|Asia-Pacific II 2009
|Mobile services on the move in Asia Pacific
|Dr Abdul Razaque Memon
|Solution Marketing, Application Business Division
|Alcatel-Lucent Asia Pacific
Dr Abdul Razaque Memon is the Director of Solution Marketing throughout the Asia Pacific region for Alcatel-Lucent’s Application Business Division. Dr Abdul Razaque Memon Abdul has over 15 years of industry experience; he has held a number of senior positions in sales and marketing focusing upon converged solutions (VoIP, NGN, IMS and IPTV, Mobile TV, VAS, Content, Advertising) for fixed and mobile network operators. Dr Abdul Razaque Memon has long been actively involved in strategic IPTV & Mobile TV projects and played a key role in growing the fixed network transformation business in Asia Pacific. Dr Abdul Razaque Memon completed his Doctorate in Computer Engineering at the Xian Jiatong University in China.
Data makes a tremendous contribution to the bottom line of Asia Pacific’s mobile operators. SMS generates the majority of data revenues in most of the world, but in Japan and Korea, almost 75 per cent of mobile data revenue is not SMS driven. Multimedia content from online virtual stores and search engines generate advertising revenue. Mobile streaming, mobile TV, mCommerce, eCommerce, new mobile payment systems, lifestyle and social networking and Web-based communications (IM, email, and so on.) are also becoming important revenue sources.
A vast majority of people across Asia Pacific still use mobile handsets only for voice communication and text messaging. For instance, in China and India, where mobile penetration is lower than 45 and 20 per cent respectively, voice and text messages are key consumer priorities. Mobile penetration in the countries of Asia Pacific differ greatly: in developed countries mobile penetration is between 70 to 110 per cent*, but in developing countries mobile penetration is less than 70 per cent*. Mobile services in developed regions In Japan and Korea, 70 to 75 per cent* of mobile data revenue came from non-SMS traffic. Text-based data browsing started in Japan with i-mode – a key consumer attraction. Content and location search applications easily find shopping and commercial sites and the majority of Japanese consumers prefer to use mobile email instead of SMS-based text messaging. Smartphone Services Globally, the Apple iPhone and Google’s Android G1 have changed the way consumers use their mobile devices and enhanced the user experience. Instead of just voice and text, they now easily access multimedia content. This has increased mobile data browsing traffic dramatically. There are now hundreds of applications available to download and install on iPhone through widgets. This has also brought new revenue streams for content providers that sell their content online through virtual stores, for software developers selling their software online and, via search engines, generated advertising revenue. Some operators (for example, CHT Taiwan, Softbank Japan, SingTel Group, Vodafone and Telstra in Australia) have already launched 3G-iPhone-based devices and services. Google-related Android partnerships and launches have also been announced. Blackberry, LG, Nokia, Palm and Samsung have launched their touch-screen mobile devices. New services will use a variety of operating systems including Microsoft Window Mobile, Symbian, Linux, Java-based, and so on. The GSMA RCS (Rich Communication Suite) consortium brought network and software vendors, service providers and CPE vendors together last year to ensure operators can go-to-market with a minimum set of rich communications features (presence; enhanced and network address book; instant messaging; chatting and content sharing) that are interoperable among different operator networks based on different network and client vendors. The roadmap for new features like fixed IMS connectivity and converged IP messaging based on RCS looks promising for all devices. Mobile streaming and TV Mobile streaming and mobile TV are changing the way users watch TV. Japan has a number of mobile TV free-to-air digital channels and is a market leader in the service. Korea launched its unicast (individual transmission direct to each subscriber) and broadcast mobile TV service with success. Australia’s Telstra launched mobile TV service on its unicast next generation 3G network-based on a rich media client. Consumers are using the mobile TV service on the move (train, buses, and pause). Singapore’s mobile TV service recently launched unicast service and broadcast trials are in progress. Hong Kong and Taiwan are preparing to auction mobile TV licenses in mid-2009. Content and advertising Content selling and advertising business models are the keys to operator success in the Asia Pacific market. Most Asia Pacific operators already sell content customised to fit mobile screens through their Internet portals. Market studies show that searches for specific content on mobile devices are still not accurate, so searching and browsing can cost more than the online content. Personalized and targeted mobile advertising helps operators increase their APRU and provide ‘stickiness’, with consumers viewing advertising they like. Mobile commerce and eCommerce Mobile commerce and eCommerce are innovative services; they are widely deployed in Japan and Korea in different forms. The use contact-less touch and pay cards (EDY, Suica, iD, Pasmo, QUICPay, USIM-card, Korea Smart Mobile T Money) and cards added to 3G-based mobile phones to create m-wallets (mobile wallets). Card readers are deployed in banks, retail and convenience stores. Japanese vendors and SKT have also signed partnerships to offer m-payment services for overseas markets. Hong Kong and Singapore rolled out ‘touch and pay’-based smartcards called Octopus and EzLink – cards used to pay for transportation, retail stores, food chains, and so on. Taiwan focused on NFC-based (near field communications) trials and deployments along with VISA and MasterCard and partnered with HTC, Nokia and BenQ to embed NFC in smartphone handsets. Australian operators are currently running similar trials with banks and credit card companies. Lifestyle and social networking iPhone’s intuitive and streamlined user interface is delivering Web-based social networking to consumers on-the-move. Subscribers have started to surf the Web more, using mobile 3G networks and operators, in turn, are offering more attractive data packages. A tight relationship between social networking (Facebook, Myspace, Orkut, Piczo, bebo) and smartphones helped usage grow exponentially throughout 2008. Many Japanese and Korean consumers browse social networking sites with smartphones – updating their status, photos and video clip and commenting on their friends’ Web pages. Social networks are developing sophisticated revenue models through product placement, sponsorship, physical retail, virtual retail, data mining, VAS charges and advertising. Web-based communications Consumers will adopt Web-based communications and applications that integrate the Web 2.0 IMS services via widgets. Dynamic personal profiles with context and mood, click-to-communicate, instant messaging (IM) centres, SMS, email and network address books with contacts imported from mobile, Internet and presence rich information on PC, desktop and mobile smartphones. Integrating IMS communication capabilities into a service provider’s Web portal, makes applications like address book management, presence, IM and click-to-dial available on Web page or a mobile. Web 2.0 widget. Mobile Web-search Mobile Web searches let subscribers find their own content quickly and efficiently. Mobile content companies have started to work with operators such as Mobile Content Networks. Yahoo Japan announced a similar partnership to provide high value search results. Future services Expect to see the personalization of services. Social networking sites will offer address books and communication. The deployment of social-support services and the provision of converged services will grow. Video services, touch screen-based services, voice recognition-based browsing and services, LTE (4G) mobile broadband and advanced handset that take better advantage of networks will be common. Mobile services in developing regions Voice and messaging Voice and messaging traffic volume and revenue are cash cows for operators, even in the economic downturn. The Philippines lead the SMS market; each user there sends an average of 750 messages* each month. As mobile phones are equipped with cameras and other multi-media software, IM and MMS usage has risen sharply. In the China market, person-to-person, application-to-person related messaging like news alerts, ring tones, promotional video clips and enterprise messages also grew at the annual rate of ten per cent. Blackberry Blackberry email has changed the way people communicate in the enterprise and SME domain. When outside their country, people stay virtually connected with the company and employees almost 24 hours a day; this has increased productivity substantially. It is now available from Southeast Asia to Indo-China and from China to Mongolia. One recently announced deployment is with Viettel in Vietnam, where a single solution is provided to cover the SME and large enterprise markets with advanced encryption and secure IT policy controls. The solution also links individuals with popular email accounts such as Yahoo Mail, Google Mail, and so on, from a variety of single devices. Mobile commerce and eCommerce Mobile-commerce in Southeast Asia and India have totally different formats; they charge low transaction fees there and use low technology handsets – like 2.5G phone SMS – to offer basic banking for rural and unreachable markets. Different business models are used with mobile payment-based solutions – depositing, withdrawing and transferring money in stored in the customers’ accounts. Different revenue splitting models were created between operators, banks and credit card companies, as well as merchants. The Philippines, a large developing country with limited fixed infrastructure, but high usage of mobile phones, has become a SMS leader with low SMS charges, and early adoption of m-payments. The SMART system serves a large migrant population. To send money home subscribers use the SMS-based m-payment solution called Smart-Load – ‘Smart money packages’ – to remit money to a bank account and then to a Smart money account. This account has features like person-to-person transfer, transfer to retailers, multiple subscribers accessing one account, airtime purchase and airtime transfer to family and friends. International remittance was added in 2007 with the help of banks and overseas operators. Government and monetary authorities supported the move. China’s Yeepay e-payment solution is based on IVR (Interactive Voice Response) call centres; it is a telephone-based system that transfers payments. China has also a gaming and virtual money system – called Linden and QQ coin – which allow participants to purchase online games and other items using virtual money. Roughly US$900 million is in the virtual money market. The monetary authority and the People’s Bank of China are barring trading of virtual money to buy real goods. Indonesia and India have also started m-payment services with government support. Large numbers of overseas workers remit small amounts to rural areas, where bank facilities do not exist, or to enjoy lower transfer costs than banks offer. Transfer facilities include account balance checking, and instant third-party transfers with SMS-based confirmation to both parties. These services have rapidly grown by over 35 per cent. Mobile TV and streaming Thailand, China and other countries have begun to launch mobile streaming service in major cities, with major operators creating partnerships with content vendors; consumers have shown interest, but growth is still slow. Mobile-based services are growing rapidly in Asia Pacific; new ways to utilize mobile infrastructure and new business models are emerging to drive the mobile services market. Mobile multimedia content services and Web 2.0 applications are becoming a reality. Some applications start in developed countries and move to developing countries, while other services like mobile payment progress the other way around. n * in-Stat’s Mobile Social Networking and the Millennial Generation 2008 and IDC Asia/Pacific (excluding Japan) Mobile Service 2008-2012 Forecast Update were referenced in this article.