I just returned from my trip to Japan and Korea. I had to go and see Korea in particular as it is rumored to have an amazing lead over the rest of the world. True enough, they are ahead and there are some interesting phenomena emerging. The question is how they can play in the global market as a service provider and a content and software exporter. The success of Samsung and LG is not helping a lot, they are pure hardware companies who focus very little on content. More about all that later in the blog.
Another encouraging sign is the opening of of the floodgates in the wireless recruitment sector. In the LA area alone, I know of tens of mid-to-high-level positions being filled as we speak. Demand will soon exceed the supply of candidates - a development fueled by VCs pouring money into new startups nicely categorized into the next hype areas.
This leads me to the last point and a word of warning on the growing wireless bubble: a good sign of it is that Silicon Valley VCs are pumping money into wireless CONSUMER plays, something they religiously refused to do still two years ago. The time-to-IPO is contracting again and we see lots of financial M&A engineering and funding of ‘also-ran’ startups. You may want to take your grandmother aside and tell her about the dangers of the stock market in the next two years - otherwise she’ll be thrown off her rocker again …
Next week’s CTIA in New Orleans will be exciting - hope to see you all there!
Warmest regards,
- Tapio Anttila
- www.anttila.net
JAPAN AND KOREA - THE TRUE LEADERS?
Japan - My first impression when arriving in Japan was ‘where are all the small phones?’… The Japanese market has suddenly adopted the idea of dragging along clunky smartphones. That is probably because they have seen the need for added functionality such as mobile payments. The smart card trials of Sony and DoCoMo have matured to a point where the rest of the world needs to take notes. We were pitching mobile phone as a personal trusted device back at Ericsson in 1998 or so - now it is suddenly starting to happen on the marketplace with Japan in the lead. Moreover, these innovations around mobile payments are largely exportable to the rest of the world, unlike most of the Japanese content or their social culture. You may want to check out the latest market insights around this at the sources below.
- http://www.eurotechnology.com/store/
- http://www.wirelesswatchjapan.com/
- Benjamin Joffe (http://www.akebonobashi.net/blog/)
Korea - If Japan is all about mobile payments, Korea is all about mobile TV. And we talk about the real mobile TV, DMB - direct satellite broadcasting to the handset - not streaming cellular mobile TV. They will have 50 channels broadcasting by May this year - all free to the end user during the launch phase. The price of those very cool devices is high, though - in the range of $1,000. Is the hype about Korean mobile use substantiated? When you listen to the market numbers and to the services launched it appears to be so. But when you spend time in the streets and trendy spots in Seoul you will have to concede that the use is still fairly conventional: SMS (high school kids average 53 SMSs per day), games, WAP. I did not yet see much of those high-end handsets in use by normal people, even in affluent and trendy spots. People use their phones ALL THE TIME for data in particular but hey, this is not America so what’s the big deal…
I spoke extensively with Simon Bureau, a consultant and Korean industry expert who has recently written (together with Benjamin Joffe) a great report on mobile music services in Japan and Korea. He gave me a lot of market insights and I warmly recommend you take a look at the fresh new report: www.vectis-intl.com. Download the very informative presentation slides (for your enjoyment only in French): http://www.akebonobashi.net/blog/
My main takeaways from the Korean experience were the following:
- There are no mobile enterprise applications, solutions or phones to speak of - it is all about the consumer market.
- SK Telecom is the big money-maker, not the content providers
- SK Telecom is becoming a mobile publisher through its Mobile Licensing Bank initiative
- SMS is only 20% of data revenues, i.e. mobile content is a significant revenue generator
- Original content plays a big role (e.g. ringback tones are often based on latest soap opera content). This focus on dynamic content is very promising in my opinion.
- Online world ‘Cyworld’ has had enormous success (both broadband and mobile): 10 million citizens have joined this online community (25% of the population). This is huge!
- Broadband and WiFi have penetrated very well and plans are in place for WiMAX - will they ever even need mobile professional solutions from Cellular providers?
- The focus on privacy and security seems to be limited - open WiFi access points are the majority and experts were pointing out how little privacy protection for example the online community Cyworld has.
HOLLYWOOD IS HIRING
Hollywood studios and other entertainment companies based in Southern California are ramping up their hiring spree. The following ‘laundry list’ will show you that LA is becoming a real hot spot for mobile content:
- Universal Music (Rio Caraeff) is building a mobile music publishing unit for the North American market: hiring need probably 10-15 people.
- Warner Brothers has hired a number of new people into their mobile unit, the VP Wireless replacement is still missing.
- Sony Pictures is still looking for a VP Wireless.
- Disney is building their Disney-branded MVNO out of LA (and another ESPN-branded out of NYC): plenty of hiring taking place right now.
- Infospace is looking for someone to head up their music bizdev.
- Mobliss is looking for two business development directors in LA.
- Nokia just hired their first LA-based bizdev person (George Linardos). It was about time.
- The new SK-Earthlink joint venture will start hiring soon: my assumption is that the new unit will be based out of LA. According to my friends in Seoul, roughly 20 Korean will be packing their bags soon to move to the US. This will be a sizable operation.
And there are countless more - please let me know which ones I forgot and I will list them here next month. Where will all these people come from? I bet we will see a rush of mobile-heads moving into our city soon. A word of warning: the weather here has a good reputation but it has been raining lately;-).
EVENTS CALENDAR
Mobile Messaging Americas by IBC - 1&2 June 2005 in Miami. As always warmly recommended - see you there!
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Disclaimer: Opinions presented herein are those of the undersigned and do not represent the position or message of any company I might be affiliated with.
