Local Mobile Search Advisory
Mobile America will be subject to a "Coke-versus-Pepsi" like battle pitting a newly "open" Verizon Wireless against the locked-down AT&T Mobility/iPhone combo. Last week, Verizon Wireless reversed its hard-line stance against "open access" to its network. Creating terms for certifying third-party applications, devices and software amounts to a radical change in its business model. Or does it?
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Google User Experience VP Marissa Mayer revealed the "fastest growing" search queries from 2007 on the NBC Today show yesterday. Here's the list: 1. iPhone, 2. Webkinz, 3. TMZ, 4. Transformers, 5. YouTube, 6. Club Penguin, 7. Myspace, 8. Heroes, 9. Facebook, 10. Anna Nicole Smith.
Another popularity metric: According to Net Applications, "total web browsing on the iPhone has topped the web browsing on all Windows Mobile devices combined." This is an amazing thing considering that the iPhone has only been in the market since June of this year and versions of Windows Mobile have been in the market for roughly a decade.
Networks in Motion has reportedly developed a new mobile application (download) for YellowPages.com, which provides maps, turn-by-turn directions and local business listings from the site. It's currently only available on AT&T phones. The application is free.
Networks in Motion is also behind various LBS applications from AAA, Verizon and Sprint, among others. The company claims that its platform is the "most widely used mobile phone navigation service in North America."
As we discussed and argued previously, Verizon's open access inititative was partly a response to Google's Android and the announcement effectively made Verizon a de-facto member of the Open Handset Alliance. Now the company, according to BusinessWeek, is formally embracing Android:
Chief Executive Officer Lowell McAdam says it now makes sense to get behind Android. "We're planning on using Android," McAdam tells BusinessWeek. "Android is an enabler of what we do."
Not only did the company decide to support Android, but McAdam says the new platform was a key influence in adopting open access. "Android really facilitated this move,"says McAdam.
T-Mobile, the exclusive distributor of the iPhone in Germany, had changed the terms for selling the combined handset and iPod music player to comply with the Nov. 21 injunction. The company said after the ruling that it will scrap an unrestricted 999-euro iPhone offer ($1,500) that it introduced to comply with the initial court order.
Consumers will now only be able to buy the phone under the original 399-euro offer with a binding two-year contract. After the end of two years users can have the iPhone unlocked so they can switch to other providers, T-Mobile said.
The ruling was issued by the Regional Court of Hamburg.
According to the Wall Street Journal, here's the current list:
If Google doesn't win the spectrum it may have lost the battle but not the war as the US mobile market appears poised to open up, offering more competition and giving consumers broader access to services and improving the usability of the mobile Internet. The iPhone is really to thank for the renewed focus on usability.
According to an informal online poll we recently conducted (non representative sample) the following were the biggest reasons for not accessing the mobile Internet:
Multiple answers were permitted.
A new translation of Dostoevsky's classic The Brothers Karamazov, released in July, has surprised its publisher by notching up more than 300,000 sales already - but it is Rin's rather less challenging Moshimo Kimiga (If You ...), a 142-page hardback book about a high-school romance, that has caused the bigger fuss.
"I typed it all on my mobile phone," Rin explains matter-of-factly over the same device. "I started writing novels on my mobile when I was in junior high school and I got really quick with my thumbs, so after a while it didn't take so long. I never planned to be a novelist, if that's what you'd call me, so I'm still quite shocked at how successful it's turned out."
This is one of those specific cultural situations where what's happening in Asia probably doesn't portend comparable developments in the West. Certainly I could imagine someone writing a novel on a daily commute using a mobile device. However the answer to the question of whether the Sony eBook Reader or the Kindle will become widespread enough in the West to make mobile-published fiction a phenomenon, as it is in Japan, is most likely "no."
Citigroup's Mark Mahaney apparently thinks that Google is crazy to bid on the 700MHz spectrum and that the effort will consume all the company's cash and resources. Here's the summary of Mahaney's comments (from Silicon Alley Insider):
Spectrum Auction / Plans: Near-term Risk for Stock
- Winning the spectrum auction would cost Google an estimated $6.6 billion
- Building a national network would cost an additional $5.5 billion to $7 billion
- Together, these would consume all cash on balance sheet.
- Results of spectrum auction won't be known until March.
- Fear that Google will go insane, spend all cash, and become capital-hog telco may scare bejesus out of investors until then. (No, Mark didn't put it quite that way)
Apparently, Mahaney feels also that the near-term mobile opportunity is overblown, while the longer-term opportunity is underrated:
- Near-term Google mobile opportunity overrated. Crappy mobile experience, limited consumer use, etc. Hopefully (but not definitely) this changes with 3G/4G and iPhone-like phones...
- Long-term Google mobile opportunity underrated. Mobile search could be major catalyst for local search, which has been a disappointment for a decade.
- Mobile search market could eventually be as big as PC search market: Mark puts global PC Search Market at $21B in '07, driven by 35 monthly searches per PC. Just one monthly search per each 2010-estimated 4 billion mobile phones would generate mobile search revenue of $2.3B.
We partly agree and partly disagree with this analysis.
In our 2012 mobile ad revenues forecast we assume an average of 18 searches per user per month (by 2012), which is perhaps slightly aggressive. But data (from the MMA) already show "the average mobile search user conducts roughly nine searches per month." In addition, an informal online survey (n=75) we recently conducted showed that roughly 47% of users performed mobile searches "more than once a week," with just over 25% saying that the searched "more than once a day."
These numbers have to be taken with some caution because the sample isn't representative of the population at large. But they are interesting and instructive. That same survey showed the following mobile search engine distribution:
Which of the following mobile search engines/sites do you use (multiple answers permitted)?
- Google -- 90.0%
- Yahoo -- 20.0%
- Ask-- 8.0%
- AOL -- 0.0%
- Microsoft Live Search/MSN -- 8.0%
By comparison, iCrossing found the following distribution for the same question (4/07)
- Google -- 90.0%
- Yahoo -- 46.0%
- Microsoft Live Search/MSN -- 19%
- Others â€“ 16%
Again, these numbers have to be taken with caution of course but they're indicative of Google's strength and opportunity if the mobile Internet can be accelerated.
AdAge reports (first segment on the video) on LandRover and 20th Century Fox mobile ad campaigns that went live simultaneously on the three devices. According to AdAge the iPhone showed the highest click-through rates on the same campaign. Presumably this goes to better graphical resolution and a better overall user experience.
No other details are provided other than that the companies involved were happy with the iPhone results and that Fox plans to expand its iPhone advertising in the future.
Here's some additional detail on the performance of the LandRover campaign from TechCrunch.
Verizon is moving to use the new GSM-compatible LTE technology standard (Long Term Evolution) for its next generation of devices. LTE is an alternative to WiMax for mobile broadband. This may ultimately be a bigger deal, though several years away, than the Verizon "any application, any device" announcement, which appears to be a bit of a bait and switch as a practical matter, with different pricing tiers and other restrictions likely to accompany the new program.
Several years from now, the LTE standard adoption will mean that U.S. consumers will be able to use their phones on multiple networks, including Verizon (and that would include the iPhone presumably). Currently Sprint and Verizon use CDMA, while AT&T and T-Mobile use GSM.