The third webinar of the year – “Mobile Multimedia: Minimizing Congestion, Maximizing Quality” – was held on July 15. You will find a full replay of the webinar here and will be able to access it later on the Mobile Minute page of our website.

The July 15 drew event visitors from Europe, the Middle East, Africa, Asia, Latin America, the U.S., and Canada. FierceWireless Editor Mike Dano moderated a panel consisting of Craig Mathias, principal of Farpoint Group; Adrian Hall, our Chief Marketing Officer and Joel Brand, our vice president of Product Management.

Craig Mathias opened the session with comments on the central role of video in consumers’ lives and the corresponding market opportunity for mobile multimedia – especially video on demand. He cited a number of mobile applications that are proliferating in our ‘video-driven culture’, including company updates to employees, real-time distribution of business and consumer news, sharing of personal events among family and friends, and marketing and advertising campaigns. He stated Farpoint’s forecast that by 2014, 40% of all mobile consumers will be accessing video on their devices. Craig added that given the current economics of data pricing, capacity and throughput – plus the continued evolution of mobile handsets and multimedia content – wireless carriers will need to build escalating demand for video into their network evolution plans.

Against this backdrop, Joel Brand presented a number of compelling industry and anonymous customer statistics on mobile internet usage today. Multimedia streaming accounts for 30-40% of network data throughput, which is generated by less than 1% of users. Today mobile video constitutes approximately 35% of the total traffic mix and is expected to grow at a compound annual rate of 131% through 2013. Smartphones are approaching laptops in percentage of video traffic generated, and in certain tier-one networks, video consumption has overtaken web browsing on Apple iPhones. Joel then showed how web and media optimization could reduce peak throughput by up to 50%. Operators can effectively manage excessive data consumption and abusive video usage by a small percentage of users through the intelligent enforcement of fair use policies, which protect network resources without damaging customer relationships.

Adrian Hall pointed the divergence between data growth and data revenue growth and its impact on operators’ profitability as cost per bit continues to rise. Adrian focused on the unique attributes of our Media Optimization solution: just-in-time video delivery that maps streaming to actual consumption, data reduction that downsizes traffic while maintaining high quality, and intelligence that adapts optimization to constantly changing network conditions.

Following Craig Mathias’ presentation, Mike Dano polled the audience on the question of whether operators should enforce fair use policies with their subscribers. The results of the poll were as follows:

Additional Mobile Minute events are being planned for later this year. We will keep you apprised of these and other developments in our ongoing efforts to provide thought leadership and consultative education to our customer and prospect base and the mobile internet industry at large.

-Jaishree Subramania

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In May, Bytemobile sat down with Ronan de Renesse of Screen Digest to discuss the state of mobile media. This week, Ronan has been kind enough to answer some questions for our readers.

1) Screen Digest recently published a report on the state of the 3G mobile broadband market. Where do you see 3G mobile broadband fitting into the overall mobile ecosystem today, and where do you see it in three years? How does this affect what carriers are doing, aren’t doing or should be doing?
Mobile broadband today is worth more than mobile TV, mobile video, mobile music, and mobile games combined. The number of mobile broadband connections has multiplied by 10 between 2006 and 2008 and is still rising. Five years after the launch of 3G, mobile operators have finally found a way to monetize their 3G licenses. However, the real potential for mobile broadband is as a primary home connection, and today’s services work well only as a secondary broadband connection. As a result, growth is likely to decline over the next couple of years until mobile broadband can become truly competitive with fixed broadband.

2) You frequently cover mobile video and mobile TV. How would you assess the current state of the mobile video and mobile TV industries? What is the key driver that will increase adoption (network solutions, handset advancements, content)?
Mobile TV/Video is the mobile content category that has suffered the most from the economic downturn. In 2008, we experienced drastic changes in business models with the emergence of mobile content bundles such as SFR Illymitics in France and disruptive technologies such Telegent Systems’ analog mobile TV chipset. The industry realized that mobility by itself does not justify a subscription fee for mobile TV. Quality of experience (i.e., large screens, premium content, good QoS) is key in order to drive the uptake of paid-for mobile TV services. With the increasing availability of free-to-air services, the industry runs the risk of consumers thinking of mobile TV as a feature (like a camera or FM radio) instead of a service. In 2008, 76% of mobile TV users watched it for free.

3) How do you see the growth in adoption of mobile video and mobile TV affecting network infrastructure? Networks already seemed to be bogged down with data traffic. Are they ready for widespread adoption of mobile video and TV?
The rise of mobile broadband, added to the increasing popularity of smartphones (typically sold with flat-rate data plans), has certainly put a lot of pressure on 3G networks lately. Mobile operators are doing a lot to upgrade their networks as quickly as possible in order to accommodate the demand for mobile data. Fixed networks can only handle widespread adoption of online video and TV, and mobile networks are very far from it - especially considering that there are far more mobile connections in the world than fixed ones. However, there are other ways to get content on your handset than through the 3G networks. Over 90% of videos and music tracks on mobile phones are side-loaded from the PC. Taking control of this delivery mechanism and monetizing or reducing it is a big challenge for handset manufacturers and operators.

4) You recently published a report that discussed how, as the walled gardens come down, handset manufacturers are moving in to provide services to operators. Will handset manufacturers continue to drive and influence the wireless industry? Does anything threaten this influence?
The success of mobile broadband and flat-rate data packages has shown several mobile operators that they are better at selling access than content and that opening the walled gardens can work to their advantage. Mobile operators are therefore increasingly opening up to third-party service providers. Handset manufacturers, on the other hand, are suffering from a difficult economic context where mobile users opt for SIM-only contracts instead of handset upgrades. Handset manufacturers are therefore looking at alternative revenue streams and/or new ways to differentiate from their competitors, and content is coming up as a relatively good option. In addition, Apple has proved with its App Store that vertical integration of hardware, software and services works well in mobile.

5) Forrester recently published a report declaring that the term “smart phone” is dying off. Is there a future for mass-market handsets? Why or why not?
There is certainly still a future for mass-market handsets, which will be primarily driven by growth in emerging markets such as China and India. The recession has also helped to keep low-end handsets in the market. However, there has been cannibalization between feature phones and smartphones which are typically populating the mid-range and high-end device segments in Western markets. Smartphones have been taking market share from feature phones for the past 12 months, as smart phones become more accessible in terms of price and feature-rich. I would say that the term “feature phone” is more likely to die than the term “smart phone.”

Stay tuned for commentary from other key industry influencers on the trends and issues important to the mobile internet ecosystem. If you have any questions you’d like us to ask, feel free to leave a comment or send an email to sinfantino@bytemobile.com.

-Stacey Infantino

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On June 18, we conducted the second webinar of the 2009 Mobile Minute series – “Making a Better Mobile Browser”. Led by FierceWireless as part of its FierceLive! webinar program, the event attracted 317 registrations and 126 unique live visitors from Europe, the Middle East, Africa, Asia, Latin America, the U.S., and Canada. You can access a full replay of the webinar on the Mobile Minute page of Bytemobile’s website.

FierceWireless Editor-in-Chief Sue Marek moderated a panel consisting of (from left to right below) Mark Donovan, senior vice president of Mobile and senior analyst at comScore; Phil Parry, mobile browser interaction manager in the Design and Usability unit at Orange Group; and Adrian Hall, chief marketing officer at Bytemobile.

Mark Donovan began the discussion with a profile of the mobile market segments today, indicating that mobile media users – defined as browsers, application users and downloaders – had grown 24% from last year and now constituted the largest segment at 35%. The key drivers include device technology, network speed and adoption of unlimited data plans. Donovan noted that the U.S. had surpassed Europe in data plan penetration and that growth will accelerate as networks become faster and data costs stabilize. He cited browsing and social networking as the fastest growing mobile data activities, with the latter increasing 170% from last year, followed by applications at 111%. In the U.S., daily news and information access on mobile devices is overtaking the circulation of daily newspapers. Donovan concluded with a review of the leading smartphone domains, which are dominated by social networking and community services, news and information, and entertainment. Excluding social networking, web search, weather and news are the leading mobile browsing genres.

Phil Parry of Orange followed with the operator’s perspective on the mobile browsing platform and business model, noting the fragmentation of the market and the pros and cons of the PC internet experience and the mobile internet experience. Parry categorized the challenges to be addressed in closing this gap as user, economic (operator) and developer issues. He echoed Donovan’s point about smartphone penetration as a major factor in the evolution of web browsing technologies and then focused on the competitive landscape for web runtime platforms, which is moving toward service discovery and personalization. Within this context, Parry noted that today 58% of Orange subscribers search the Web through Orange World, the operator’s portal, while 78% circumvent the portal for direct access. He summarized the mobile platform and web-based application development environments and the balance between portability and performance. In conclusion, Parry stated that Orange would support the development of best-of-breed mobile web services with a unique operator-based platform and continued focus on the design of the user experience.

Adrian Hall’s segment of the panel played off of Donovan’s and Parry’s segments and shared Bytemobile’s experience in working with more than 100 operators worldwide on the evolution of their networks and data services. Hall underscored the importance of personalization to the success of the mobile Internet, highlighting Bytemobile’s Widget Bar as an example of a smart browsing tool that enables customization of the user experience from within the network and supports the implementation of new business models. He also reminded the audience that content adaptation has valid uses cases for all mobile devices – including even the highest-end smartphones, such as the iPhone and the new Android devices. Hall closed with a quick summary of Bytemobile’s product portfolio, again relating key points back to the comments of the other two speakers.

Following the individual presentations, Sue Marek took selected questions from the webinar participants. These questions ranged from the match-up between application requirements and browser capabilities to battery life, from the fragmentation of the mobile space to social networking opportunities and the impact of bandwidth constraints on application developers.

In addition, the audience was polled on the multiple-choice question heading the chart below:

The response emphasizes the fact that improving the mobile browsing experience is a multi-point solution – diversity of opinion notwithstanding, there is no single answer. Moreover, the Bytemobile product portfolio supports either directly or indirectly the key components of the solution.

Please note that the next webinar on mobile multimedia and the changing wireless traffic mix – also to be led by FierceWireless – is scheduled for July 15. You can register here.

-Jaishree Subramania

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Bytemobile has reinforced its presence in Australia, New Zealand and Oceania with a new sales team.
Renato Trentin has joined Bytemobile as regional sales director.  His view of the market: “With the introduction of 3G networks, easy-to-use smartphones, and consumers’ thirst for rich media, Australian mobile data usage continues to grow beyond expectations.  In fact, this growth has gone well beyond the early adopters and is now entering the PC user community.  User-generated content and social networking services on mobile devices will continue to grow throughout this community.”

Luke Anderson has joined Bytemobile as sales engineering manager.  He states: “The mobile entertainment industry in Australia is growing at phenomenal rates.  Mobile devices are evolving to satisfy increasing consumer demand, and operators are responding with the launch of networks to provide fast, always-on access to the open Internet.  This market environment provides an exciting landscape for Bytemobile, as we empower the next generation of mobile computing and unleash the true power of the mobile Internet.”

ANZ Market Data
According to various industry sources, Australia has a wireless penetration rate of 100.8%.

In Australia, data ARPU is increasing as consumers substitute voice calls with text messages and web searches.  MarketWatch.com states that the level of wireless penetration in Australia will continue to increase, reaching 109.3% in 2010.  It also believes that Hutchison will remain the growth story in Australia’s mobile space.  Per MarketWatch.com, the country’s largest operator, Telstra, will continue to enjoy the highest level of profitability in the operator space with 42.9% EBITDA margin in 2010, despite aggressive mobile broadband offerings from other carriers.  Optus Australia announced earlier this year that its 3G coverage has reached 85% of the total population.

The Australian Mobile Phone Lifestyle Index (August 2008) offers interesting insights on the usage, behavior and preferences of mobile phone users in Australia.

- Jaishree Subramania

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