Who’s Making Money in Mobile? (Panel)

By Ravit Lichtenberg (blog) – At the Always On Summit at Stanford, an impressive panel is underway, discussing mobile monetization, the role of the operator, platform, apps, etc.

Being in the Silicon Valley, the iPhone conversation dominates. Purnima Kochikar starts by saying: “I feel like a foreign student at an iPhone love fest…I’m going to try and convince you to consider Nokia.” The audience—mostly toting iPhones, Andriod, and Blackberries–laughs. .

Decrem gives impressive stats: Tapulous has 4 MIL unique users per month and have seen 460M games played on TapTap Revenge in last year alone. “Engagement is amazing. The tail is getting fatter and fatter as more releases are out” says Decrem. With Tapulous’ growth, the company is now able to better predict revenue and is able to flatten out the spikes that has been traditionally attached to game release. “This is a new platform and new rules are being written,” says Decrem. .


Khalaf: We have now seen that if you make something cheap enough, people will buy it. The iPhone app store is growing 25 times faster than iTunes. .

Murphy: No one’s making a lot of money but a lot of people are making small money. Remember we’re still early. .

Mozes: Mobile advertising got a lot of attention over the past years. Still not a lot of enablement of mobile monetization strategy though. .

Kochikar warns that it is still very early so the question to ask is what WILL make money? There are two big buckets, says Kochikar: the first: complete indulgences. It includes games, premium game content—this is where advertisement and brand play strongly. Getting 7-10X return on video advertisement inside gaming content because it is strongly targeted. The US army is reaching out this way because it found video advertisement inside gaming a good recruiting tool. The second bucket is opportunity for improvements: In short, it allows one to get a life, get a wife, learn something new. .

Role of mobile operators

For Nokia, the operator is part of the value chain. When you get out of the US the use of credit card declines, use of pre-pay is norm and comes with privacy and cash economies. .

With Verizon’s announcement that they’re launching an app store we’re seeing new enablement that wasn’t available earlier. Verizon will support multiple app stores, approve apps within 14 days, open APIs, etc. Carrier boundaries are starting to fall. Carriers have a great opportunity to move fast and take part as a platform for open stores: a distribution for digital goods between the consumer and the developer. .

App store approach vs. browser approach for distributing content.

Khalaf emphasizes it’s all about the user experience. People want to use something that’s easy to use. Content and media may be delivered still via browser, but music and games will see growth on Mobile platforms. .

Decrem says therese’s still a difference between browser and mobile experience for games and browsing. Tapulous offers a hybrid experience across web and app. Murphy concurs ad says that more and more of the apps are written inside the browser with an application wrapped around them. Porter says Mozes’ strategy is to build whatever functionality they can into the mobile browser and then see what they can build on the application for additional adoption. .

Kochira highlights the news that Apple will be blocking google voice. “People may forget that even today, despite of immense progress, smart phones still take less than 10% of the market.” To Kochira, the question is how to help consumers do more with their mobile devices that make the other 90% of the market? Nokia is focusing on proxy browsing and other ways to enable engagement through feature phones. .

Which platform should developers develop for first?

Porter says Mozes started with mobile messaging, voice messaging and now are focusing on the iPhone because “it’s the most popular and easiest thing we can do. Mozes will also develop for Android. “We focused on mobile messaging for first couple of years…as we invest now into smartphones we see this is where it’s going to take us next.” .

Khalaf: I would definitely start with iPhone. Android makes it easy to be discovered and apps built for it are likely to succeed. To a lesser degree: blackberry. “They (RIM) must do something to improve the eco-system and open that platform. Granted, it’s more for mobile professionals but they have a big challenge to catch up with the iPhone. We still don’t know about Palm. Symbian is the next platform to look at. There will be consolidation, there will be a publisher who takes developers under their wings who manages the funding, distribution….they’ll go iPhone, Andriod, then Symbian.” .

Kochikar: If you want to be truly practical, you start somewhere and find out where to scale. Consider Nokia when you want to scale. We have 3 layers, 4M developers. When you look at people in our tiered programs, it’s completely skewed: 55% are in the US…many have tried the other programs and are now looking for international extension. Getting into the app store is one thing—but figuring out how to get to the audience is another. .

Murphy: Not all users are alike. You have to look where the activity is. Even if you look at install base devices it’s the activity that’s different. At the end of the day the most valuable thing is building the network. Nobody is coming close to offering developer platform, device that is easy to use, community of developers who are excited and talking about the product, distribution channel that enables easy discovery and adoption like the iPhone.

On this panel

Bart Decrem, CEO Tapulous http://tapulous.com
Simon Khalaf CEO, Flurry http://flurry.com
Matt Murphy, Partner Kleiner Perkins Caufield & Byers www.kpcb.com
Dorrian Porter CEO, Mozes http://mozes.com
PurnimaKochikar, VP, Nokia Community and Developer Forum, Nokia http://nokia.com

Moderated by Mark Newhall, Co-Founder, IdealWave Solutios www.idealwave.com/ and INmobile.org www.inmobile.org/information/

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