Technology | Media | Telecommunications

Thursday, May 31, 2012

North America Accounts for 60 Percent of LTE Subs

According to the latest market study by ABI Research, LTE mobile network subscriptions are expected to exceed 40 million by the end of 2012, representing a fourfold increase over the nine million global LTE subscriptions in 2011.

The wide range of expected LTE smartphone launches in 2012 from major OEMs -- such as Nokia, Samsung, and Apple -- as well as the surge in data consumption, are the main causes behind the rise in LTE subscriptions.

Currently, the North American region accounts for 60 percent of total LTE subscriptions, followed by the Asia-Pacific region at 37 percent.

However, Asia-Pacific LTE subscriptions are expected to overtake North America by 2014, primarily driven by adoption in China, India, Japan, and South Korea.

"South Korea and Japan are witnessing amazing LTE subscription growth due to the availability of high-quality content, enabling the countries to be the next largest LTE markets after the U.S.," says Ying Kang Tan, research associate at ABI Research.

Having LTE data plans priced on par with 3G data plans were a major factor that accelerated the migration over to LTE.

The Asia-Pacific will also be the main growth engine for TD-LTE. Global TD-LTE subscription numbers will grow from one million subscriptions at the end of 2012 to 139 million subscriptions by 2017.

China, India, and Japan are collectively forecast to account for 92 million TD-LTE subscriptions.

That being said, spectrum fragmentation still remains the primary obstacle preventing LTE subscriber growth in the Asia-Pacific region to go full throttle. With LTE deployed in more than five spectrum bands, it creates additional costs for handset OEMs to develop an LTE smartphone for every band.

Wednesday, May 30, 2012

Impact of Low-Cost Media Tablets in Growth Markets

The pricing trend for new media tablets is downward, as more smaller and less-expensive models are introduced into the marketplace by a growing variety of different vendors.

That being said, despite a series of low-cost media tablet launches in the second half of 2011, Apple's iPad tablet has managed to maintain its premier position in the Indian market with 51 percent market share in 2011.

Samsung's achievement at extending its success in the handset segment to the tablet segment, with its Galaxy Tab, allowed Samsung to be ranked in second place -- with 24 percent market share.

Indian consumers also showed a strong penchant for RIM's BlackBerry PlayBook -- after prices were slashed significantly, making it the third largest player with a 10.4 percent market share.

The presence of ultra-low cost media tablets with non-optimal specifications might ruin the user experience and, in turn, prove to be a dampener for media tablet growth.

"Although there is lot of buzz in the Indian market, media tablets are yet to demonstrate their value proposition to Indian consumers," says Aishwarya Singh, analyst at ABI Research. "While there are several media tablets being launched in the sub-$200 price range, simply lowering the average selling price of media tablets may not lead to the desired growth in the market."

However, media tablets from the domestic handset makers, such as Micromax, may be the right products at the right price point for the mass market.

In India, total media tablet shipments in 2011 are estimated to be 0.39 million units, which is a very small fraction of the nearly 65 million shipped globally. However, the Indian media tablet market is estimated to grow with a CAGR of 71 percent and shipments are expected to growth to 9.66 million units in 2017.

2012 is going to be an important year in the Indian tablet market as there are ample media tablet models available across different price points.

An enhanced user experience, seamless connectivity options, and localized content may soon become the key drivers of the forward-looking media tablet market growth.

Tuesday, May 29, 2012

Upside Opportunity for Home Automation Services

Home automation service offerings are rapidly transforming the way consumers will monitor, secure, and control their residence. Typically delivered by more expensive, custom-installed technology, home automation is now moving into the mainstream, with many companies adding home automation to their customer services.

A number of factors are driving the new entrants into the market. Internet connectivity is one key factor.

Not only are there currently high home broadband penetration rates, as well as the potential for embedded cellular connections to connect systems, but also smartphone applications allow consumers to control and check their homes from wherever they are.

As connectivity options make the home automation systems more useful, market changes are also making home automation more affordable.

A traditional large up-front installation and equipment purchase is increasingly being replaced by monthly subscription offerings -- often bundled alongside already existing services.

"The North American market has long been the dominant region for home automation systems and now it is leading the way with managed home automation subscription services," says Jonathan Collins, principal analyst, wireless healthcare and M2M at ABI Research.

In the past two years, service providers, including telecoms, cable, security, and energy, have all launched additional home automation services for managing energy use or security monitoring to their suites of monthly billed services.

Over the next five years the managed home automation market will grow installments at a CAGR of 60 percent between 2012 and 2017, outstripping the 31 percent growth across the total market comprising luxury, mainstream, and DIY home automation deployments.

The evolution of the home automation market into the mainstream requires a raft of new partnerships. No company is able to provide all the parts, so telecom, cable, security, and utility providers are all looking to smart devices vendors, managed software providers, local installation specialists, and others to support the broad roll-out of home automation services.

Monday, May 28, 2012

Top Three Data Traffic Sources on Mobile Phones

According to the latest market study by Informa Telecoms & Media, in 2016 mobile phone users will (on average) consume 6.5 times as much video, over eight times as much music or social media, and nearly 10 times as many games as in 2011.

There will be a big upsurge in traffic for most mobile data services over the next five years, largely driven by the spread of smartphones and a 23 percent increase in the number of mobile users.

In 2016, the average mobile user will be browsing six times as many web pages and downloading 14 times as many megabytes of applications on their handset as in 2011.

Text (SMS) and picture (MMS) messaging traffic will continue to grow, but at a much slower pace than most other mobile data services. On average, mobile users sent 118 SMSes and two MMSes a month in 2011, compared to the 146 SMSes and four MMSes they will be sending in 2016.

Usage of Internet-derived messaging services, namely instant messaging and e-mail, will see higher growth. For example, compared to the global monthly average of 31 mobile instant messages sent in 2011, users will be sending 118 in 2016.

That being said, according to the study findings, the services that put the greatest strain on mobile networks won't necessarily be the ones that deliver the most revenue.

"The top three data guzzlers on mobile phones over the next five years will be applications, video streaming and web browsing – in that order of importance," says Guillermo Escofet, senior analyst at Informa Telecoms & Media.

Yet, the top revenue earners in 2016 will be web browsing first, followed by P2P SMS and applications. Video streaming will likely represent less than 1 percent of mobile data revenue in 2016, despite consuming a third of the typical handset traffic.

The growth in traffic will far outstrip the growth in revenues. Global mobile data traffic will grow from 3.89 trillion megabytes in 2011 to 39.75 trillion megabytes in 2016, amounting to a tenfold increase.

By contrast, global mobile data revenues will grow from $325.8 billion in 2011 to $627.5 billion in 2016, amounting to a twofold increase. And although the revenue pie will grow, the slice kept by mobile operators will shrink.

Excluding data and SMS/MMS -- over whose sale operators have a monopoly -- the percentage for operators of what users pay for all other data services, anything from downloading a song to making purchases via a mobile wallet, will drop from 56 percent in 2011 to 41 percent in 2016.

Saturday, May 26, 2012

China to Reach $7.36 Billion in Online Ad Spending


While the advertising sector's market outlook still looks bleak in many nations, some emerging countries offer an upbeat perspective. As an example, the outlook for advertising as a whole within China is a very promising one, and marketer spending for online ads in particular is perhaps the most positive of all.

eMarketer estimates that online ad spending increased by 43.2 percent in 2011, and they forecast another increase of 39 percent in 2012. Growth will be driven by the increased adoption in both internet penetration and online activities -- such as online video, social media and search.

According to an April 2012 report from consultancies R3 and Admaster Digital Consulting, more than four-fifths of marketers in China plan on increasing digital media spending during 2012.

Moreover, 41 percent of surveyed marketers plan to increase their spending by at least 20 percent, and 13 percent will increase spending by 50 percent or more in China.

Marketers in China are especially bullish about the upside potential for online video and social media -- including weibo microblogs and social networks.

According to the report, 23 percent of the marketers surveyed expected to devote most of the increased spending to online video in 2012, followed by 20 percent to weibo microblogs and 16 percent to social networks.

eMarketer estimates that online ad spending in China will reach $7.36 billion in 2012, and more than double to $16.48 billion by 2016.

R3 and Admaster’s findings suggest that marketers are rushing to place brands where internet users are consuming digital media, hoping that it vaults their clients’ brand values to the top of their product or service category.

Friday, May 25, 2012

How U.S. Consumers are Spending on Mobile Apps

According to the latest market study by ABI Research, about two-thirds of U.S. mobile app users have spent money on an application on at least one occasion. Among these paying users, the mean spend was $14 per month.

Behind the seemingly high average amount there are, however, some striking findings.

Senior analyst Aapo Markkanen at ABI said, “The median amount among the consumers who spend money on apps is much lower than the average, just $7.50 per month."

This reflects the disproportionate role of big spenders as a revenue source. The highest-spending 3 percent of all app users account for nearly 20 percent of the total spend, while over 70 percent spends either nothing or very little.

The numbers also reflect certain trends in different app categories. Thus far, the releases that have best succeeded in making money have typically been utility apps often used for business purposes, or iOS games monetized through strings of in-app purchases.

In both cases the money comes from a remarkably small base of customers. Is there anything developers can do to boost the conversion rate from free to premium?

Markkanen has two recommendations. "First, don’t get obsessed by mobile and apps, but remember also the web,” he adds. “Most of the successful app concepts either support, or are supported by, a web component."

Second, he says it's best to see your product through a long-term lens, asking yourself what could convince your customers to still engage with the app in two years' time.

Evernote, for example, has excelled at both. It has skillfully combined the web and the mobile, and at the same time it has also managed to become a habit for many of its users.

It demonstrates that the longer its customers stick around with a free version of an app, the likelier they're going to convert to its premium version.

Thursday, May 24, 2012

High Growth Opportunities in China Tier Two Cities

Adventurous technology marketers looking for new territory to explore should consider Tier 2 cities in China -- such as Chengdu and Sichuan, according to the latest market study by International Data Corporation (IDC). Growing Tier 2 cities are exploding in terms of growth and this growth is coupled with a very high proportion of savvy consumers -- indicative of the exponential upside for digital tech companies.

IDC's research program has identified six distinct consumer market segments: Tech Evangelists, Impulse Buyers, Experimental Adopters, Pragmatic Purchasers, Green Buyers, and Disengaged Functionalists.


Tech Evangelists not only own the most devices and utilize the most advanced functions, features and apps, they are also the group that drives adoption of device ownership and usage by other market segments.

Tech Evangelists hold enormous sway over the buying patterns and device usage trends mass-market segments exhibit. They are also the group that mainstream market segments reach out to directly for purchasing advice.

"Given the extremely large combined population of Tier 2 cities in China, coupled with a very large proportion of Tech Evangelists, marketers should place Tier 2 cities as a key priority for all consumer-facing brands, vendors, and data service providers," said Michael DeHart, director of the IDC Global ConsumerScape 360 program.

Tier 1 cities in China should no longer be viewed as emerging markets. These are mature economies with some of the largest populations in the world -- bigger than many small countries."

Tier 2 cities are currently exploding in terms of growth in China, and are now showing an extremely high level of Tech Evangelist consumers, indicative of continued exponential growth in these markets. And, while Tier 2 cities in China account for about 8 percent of the population of China, they account for about 59 percent of U.S. imports, according to the U.S. Commercial Service.

This is critical information for PC, smartphone, tablet, and software vendors. "If you can reach this group successfully, you'll see exponential ROI implications. By comparison, this level of Tech Evangelists in tier 2 cities - 41 percent - is higher than the rate of Tech Evangelists in any country that we currently track in ConsumerScape 360°," says DeHart.

Tier 2 cities and provincial capitals in China include, but are not limited to Chengdu, Sichuan, Chongqing, Dalian, Liaoning, Hangzhou, Ningbo, Zhejiang, Kunming, Yunnan, Nanjing, Suzhou, Jiangsu, Qingdao, Shandong, Tianjin, Shenzhen, Zhuhai, Guangdong, Wuhan, Hubei, Xiamen, Fujian, Xi'an, and Shaanxi.

Wednesday, May 23, 2012

Mobile Operators Use Wi-Fi Hotspots for Net Offload

Mobile service providers have either a big challenge, or a big opportunity -- depending on your point of view. As a result of introducing new smartphones with broadband internet access offerings and promoting them vigorously, they're experiencing a variety of network performance issues.

Some are addressing the issue with reactive bandwidth cap mandates or throttling data throughput, while others are proactively investing in new infrastructure to offload the growing mobile data traffic.

Infonetics Research released excerpts from its latest market study report entitled "Carrier WiFi Offload and Hotspot Strategies: Global Service Provider Survey." Mobile operators now appear to be firmly behind carrier WiFi as a key solution for the mobile offload requirement -- even as they continue to investigate other small cell possibilities.

"Our survey shows that whilst data offload is the current priority, in coming years operators will want to see a closer integration of WiFi with the mobile network so that offload becomes more intelligent, automated, and seamless. They want to utilize WiFi not only to augment mobile services, but to enhance the network itself by becoming an integrated part of the mobile network," says Richard Webb directing analyst at Infonetics Research.

Infonetics survey and market study highlights include:
  • Two-thirds of the service providers that Infonetics interviewed have already deployed 20,000 to over 150,000 WiFi access points (APs) in public spaces.
  • Street coverage is seen as one of the areas of greatest deficit for WiFi coverage; by 2013, the percentage of service providers planning to deploy WiFi for street coverage jumps to 79 percent.
  • Complementing the mobile data service by enhancing throughput is currently the top deployment driver for carrier WiFi, followed by the scarcity of licensed spectrum.
  • Nearly all respondent carriers plan to increase the number of access points deployed by 2013, so Infonetics expects significant carrier WiFi deployment over the coming year.
  • Smartphones and tablets are named by mobile operators as the top mobile broadband devices driving their 2013 deployments of public WiFi networks.

For its Carrier WiFi Offload and Hotspot Strategies survey, Infonetics interviewed 24 mobile, incumbent, and competitive operators in Asia-Pacific, Europe, North America, the Middle East and Africa that operate a public WiFi network used for offloading cellular networks, or who plan to by year-end.

The study provides insight into service provider WiFi offload deployment plans and drivers, ratings of WiFi product features, and mobile offload and WiFi service strategies. Together the survey respondents represent 35 percent of the world's telecom carrier revenue and 36 percent of the world's telecom capex (capital expenditures).

Tuesday, May 22, 2012

Why Retailer Apps are Popular with Mobile Shoppers

Are smartphone apps the next new marketing gimmick for retailers, or a valuable tool for their customers? According to the latest market study by ABI Research, given the results of a new survey of U.S. consumers, it may be both.

Survey respondents who said they had downloaded a retailer-branded app said the app caused them to visit the store more (45.8%), buy more of the store or brand's products and services (40.4%), tell a friend about their store shopping experience (35.8%), and encourage friends to visit the store (30.8%).

"These are overwhelmingly positive numbers," says senior analyst Mark Beccue at ABI Research. "They are so compelling that if retailers do not have a smartphone app strategy in place right now they are in danger of being left behind by their competitors."

That being said, only 25 percent of the respondents had downloaded a retailer-branded app. It is possible the high level of positive response is due to the profile of the respondents, who might be enthusiastic fans of particular favorite store(s).

As the number of consumers who download retailer-branded apps go up, the level of positive response might go down. A second effect that probably won't benefit retailer-branded apps -- 37.9 percent of the respondents said downloading a retailer's branded app made them more likely to download other retailer-branded apps.

Still, the number of smartphone users that view these retailer apps in a positive light are compelling and encouraging.

"Clearly consumers are using retailer-branded apps as an engagement tool. Once a retailer can capture a consumer with one, there is a real opportunity to leverage smartphone apps to enhance customer service, deliver richer, more relevant product information in real time, shorten checkout lines, and more," says Beccue.

Perhaps we are at the dawn of a very dynamic and creative time for retail. It's a perfect opportunity for savvy retailers to experiment with smartphone applications, and thereby gain a competitive advantage -- while the window of opportunity is still open.

Monday, May 21, 2012

Mobile Payment Apps are Gaining Increased Adoption

You may recall that in March I reported NPD In-Stat had forecast that proximity mobile payment transactions will approach 9.9 billion in 2016 -- that's up from 1.1 billion in 2012, nearly a ten-fold increase.

That being said, proximity technology that's embedded in mobile handsets are just one of the many emerging global market opportunities for this evolving new online business model.

U.S. android smartphone users engaged in mobile payment applications (via software apps) are on the rise, growing 8 percent since August last year to nearly 35 percent, according to the latest market study by The NPD Group.

An increasing proportion of consumers are engaged in using their smartphones to move money, buy products and services on their phone, comparison shop, redeem coupons, and start to pay for all types of things -- using their mobile phone.

"Mobile payment and wallet solutions are clearly at a very early stage of development, but consumers are demonstrating greater comfort in how they are using their smartphones," said Linda Barrabee, research director, NPD Connected Intelligence.

Consumers are doing everything from basic utility (bill pay, moving money, and account management) to using the phone itself to pay for goods and services of limited value (micro-transactions), including buying a cup of coffee or movie tickets.

The top American payment apps used in March include PayPal, mobile bill pay apps (My Verizon and My AT&T), payments acceptance apps Pay Anywhere and Square, and Starbucks and Fandango Movies.

"Ultimately, the success of mobile payment and wallet initiatives rests on changing entrenched consumer behaviors, and shifting the reliance on, and use of, physical wallets and all of its contents to a mobile (digital) version,” said Barrabee.

However, in order to do this, and facilitate on-the-go consumer transactions and commerce, wireless carriers, credit card companies, and e-commerce companies need to make sure the process is convenient, simple, and secure for consumers.

The NPD Connected Intelligence SmartMeter -- powered by Informate -- is an application running on Android and BlackBerry devices leveraging an opt-in panel of consumers. The SmartMeter tracks data consumption, as well as function and content use. This includes web and application use across 23 categories including Banking, content sharing, e-books, games, navigation, health, music and video.

Saturday, May 19, 2012

Smartphones Drive Social Network Usage in France


As you may recall, I've reported in the past about the amazing broadband internet service offering competition in France, which has helped to drive down subscriber costs and increase the adoption of enhanced information and communication technology (ICT) applications.

That being said, eMarketer reported that France has trailed the rest of the EU-5 (Germany, Italy, Spain and the UK) in microblog usage during 2012, but growth recently accelerated as French politicians sought out voters on social media during a very close presidential election.

The presidential race is over, but eMarketer estimates that the popularity of social networking -- especially via mobile devices, such as smartphones -- will continue to increase throughout the country.

eMarketer expects social networks to attract 21.9 million users in France in 2012, increasing to 23.6 million in 2013. While the total number of social network users in the country is impressive, the number of social network users accessing via mobile phones is even more noteworthy.

According to their market assessment, this year the number of mobile social users will grow 53.8 percent to 7.5 million and next year account for nearly half (11.3 million) of total social network users.

"Several factors are contributing to the boom in mobile social networking in France," said Karin von Abrams, senior analyst at eMarketer. "One is the rising penetration of smartphones."

eMarketer estimates that one-third of all mobile phone users in France will have a smartphone in 2012. In addition, major social networks such as Facebook have made a big effort to optimize their sites for mobile access.

Also, smartphone ownership is highest among the demographic segments most involved in social networking, such as college students and young professionals ages 25 to 44.

By 2014, nearly a quarter of the population of France will access a social network via a mobile phone. eMarketer estimates that by that year, in the EU-5, only the UK will surpass France in the percentage of the population accessing social networks on mobile.

While internet users in France are comparatively unenthusiastic about social networking on their PCs, the convenience of mobile access is driving strong numbers to social sites.

Friday, May 18, 2012

Smart Grid Investment will Increase by 17.4 Percent

According to the latest market study by IDC Energy Insights, smart grid infrastructure investment will increase by 17.4 percent globally -- Compound Annual Growth Rate (CAGR) for hardware, software and services -- from 2010 to 2015 while overall spending will reach nearly $46.4 Billion worldwide in 2015.

The Asia-Pacific region is forecast to experience the most growth in spending with a five-year CAGR of 33.7 percent.

IDC Energy Insights identified 14 smart grid project types to help profile top investment priorities across the various regions of the world. They then reviewed data based on technology type (hardware, software and services), utility ownership (government owned or investor owned) and whether the utilities are electric only or a combination electric and gas.

Utilities across the globe share the same or similar pressures and business drivers to make information and communications technology (ICT) investments in smart grid infrastructure.

However, differences in regional investment profiles are stark in some cases, driven by differences in government mandates, environmental regulations and private sector support.

Utility investments in smart grid initiatives are intended to improve grid reliability, support distributed and renewable energy, reduce operations and maintenance costs, increase energy delivery efficiency, improve system security and enable energy efficiency and demand response.

With these drivers in motion, IDC Energy Insights surveyed utilities in four global regions (North America, Europe, Asia Pacific, and Latin America) to understand the magnitude and timing of ICT investment.

According to their report, in North America, they found widely deployed advanced metering infrastructure (AMI) and smart meter investment leading to high expectations for demand response for 2014.

In the same period, North America distribution automation investments will concentrate on feeder automation, volt/var optimization, and automated fault restoration.

In Europe and Asia-Pacific regions, smart meters and AMI investments carry the sector's growth forward as major project deployments begin later in the forecast period as Europe eyes its 20-20-20 goals -- a 20 percent increase in energy efficiency, 20 percent reduction of CO2 emissions, and 20 percent renewable generation sources by 2020.

In Asia Pacific, the smart metering torch is being carried by China with a goal of deploying 300 million smart meters by 2020.

Thursday, May 17, 2012

17.4 Million Media Tablets were Shipped in 1Q 2012

The ongoing outlook for the high-growth media tablet market segment is subject to seasonal fluctuation. According to the latest market study by International Data Corporation (IDC), a drop in shipments of Google Android-based media tablets was offset by a strong quarter from Apple -- and this result caused the media tablet market to miss projections for the first quarter of 2012 (1Q12).

Total worldwide media tablet shipments for the quarter reached 17.4 million units in 1Q12 -- that's 1.2 million units below IDC's prior projection for the quarter. While IDC predicted a sharp seasonal slowdown of -34 percent from the previous quarter's record-breaking 28.2 million units, the actual decline was slightly steeper at -38.4 percent.

However, that being said, the total still represents a solid year-over-year growth rate of 120 percent, which is up from the 7.9 million units shipped in the first quarter of 2011.

"Apple's move to position the iPad as an all-purpose tablet, instead of just a content consumption device, is resonating with consumers as well as educational and commercial buyers. And its decision to keep a lower-priced iPad 2 in the market after it launched the new iPad in March seems to be paying off as well," said Tom Mainelli, research director, Mobile Connected Devices at IDC.

Apple shipped 11.8 million iPads during the quarter, that's down from 15.4 million units in the fourth quarter of 2011, and grew its worldwide share from 54.7 percent in 4Q11 to 68 percent in 1Q12. Amazon entered the market in 4Q11 to grab second place with a 16.8 percent share that was based on a shipment of 4.8 million units.

Its share decline significantly in the first quarter to just over 4 percent, falling to third place as a result. Samsung took advantage of Amazon's decline to regain the number two position, while Lenovo moved into the number four spot, followed by Barnes & Noble at number five.

Although total Android shipments were down sharply in 1Q12, companies such as Samsung and Lenovo are beginning to gain traction in the market with their latest generation of Android products. IDC expects the segment to rebound quickly as other vendors introduce new products in the second quarter and beyond.

IDC says that the market impact from the introduction of Microsoft Windows-based tablets is yet to be determined. Pricing on the new Windows tablets hasn't been announced, and that will be a key factor that could limit its potential. Consumer reception to the new OS and the success of integration with traditional Windows systems will also be critical.

"The worldwide tablet market is entering a new phase in the second half of 2012 that will undoubtedly reshape the competitive landscape," said Bob O'Donnell, program vice president, Clients and Displays at IDC.

"While Apple will continue to sit comfortably on the top for now, the battle for the next several positions is going to be fierce. Throw in Ultrabooks, the launch of Windows 8, and a few surprise product launches, and you have all the makings of an incredible 2012 holiday shopping season."

Wednesday, May 16, 2012

Digital Shoreditch Festival – the Upside Opportunity


I’ve previously shared a summary of observations during my attendance at the 2012 South by Southwest (SXSW) Interactive events earlier this year. What I didn’t mention was that I had the opportunity to briefly meet Kam Star, while he was in Austin, Texas attending SXSW.

As the founder, Kam explained his aspirations for the Digital Shoreditch Festival -- to replicate some of the success of the SXSWi legacy within the London marketplace. Why should this bold goal matter to the British public. For starters, it’s about the potential economic impact.

Case in point: for the second straight year, in 2011 the SXSW Interactive attendance fueled the impressive increase in event attendance -- although SXSW Film and SXSW Music also enjoyed banner years as well.

The City of Austin’s hospitality industry benefitted from the outside visitors with two very profitable weeks. SXSW’s direct booking of more than 10,500 individual reservations totaling 47,500+ room nights -- that was an increase of more than 20 percent over the previous year.

In 2011, it’s estimated that SXSW in total (interactive, music and film events combined) was directly and indirectly responsible for injecting about $167 million into the Austin economy.

In addition to the economic impact benefits, there are clearly other advantages derived from SXSW by the local tech-related clusters and the extended creative community. As an example, I often meet old business friends and make some new ones during the Interactive panels, the press briefings and the numerous parties.

That being said, I also believe that London, England has some things in common with the emerging tech and digital creative clusters in Austin, Texas. In particular, London already has established gaming, music and film/video sectors that’s represented by accomplished entrepreneurs with a proven track record.

In summary, I’m very optimistic about the upside opportunity for market development in East London, and I look forward to learning more about the evolving community during my upcoming visit.

See the depth and breadth of all the sessions at Digtal Shoreditch that span across two weeks. You can choose from a couple different attendee ticket types, and then there’s the mobile hackathon -- with a £10,000 prize.

If you’re planning to attend the event, perhaps I’ll see you there. I’ll be the gentleman following the event buzz, taking notes at sessions, snapping some photos and shooting video – all in preparation for a follow-on story, to be published upon my return.

Tuesday, May 15, 2012

Mobile Broadband Deployments in North America

According to the latest market study by Informa Telecoms & Media, North America continues to lead global LTE market development -- with 10.8 million LTE subscriptions, that's more than two-thirds of the worldwide subscriber base as of March 2012.

The U.S. has about 10.5 million LTE connections, while Canada contributes nearly 300,000 connections as of the first quarter 2012.

On a global basis, the leading mobile broadband technology, HSPA, with more than 80 percent share of subscriptions in the mobile broadband market today, continues to achieve milestones. There are now 221 commercial HSPA+ networks in 107 countries including 80 commercial HSPA+ Dual-Carrier networks in 46 countries with peak theoretical uplink rates of 42 Mbps.

"The surge is beginning for LTE subscriptions as operators gain new wireless spectrum, deploy infrastructure and offer LTE service," stated Chris Pearson, President of 4G Americas. "With over 220 HSPA+ deployments around the world providing fast mobile broadband connections, it is both logical and impressive to see the tremendous momentum of LTE now taking place to provide an even more robust and efficient experience."

Informa's early reports estimate that the Americas region had more than 200 million HSPA and LTE connections at the end of the first quarter of 2012. It is expected that the Americas region will exceed 250 million 3GPP mobile broadband subscriptions by the end of 2012 -- that number is expected to more than double by 2015, and is forecast to reach more than 700 million subscriptions by 2016.


Mobile broadband deployments continue to progress:
  • Latin America has 80 commercial deployments of HSPA in 34 countries, and of those, 36 have been upgraded to HSPA+ in 21 countries. Entel and Movistar in Chile and Personal in Paraguay have deployed HSPA+ Dual-Carrier at peak theoretical uplink speeds of 42 Mbps.
  • There are 6 commercial LTE networks in 4 countries in Latin America (Brazil, Colombia, Puerto Rico and Uruguay) and Informa expects about 300,000 LTE connections by the end of 2012.
  • North America has 17 commercial deployments of HSPA: 7 in the U.S. and 10 in Canada. Of those, 5 have been upgraded to HSPA+ in the U.S. and 8 have been upgraded to HSPA+ in Canada. T-Mobile USA has deployed HSPA+ with Dual-Carrier.
  • There are 8 commercial LTE networks in the U.S. and 3 in Canada.

LTE technologies have advanced in deployments and subscriptions on a worldwide basis. Today, LTE is commercial on 74 networks in 40 countries with more than 110 commercial networks expected by the end of 2012. Based upon public announcements, there are more than 334 operators committed to LTE in their future plans: 73 in trial; 187 planned (including 40 more launches in 2012); 59 potential licenses; and 15 licenses awarded.

Monday, May 14, 2012

106 Million Americans Now Own a Smartphone

comScore released data about key trends in the U.S. mobile phone industry during the three month average period ending March 2012. Their latest market study surveyed more than 30,000 U.S. mobile subscribers and found Samsung to be the top handset manufacturer overall.

Google Android continued to grow its share in the U.S. smartphone market, accounting for 51 percent of smartphone subscribers, while Apple iOS captured more than 30 percent.

For the three-month average period ending in March, 234 million Americans age 13 and older used mobile devices.

Device manufacturer Samsung ranked as the top OEM with 26.0 percent of U.S. mobile subscribers (up 0.7 percentage points), followed by LG with 19.3 percent share.

Apple continued to gain share in the OEM market, ranking third with 14.0 percent of mobile subscribers (up 1.6 percentage points), followed by Motorola with 12.8 percent and HTC with 6.0 percent.

More than 106 million people in the U.S. owned smartphones during the three months ending in March, up 9 percent versus December.

Google Android ranked as the top smartphone platform with 51 percent market share (up 3.7 percentage points).

Apple’s share of the smartphone market increased 1.1 percentage points to 30.7 percent. RIM ranked third with 12.3 percent share, followed by Microsoft (3.9 percent) and Symbian (1.4 percent).

In March, 74.3 percent of U.S. mobile subscribers used text messaging on their mobile device. Downloaded applications were used by 50 percent of subscribers (up 2.4 percentage points), while browsers were used by 49.3 percent (up 1.8 percentage points).

Accessing of social networking sites or blogs increased 0.8 percentage points to 36.1 percent of mobile subscribers. Game-playing was done by 32.6 percent of the mobile audience (up 1.2 percentage points), while 25.3 percent listened to music on their phones (up 1.5 percentage points).

Saturday, May 12, 2012

Behavioral Traits of American Smartphone Owners


Using their new and powerful mobile smartphones, an expanding class of American consumers -- 100 million strong and growing -- is helping to redefine the cultural norms in the U.S. marketplace.

According to the latest market study by eMarketer, members of the "smartphone class" stand apart from other Americans in the way they shop, communicate, consume media -- even how they use their spare time.

This class of smartphone-enabled people can be defined by their connectedness and their sense of empowerment that's attained through unfettered access to real-time online information.

"What others do with a PC, they do with their smartphones," said Catherine Boyle, eMarketer senior analyst.

Their phone is their workplace, entertainment center and their marketplace. They watch videos in coffee shops, social network at concerts, play games in waiting rooms, scan barcodes in stores and shop with their smartphone from anywhere at any time.

Moreover, their mobile online behaviors are rerouting the traditional path to purchase and they are proving to the rest of America that spare moments can be productive ones, too.

eMarketer estimates nearly 116 million Americans will use a smartphone at least monthly by the end of 2012, up from 93.1 million in 2011. By 2013, they will represent over half of all mobile phone users, and by 2016, nearly three in five consumers will have a smartphone.

The U.S. smartphone class is not defined by age, gender, income or race. Instead, it's defined by shared behaviors. Understanding the common behavioral traits that unite the class makes members easy to recognize and underscores the influence this class of consumers is having on how Americans communicate, consume media and shop.

One of those behaviors is to always be snacking content. The smartphone class doesn’t tolerate dull moments; members turn to their phones for instant gratification. Depending on their mood in the moment, gratification might mean completing a quick task or finding a fun distraction.

For marketers, this rising content consumption means an increasing number of touch-points where they can reach consumers. eMarketer forecasts double-digit growth in mobile gaming as well as music and video consumption among the smartphone class through 2015.

"Snacking on mobile in small amounts throughout the day can be as lucrative to brands as it is gratifying to members of the smartphone class," said Boyle. "The five minutes grazing on news in the morning, the 15 minutes playing a game at lunch and the two minutes watching a video at the grocery store are all opportunities for marketers to get a message across or close a sale."

Friday, May 11, 2012

E-reader Market Upside in EMEA is Growing Rapidly

According to the latest market study by International Data Corporation (IDC), the market for ereaders in the EMEA region more than doubled in 2011 compared to the previous year, reaching total shipments of nearly 4.8 million units. There's growing mainstream adoption of these devices, which is creating the potential for incremental digital multimedia revenue.

Although EMEA still accounts for just over 17 percent of the worldwide market, IDC forecasts sales in this region to exceed 24 million units by 2016, generating a 37 percent compound annual growth rate (CAGR) over the forecast period.

The fall in prices greatly contributed to the sales momentum in 2011. The average price for ereaders continued to slide as Amazon aggressively brought the price of its WiFi Kindle device down to €99 in eurozone countries. In 2011, the company experienced strong acceleration in sales thanks to the the rapid uptake of Amazon Kindle devices in Germany, France, Italy, and Spain.

In these countries, the opening of local Kindle stores has been very successful, prompting strong growth through Amazon's direct channel. The company now has in place numerous agreements with local retailers and is therefore broadly present in physical stores around Europe as well as through its traditional direct channel. Amazon led the market for ereaders in EMEA in 2011, followed by Sony.

The level of competition increased as new vendors made their entrance in the EMEA market. Canadian vendor Kobo Books established a strong presence -- due to marketing campaigns, aggressive prices and partnerships with local retailers in the UK, France, and Germany.

The end of 2011 also saw rapid uptake of Android TFT screen devices retailing for less than €60. German vendor Trekstor posted remarkable results in Germany due to a drop in price and a key partnership with local bookstore chain Hugendubel und Weltbild. Color TFT devices are gaining momentum among low-end users on a budget.

"The EMEA market for ereaders is developing fast," said Mario Lombardo, senior analyst at IDC EMEA. "The rapid fall in prices is making ereaders increasingly accessible to consumers, transforming the way they access content."

2012 will be a crucial year for this market. Prices will continue to fall, driven by pricing strategies of major vendors that can increasingly count on a substantial content revenue stream. On the other hand, vendors mainly counting on sales of the mere hardware will face very challenging times, and some are likely to be forced out of the market.

As the installed base of ereaders continues to grow, the European publishing industry is inevitably going through a huge transformation process in order to meet the increasing demand for digital content.

Not only are publishers in France, Germany, Italy, and Spain working frantically to provide digital content in local languages; more importantly, they are also adapting to a completely new business and facing intense pressure from the channel to reduce the price of ebooks.

In most of the major publishing markets in Western Europe, publishers still impose fixed prices on ebooks and content vendors are only allowed to apply a maximum percentage of discount. Furthermore, in most Western European countries, tax regulations impose the maximum VAT on ebooks instead of the reduced VAT level used for printed versions. Shifts in these regulations will undoubtedly help the market for digital content to flourish in the coming years.

The EMEA market for ereaders is expected to grow by 37 percent CAGR between 2012 and 2016. Western Europe will be the fastest growing region in EMEA, generating 41 percent CAGR. Although they will continue to be a mainly consumer product, ereaders are expected to increasingly be implemented in the education sector as more text books become available in digital format. In the ereader market, as well as in the digital content market, price will be key.

On one hand new decreases in the price of ereader devices are likely to force minor vendors out of the market; on the other hand, relaxation of governments' and publishers' price policies on ebooks will help major vendors to capitalize on their digital content business.

Thursday, May 10, 2012

19.3 Million People in Japan Now Own Smartphones

comScore reported key trends in Japan's mobile phone industry during the three month average period ending February 2012. The market study surveyed more than 4,000 Japanese mobile phone service subscribers and found Sharp to be the top mobile handset manufacturer overall -- with 23.5 percent market share.

Google's Android platform accounted for the vast majority of Japan's smartphone market at 61.4 percent, followed by Apple with 34.2 percent of the market.

"Smartphones surpassed feature phones as the most acquired device type in February 2012, signaling an important shift in Japan's mobile market," said Daizo Nishitani, vice president of comScore Japan KK.

The rise in smartphone adoption opens the door to tremendous opportunity for content publishers and advertisers to expand their reach and increase engagement with key consumer segments through this channel.

Japanese mobile phone users were already highly engaged with their devices, but with the added functionality and higher levels of mobile media consumption we should expect to see significant changes in behavior among the Japanese mobile population in 2012.

For the three-month average period ending in February, 101.7 million people age 13 and older used mobile devices in Japan (feature phone and smartphone devices).

Device manufacturer Sharp ranked as the top OEM with 23.5 percent of Japanese mobile subscribers, followed by Panasonic with 13.8 percent share. Fujitsu captured the third place ranking in February with 11.8 percent of mobile subscribers, followed by NEC at 9.7 percent and Sony at 7.5 percent to round out the top five.

Apple, which ranked as the eighth largest OEM in Japan with 6.5 percent market share, experienced the strongest gain among device manufacturers -- increasing 1.6 percentage points since November 2011.

More than 19.3 million people in Japan owned smartphones during the three months ending in February, up 28 percent versus November. Android’s share of the smartphone market reached 61.4 percent, while Apple ranked second with 34.2 percent of the smartphone market (up 1.3 percentage points versus November 2011), followed by Microsoft, which accounted for 3.9 percent in February 2012.

Analysis of selected activities consumers performed on their mobile phones found that 57.6 million users accessed email on their phone, representing more than half of all mobile phone users.

Japanese mobile owners were more likely to use an application (55.4 percent) than a mobile browser (52.4 percent), while 45.4 percent sent a text message to another phone during the month. Nearly 1 in 5 mobile users accessed social networking or blog sites on their phone, while slightly less (18.8 percent) watched TV or video.

Wednesday, May 09, 2012

Factors that Influence Mobile Content Consumption

comScore announced the next generation of it's market study methodology, offering new insight into global digital device usage and content consumption. Their Device Essentials service includes reporting capabilities across all global geographies, plus detailed reporting for some local U.S. markets.

Media Tablet Market Assessment

The Amazon Kindle Fire, introduced to the market in November 2011, has seen rapid adoption among buyers of tablets. Within the Google Android media tablet market, Kindle Fire has almost doubled its share in the past two months from 29.4 percent share in December 2011 to 54.4 percent share in February 2012 -- already establishing itself as the leading Android tablet by a wide margin.

Samsung’s Galaxy Tab family followed with a market share of 15.4 percent in February, followed by the Motorola Xoom with 7.0 percent share. The Asus Transformer and Toshiba AT100 rounded out the top five with 6.3 percent and 5.7 percent market share, respectively.

Tablet adoption among U.S. consumers continues to climb as more devices appealing to various price and feature preferences are introduced to the market. Screen size is perhaps the most outwardly apparent differentiator between devices, with the market offering consumers a wide variety of options such as the 10″ Apple iPad, 9″ Sony S1, 7″ Amazon Kindle Fire and 5″ Dell Streak.

Analysis of page view consumption by screen size found a strong positive association between tablet screen size and content consumption. Specifically, 10″ tablets have a 39 percent higher consumption rate than 7″ tablets and a 58-percent higher rate than 5″ tablets.

Although many factors -- such as consumer demographics, content availability, connection speed and ease of portability -- may influence consumption levels, the results of this analysis highlight important questions for the industry as the media tablet space develops.

With the emergence of a growing number of smaller-sized tablet devices, advertisers and publishers will need to understand whether these devices limit the opportunity for advertising compared to their larger-screen counterparts, or if they are able to build incremental reach and engagement by presenting different use cases.

Mobile Smartphone Market Assessment

comScore analyzed the share of unique smartphone devices among the top four mobile network service providers in the most populous U.S. states and found significant variation between markets.

Looking exclusively at the top four carriers, AT&T accounted for the largest share of unique smartphones in Texas (46.2 percent), California (42.9 percent) and Illinois (42.1 percent), while Verizon claimed the top spot in New York (43.6 percent) and Florida (36.5 percent).

The greatest disparity in carrier share between AT&T and Verizon occurred in Texas, where AT&T’s smartphone share was more than double that of Verizon’s share.

Sprint PCS ranked as the third largest smartphone carrier in each of the top five markets, with the carrier owning its highest market share in Illinois at 22.8 percent.

T-Mobile USA captured its highest market share in Texas, where the carrier accounted for 11.9 percent of smartphone devices.

Tuesday, May 08, 2012

How App Developers are Gaining a Market Advantage

Multilingual software app developers have a unique competitive advantage, as more people throughout the world adopt new mobile smartphone and media tablet devices. Locally-developed and well-translated content is the key to having mobile apps discovered by consumers.

According to the latest market study by ABI Research, in Apple's Japanese App Store, 87 percent of the ten highest-ranked apps in all 21 categories were available in Japanese, as of February. Germany (83 percent) and France (82 percent) were other markets where over four-fifths of the highest-ranking apps were available in the local languages.

In China, Chinese-speaking apps accounted for 76 percent of the highest-ranked apps -- with about half of them developed specifically for the local market.

ABI senior analyst Aapo Markkanen said, "Our findings confirm that apps that fit into the local culture, or at least speak the audience's native language, see a measurable boost in their download rankings."

This latest research finding could mean two things. First, domestic developer communities will always have a certain edge in winning over the consumer's hearts and minds. Second, larger developer houses with global ambitions risk seeing their expensive releases go unnoticed if they don't localize the content properly.

However, designing apps solely according to consumer needs is often not enough. Developers who struggle to be discovered should envisage and pay attention to what the device vendors that distribute and curate apps want to showcase about their products.

ABI practice director Dan Shey lists technologies that, if employed smartly, could pay off for the developers this year.

"A lot of future Android handsets will support NFC, so we expect Google and its OEM partners to promote the first wave of NFC-based apps strongly," says Shey.

"Apple is already giving extra visibility to apps that leverage the new iPad's Retina display and its next favorite thing will likely be voice recognition, once Siri's API gets launched. Microsoft’s focus will be in live tiles, while RIM wants to see developers embedding BlackBerry Messenger into apps."

ABI Research's latest report takes a holistic look at the dynamics of how consumers discover apps and how developers can take advantage of this in their launch and marketing strategies. The report also assesses the opportunities that stem from the challenges in discovery, explaining how players from various parts of the value chain can connect users to the right apps.

Monday, May 07, 2012

Exploring the Global Digital Signage Market Upside

While there's still a raging debate over the full upside potential of the Digital Signage market, particularly within the retail industry, pundits and insiders know that the most effective way to quantify the market is to follow the display technology outlook.

NPD DisplaySearch will once again host a one-day Digital Signage Conference at InfoComm, providing in-depth insight into the projected growth and emerging trends of the digital signage industry.

The fifth annual Digital Signage Conference is taking place on June 12, in Las Vegas, Nevada. Practitioners in the digital signage sector will address the key distribution channels, revenue opportunities, hot markets and new technologies throughout the entire supply chain.

"Flat panel displays continue to be a major force in the digital signage industry, as new technologies come to market and existing technologies adapt to changing demands," said Chris Connery, Vice President of Large Format Commercial Displays for NPD DisplaySearch.

In the digital signage industry, the components that comprise the technology are critical to the direction in which the industry is moving. Leading industry players will share details about how hardware, software and services come together to generate one-time and ongoing revenue streams.

From financing to content creation to content management to IT and AV support and installation, conference attendees will hear perspectives from companies that are focused on the entire value chain, not just the supply chain.

"It's virtually impossible for professionals in the AV, information communications and systems integration industries to ignore the impact of digital signage on our industry," said Randal A. Lemke, Ph.D., Executive Director, InfoComm International.

New display technologies such as OLED, transparent displays, touch screens, and glasses-free 3D displays are debuting at trade shows and are even beginning to show up in consumer electronics, but are these technologies really ready for commercial adoption?

NPD DisplaySearch will discuss the state of OLED, 3M will educate on current and future touch technologies, and Philips/Dimenco will introduce glasses-free 3D for public environments.

Saturday, May 05, 2012

London 2012 Summer Olympics will Boost Advertising


I'm attending the Digital Shoreditch Festival, later this month when I visit London, England (my home town). One of the storyline topics that I'll be researching is how the savvy local digital media talent will be capitalizing on the upcoming London 2012 Summer Olympics event coverage.

According to the latest assessment by eMarketer, in 2012 the total advertising spending growth within the UK will outpace the rest of Europe and the U.S. market for one reason: the highly anticipated global media buzz that will surround the London Olympics.

In February, Strategy Analytics forecast that total ad spending in the UK will increase by 4.2 percent, compared to 3.7 percent in Europe overall and 2.7 percent in the U.S. marketplace.

The boost from the Summer Olympics will push the UK closer to the worldwide average of 4.9 percent, which is buoyed by fast growth in emerging markets like China, Brazil and India.

By comparison, eMarketer estimates that UK total advertising spending will increase 4.8 percent, up from 3 percent in 2011, showing an apparent convergence in the market projections.

"This summer's Olympics are already generating extra interest and investment in UK advertising, as brands ramp up activity focused on the Games and the audiences they will attract," said Karin von Abrams, senior analyst at eMarketer. "The most recent Bellwether study from the Institute of Practitioners in Advertising (IPA) also points to an uplift in ad spending this year, despite a generally gloomy economic picture."

More British marketers have increased their ad spending in Q1 2012 than had cut back -- that's the third successive quarter this has happened. Online spending in particular rose by 7.8 percent during the quarter, according to the IPA.

Strategy Analytics estimates that online ad spending will be a bright spot across the board, rising 10.6 percent in the UK, 11.7 percent throughout Europe and 12.8 percent worldwide.

Once again, eMarketer's forecast concurs, estimating UK online ad spending will jump 12 percent and reach £5.09 billion ($7.84 billion) in 2012, before it likely stabilizes at 10 percent growth by 2013.

Friday, May 04, 2012

How Savvy Mobile App Developers Gain Market Share

During the last decade, the smart marketers have used a variety of search engine optimization (SEO) methods to attract traffic to their web sites. As more consumers adopt smartphones, and visit app stores to find useful software applications, today marketers must learn the evolving art and science of mobile app promotion.

During a recent market study ABI Research asked a key question: Can an independent developer with a nonexistent marketing budget have the largest number of top apps in Apple’s ecosystem for three months in a row? And especially when the average rating for those apps is only 2.9 out of 5?

This is the case for independent application developer Michael Quach, who continuously has the highest number of titles among the top iOS apps tracked by ABI Research. In February 2012, he had an average of 40 titles per country, out of a sample size of 5,250 in each country. This sample covered the highest-ranked 250 apps in all 21 categories.

What can other app developers learn from Mr. Quach? According to ABI senior analyst Aapo Markkanen, strategic category placement is one area more developers should focus on.

“Practically all of Quach’s apps are aggregations of various tips, trivia, or pictures, which are dirt-cheap to produce but appeal easily to spontaneous app browser curiosity,” says Markkanen.

Most of them could be logically categorized under the ‘reference’ or ‘entertainment’ section, but actually less than 5 percent are found there. Instead, 60 percent are listed in the ‘medical’ category and 25 percent are under ‘books,’ both of which have favorable eyeballs-to-competition ratios.

Why is this an important point? This means that those apps attract a lot of customers but aren’t as strongly contested as the most visited categories, like ‘games’ and ‘entertainment.’

ABI practice director Dan Shey continues, "If you publish your app in the right category, with a catchy name, a bright-colored icon, and skillful search engine optimization, this can go a long way in attracting downloads. Smart developers also follow their performance in a very detailed level and some even use Android as a test bed for their launch and publishing strategies."

Apparently, one plus side of Google's liberal submission policy for Android is that one can freely try out which kind of choices work and which don't.

Thursday, May 03, 2012

Why Media Tablets Attract Seniors and Young Children

According to the latest market study by ABI Research, 80 percent of all media tablet application downloads will be from a short list of very popular categories by 2016. They anticipate that Apple ​iPad and Google Android media tablet owners will remain avid app users over the next five years, averaging more than 31 downloads per year per media tablet.

Their market study of emerging tablet applications found that 11 of the 13.7 billion app downloads forecast for Apple iPad and Google Android media tablets in 2016 will be focused on four primary categories: games, digital publishing, social networking, and e-commerce.

"Media tablet app consumption will mimic smartphone app use in some ways, but in many ways, it will be very different," says Mark Beccue, senior analyst at ABI Research. Digital publishing of books, magazines, and newspapers will flourish on media tablets in a way never seen on smartphones."

Increasingly, consumers will opt for the more versatile media tablet over dedicated eBook readers. Leveraging unparalleled interactivity and design, digital media publishers will gain new readers, including seniors (ages 60+) -- who won't need custom, large-print publications anymore -- and children (ages 1-9) who will be captivated by the graphics.

E-commerce will be transformed by media tablets as significant numbers of consumers forego online shopping on desktop computers for shopping on media tablets. And while e-commerce will continue to depend on websites, apps will become increasingly important to shoppers who will take full advantage of the media tablet's touchscreen interface and even camera and microphone capabilities.

Media tablets will become increasingly popular with groups that haven't previously been associated with computing or mobile devices in the past -- in particular, adult seniors and young children. The long-term implications are significant for all marketers who seek to target and engage these segments of the population in the online marketplace.

"The magic of media tablets for seniors and children is the touch screen interface. It’s so intuitive," adds Beccue.

These demographic groups will rely heavily on downloaded apps over web surfing on their media tablets. Apps designed for young children, such as books and interactive, educational games will become increasingly popular and may even propel media tablets to become the de facto replacement of personal DVD players, particularly in cars.

Just imagine, it's forecast that nearly one billion media tablet apps designed for young children will be downloaded in 2016.

Wednesday, May 02, 2012

How Video Apps are Driving SP Network Investment

Infonetics Research released excerpts from two recently published video equipment market share and forecast reports. These latest market studies demonstrate how video entertainment applications demand is impacting broadband service provider (SP) infrastructure investment decisions. That being said, most of the growth will come from online video streaming apps, not traditional pay-TV.

The first report, Video-on-Demand (VOD) and Encoder Equipment and Video Subscribers -- which tracks video equipment sold to telco IPTV, cable video, and satellite video providers. And the second report, Set-Top Boxes and Subscribers -- which tracks IP, cable, satellite hybrid, DVR, and high definition (HD) STBs, as well as over-the-top (OTT) media servers.

"Two of the most interesting trends in the video equipment and set-top box markets are 1) across the board, pay-TV operators continue to increase their investments in MPEG-4 encoders to reduce bandwidth requirements for their broadcast channels and VOD streams, and 2) despite healthy STB unit growth in 2011, revenue was nearly flat, reflecting the growth of lower-cost STBs in emerging markets, particularly China, combined with the increased competition we're seeing in the more mature markets," notes Jeff Heynen, directing analyst for broadband access and video at Infonetics Research.

VOD and Video Encoder Market Highlights
  • Following annual declines in 2009 and 2010 during the global recession, the video infrastructure market (VOD and streaming content servers and video encoders) grew 6 percent in 2011 to $803 million, as all major world regions except EMEA increased spending.
  • Sequentially (from the third to the fourth quarters), the overall market is up 4 percent and from the year-ago fourth quarter, the market is up 6 percent.
  • Infonetics forecasts double-digit percent revenue increases in the global video infrastructure market in 2012.
  • A cumulative $1.9 billion will be spent on standard and high definition (SD and HD) MPEG-4 video encoders over the next 5 years, from 2012 to 2016.
  • Huawei leads the global VOD server market in both 4Q11 and for the overall year 2011; Motorola and ZTE are neck-and-neck for global VOD revenue in 4Q11

Video Set-Top Box Market Highlights
  • In 2011, worldwide set-top box unit shipments grew 13.7 percent compared to the previous year, while revenue was nearly flat, up less than 1 percent, to $13.3 billion.
  • Similarly, global set-top box unit shipments grew faster (+6.0 percent) than revenue (+3.8 percent) between the third and fourth quarters of 2011.
  • Decent growth in high definition (HD) and DVR STB sales helped keep average selling prices (ASPs) from declining too quickly.
  • In the tight race for overall global STB revenue share, Motorola, Echostar, Pace and Cisco lead, all separated by only a few market share percentage points in 4Q11.
  • IP STB and hybrid IP/DTT STB unit shipments are forecast to grow the strongest among the various types of set-top boxes over the next 5 years, increasing their share of the total market.
  • Demand continues to accelerate for online video streaming devices -- such as those made by Apple, Boxee, Roku, Popcorn Hour, D-Link, NETGEAR, Western Digital and TiVo -- with global over-the-top (OTT) media server revenue jumping 38 percent and unit shipments up 68 percent in 2011 as more service providers offer streaming video to their subscribers.

Tuesday, May 01, 2012

Americans Viewed 8.3 Billion Video Ads in March

comScore released new market data showing that 181 million U.S. Internet users watched nearly 37 billion online content videos in March 2012, while video advertising topped 8 billion for the first time on record.

Google Sites, driven primarily by video viewing at YouTube.com, ranked as the top online video content property in March with 146.1 million unique viewers, followed by Yahoo! Sites with 60.6 million, VEVO with 51.3 million, Facebook.com with 45.1 million and Viacom Digital with 44.3 million.

Nearly 37 billion video views occurred during the month, with Google Sites generating the highest number at 15.7 billion, followed by Hulu with 1 billion and Yahoo! Sites with 815 million.

The average viewer watched 21.7 hours of online video content, with Google Sites (7.1 hours) and Hulu (4.6 hours) posting the highest average engagement among the top ten properties.

Americans viewed more than 8.3 billion video ads in March, representing an all-time high, with Hulu delivering another month of record video ad views at more than 1.7 billion.

Google Sites ranked second with more than 1.2 billion video ads during the month, followed by BrightRoll Video Network with 953 million, Adap.tv with 892 million and Specific Media with more than 775 million.

Time spent watching video ads totaled 3.5 billion minutes, with Hulu delivering the highest duration of video ads at 690 million minutes. Video ads reached 51 percent of the total U.S. population an average of 53 times during the month. Hulu delivered the highest frequency of video ads to its viewers with an average of 51, while ESPN delivered an average of 26 ads per viewer.

The March 2012 YouTube partner data revealed that video music channels VEVO (49.1 million viewers) and Warner Music (30.3 million viewers) maintained the top two positions. Gaming channel Machinima ranked third with 22.9 million viewers, followed by Maker Studios Inc. with 14.6 million, FullScreen with 12 million and BroadbandTV with 8.5 million.

Among the top 10 YouTube partners, Machinima demonstrated the highest engagement (69 minutes per viewer) followed by VEVO (62.5 minutes per viewer). VEVO streamed the most videos (670 million), followed by Machinima (379 million).


Other notable findings from the March 2012 study include:
  • 83.5 percent of the U.S. Internet audience viewed online video.
  • The duration of the average online content video was 6.4 minutes, while the average online video ad was 0.4 minutes.
  • Video ads accounted for 18.5 percent of all videos viewed and 1.5 percent of all minutes spent viewing video online.