attach problems that mobile uniquely solves … don’t compete against incumbents from the web space
Panel from “Making the Brand Mobile” (shown in picture: Panel at Dow Jones Wireless Innovation “Making the Brand Mobile” Douglas Brown @ Bank of America, Allen Duan @ MTV Networks, Edward Kaczmarek @ Kraft Foods, Max Mancini @ eBay, Henri Moissinac @ Facebook, David Barry @ Dow Jones Company)
– Facebook: “We’re starting to think that mobile is not an extension of Facebook, it’s going to be the main platform of Facebook. Norway, for example, 50% of Facebook access is from mobile.” Facebook has 40,000 developers coding applications for it.
– Pace and intensity of change in mobile is hard to deny … last year there was no Apple App store. The panel was split on iPhone for branding entrance; “iPhone is a good place to start .. we’ll get it right there first” vs. “you need to have a wide handset strategy … Symbian (O/S on Nokia, Samsung, Sony Ericsson, et. al.) represents 60% of all handsets in the world”
– Biggest mistake: “Don’t try to replicate the user experience from your website. Instead, what are the core values of your offer and how do they apply to mobile?” Mobile web is not web … it’s a lot more like traditional software development 10 years ago (before Saas and Agile methods). And, yes, it is more expensive to develop for mobile … prepare for it!
– Bank of America saw $6B of money transactions in mobile in 2008
– LBS (Location Based Services) giving users context sensitive experience is VERY Important to the strategy of all the companies
John Faith, GM&VP, Mobile, MySpace.com
– Explosive growth from Mobile … seeing 20M accesses a month through mobile (75% from WAP, 25% App) … eventually want to become platform agnostic
– Good jump on advertising thinking: 40% of pages on mobile web are advertising enable, but only 10% of that inventory is currently used (marketing opportunity!!!) … focusing on “hypertargetting” (demographic, contextual and location based advertising)
– MySpace is great for musicians and bands …next step, what does mobile mean for this group?
A show of hands in the audience. How many of you have accounts on:
– Facebook: 70%
– LinkedIn: 50%
– MySpace: 20%
– Twitter: 10%
(surprised at the Twitter response considering the press it’s been getting!)
Alan Brenner, SVP of RIM, Blackberry Platform
-Release of Blackberry App store VERY soon
– there is a huge pentup anticipation to discover and acquire apps on Blackberry
– Subscribers expect both volume and quality … their reputation for great, rich sticky apps will extend to the app store
– The Blackberry image of being an enterprise device is outdated … of the 25M active Blackberry users, 50% are consumers, 50% are enterprise (and consumer interest is outstripping enterprise … the Blackberry Bold is very popular)
– Big Change in application space over last year … it’s much more interesting to us now. GREAT time to be building apps on Blackberry right now.
– Want to challenge a combination of apps on device and apps on cloud
– $150M Blackberry Fund … only 5 companies have been funded so far
– Smartphone industry is one huge growth areas, and RIM is well positioned here
– There is no inflection point where everything has or will become easier … we take challenges one at a time and have relentless attention to detail … there is no other way (I AGREE!!!!)
– To come … unified communications … making calls from Blackberry through enterprise PBX’s while in the office for example
Wrap up panel
– For app developers: make money with your core value proposition … add to it with advertising revenue. Few startups will win with an ad only mode (and if that IS your model, justify it with lots of CPM’s, not just hopes of CPM’s)
– Ad firms that are winning are focused on carrier deals
– VCs looking for disruptive technologies and disruptive business models. Think “If one carrier has it and another one doesn’t, the second one will lose”
– If you are building a feature, approach angels and look for quick exit. If you are building a business, look for VC funding. Opportunities are looking to be harvested in a 3 to 7 year time frame.
– Go hard and get first mover advantage