Summit at Stanford 2010: What’s New in the Mobile Monetization World?

By July 28, 2010

One of the panels at this morning's Summit At Stanford 2010 was "Mobile Monetization - Billions for the Taking." Speakers were Sunil Verma from Mobclix (ad exchange system on mobile), Anderson Thees from Apontador (LBS leader in B

razil) and Bill Diotte from BroadHop (“air traffic controller for networks”).
Here are our takeaways from the session...

First postulate: it’s a good time to enter the mobile industry because there are a lot of changes in the ecosystem, and, consequently, opportunities. The carriers and service providers lost the first smartphone battle, as Apple and Google are playing by their own rules on their platforms. The good thing is that carriers need to monetize their assets and need partners to optimize them: smart startups are welcome. Also, there is a gap between mobile app and carrier that a startup can fit into: better integration means better user experience, and so, better monetization.
On the developer side, little money is needed to build an app and deliver it to the world: innovation will soon follow as more and more developers are able to launch their apps. Developers need to think about cross-platform development (Blackberry is still number one in the U.S. smartphone segment) as the incremental cost is affordable and can bring nice surprises.
The mobile world is discovering more and more revenue-stream possibilities: freemium and virtual goods, for example. Furthermore, transaction costs are becoming lower (still high though; think about the 30% on the App Store), and micro transactions are now possible. Still, the utility base per use model is missing -- it is not yet technically possible because of the network infrastructure.
Anderson Thees from Apontador gave a quick international overview: Average Revenue Per User (ARPU) erosion is huge in emerging countries, but the cost for acquiring customers is still high, so free apps and content is very important for a service provider to attract new users.
Regarding Brazil: mobile data there is still very expensive, so paying for mobile apps is not common -- you have to provide a real added value. Anderson noted that Apple's model is a closed garden, but it’s an alternative to something that is not working in Brazil. As soon as emerging countries have relevant 3G/4G networks, the competition will intensify regarding international competition, both from and to developed countries.

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