Carriers becoming primary Internet providers: Vodafone exec
BOSTON -- As the number of mobile devices approaches three times that of PCs worldwide, carriers are becoming the primary Internet access providers, especially in emerging markets, according to a Vodafone executive.
During his presentation "The Web on Mobile: the Same or Different?" the Vodafone exec also touted the opportunity for mobile widgets, citing his company's partnership with China Mobile and Japan's SoftBank on the Joint Innovation Lab, or JIL. He also gave his view of the current state of the mobile industry and his vision of its future, which will include a full, unified Internet.
"We've launched flat-rate pricing to drive data consumption and a content adaptation solution to make full Web pages readable on mobile phones, services from leading Internet players including Facebook, Google, eBay and Microsoft) and various promotion campaigns," said Erik de Kroon, head of marketing for Internet discovery at Vodafone Group, Newbury, Berkshire, Britain.
"Since the data bundle offering, consumers have communicated to us 'Yes, we want the full Internet," Mr. de Kroon said. "Off-portal page views are growing rapidly, although 90 percent of our browsing consumers still use Vodafone Live.
"We're seeing a little bit of both," he said. "People want to view full Web pages, so we let them go off deck, but there's still a place for easy-to-find on-deck content."
Vodafone Live is the company's primary mobile Web offering, although it has been expanding off-deck mobile Internet opportunities as well.
Vodafone Group has a presence in 25 countries and 42 further partner markets, with 269 million proportionate customers as of June 2008 and $70 billion in revenues in the 2007-2008 fiscal year.
Vodafone has a 45 percent stake in Verizon Wireless. Verizon Communications holds the other 55 percent.
According to a Vodafone study of the most popular mobile search terms in Britain, social networking was by far the largest category, followed by adult, email, shopping, downloads, YouTube, gambling, sports, news and weather, and Google.
"There is a Google search bar install on deck within Vodafone Live, and people use it as a way to get where they want to be faster," Mr. de Kroon said. "Using the search bar is faster than typing in a URL."
It's obvious that there are many differences between the PC and mobile Internet, but as mobile technology progress, the impact of those differences will be minimized.
"With mobile the entry point more important, the screen is obviously smaller, and people tend to have less patience on mobile," Mr. de Kroon said. "There are business model differences, for example on the Internet ecommerce is key and advertisers want to drive customers straight to a sale.
"On mobile, customers are buying mobile content, but they're not yet buying TVs or cars via mobile, although they may someday," he said. "Apple's App Store has proven that customers are willing to pay for mobile data apps, and that has implications for the mobile business model."
Mr. de Kroon also sees opportunities for mobile advertising, although he says it's still in its infancy and faces obstacles to reach the mass market.
"I'm a big believer in mobile advertising, but it will take different shapes, and it's still in phase of experimenting with which forms will work best," Mr. de Kroon said. "Brand advertising and location-based ads driving customers to physical locations will be the next big wave."
Sounding a familiar lament, one obstacle he noted was mobile's perceived limited reach due to fragmentation in the industry.
"We're lucky to be working in an industry with a lot of innovation, which is a very good thing for everybody, but there is a negative side effect," Mr. de Kroon said. "Apps do not tend to work across all devices, which leads to a very big burden on developers who have to adapt their apps to all different devices."
Vodafone is placing a strong emphasis on innovation in mobile applications and widgets.
"We want to make mobile widgets available across a wide range of devices by using Web standards such as HTML and Java, which is very important," Mr. de Kroon said. "We believe this is the future, because developers are already familiar with the standards that already exists, so it's easier to program.
"This is not an area where we start from scratch," he said. "We can build on existing standards rather than having to invent new ones."
The use cases from customer perspective have evolved on the PC from widgets to small apps and eventually full apps. On mobile, we are currently in the content update phase for the most part, with small apps and device functions to follow.
"We're hoping to drive innovation by using richer technology for simple apps such as games to more complex apps such as messaging and LBS, and in order to get there, we need further standardization," Mr. de Kroon said.
Vodafone's partnership with China Mobile and Japan's SoftBank on the Joint Innovation Lab has reach to 27 countries, 5 continents and 700 million customers.
"We're working to accelerate the standardization of widget technology, starting with existing standards, providing open-source reference implementation," Mr. de Kroon said. "We're making available to the developer community a developer Web site, beta releases of basic widgets and richer widgets including APIs."
Vodafone also sees an excellent opportunity in emerging markets, especially India, South Africa, Egypt, Turkey and Romania.
"When you look at mobile versus PC penetration, mobile is much higher," Mr. de Kroon said. "Mobile carriers are rapidly becoming the main access providers to the Internet in these countries.
"The Internet is becoming mobile, and the growth in that area has taken us all by surprise, especially in the consumer segment," he said. "There are many opportunities for all of us in emerging markets.
Whether an emerging market or a first-world juggernaut, Vodafone sees carriers leading the way to a unified, full mobile Internet experience.
"We need to demystify the benefits of the mobile Internet, its functional benefits because of the ease of use and the emotional benefits because of its relevance and personalization," Mr. de Kroon said. "Mobile operators will play a key role in making this happen, driving standards for content and apps that work on any phone, achieving true standardization and local presence around the world."