THE NETSIZE GUIDE

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THE NETSIZE GUIDE
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foreword transaction Playing To Win The Vertical Explosion Huge Opportunities in Big Data Engage at Every Stage Building Lasting Loyalty Turning Sports Fans into Brand Friends
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transformation Messaging Momentum Personalizing the Content Cloud
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trust Securing an Open World Crossing Channels Orchestrating Security Enter the Trustzone Foundation for a Secure World

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solutions at a glance Netsize Gemalto Trusted Logic the global mobile market 5 Surprising Facts About Global Digital Traffic As Over the Top Players Dominate, Mobile Operators Will Transition into Enablers country data data per country colofon

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Alexander Vlasblom Marketing Communications Director Netsize & Trusted Logic, Gemalto Editor of The Netsize Guide

FOREWORD
Welcome to the 10th Anniversary edition of the Netsize Guide, the comprehensive work of reference that has consistently provided our readers important insights into the mobile developments impacting business – and our society – at all levels.

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FOREWORD

In this decade we have seen phenomenal change and progress.
• We have experienced a shift from low-end devices and feature phones to smartphones, tablets and connected devices that enrich our lives, making it easier than ever before to enjoy entertainment and do business. • We have gone from a situation where wireless connectivity – a factor the GSMA reminds us is instrumental in efforts to improve education and eradicate poverty – was scarce, to a world where mobile broadband uptake is rapid. • We have observed the rise of transformational content and services, from mobile apps that allow us to use our devices in ways we could not have imagined just a few years ago, to social networks that empower us to connect with friends, peers and companies on our terms and in real-time.

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Indeed, the last decade has allowed us to start thinking of mobile as the 1st screen, providing us the interface to digital content and services, as well as the bridge to the physical and virtual worlds. We are embarking on a new phase in growth and innovation, a direction that will not be defined by technology alone. Transaction, Transformation, Trust In this Netsize Guide by Gemalto we explore the three themes that characterize the state of mobile today, and define its future path: Transaction, Transformation and Trust. As we show in the TRANSACTION chapter, we have come to rely on mobile devices at every stage of the consumer journey. From researching products to making purchases, we reach for our mobile devices for assistance.

In the next chapter, aptly titled TRANSFORMATION, we illustrate how mobile devices are also acquiring the capabilities to transform long-established business models around content, communications and connectivity. The cloud allows us to demand – and expect – simple and easy access to our media, content and networks anywhere, anytime. In the final chapter, TRUST, we offer a new perspective on what matters most in mobile. Technology will not determine the next step in the evolution of mobile. As this chapter explains: the next phase of mobile will “be determined by our very human requirements for simple, transparent services we can trust.” Trust is critical. It is the fundamental competency required by all the players and people that make up the digital business ecosystem. Building and maintaining trust with these stakeholders will emerge as the key determinant of competitive advantage and – ultimately – success. In fact, only a relationship built on trust will provide companies the access to the customer insights that lay the groundwork for the applications, devices, services and infrastructure we want (and will expect).

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MOBILE COMMERCE

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TRANSFORMATION

TRUST

DIGITAL LIVE

TRUSTED EXECUTION

Understanding the interplay of the three key themes that define this year’s Netsize Guide equips companies across the industry to prepare for the next phase of mobile. In an increasingly connected society, Gemalto makes digital interactions secure and easy, helping people make the most of the digital world: communicating by mobile, banking online and using mobile, accessing content and services. We help mobile operators, banks and enterprises meet the growing demands for personal mobile services, identity protection, payment security and authenticated online services. And we help device manufacturers meet the security demands for tablets and smartphones running open operating systems, and conveniently integrate direct carrier billing in their online and mobile application stores. As we demonstrate in this milestone edition of the Netsize Guide by Gemalto, our lives and our mobile devices are becoming inextricably intertwined. This development impacts everything and spells opportunity for companies that can deliver us what we want how we want it. We are proud to provide you a roadmap to navigate the change ahead. We are in for exciting and disruptive times ahead. Strap yourself in for a wonderful ride!

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“We’re seeing phenomenal growth rates in terms of what consumers are doing with their mobile devices while they are in a physical bricks-and-mortar store—searching for product information, ratings and reviews, or to competitive shop and compare prices.”
Kelly O’Neill, director of industry marketing, Oracle-ATG

Companies are not only waking up to the mobile opportunity; they are grabbing on to it with both hands. The result is a seismic shift from exploration to execution, reflected in strategies that are comprehensive, comprising solutions that address every phase of the consumer journey, from awareness and engagement, to conversion and commerce. Increased smartphone adoption, a sharp rise in mobile Internet usage and a marked increase in mobile advertising spending in key regions including the U.S. and Europe have injected renewed dynamism into the mobile marketing landscape. Indeed, the global trend toward smartphone adoption and increased mobile Internet access among consumers is igniting renewed marketer emphasis on mobile. In Europe, research firm eMarketer predicts the number of mobile users in the EU-5 accessing the web from their mobile devices will double from 2010 to 2015, reaching a whopping 94 millionCL. Application and browser usage rates, which are steadily creeping up as more users go online with their mobile devices, will also continue to rise, presenting companies new options to connect with customers and drive commerce.

FIGURE 1:

Mobile users EU-5, age13+, used an app Total EU-5: 97 million

Source: comScore, MobiLens June 2011

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These numbers dovetail well with MobiLens, a recent report from research firm comScore based on a survey of mobile users in the EU-5. Specifically, comScore estimates some 97 million consumer use mobile apps on their devices. The chart below provides a breakdown by category. The Country Data section in this Netsize Guide highlights detailed usage statistics by country. While smartphone penetration is clearly on the rise, the mix of operating systems and platforms across key regions is radically different. Apple and Android have a strong position in the U.S. market. However, Symbian leads the pack in Africa, Asia and much of Europe. Regardless of how the platform wars play out, the bottom line is that more mobile users equipped with smartphones mean more users will access the Web from their mobile devices. In turn, greater use of browsers and apps mean enhanced opportunities for marketers to engage customers at every stage of the purchase process, from building awareness all the way through to boosting loyalty. Simple phones, extraordinary services While the industry may be excited about the advance of smartphones, it’s ordinary feature phones that empower billions to lead truly mobile lives. According to the annual mega-trends presentationCL compiled by Mary Meeker, renowned industry analyst and partner at venture capital firm Kleiner Perkins Caufield & Byers (KPCB), feature phone users outnumber smartphone users by a ratio of nearly six-to-one. Feature phones are not just in the majority. FIGURE 2: They are driving services innovation as Global Smartphone vsMobile Phone Subscribers 2011E people in emerging and developing markets use simple text messaging to improve their lives, conduct commerce, transfer money and even oversee elections. From lifesimplifying reminders to life-saving medical advice, people around the are using text to connect, communicate and interact with companies, brands, medical doctors, government authorities and clergy – and the list goes on. In fact, consumer research suggests our increasing reliance on text messaging has
Source: Smartphone subscriber estimates per Morgan Stanley Research, Mobile phone subscribers per Informa (as of Q2 11) THE NETSIZE GUIDE: TRULY MOBILE

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embedded this interaction in our daily routine. This is the key finding of a 2010 U.K. market surveyCL conducted by Dialogue Communications , a mobile messaging and mobile payments company. It found that more than 67 percent of respondents actually want more messaging services in their lives. Specifically, respondents said they would welcome reminders and alerts via text for everything from medical alerts to bill payments. Why? Respondents said text reminders are more convenient and reliable than post or e-mail, and much easier to sync up with the calendars they already use on their mobile phones.

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People- powered communications Mobile devices are highly personal. Little wonder most consumers are quick to dismiss marketing messages about products, services and offers that aren’t relevant to their interests. That’s called spam. However, consumers are increasingly willing to receive marketing messages from the brands they love provided they promote products and services that are aligned with their individual preferences and their requirement for privacy. That’s called permission based mobile marketing. For this reason, permission based mobile marketing – defined by the Mobile Marketing Association as “the practice of gaining consent from consumers in advance of a continuing marketing dialogue taking place on mobile devices and in return for some kind of value exchange”CL – is emerging as the ideal way to communicate with consumers. For brands and agencies, permission based mobile marketing ensures the brand message is delivered to an audience of opted-in consumers who genuinely want

to hear it. Thus, permission marketing provides the cornerstone of a strategy that delivers reach, interactivity and high response rates. For mobile operators, permission based mobile marketing allows them to be full participants in the mobile marketing value chain, not just a pipe. Whether the messages are delivered via SMS, or transmitted more effectively overthe-air directly to users’ SIM cards where they instantly pop up on the mobile phone’s idle screen and engage user interaction, mobile operators control the networks and manage the inventory. Fortunately for the operators, brands and advertisers consider this inventory – optedin consumers who have volunteered information about their preferences, hobbies and interests – to be the most desirable. More importantly, permission builds trust, and ultimately lays the groundwork for all companies – including mobile operators – to connect with consumers. Executed correctly, the same approach can be used to increase customer engagement, boost loyalty and improve CRM..

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Shift happens Mobile marketing is experiencing a massive shift from experimentation to execution, reflected in increased spend and the advance of more ambitious campaigns that focus on consumers at every stage of the purchase funnelCL (awareness, engagement, consideration, conversion and loyalty). This was a key takeaway at the Mobile Marketing Association (MMA) Forum in London last October. The MMA, the premier global non-profit trade association representing all players in the mobile marketing value chain with more than 700 member companies, is an action-oriented organization with global focus, regional actions and local relevance.

“We realized that brands and agencies are our primary audience,” observed Paul Berney, MMA CMO. Thus, the industry at-large “no longer needs convincing that mobile is an indispensable part of the marketing mix.” Now brands and agencies have to get down to the work of developing effective mobile marketing strategies that will allow them to achieve key business objectives and drive sales. Another indicator that heralds healthy mobile marketing growth is the decision by major companies to dedicate more budget to mobile. A new report released by Forrester Research predicts that marketers will finally allocate sufficient funds into mobile, with an estimated $1 billion in spend for mobile display and search advertising by year-end. Forrester further predicts that marketers will become masters at using mobile marketing channels to generate real leads, drive foot traffic into stores and to sell products and services. FIGURE 3:
Global Mobile Advertising Revenues

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In Europe, analysts are positive about the outlook for growth. Mobile ad network aggregator Smaato and research firm mobileSQUAREDCL predict an increase in mobile ad spending in the EU-5 from $122.6 million in 2010 to $1.29 billion in 2015. In the same period, mobile display spending alone is expected to rise from $52.8 million to $339.1 million.
Source: Informa Telecoms & Media

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Mobile advertising revenues are also set to rise, driven by the initiatives and investments of big players including Apple and Google. New researcCL from Informa Telecoms and Media forecasts global mobile advertising revenues will show strong growth over the next five years and generate revenues of around $24 billion in 2015. Shop till we drop Clearly, mobile is top of mind for an increasing number of marketers as they seek to accompany consumers at every stage of the purchase funnel. But what do consumers think about this new mega-trend? Mobile Exposure 2010CL, an ambitious annual, independent consumer study conducted by TNS on behalf of mobile operator Orange sharply, sheds light on how

Mobile on the move A survey developed by JumptapCL a provider of targeted mobile advertising, in conjunction with publisher DM2 Media, points to an upward trend. The first “State of Mobile Advertising” survey (released March 2011) aggregates responses from nearly 350 mobile advertising executives including brands, agencies, publishers and technology enablers. Among the findings: Mobile takes a bigger slice of the pie. For those with near-term mobile marketing plans, 60 percent intend to draw their mobile budget from their

current online budget. An additional 20 percent said that mobile will be an entirely new line item. Opportunities in mobile CRM. Advertisers were evenly split between direct response and branding campaigns with 51 percent citing awareness/ loyalty and 49 percent citing customer acquisition and retention. New verticals emerge. Entertainment is the category that publishers expect to generate the most mobile ad revenue in 2011, followed by technology and automotive.

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consumers are engaging with mobile media content, including advertising. By way of background, the report examines the usage and habits of mobile media users across four European markets: U.K. (1,000 mobile media users and 450 iPhone users), France (1,000 mobile media users and 450 iPhone users), Spain (1,000 mobile media users and 450 iPhone users), and Poland (1,000 smartphone users). However, the real story is the opportunity for brands and advertisers active in these markets. Specifically, the survey suggests that consumers would most welcome
FIGURE 4:

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What opportunities for mobile advertising? % from 7 to 10 out of 10
UK Sponsored screen savers Information on the area you’re in Sponsored pages on the web like Sponsored games that you can download for free Sponsored videos where you get a video for free Ads that appear at the top or bottom of your screen Short text message advertisement Text message sent to your phone Picture or video message Coupons that you could use Alerts for special promotions/sales ads for tickets and reservations
BASE: Mobile Media Users Source: TNS / Orange, Mobile Exposure 2010

France 24% 27% 16% 24% 17% 14% 17% 18% 14% 41% 34% 21%

Spain 18% 26% 15% 30% 18% 11% 15% 22% 16% 43% 33% 25%

Poland 32% 43% 17% 37% 32% 12% 17% 16% 18% 50% 42% 30%

17% 25% 13% 24% 15% 13% 16% 20% 14% 41% 24% 22%

coupons sent directly to their mobile phones and text alerts for promotions. Sponsored content, such as games and videos, also show great potential. Consumer’s willingness and readiness to engage in mobile shopping and commerce is also echoed by a global Accenture survey, Retailing in an Era of MobilityCL. It argues the growing use of smartphone technology and the economic downturn have encouraged cost-conscious consumers to explore alternative retail channels such as mobile to secure bargains.
Almost half – 48 percent – of consumers use their mobile devices to research or browse products and services, according to Oracle’s Mobile TrendsCL: Consumer Views of Mobile Shopping and Mobile Service Providers report. The report reinforces that mobile commerce is growing dramatically as consumers are increasingly turning to their mobile devices to comparison-shop, get product ratings and search for coupons.

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Among the finding: smartphone users would find it useful to download money-off coupons to their phones (79 percent) and receive instant money-off coupons as they pass by an item in a store (73 percent). Conversely, fewer than half (48 percent) of smartphone users have downloaded a coupon from their PCs.

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Research firm Juniper Research has identified three key segments comprising the mobile retail market: mobile coupons (total redemption value of mobile coupons), mobile smart posters (total fees resulting from smart poster product information, downloads and sales), and mobile advertising (total ad spend on mobile distribution channels). Based on this model, Juniper Research expects the global mobile retail market to enter a new growth phase. Mobile Marketing & Retail Strategies: Advertising, Coupons & Smart Posters 2009-2014CL further indicates the mobile retail market, which was worth $4.1 billion in 2009, will experience FIGURE 5: average annual growth of about 24 The Mobile Retail Opportunity ($m) Split by Smart Posters, Coupons & Advertising 2009-2014 percent during the next four years to reach slightly more than $12 billion in 2014. Once brands have successfully engaged in ad hoc ad campaigns, Juniper Research expects marketers will “return for repeat advertising that may include direct mobile purchase, and ultimately make mobile part of their integrated multimedia/multiplatform strategy.”
Source: Juniper Research

Contactless payments pay-off Mobile payments are moving to the top of agenda, as players across the ecosystems jockey for position to enable mobile commerce via a variety of mechanisms and approaches, ranging from smartphone apps and 2D barcode schemes to contactless payments and mobile wallets enabled by NFC. NFC – or Near-Field Communications – is a set of technologies that supports communications between two devices in close proximity to each other. An NFC link enables small amounts of data to be exchanged over short distances, making it an ideal solution where quick exchange of small amounts of data is paramount to quality user experiences such as mobile payments. In the U.K., mobile operators Vodafone, Everything Everywhere and O2 entered a joint venture called m-wallet, a service built around a smartphone app that enables contactless payments. This move followed on the heels of news that mobile operator Orange UK had sealed a partnership deal with credit card company Barclaycard to offer contactless mobile phone payment solutions to its customers. Elsewhere in Europe, French operators Bouygues Telecom, Orange and SFR joined with Atos Origin to form a joint venture company in February 2011 to launch an innovative payment solution, backed by online retailers including Aquarelle, Brandalley, Darty and Rue du Commerce. The service, called Buyster, is described as “an innovative, simple, fast and secure remote payment solution for fixed and mobile internet purchases.” Spanish mobile operators Orange, Telefónica Movistar and Vodafone signed a cooperation agreement in March 2011 to lay the groundwork for a Near-Field Communication (NFC) ecosystem and so avoid the risk of market fragmentation.

Asia also saw a flurry of activity. In October 2011 the Singapore telecom authority Infocomm Development Authority of Singapore (IDA) made the decision to implement a trusted third party NFC infrastructure. This will enable banks, payment and service providers to deploy innovative mobile NFC services to all mobile subscribers of Singapore’s three mobile operators. Such ubiquitous access will “spur the growth and adoption of innovative NFC mobile services, and in turn transform Singapore’s payment landscape,” Ronnie Tay, IDA Chief Executive Officer, said in a statement. Contactless payments are poised to take transactions to a new level. Research firm Yankee Group reports global mobile transactions (including banking) were worth $162 billion in 2010 and will reach a staggering $984 billion in 2014. But the real news is the increasing importance of NFC driven by the number of NFC-enabled phones (forecast to grow from 834,000 in 2010 to 151 million in 2014) and NFC transactions (leaping from $27 million in 2010 to $40 billion in 2014). Meantime, a raft of surveys underlines the willingness of consumers to make payments and purchases using their mobile phones. A recent survey by Accenture, aptly titled The Brave New World of Mobile Commerce: A convergence of traditional and alternative currencies, finds that early adapters (those consumers at the forefront of mobile trends across U.S. China, India, Japan, Brazil, Germany, France, Italy, Spain, Korea and the U.K.) are eager to embrace mobile payments. However, there are some regional differences. Two-in-five Asian consumers are already using their mobile devices to make payments and conduct transactions. This, Accenture concludes, is “far ahead of the U.S. and Europe,” where NFC is just beginning to gain serious traction.

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Vertical explosion From department stores to computers & electronics retailers to luxury fashion brands, marketers are investing in mobile advertising to reach and influence people throughout the purchase funnel.

In fact, Millennial Media, a leading independent mobile advertising and data company we interviewed, reports that Retail was the top vertical on the Millennial Media advertising network both globally and in the U.S. What’s more, spend by brands has skyrocketed, growing by a whopping 1300 percent for the period Q1 2010 to Q1 2011. This development is the focus of Mobile Intel: RetailCL, a mobile intelligence report that draws from Millennial Media network data (data that was accumulated across 67 billion mobile impressions in 250 countries and territories in Q1 2011) and consumer research conducted by comScore. The report identifies key mobile retail opportunities and reveals the key characteristics of mobile retail users, a growing segment of consumers using their mobile devices to research and purchase goods and services. So who are the consumers accessing retail content on their mobile devices? The comScore study reveals the vast majority of mobile retail users are tech-savvy digital natives between the ages of 18 and 35 for whom the mobile phone has become an indispensible part of their daily routine. These consumers also tend to be more affluent and lead in the $100,000+ annual income bracket, providing a wide range of companies in sectors including retail, finance and travel a significant audience that is likely to appreciate and respond to a mobile call to action.
FIGURE 6:

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Global Vertical Explosion
Retail & Restaurants Automotive Finance Telecommunications Health: Fitness & Welness Education
SOURCE: MiIlennial Media, Q1 2011

Year-Over-Year Revenue Growth - Q1 2011/Q1 2010

1342% 25% 13% 24% 15% 13%

These findings dovetail with Millennial Media’s Q1 2011 Quarterly S.M.A.R.T.™ (Scorecard for Mobile Advertising Reach and Targeting) report, which identified strong – and growing – spending in the Retail category. Globally, Retail & Restaurants spending on Millennial’s network grew 1342% from Q1 2010 to Q1 2011, followed by Automotive and Finance.

Browsing and buying Interestingly, mobile users are not only using their devices to research their purchases; they are also using their mobile phones to complete the transaction. From transport tickets to big-ticket items, consumers are moving their daily shopping routine to mobile. Mobile Intel: Retail findings identify a trend to mobile commerce. Specifically, 21 percent of respondents surveyed in June 2010 said they had made a purchase using

FIGURE 7:

mCommerce Items Purchased

their mobile phone (via a Web browser or a mobile application) in the last 30 days. A closer examination of their purchases shows consumers are buying a wide range of items using their mobile devices. Consumer electronics and clothing accessories top the list, followed by tickets, hotel stays and flowers

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Connect the dots, and consumers clearly see real value in mobile commerce and the convenience of being able to research and Source: comScore/Millenial Media Mobile Retail Study, 2010 buy items at the moment of inspiration. The shift away from micro-payments to big-ticket items is a game-changing development that heralds a new phase of growth in consumers’ buying behavior. More importantly, it sends a clear signal to brands that they can also use mobile to encourage loyalty and repeat purchases. Mobile loyalty The fusion of social and mobile devices and explosion of associated apps have all served to fuel consumer appetite for more and better mobile services. The challenge for businesses in 2012 will be to adapt their mobile offerings to this increased demand, and find ways to target their services at specific segments of their customer base. There is a clear opportunity for mobile to become a primary CRM channel for many services and industries. And this mindset is almost overdue as more reports are already identifying mobile CRM as an untapped opportunity for brands and media companies. Hipcricket, a mobile marketing and advertising company recently acquired by Augme Technologies, has been the first to survey and confirm consumer interestCL in approaches that incorporate loyalty mechanisms such as clubs, communities and coupons. Specifically, Hipcricket found that 57 percent of consumers would be interested in opting in to a brand’s loyalty club via a mobile social networking application such as Facebook. The survey also found that 80 percent of respondents stated that they still have not been marketed to by their favorite brands via their mobile device. Jeff Hasen, Hipcricket CMO, tells Netsize that an increasing number of his major clients, such as department store chain Macy’s, are making sure “everything they do has a broader objective around how to entice consumers to have an engaged relationship and how to tie it all back into existing CRM programs.”

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Why the increased interest among brands? Hasen identifies two drivers: the advance of APIs that allow companies to integrate a mobile CRM program with their larger existing CRM, and the requirement for brands to rise above the noise way in advance of key dates such as the start of the holiday shopping season. However, retail isn’t the only sector bullish about mobile. BNP Paribas, a leading bank we interviewed for the Netsize Guide, sees mobile as part of a multi-channel approach to CRM. As Phillippe Gillet, BNP Paribas Director, IT Strategy and Innovation, points out: “With it [mobile] you can manage contact with the customer. For example, the call center can arrange a follow-up appointment with the customer on their mobile phone and then forward this appointment and all the details directly to the customer manager in the branch office. Thus, the relationship with the customer is enriched and managed across all channels: ATMs, personal computers and, of course, mobile. It’s important to have a completely integrated view of the relationship with the customer.” Engage at every stage Mobile phones present new ways to engage with on-the-go consumers and enable real-time options for mobile rewards, payments and commerce. This is where Mobile Relationship Marketing (MRM) comes in. The concept sits at the center of a global initiative spearheaded by the CMO Council to explore the vast opportunities to create business value, improve process efficiency, trigger product consumption and use, further loyalty and repeat purchase, and increase customer feedback, assistance, affinity and advocacy. As Donovan Neale-May, CMO Council Executive Director, put it in an interview with Netsize, the role of mobile is to ensure continuous customer touch and interaction, sustained support and service. “Using new mobile apps, location-based messaging, proximity marketing, and smart merchandising systems in-store, marketers are now able to attract and engage consumers in any place where they are willing to interact, transact or stay in contact with brands. This includes retail, sports, entertainment, destination, education, mass transit, and travel environments. An effective MRM strategy integrates social interaction; customer insight gathering and listening; consumer engagement and loyalty; market listening; purchase incentive or inducement; as well as lifetime revenue optimization, all through optimized use of the mobile channel.” Connect the dots, and consumers are open to being involved in mobile programs that deepen engagement and drive loyalty. Now it’s up to brands and media companies to incorporate mobile in their marketing strategies. In a world where mobile is at the center of all we do, their campaigns and content should do more than simply boost awareness. They must wield mobile to escort consumers at every stage of the purchase funnel and – ultimately– entice consumers into more engaged and longterm relationships.

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IN SUMMARY:

• We are entering into a new and critical phase of development in the mobile industry. The discussion no longer centers on whether mobile fits in the marketing mix. Mobile has clearly earned its place at the table. Instead, we are debating where mobile fits best in the customer journey and how companies across all verticals can craft mobile campaigns that focus on customer engagement, retention and CRM. • Providing value and seeking permission are at the center of communications between companies and consumers. Fortunately, consumers are progressively more accepting of advertising on their devices. However, people also expect value (in the form of relevant information and offers) in return for their attention, and they expect to determine what kind of offers and messages they receive in the first place. The bottom line: more relevant communications increases the likelihood of a response and can help take a customer relationship to the next level. • Marketing is driving transactions as consumers recognize real value in mobile commerce and the convenience of being able to research and buy items with their devices at the moment of inspiration. The shift away from micro-payments to big-ticket items is also a game-changing development that heralds a new phase in consumers’ overall buying behavior. To take advantage of this opportunity companies must think of ways to expand how they use mobile in their messaging and campaigns to allow interaction, enable transactions and encourage loyalty

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Gonzague de Vallois | Senior Vice President Publishing, Gameloft

playing to win
A leading global publisher of digital and social games, Gameloft has a long track record in creating games for all digital platforms, including mobile phones, smartphones, tablets, set top boxes, connected TVs and consoles. This year saw Gameloft surpass the 200 million download mark on Apple App Store. Major hit franchises such as N.O.V.A. - Near Orbit Vanguard Alliance, Asphalt, Modern Combat and Let’s Golf have contributed to this monumental achievement. The company is also gearing up to launch a game based on the movie The Adventures of Tintin directed by Steven Spielberg. The deal will bring the iconic comic book character Tintin to fans on their mobile phone, smartphone or tablet devices. Gonzague de Vallois discusses the importance of winning franchises, the dynamism of the smartphone and tablet market and the impact of new gaming platforms and models on future growth opportunities.

The growth in the smartphone and tablet market has contributed significantly to Gameloft’s growth. In fact, first-half sales in 2011 on smartphones and tablets grew by over half year on year and represented 30 percent of total sales. Please provide me a high-level view of some of the other key milestones.

Reaching 200 million downloads on the iOS App store was a huge accomplishment. We have been able to develop a truly massive fan base by offering high-quality games on the App Store. And for millions of people worldwide, Gameloft is now synonymous with amazing gaming experiences on their iPhone, iPod touch and iPad. We plan to bring more than 20 new titles to iOS through the end of this year. These games will be offered as premium, freemium or subscription based according to their genre.

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Also we reached the 5,000 employees in the last 12 months. This is another milestone because it shows that this market is growing fast. The company is growing, games are growing richer and richer and iOS and Android continue to grow and be the dominant platforms.

entertainment. Full versions of three Gameloft titles will come pre-installed on new Optimus 3D smartphones: Asphalt 6: Adrenaline, N.O.V.A. — Near Orbit Vanguard Alliance and Let’s Golf! 2. The games were specifically chosen for the realism and immersive game play they provide when digitally re-mastered into S-3D. The most recent data shows iOS and Android devices are capturing a growing part of the portable gaming market by revenue. With the next generation of smartphones offering 3D capabilities, the bar has been raised to a new height. On the Optimus 3D, we’re able to offer our most popular titles to an entirely new audience at very competitive price points.

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As you point out, new devices and features are driving the growth of the games market. What about branded apps and the decision by more brands to deliver gaming entertainment as part of their offer?

Speaking of rich experiences, LG Electronics has also announced its entry into the handheld gaming market with the launch of the LG Optimus 3D and the introduction of 17 Stereoscopic 3D (S-3D) games from Gameloft...

We don’t do work for hire. We approach the brands and licensers and tell them we are interested in creating a digital gaming experience around what they offer. So, I can’t comment on demand from brands. But I can say that our activities with our clients have grown significantly. For example, we have recently launched a new update of the classic card game UNO, which is a brand belonging to Mattel. That has been a

Yes. This is an exciting development as 3D is the natural next step in portable

really big hit for us in the last years. We are also launching a game based on the movie The Adventures of Tintin directed by Steven Spielberg. We will have the smartphone game available for both Android and iOS. Our client’s goal is to promote the movie; our goal is to bring the best experience possible to consumers so they buy the game.

Many reports suggest the focus on downloads is short-sighted. The end-game is actually about getting customers to come back for more and stay loyal. What is your view, and how are you boosting customer long-term loyalty?

We have also adopted a freemium model with some of our games, such as the new release of let’s Golf! It’s the third generation of a very successful game for us, and it’s the first time we launche a game free-to-play. For this type of game we don’t focus on revenues for the short-term; we think about the long-term value of our customers – daily active users. It’s a brand new way of thinking about games.

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It is a development that impacts our business, especially in view of how gaming has evolved over the last 12 months. Specifically, we have seen two directions emerge. One is the growth in the audience for casual games. The second is the rise of the freemium and free-to-play monetization models. Smartphones are now reaching the mass market, and many of these newer users are interested in a more casual gaming experience. This is different from the first wave of smartphone users, who were mainly early-adopters, and expected more sports and action games. The shift in monetization models is obvious when you look at the Android Marketplace app store or the App Store from Apple. There you see that more games are released by freeto-play. And then users buy items depending on the game play.

You started to discuss monetization models. Why the focus on freemium? It was very much about payto-download previously...

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Yes, but the trend to freemium is strong. However, our choice of monetization model also depends heavily on the game play. There are some games that are simply more suitable to a premium model because they ask the users to pay upfront for the game and then allow that person to play forever. The majority of our revenue is coming from the premium model, but this is changing. For this holiday season, for example, we have planned a very strong lineup that includes freemium games. Overall, we support a variety of monetization models, including subscription. Interestingly, subscription – today available on iOS – is very successful. And one of massively multi-player games, which we offer based on a 90-day subscription is in the top charts across the markets.

Order & Chaos, on the other hand, is a combination of all models. You pay to get the game, but you pay $6.99, and with that you can play the game and there is a three-month subscription package included. From within the app, you can buy items to progress quicker in the game. After three months is up you can keep playing, but you have to subscribe and pay $0.99 a month. The consumer experience and the monetization are intertwined. You cannot monetize well if you don’t deliver the right user experience. If the experience is right, then you can add on top to let users buy items from inside the game, or subscribe to keep playing if the game play is compelling.

and there is commerce around an in-app purchase inside the game.

You describe Gameloft as a “publisher of digital and social games.” Please outline your approach to social media and the pillars of your social media strategy.

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I’d like to move to commerce and transactions. What do you enable? Where do mobile gaming and mobile commerce meet?

There are different types of commerce. There’s the in-game commerce and, as we discussed earlier, the freemium model is exploding we see more and more transactions there. To make it all work you need to have the right billing and make the purchasing experience as smooth as possible. Then there is the commerce that is added on to the game. A well-known example is Angry Birds. When you play that game, you can access a store directly from the game where you can buy toys and t-shirts. That is commerce that helps create brand experiences, where the game is the entry point,

Our strategy is built on two main pillars: one is community. This is the effort we focus on creating a direct relationship with consumers through social media. To this end we have community managers in all our main markets, who interact with our consumers – getting their feedback, informing them about what we are doing via Facebook, Twitter and YouTube. We will be celebrating a pretty significant number of Facebook fans soon, so that shows you how social media supports and grows our relationships. The second pillar is how we integrate social media elements inside the actual games. To achieve this we have been adding multi-player elements to our games to make them realtime, interactive and engaging. An example is Let’s Golf! 3. You can play it with a friend from start to finish. You can arrange a match and you can ask someone to join you on a particular hole, for instance. The experience is that I can see you playing that hole in real-time through a little window on my screen. So, it’s just like being together on a golf course and playing the same hole. Beyond making the game multiplayer, we also leverage how you

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How are you dealing with proliferation of devices and platforms?

friends can be part of your game, even you are not playing simultaneously. In this scenario, we enable users to invite friends – and we also reward them for inviting their friends. Think of what you see on the PC games like FarmVille from Zynga and this is very much like the social gaming experience we enable you to have on your smartphone.

The good news for us is that we’ve been coping with fragmentation for about ten years now because we have experienced the same problems in the feature phones. For each game we launched we were covering over 1,000 devices, which meant we had to support 1,000 different versions in ten different languages. So, actually the fragmentation has decreased overall, and the fragmentation on Android and iOS is also less. We want to bring the best experience to each device so we don’t just focus on creating games for the platform that represents the lowest common denominator. Instead, we adapt each game to the potential of each device, so that means adapting the display to the device screen size and the levels of features to the processing power. If a device has better processing power, then we will do an enhanced version to take full advantage of that capability. Of course, if you want to do tailor-made versions for each device, then you need to have the teams to do that. We have seen that consumers want this experience on their phone. The higher the quality you deliver, the higher the customer satisfaction– and the more likely those customers will be loyal. So, yes, it is a large investment, but we think consumers deserve it, and we’ve been showing for the last ten years that it’s paying off.

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How is the advance of tablets and other shifts in devices and platforms impacting your business and the game experience you deliver?

Yes, it’s true the tablet market is a growing business. It’s still mainly driven by the iPad, by the iOS devices. However, we think that Android will gain traction and mean more competition in the market. We support all the platforms, but we have also adapted our level of support to the level of business that those platforms are bringing us. Today the two leaders are iOS and Android, so that’s where we have the biggest support. It’s true that this was not a priority for us in the past years. But today it’s a bigger priority for us. We are focused on two main platforms: smartphones and tablets.

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Gavin Stirrat | Managing Director, EMEA, Millennial Media

the vertical explosion
Named one of the top 75 fastest growing private companies, Millennial Media has become the largest independent mobile advertising and data company worldwide. Millennial Media reaches mobile consumers in 250 countries and territories and is committed to growing the mobile advertising marketplace by becoming the preferred partner to all advertis-

How have mobile advertising application and media developers seeking to campaigns, objectives and maximize ad revenue, and all mobile operators spending evolved since seeking to further monetize their networks. In Millennial Media published its first report in March 2009?
addition to providing the technology, tools and services that power some of the leading companies in the media business today, Millennial Media has also drawn from actual campaign and network data from its network to produce over 50 (!) reports packed with mobile intelligence and actionable insights. Gavin Stirrat discusses the evolution of mobile advertising and the future of mobile commerce.

ers seeking to reach mobile consumers, all

We’re continuing to see ever-growing spend from a growing pool of directresponse advertisers. This includes smaller, mobile-specific companies, such as game developers, using mobile advertising to promote their offers and apps, as well as larger companies that are looking to increase the reach of their services and apps. The growth is coming from a wide range of companies – from retailers to FMCGs, and from finance companies to restaurants. Direct-response has always been a strong focus, but now more brands are getting involved.

More brands from more verticals are becoming what you call directresponse advertisers. What are their campaign requirements and how are you meeting their needs?

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At the most basic level, these advertisers have a click-through-rate target. However, we’re increasingly seeing that these companies have an effective CPA or cost-per-download target. So they will come to us saying, ‘We will buy media from you on a CPM or a CPC basis, but I have a target CPA or a target download price of $x.’ In this case Millennial buys and manages media on their behalf to ensure that we are delivering campaigns that hit their backend ROI goals.

So, there is a range of different objectives. Some spend to boost visibility for their app and move it higher up in the rankings, and other brands are looking more to generate sales from the application. In both cases, we are seeing more companies really starting to realize the opportunity in mobile, and as a result create integrated mobile media campaigns which take advantage of the unique attributes of mobile to engage with their audience. This allows them to interact with customers, and the more sophisticated brands are doing huge amounts of sales through their applications.

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What are these objectives and how has the role of mobile evolved?

A lot of these apps are aggregating anonymous consumer engagement insight from their customers, which can then be fed into CRM systems that are used by our advertisers, enabling a more contextual user experience and ultimately more and deeper campaigns and engagements. Travel companies are looking to enable bookings; automotive companies are looking to encourage consumers to register for a test drive or request a brochure; restaurants and fast-food chains are using mobile advertising to allow people to order food for takeout directly through the application.

With the emphasis on repeat spends and longer-term engagement, what capabilities mix (intelligence, targeting, other?) is needed by mobile marketing companies to succeed in the mobile advertising market? Likewise, what expertise should advertisers build to take full advantage of the mobile advertising opportunity?

One of the interesting and challenging areas for the market right now is technology and measurement. The

mobile agencies – certainly in the U.K. and around Europe – are starting to build their own solutions that help them to do more than just calculate the impressions and the clicks. That’s what everyone was doing 12-24 months ago. Now they are focused on measuring how many downloads are happening and even calculating post-download activity like bookings or sales. Of course, mobile is not the desktop. It’s more difficult to measure on mobile, and that’s definitely the challenge that the industry faces. If you speak to the media agencies that aren’t necessarily mobile specialists, that comes up as a barrier to them opening up bigger spends in mobile. That said, for people who understand digital advertising – whether that be search, affiliate, display, email – the metrics are much the same although the technology challenges are quite different. At the end of the day, the expertise needed is similar to the expertise that already exists in digital broadly.

crowded and increasingly confusing for media buyers, especially media buyers who don’t work at mobilespecialist agencies. They also tend to struggle with understanding the benefits of one ad network over another.
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Take a step back, and it’s a repeat of what we saw in Internet and online advertising. A huge number of companies burst onto the space during the dot-com boom and then many disappeared. In mobile this is happening again - only faster. With this accelerated market maturation it is incumbent on all companies to act responsibly and those players with the necessary heritage and experience can help by providing thought leadership for the entire industry and insight and education for the market.

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Mobile advertising is increasingly focused on driving business, footfall and – ultimately - transactions. When and where will mobile advertising and commerce meet?

What is the role for independent players? Are we heading for consolidation in the mobile advertising market? If so, what are the drivers?

We are seeing lots of independent players coming on to the market and trying to take advantage of the growth project for this industry. Right now the market is becoming very

Mobile commerce and transactions are becoming more of a focus because consumers are demanding all the functionality they have on the desktop. Take Amazon or PayPal: both have click-to-purchase products on the desktop and the cookies allow for a fairly seamless online purchase. In mobile, payment methods and products are getting there, but it’s not quite as seamless a process for the consumer – yet.

You mentioned NFC. What is the outlook for NFC, and when will it finally break on to the mainstream in Europe and elsewhere?

This is bound to change over the next 12 months as big e-commerce companies mobilize their offers to take advantage of the market opportunity. NFC is developing at an exponential rate and with mobile network operators and financial service providers now backing the technology – take the recent QuickTap launch by Barclaycard and Orange - that’s going to help to complete the loop and allow mobile advertisers to really exploit the scale that mobile offers. This is part of a much larger trend happening in the marketplace and across verticals. Many retailers are taking consumers full circle and straight to commerce. Consumers access the app on their smartphone, build shopping lists or organize vacations, and then complete the transaction on the phone because these companies have their payments platforms in place to enable one-click purchasing. Obviously, these are the big brands with the technology and investments to roll it out, so they’re probably ahead of the curve. But it will become more widespread as payment platforms like PayPal, retailers, e-tailers and m-tailers begin to mobilize their offers.

In the U.K. mobile operators are rolling out trials and services and handsets have hit the market that have NFC chips built-in. In the UK, Orange and Barclaycard have launched QuickTap, whilst Google have partnered with MasterCard. Meanwhile, in the US, three major carriers, AT&T, T-Mobile and Verizon, have launched ISIS. However, because this is at an experimentation stage, brands have yet to dip their toes in the water and really take advantage of NFC technologies. There are some exciting scenarios around NFC. Imagine a major fast-food chain. Let’s say their system detects that one store is not selling as many burgers as they should be selling and wants to take action to boost sales. This would notify an advertising company or an ad network like Millennial Media. We would then kick in with a campaign that taps into our scale and unique IP to encourage sales by targeting according to consumer segment, and other variables the advertiser requests. To make sure people act on the offer and buy burgers, we can incentivise via mobile coupon and then enable purchase on the spot using NFC technology. We would then run this campaign until the restaurant’s system notified us that they had made their quota, and then we would switch it off.

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This is the kind of campaign and approach that will be hugely appealing to retailers because it will help them reduce unsold stock, especially if it’s perishable stock.

for effective mobile advertising. All this increases the amount of time people are spending on their devices and that’s going to increase the opportunity for advertisers to associate themselves with activities and content. Sensing a business opportunity for our clients, we recently developed an ad format called the mobile circular, which is similar to the circulars merchants used to pay to insert into magazines or newspapers. Our mobile circular is like having a mini-catalogue of promotions on your mobile phone. So, it’s a rich media unit that allows targeting and a connection through an API directly into the store stock system. All this combined allows advertisers to conduct campaigns that promote merchandise that is overstocked, or perishable as I mentioned before, which means advertisers are getting value from being able to balance supply and demand. The consumer benefits because they are alerted to the deals they appreciate. When they enter the shop, they’re scanning their mobile phones to complete the transaction. Rich media is also exciting. As the operating systems get cleverer, and

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Ironically, the industry has been talking about being able to run a campaign that directed people into a coffee shop, for example, since 2001. It’s only since 2010 that it has actually been possible to run that type of campaign and be able to deliver a rich-media advert to a consumer on their phone. We’re on an accelerating curve, and I do think 2012 will be the year we will see NFC campaigns that finally do drive consumers into the coffee shop. Only this time we’ll be driving them into coffee shop and their loyalty card will be in their phone, allowing increased engagement and commerce. Or there will be a mobile coupon delivered to their phone that they’ll be able to scan at the point-of-sale.

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What are the trends or scenarios that excite you most when you look to the next 12 months in mobile?

The impact of the iPad and the advance of tablets all work together to create more opportunities and more contexts

the processing speeds get faster, we’re starting to see some cool rich media advertisements using video, for example. This is significant because having a great interactive piece of media to demonstrate a product of service is what sells. We’re able to

deliver and measure video, and we’re seeing more companies delivering rich media and video advertising. The ability for companies to run and – more importantly – measure these rich media campaigns is the type of activity that unlocks the big, big budgets.

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Tom Daly | Group Manager, Global Connections, The Coca-Cola Company

huge opportunities in big data
Coca-Cola doesn’t just think mobile. It is immersed in it. To date the company has embraced a wide variety of mobile marketing activities and formats, including mobile apps, games, messaging campaigns, 2D barcode schemes, loyalty programs – and even a music download store. But Coke is not just using mobile to raise brand aware-

This year your focus has globe. The company is also pursuing mobile sharpened on mobile commerce trials to drive sales of its products. commerce and using mobile Among these is a partnership with Google to drive real sales. What is behind your thinking here?
to test the new Google Wallet mobile payment system unveiled by the Internet giant in late May 2011. Google’s Mobile Wallet allows a consumer to make a purchase through an NFC-enabled Google Android phone, as well as credit cards. Tom Daly updates us on progress and discusses his company’s wider objective to take marketing across all channels to a new level through mobile.

ness and engage with consumers around the

Players in the mobile commerce space tend to think about the places people buy stuff, and the role of financial institutions versus the carriers versus the hardware vendors. Where are the brands? They have a role to play in this because a discussion about commerce has to include the brands people buy, in addition to the places they buy those brands. And, for brands like ours that are very widely available and purchased “on the go”, we see mobile payments enabling desire – the desire to purchase – while removing the friction of cash. This is the real scenario that capabilities like Google Wallet are enabling. I’m thirsty, I don’t have change in my pocket. I just want to get a Coke. Everyone

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has had an experience where they didn’t have exact change and the impulse to buy had to be satisfied then and there. This is what the video from Engadget grabbed onto in order to demonstrate and drive home why mobile wallets are going to win. Consumers will embrace this capability and this convenience. When will this happen? We can’t know the speed at which it will happen, but we believe we can influence it. Our involvement opens people’s eyes to the role that we play, a role I believe is perhaps underappreciated. But – once we share what we offer beyond advertising dollars – our role is more fully appreciated, and partners see that we can really help shape the discussion. And this is what we are doing through our participation in Google Wallet.

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Consumers are also shopping using other methods. We have the example of Homeplus, a major South Korean retailer, that allows shoppers to scan barcodes of pictures of products displayed in a Seoul subway station to order and buy groceries…

enable value exchanges for customers, consumers and brands via mobile. That is what we are working to achieve with relevant trade groups like GS1. At Coke we placed 2D barcodes on packs of Coke in Germany as part of a promotional effort. There’s also a lot of activity in the U.S., where we have our teams at work to understand the evolution of codes and their role in the overall shopping experience. Whether it’s product information, nutritional information, or transactional information, barcodes have their place in the mix– both from a business-tobusiness perspective, as well as from a business-to-consumer perspective. These barcodes also have an appeal

Yes. Barcodes are a way to enable mobile commerce. But introducing a code on a package is hardly revolutionary; it’s been going on since 1970 with UPC codes. In fact, Coke has been among the leading brands in the evolution of these codes over the past 40 years. It’s about the evolution of that UPC code and turning it into something more powerful and robust, so it can

brand marketers. They want to harness 2D barcodes to make cool experiences happen for the consumers, extend the value of the package, and bring it all together in a broader integrated marketing communications effort.

FIFA World Cup or other events. We’ve got a great brand that is liked by tens of millions Facebook fans. They want find a way to talk to other Coke fans, perhaps while they’re enjoying a Subway sandwich and an ice-cold Coke.
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Integrated is a key concept here. If we go back to the Google Wallet example, there are many in the industry who say the real power of Google Wallet is the insights it allows into consumer behavior. In other words, it’s the data and the marketing opportunities it enables. What are your views?

Loyalty should also be part of this experience, things like exclusive offers delivered to consumers on their mobile phones, for instance. But not just coupons because I think it’s far from proven that consumers only want coupons from their favorite brands. They want an experience.

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It’s about insights and inspiration. If you go back through the Engadget video, you’ll see that Subway is also participating in the Google Wallet. Subway is an important customer of The Coca-Cola Company, and we try to solve consumer marketing challenges together. After all, we’re already together in the consumer’s experience in the realworld. When you walk into a Subway shop, you can order a sandwich and a Coke. Fortunately, the mobile phone offers a myriad of digital capabilities to help inspire a consumer to spend ten minutes to walk to a Subway and grab a great lunch – with a Coke by the way. Mobile creates an experience that’s enhanced. And it doesn’t stop there. Take the really cool exclusive content we might have on offer around the various platforms Coca-Cola is part of like The Olympics,

You’re talking about an integrated approach here. And - having followed mobile content for over a decade – it reminds me of the bundle discussion all over again. Mobile content was delivered in bundles that were more valuable than the separate items, and that was where the innovation was…

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Yes, marketing is more than the sum of the parts. And the work that needs to be done is all about really understanding the flow of goods down the value chain and funds back up. There are major transaction sets here. The work for the marketer is to use mobile effectively to go up and down the value chain, and understand the complete set of mobile tactics and how to integrate mobile. This about the flow of funds, about the flow of data, about the role of 2D barcodes, about text messages, about Augmented Reality, about the role of mobile

content, about mobile-enabled transactions, about location, and about mobile search. This is the bundle.

when they scan the barcode. The consumer probably wants nutritional information. They probably also want information about health and wellness, as well as points of view on the company’s role in sustainability efforts. And they want to know all that before and when they’re standing at the shelf, at that moment of truth. So, that one barcode has to deliver all of those things. Direct marketing is a part of it, as is brand marketing. But, in my opinion, it’s still unclear exactly what combination of skills are needed. It is clear you’re going to draw from both.

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If we accept that marketing follows this flow, then what is the capabilities mix now needed by brands and marketers to deliver the bundle?

It is tempting to just combine it all and label it direct marketing. But the brand cannot be ignored. In fact, the brand is more important than ever because it’s the brand promise that creates the consumer value. Remember, we’re in the brand business. We’re in the franchise business, working with our bottling partners.. So we need to do the things that make them successful, and they need to do the things that make our customers – 22 million of them – successful. Look at it all from this perspective, and you quickly see a virtuous cycle forming. However, I don’t think direct marketing captures exactly what this is, or what it encompasses. Let’s go back to the 2D barcode example. We talked about two stakeholders out of three: the brand and the customer. But we didn’t discuss what the consumer wants

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Let’s move to the capabilities offered by the technology. Mobile phones, smartphones, tablets. It’s a maze out there. How do you navigate it?

We do this though better data. For example, we’re more disciplined about reporting on app consumption. And we’re able to give marketers in an individual country more specific data about how consumers are consuming content. Is it on a tablet device? Is it on a smart device, and, if it’s on a smart device, whose device is it? So, richer data is helping us be better marketers. And it is also making us better customers of the technology we choose and use to collect and analyze the data in the first place. As a result, I can be more accurate about what I need and demand from technology, and that, in turn, helps the folks who are trying to sell brands like

Coca-Cola. We want to partner with someone who wants to experiment and learn along with us. And we strive to coordinate several experiments in parallel, as opposed to one big experiment directed from the center.
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This flexible and experimental approach means that Coke is pursuing a lot of interesting projects across a lot of regions – all in parallel. Can you share some highlights?

Sure. An interesting example is in Hong Kong, where we’re using audio fingerprinting. Consumers get involved with our summer promotion by holding their Coke app up to the TV to enter and win. The mobile campaign is an extension of TV, and extending the value of television advertising.

use their phones to catch Coke caps that appear to be ‘flying’ out of the TV screen. Augmented Reality and 3D TV allow the game to be very real, and extremely popular. The game was also promoted via additional channels including print, TV, online social and outdoor. This cross-media approach was successful and helped push the app, CHOK, to the number one spot in the download charts just 15 hours after it was released. The penetration of this campaign has been simply astounding - and it’s still running.

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How does it work?

Consumers are accustomed to collecting bottle caps for prizes. But we wanted to reinvent this classical experience for the digital age. This is what we have achieved by harnessing smartphone features, such as sound detection and the accelerometer. Consumers start by downloading our iPhone app, which allows them to play a game – delivered as part of our TV commercials – to win instant prizes, discounts, games, and virtual mobile collectibles. The twist – and what makes this game truly transformational: it lets consumers

What’s striking about your approach to mobile is the emphasis on cross-media and transmedia campaigns and approaches…

Marketing is like a clock. There’s no one gear that makes the watch tick. A watch doesn’t work if it only has one hand. You’ve got to have all the pieces working together to make the watch useful. You have to understand the hour hand, the minute hand. Let’s figure out what combination of gears can drive those parts, so that we can accurately know what time it is. And it’s the same in marketing. Every channel has its voice.

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Donovan Neale-May | Executive Director, Chief Marketing Officer (CMO) Council

engage at every stage
The Chief Marketing Officer (CMO) Council is dedicated to high-level knowledge exchange, thought leadership and personal relationship building among senior corporate marketing leaders and brand decision-makers across a wide range of global industries. The CMO Council’s 6,000 members control more than $300 billion in aggregated annual marketing expenditures and run complex, distributed marketing and sales operations worldwide. The CMO Council has recently sharpened its focus on mobile, launching programs to educate marketers about the opportunities and options. Donovan NealeMay discusses the shift from traditional marketing to Mobile Relationship Marketing (MRM) and why it is destined to become the focus of all marketing across all verticals.

As you point out, the massive shift to Mobile Relationship Marketing (MRM) is transforming the marketing mix and enabling brands to “Engage at Every Stage” of the consumer lifecycle. Please define MRM and the opportunities it opens up for brands and marketers.

Customer insight, intimacy and engagement are essential to sustaining successful brands. Yet for many companies, especially those who sell through indirect channels or to cash-only customers, connecting with and influencing the customer is a serious struggle. Consumer marketers around the world are now trying to overcome these traditional obstacles by leveraging the power of the web and mobile social networking to create more direct relationships with customers. Mobile Relationship Marketing (MRM) is the new mantra for companies across multiple industries to ensure

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continuous customer touch and interaction, sustained support and service, closer and more dependent connectivity, as well as greater insight and intimacy. MRM has vast potential to create business value, improve process efficiency, trigger product consumption and use, further loyalty and repeat purchase, and increase customer feedback, assistance, affinity and advocacy. Using new mobile apps, location-based messaging, proximity marketing, and smart merchandising systems in-store, marketers are now able to attract and engage consumers in any place where they are willing to interact, transact or stay in contact with brands. This includes retail, sports, entertainment, destination, education, mass transit, and travel environments. An effective MRM strategy integrates social interaction; customer insight gathering and listening; consumer engagement and loyalty; market listening; purchase incentive or inducement; as well as lifetime revenue optimization, all through optimized use of the mobile channel.

value of mobile devices is the just-intime messaging they enable, delivering messaging that notifies, advises, alerts, reminds and - ultimately – drives consumption or use of products and services. Additionally, this messaging can also provide assistance and help at the moment when somebody’s trying to make a purchasing decision, or looking for the best deal. And – in cases where you have time-based messaging, proximity-based messaging, locationbased messaging – you have important context that enables companies to message to their customers in the right place, at the right time. The mobile channel is the only channel that can do that. This characteristic makes mobile a significantly powerful way to do individualized relationship marketing, and that’s where marketers have got to move toward. Marketers must move past pushing out messages, blasting out offers and paying for positions or displays to get their communications out to the market, and focus much more on engaging, interacting, assisting and enabling. This is a good fit with mobile for several reasons. For one, it’s accountable. Making investments in mobile relationship development are bound to have a higher return on investment because it’s more quantifiable, more tangible and more measurable. Second, mobile also enables customers who have strong brand advocacy or strong affinity to share and communicate

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Creating brand affinity and advocacy are ambitious objectives. What is the value of mobile and where does it fit?

Mobile devices enable marketers to provide contextual messaging, just-intime inside advice, notification bulletins, and assume a different type of role with the consumer that they value. Consumers will always appreciate brands that are helpful, and mobile can be this electronic concierge. The big

this. Increasingly, mobile also enables these same customers to transact. At the end of the day, these all-inone connected devices are not just about communication. They’re becoming transactional, behavioral, and they are becoming an essential part of people’s lifestyles.

their prescription or notifying farmers that the climate’s just right to spray their crops, these are all interactions that can help trigger consumption and purchase. Mobile can also extend the impact and value of advertising. So, if I’m putting up point-of-sale displays, or buying bus shelters, or doing different types of outdoor signage, I can have a quick response tag in there. I can have near-field communications. I can track the degree to which that advertising is attracting the attention of consumers, prompting them to interact and engage with the brand using their mobile device. In print media innovations such as 2D barcodes make it possible for consumers to access more information about the product and even interact with the brand. Thus, mobile complements all advertising and presents marketers with a mechanism for measuring advertising effectiveness and its ability to drive response. Across the board, campaigns have to be designed differently. And they have to take advantage of the impact of mobile. A good example is branded apps, which are proliferating people with mobile devices like them and use them. Marketers can harness apps to define and shape perceptions of their brand. They can enable consumers to interact – and have an ongoing relationship – through apps. But it’s not just about branding. Apps make it faster, quicker and easier for companies to

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Mobile has earned a seat at the digital marketing table. What are the touch decisions and choices that face marketers as they map out their cross-media strategies?

Marketers can get more creative about where advertising can be placed, inserting it into digital signage systems at gas station pumps, embedding it into mobile content and games, and integrating it into mobile apps. Advertising will always be an essential component. The question is: how do you allocate your spend to get the best return. There are no hard-and-fast rules here. For some brands in some regions of the world, the most efficient way to promote the brand is still to advertise on TV or radio. In many parts of the world it is also difficult to deliver rich media marketing through mobile devices. However, messaging can be done anywhere, any time, and with very low bandwidth consumption. In my view, mobile messaging is a valuable way to invest your money because it can be helpful. Whether you’re reminding people to replenish

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deliver a product, service or experience to a user. Apps also enable commerce, allowing consumers to buy a ticket, redeem an offer or make a transaction.

your product, but supporting your customer and supporting your channel, supporting your field organization and supporting your supply chain. Mobile also plugs into the business to present us with a variety of different ways to predict, forecast and plan. Marketers have to think this through carefully because there a whole other set of considerations here when it comes to developing and executing a mobile strategy. And you have to think differently about the consumers. Addressing them on mobile is based on who they are and how they embrace mobile in their everyday lives. Different groups of consumers are in different stages of understanding and using mobile technology. For example, reaching senior citizens may require a very different approach than it would to reach consumers in their teens.

You stated that campaigns have to be very different from the way they are right now. That’s telling us that a huge rethink is necessary and impending. Could you please elaborate on that? What needs to be different, and why?

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Marketers need to understand this channel and what is possible. They require more research and insights into the content, services, and applications utilized by their target audience. They also have to listen to their customers and understand the degree to which consumers want to access content, receive messages, and opt-in to different types of marketing and CRM programs. Marketers also have to get the value exchange right. They have to give consumers an incentive to engage with the brand. This isn’t just about developing a creative strategy, producing advertising and buying space in a complex way to make sure you saturate the market across all channels. Today, it’s about the interaction. It’s about the information. It’s about the advice. To be clear, mobile is not just an add-on to an ad campaign. It’s not just another channel of content delivery. It’s part of a larger strategy that can impact all facets of your business – not just promoting

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The mobile channel also allows customers to connect with other customers, an interaction that impacts customer awareness and opinions on brands and companies...

Yes. And that’s why there is more disruption with mobile. With mobile, I may be notified by a friend about a hot new offer, or I may find somebody’s tweeted something. So, all of a sudden, my awareness and my sources of awareness are different. From the perspective of the consumer, these sources are more trusted, and they may result in a quicker purchasing

cycle because somebody in the social network has already validated the product or the service. If someone I trust tells me about a great restaurant, then I don’t need to consider it any further. Joe says it’s great, so let’s go there. Products and services are consumervoted and consumer-verified. This input drives, influences and shapes buying behavior. This same interaction paves the way for more impulse buying because mobile enables impulse behavior. I’m in the neighborhood, where should I go eat? I can access a social network or review the recommendations to get what I need to make that decision immediately. Where do I go and what do I buy? It may be that I make these decisions because I’ve got a Living Social offer, a Groupon offer, or a Travelzoo offer. Whatever it is – I am making a decision based on it. Consumers are not getting information in a traditional way across traditional channels where the brands and marketers controlled the message. Mobile means it’s also indirect and via a variety of sources, including the social media networks consumers are interacting with on the move.

We will start with an audit to determine where companies and brands are in the journey. We want to understand what they’ve invested in, or what they intend to do relative to the mobile channel. We also want to understand their level of comprehension and knowledge, as well as where they see the potential obstacles and objections. The role of technology in marketing is also important, which is why we will look at the cool, new things enabled by mobile and mobile devices. This insight will allow us to evaluate and assess what sort of paradigm shifts and changes are on the horizon. Additionally, this will allow us to provide companies with aggregated insight into all the enabling solutions and services that are out there to help them embrace the channel more efficiently and more effectively. Finally, we also want to identify the brands that are leaders in MRM adoption and use, companies that have already developed longer term plans and thinking around evolving their services and product offerings to optimize the mobile channel. From retail to transport, mobile impacts many verticals in many ways, and it opens up all new opportunities once you see understand that the focus on marketing moving forward has to be more on advising and less on advertising.

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Of course, this thinking feeds back into the work you have pioneered around MRM. What are the plans and projects in the pipeline, and what can we expect?

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Madeline Tan | Advertising Sales Director, SingTel

building lasting loyalty
Arguably the largest pan-Asian telecom operator, SingTel boasts a combined user base of over 260 million subscribers and operations in countries including Australia India, Indonesia, Philippines, Thailand, Bangladesh and Pakistan. This highly developed network equips SingTel to serve both the corporate and consumer markets. It also enables the operator to pursue an ambitious strategy to deliver all its customers a targeted and rewarding advertising experience. Determined become a media platform and secure a significant share of the mobile and Internet advertising market, SingTel is leveraging its customer knowledge management systems and integrated service platforms to deliver an end-to-end solution across four key areas: inventory creation and control of customer information, media planning, advertisement delivery and advertising campaign performance tracking. Madeline Tan reviews recent company milestones and discusses what the future of mobile holds for her company and the global mobile industry.

You are on track with a strategy to be a leading media owner and garner a significant share of the revenue pie. What capabilities do you feel best position you to advantage of opportunities in mobile marketing and mobile advertising?

SingTel is a market leader here in Singapore, with a significant size subscriber base. Our insights into our users, knowing who our subscribers are, is also asset. We know their demographic profile – such as age, gender, and whether they are a home owner – as well as there location and where they generally stay. This information helps us to offer offering this inventory to our advertiser partners and the result is a more targeted marketing platform. The enables advertisers on our network to target a specific target audience. If a brand wants to reach, say, women ages 25 to 45, we can do so. And, given the

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size of our subscriber base, we deliver advertisers a targeted audience, rather just a small sample of users.

products and services to purchase.

You were a first-mover in mobile advertising, one of the few mobile operators to truly grasp the opportunity and create an attractive inventory. Please update me on your progress.

Please offer us a recent example of a brand case study that illustrates what SingTel can deliver.

Our platform has been live for two years. We work with media agencies to offer our inventory to advertisers. We are past the pilot stage and have successfully positioned mobile as a new media. It’s now seen as another media for advertisers and has a clear position and complementary position in their cross-media ad campaigns. The growth is significant and we have more than doubled, - our mobile advertising revenues year on year. This has been due to our own aggressive strategy and our strong focus on location-based advertising, a focus that brings considerable advantages to our advertisers. To go back to my earlier example, if the advertiser wants to target women between the ages of 25 to 45, and reach them when they are a specific location, then SingTel has the capabilities to offer this. Put another way, we can reach out to consumers at the pointof-purchase. This is where the mobile platform is truly the best platform. After all, it is the mobile device that consumers have with them when they are shopping and looking for

A good example is Old Town Coffee, a Malaysian-based company and SingTel brand client. The company has a network of shops in Singapore and wanted to raise brand awareness among consumers who tend to frequent shops like Starbucks. To achieve a higher profile among their target demographic they harnessed location-based advertising and proximity marketing.

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Specifically, we helped them deliver an MMS campaign that targeted people who were near select outlets and stores. Consumers received an MMS message directly on their device, which they could then show to the cashier and redeem in the store for a free cup of coffee. Of course, once the consumers were in the in the store, the owner also had the opportunity to upsell them other products like rice and noodles. The campaign was a success

and had redemption rate of about 3.3 percent, as the average response rate in Singapore is generally below 0.5% We also conducted a location-based advertising campaign with a secondhand car dealer in Singapore. This is a small business, so it chose to deliver only a few thousand SMS messages over a two-day period. During that time only eight people walked into the shop. However, of the eight, two bought a car.

benefits of value-added services like mobile payments, mobile commerce and mobile marketing. What is your view, and how you are uniquely positioned to take advantage of these opportunities?

Firstly, the mobile market in this region is huge. At SingTel we are aware of this. We recognized early on that there is potential in mobile advertising and benefits we can reap from having a significant share of the advertising pie right here in Singapore. We have delivering mobile advertising via SMS and MMS, and with a sharp focus on location-based advertising. It will take time, but I believe the percentage growth of mobile advertising will outpace what we saw some ten years ago when the online Internet was the focus. If you look at the growth curve of mobile advertising, mobile is growing much faster now than Internet did before. So, there is definitely a lot of opportunity and we can take advantage of this. At SingTel, we have our own team, headed by myself, going out there to sell mobile to brands, advertiser and media agencies and educate them about the media platform we offer. So, we are serious about this business. You mentioned mobile payments and mobile commerce. We can also expect this to happen. How soon? It’s hard to say, but in Singapore all the three telcos have an interest and are actively pursuing strategies.

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The results show the benefits of mobile to target a specific audience and deliver location-based advertising. You have to remember that these consumers were looking to buy a second car - and in Singapore that isn’t cheap either. This confirms the quality of our customers and the data we have about them. We have people in our subscriber base who have spending power.

Many reports out of your region claim that mobile operators in Asia-Pacific are ahead of the curve when it comes to understanding and leveraging the

Many companies we have interviewed for the Netsize Guide

tell us that campaign objectives are not just about raising brand awareness. While that still sits at the center, more companies are focused on delivering effective campaigns to drive deeper customer engagement and boost customer loyalty. And this isn’t limited to brands; mobile operators are also exploring mobile loyalty campaigns and programs. What are your views?

mass market and get more new leads or conversions. These marketers want us to deliver reach – which we do. However, there are also advertisers that want to target specific customer segments and demographics. Our deep customer data and insights allows us to do this as well too, and we can also command a premium rate from the advertisers who require us to know our customers. With this in mind, we have gone out to sell our own mobile advertising. As a result we are not a dumb pipe because we use our data. We have a clear strategy: we want to be a media platform, not just a telco.

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I totally agree. In fact, this is one of the reasons we are working with Gemalto on ways to achieve deeper customer engagement and understand customers in order to deliver what is relevant to them. Today consumers are exposed to so many mediums, but they still have limited time and patience when it comes to finding products and services we want. So, we as a mobile operator, are tasked with having to develop a deeper understanding of the customers to serve them better and provide them relevant information. At the same time, knowing our customers better also allows us to help our advertisers to minimize wastage and better engage their target audience. Better targeting makes for a better response. If advertising is relevant to me, then I will likely respond. That’s not always the case when we’re talking about typical advertising that brands just deliver to everyone regardless of what they want or need. Of course, we are aware there are advertisers that will want to cast the net in the big, wide oceans too, hopefully, reach a

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What are your thoughts about the requirement for conversational marketing, and the role of messaging in marketing overall?

Messaging is part of our strategy. We want to do more in the direction of interactive messaging with our consumers to better understand them. Why do we need to know our customers much better? Because that’s how we can build brand loyalty. When you know

what your customers want, you can deliver it. That makes the marketing mix more relevant. When you have all this, then customers will always come back to you. I think brand loyalty has begun to wane over the last years, but knowing what your customers want can help to build that loyalty again. Building loyalty is also important to us as a mobile operator because we know we are not just selling mobile tariffs and plans. We also sell our own mobile content via our portal. When a customer buys certain content, or subscribes to content, that’s information that tells us a lot about this type of customer. Put it all together, and it’s information we can use to better target and serve our customers – and keep them coming back for more. We are working with Gemalto in an initiative focused on its Interactive SMS product offer. This initiative allows us to communicate - in a two-way conversation - with our subscribers.

It’s too early to know how they will meet. It depends a lot on how fast the industry comes together and grows together. It is certainly not going to happen in isolation. It will require partnership. In terms of vision and what I expect, it ties back in with our own advertising slogan at SingTel: Dare to Dream. The message is that you need to dream big. So, speaking personally, I would say there are so many possibilities for mobile commerce that we would want to dream big. We would want to think big. Mobile commerce, market transactions, NFC, marketing. It’s all connected and converging.
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Well, that’s a great way to get to the last question, which is all about your vision for the next 12 months. What are you passionate about? What do you expect, or what would you hope to see?

You are convinced mobile commerce is going to happen. I would be interested in your views about when and how this will likely happen. Where do mobile marketing, mobile advertising and NFC meet, and what can the industry expect?

I would hope to see more the convergence and more cooperation. There are many ways that we can work with different partners to achieve many services. It could be mobile shopping. It could be mobile banking. Personally, I believe in partnering, rather than competing.

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Nigel Tatlock | CEO, Atlas Premium Brands

When it comes to mobile sports content, Atlas Premium Brands (APB) is literally a major league player. A part of the internationally operating Atlas Group of Companies, the company is the official and exclusive mobile partner of several leading football clubs including Chelsea, Liverpool FC and Real Madrid. Additionally, the company has secured the

Mobile sports content is always a rights in territories worldwide, including the crowd-pleaser, and you distribute Middle East, Thailand, Indonesia, China, Viet- content for well-known clubs. nam and all countries in Africa. The company What monetization models have you chosen and why?
has also secured rights of individual players collaborates with the clubs to secure sponsorship rights. This places APB at the center of the relationship between clubs and their fans, distributing exclusive mobile content via mobile portals, websites and apps such as match photos, player profiles, ringtones, mobile games, plus user self-generated content around the action. In March 2011 APB signed a partnership agreement with Blue Talk, the creator of teamBlogger, which enables fans to share and discuss content they love. Nigel Tatlock maps out the company plans to harness the unique characteristics of mobile and social to succeed on and off the field. within the premiership league and actively

exclusive exploitation of mobile and Internet

We have a freemium model because it fits with the content we offer and what fans want. Today the football fan wants two things: narrative and news that will keep them up to date with what’s happening with their football team because it’s precious to them; and they want to see the goal. We give people breaking news free of charge. When they download the Sports Locker they can open the app, click on the Chelsea link and access breaking news. Consumers can also see the whole assortment of sports content that is unique to our offer, and purchase, if they so wish. To get them more interested we will also allow them to see an image directly from the stadium of the goal that was scored. This is breaking news, so we will generally have that picture on our application

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turning sports fans into brand friends

live within about a minute, giving the users the chance to live the excitement and see the ball crashing into the net. At the end of the game we push a message to the fan saying: ‘We know you’re a Manchester United fan and you know they beat Liverpool three-nil, now if you’d like to see all of those goals, you’re going to have to pay for them.’ Fans are charged different prices depending on where they are in the world. That’s our freemium versus premium model. We don’t want to bastardize valuable content and just put adverts around it that have no relevance. The fans won’t benefit, and neither will the advertiser. Therefore, this is the mix of models that makes sense.

which means we are getting fresh content by the second, not the minute. So, there’s always new content to drive fans back. And we’ve developed our content platform to support our relationships with carriers, content aggregators and consumers alike. In practice fans email us video from the games, for example. The video comes into our content management platform, where it’s formatted, tagged, and given a description. Then, once someone hits the green button, that’s that content ingested across the whole of our network. We also have a social aspect to our applications, which we’re just about to launch. We call it a Fan Zone, a space where people can come on and air their frustration and admiration about the teams they follow and other fans can answer back using their mobile phones. What we want to achieve here is an experience that complements TV, a second screen that people will use to watch the highlights and communicate with their friends around the world. So, the guy in Australia can talk to his mates in the U.K. and South Africa about the game that is being televised live.

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Flurry, for example, tells us that a significant number of users download apps and then stop using them after the novelty is gone. How do you keep your content sticky?

Fans can get bored with content. The solution is to continually update and refresh the application to retain fans’ interest. We don’t experience this problem because the applications we have are so feature rich with content. On average, we receive between 12 to 15 videos and 150 photographs from our leagues daily,

Your new focus on mobile and social dovetails well with a larger megatrend: Social TV and the extension social media into how we interact around television. Please elaborate on your roadmap and objectives.

Part of this is linked to our in-match

statistics. Let’s say the game is Liverpool versus Manchester United, and the score is 1-1. If a fan wanted to go back into the archive to find the last time it was a tie, they can do this by hitting on a button to find the answer. This is information that they can then share with friends and discuss. We also give the paying user of our product an image of a game that shows a similar situation. So, let’s say there is a penalty shot. We will deliver an image of where Wayne Rooney or Steven Gerrard have placed the shot through their last eight penalties. We give our users the information and enable them to share that information with their friends and other fans. To make this work we’re pulling in and integrating into the major social networks including Twitter and Facebook. This makes it possible for users to share information with all their friends –even the ones that don’t have our Sports Locker application. Instead, they can connect and share via Twitter.

to TV networks about precisely this opportunity. The idea is to give the networks the ability to take control of the consumer experience on the handset – through our app – during half-time, so they can start a discussion with fans directly about the game. This way the TV execs at SuperSports in South Africa can say, ‘Wayne Rooney was off sides when he scored that goal.’ Back in the studio, they can take excerpts from the fan comments that pour in, and broadcast them. After all, people everywhere want that 15 minutes of fame. If fans see their name on a ticker scrolling across the bottom of the screen with their message or their views, then they are more inclined to pay attention, and watch the advertisers that are sandwiched in the conversation That is a first step that also paves the way for brands to eventually place relevant and meaningful adverting onto our applications. I think that’s compelling for a fast-food chain like Dominoes, for example. When I watch football, if I’ve got friends around, do I order pizza? Yes. Do I drink beer? Yes. Thus, the integration with the brands and the advert in the app makes sense because football clubs are generally sponsored by this mix of brands. You can also imagine an offer that includes a discount on the pizza you order at

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And this allows your content to go viral?

Yes. Someone tweets the information and then someone answers back ‘great information and app, where did you get it from?’ That person answers that it’s an app called Sports Locker and here is how you can download it. It’s great because it’s viral and it’s gaining another consumer for us, so the cost of acquisition is quite cheap. Getting back to your point about Social TV, in countries such as Africa we’re talking

that moment – and pay for – from the application. Would brands want to give their customers a money-off coupon deliver to their phone that allows them to go around to the local store and redeem it? Would they like to engage with users on their mobile phones? The answer is a resounding ‘yes.’ And this is what we can enable with our application.

their beer and would be interested in buying some when he goes to watch Chelsea, or that he is looking for a nearby pub that sells his favorite beer. Our work with the advertising agency I mentioned lays the groundwork for this, taking brand sponsorship and their support of the sport to the next level. It’s about giving brands the ability to know they have 60 million people around the world who enjoy their products and the opportunity to engage with each of those 60 million people, as opposed to just spending a huge amount of money to reach a mass-market audience of nameless, faceless people. So, the value is not just in a GBP7.50 CPM. The value –for the brands and the consumers – is the connection and the opportunity to engage.

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You enable this engagement advertising already. Who are your partners, and how is it done?

We’re working with one of the leading advertising agencies worldwide. Together we are building the social network I discussed. It’s a great fit because they work with high profile brands and want to open up the opportunities to the Emirates, Etihad, O2, and all the brands that sponsor sport and events. Mobile is not just about engagement; it also allows brands to measure their effectiveness. Take Singha Beer, which sponsors Chelsea football club. Granted Singha Beer will know how many pints of beer are sold. But they don’t know Fred Smith, who lives in Fulham, loves

You mention CRM and we have interviewed companies and organizations for the Netsize Guide that are focused on mobile loyalty, mobile CRM and all the ways to grow the lifetime value of the customer. What are you seeing? Is this the end-game?

I would support exactly what you’re being told. A football club will tell you they have around 200 million fans around the world. Ask them to supply names and details, and they can’t. Atlas adds value to their model because we have state-of-the-art CRM platforms that allow us to provide our partners and clients insights into every handset that buys content from the service. We could

give Samsung, a sponsor of Chelsea, what we acquire from 10 million handsets and users – no matter if they are Nokia users, HTC users or iPhone users. What that does is extend the reach of the football clubs and their sponsors. We engage with consumers on a daily basis, a relationship that allows us to build up a detailed profile. And we can become quite scientific about our calculations based on the data – to the extent of that we can predict how much users are likely to spend over a period of a month. Based on this, we can help our customers set the prices and offers for regions and user segments accordingly. That’s where all football clubs traditionally fail. They simply

don’t have the CRM in place to understand the buying consumption of their consumers. Our systems help them identify where to spend the money and effort. We can also advise then when – and how – they need to target specific user segments, rather than just spend their marketing budget putting up a billboard up in Cape Town Airport with Manchester United plastered all over it. We have a firm belief that the true value of a company, including ours, is in the CRM. If Atlas was ever to be acquired, it would more than likely be by a company that wanted to reach fans and valued our ability to market to those fans based on what we know about them.

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“Consumers want a better world, not just better widgets.” Simon MainwaringCL, branding consultant, bestselling author and blogger

The emergence of empowered consumers, the advance of mobile devices and the abundance of applications designed to give us more of a say in how we create, access and experience all things digital have transformed our daily lives. However, it’s the addictiveness, pervasiveness and sheer dominance of mobile devices that has allow them to take a center role in our routine. Everything we can do on the web with our PCs we can also do on our mobile phones. What’s more, the phenomenal popularity of location-based services, social networks and a host of schemes that us to capture, create and access content on-the-move pave the way for a new phase of convergence that goes beyond just bringing together disparate platforms and devices. This new level of convergence unifies our life experiences – as well as the content and communications that give it substance – into one universal, ubiquitous and meaningful mass media. This is the view of Tomi Ahonen, independent consultant, mobile luminary and author of the milestone book, Mobile as 7th of the Mass Media : Cellphone, Cameraphone, iPhone, SmartphoneCL. In this context Ahonen refers to mobile as the 7th of the mass media, following print from the 1500s, recording from the 1900s, cinema from the 1910s, radio from the 1920s TV from the 1950s and Internet from the 1990s. He further concludes that all forms of content will “ultimately converge around the cellphone.” Mobile is already very versatile as a media channel if we consider that it is digital, multimedia-capable, personal and interactive. However, David CushmanCL, social media strategist and renowned blogger, believes mobile is a powerful mass media – and much more. His thought-provoking views, which take Ahonen’s arguments a giant step further, suggest that Internet and mobile – the sixth and seventh mass media – themselves converge in the creation of the 8th mass media: Us.

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As Cushman sees it, the Internet and mobile are simply tools that enable people to create and control all aspects of their digital experiences. “We are the eighth mass media. We are the distribution, the content, the medium and the message carried with it. We are the connections. We are also how the connections are made.” Put another way, digital convergence is the direction of the future. But we, the people, will decide its course. We are a mass media, and by harnessing the Internet and mobile via our connected devices, we have gained infinitely more control over how we live our lives. Personal assistance The last chapter, Transaction, underlines our increasing reliance on mobile devices at every stage of the purchase funnel. From researching products to conducting transactions, we reach for our mobile devices to help us make the right decisions. What’s more, significant progress in search, personalization and Artificial Intelligence (AI) over the last 12 months allows us to endow our mobile phones with even more intelligence and an innate ability to know what is best for us. It’s no coincidence the iPhone 4S announcement highlighted how Siri – the technology Apple cleverly acquired last year – plays in Apple’s bigger ambitions to deliver us suggestions, recommendations and assistance on our mobile devices. Apple’s Siri is marketed as the smart helper that gets things done. According to Apple, Siri helps users make calls, send text messages or email, schedule meetings and reminders, make notes, search the Internet, find local businesses, and get directions. Consumers can also get answers, find facts and even perform complex calculations. All they have to do is ask. We will remember 2011 as the year we began to think of our personal devices (and apps) as our own personal assistants. The seismic shift in our attitudes about mobile has also sparked industry-watchers and analysts to correctly observe that virtual assistants is the next battleground in the smartphone wars. Mobile without limits Clearly, the advance of smartphones is changing how we manage our digital lives. However, on a more basic level, these devices are also transforming long-established business models around the content, communications and connectivity that make up the fabric of our digital existence. Case in point: mobile portals. There was a time when operator mobile portals were the main destination for mobile users looking to download content for their handsets. That was before smartphones – equipped with PC-like browsers changed the rules.

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As a result, mobile portals have gone from being important gateways to the mobile Web to being an insignificant sideshow we pass on our journey to explore the mobile Web. In addition, app stores, advertisers and a host of other players have inserted themselves in the emerging App Economy, exercising tremendous influence over distribution, monetization and discovery. What does the future hold for mobile operators? It’s a tough one to call. Research firm Informa Telecoms & MediaCL suggests the future may lie in changing the focus of portals to offer services, not content or apps. Renewed emphasis on the individual would help transform portals into “places where consumers can view and sign up to operators’ wider range of services and engage in self-care activities, such as check their balance/consumption, top up their credit or change subscription plan.” Thus, a subscriber-centric approach – rather than a content-centric model – would allow operators to tailor services to the individual needs of their customers and boost customer loyalty. Messaging unleashed While SMS traffic continues to grow, the revenue generated by mobile operators has declined significantly. What has changed? In a word: everything. The spread of affordable bundles, the penetration of IP-based applications and the entrance of overthe-top (OTT) providers have transformed messaging services – and the value chain that enables them. The outcome: a slew of applications that enable one-to-many messaging. In practice these allow users to create or add groups, and send messages out to those who join the group. Thus, one-to-many broadcast models are springing up and entire communities are forming around messaging using these applications. In an interview with Netsize Pamela Clark-Dickson, Senior Analyst, Mobile Content & Applications, Informa Telecoms & Media, identified two key drivers behind this trend. The first is the move to open operating systems for mobile devices, making it possible for developers to create applications for Android-based devices, for example. The second driver is the increasing availability of ubiquitous high-speed mobile data networks and Wi-Fi. This presents an opportunity for start-up companies to develop and distribute applications that enable over-the-top services. “These include messaging services that might be transported over data channels as opposed to being transported end-to-end via traditional messaging bearers,” Clark-Dickson observes. “Costs savings can be achieved by transporting messages over data channels for some portion of the journey between sender and recipient.”
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Content Cloud Battle Technological innovation has moved music from eighttracks to MP3 players; movies from VCRs to DVRs; TV shows from living room sets to PCs, tablets and smartphones; and photos from paper to digital. Increased competition has spurred the growth of new distribution models and outlets – iTunes, Spotify, Netflix, RedBox, Hulu and YouTube – to name a few. At the other end of the spectrum, the advent of Internetdriven social networking has played a pivotal role in revolutionizing the way people interact and communicate. The result is thousands of sites through which billions of people connect to socialize, share photos and videos, and exchange ideas. Delivering today’s fully connected lifestyle is a challenge. It requires the interplay of various components, including: a digital vault (DV) to house all user content in the cloud, social communities, premium content, business enablers, gateways, core and access networks, and connected devices. These components must also work together, communicating through application programming interfaces (APIs), to enable new forms of entertainment and a lifetime of digital content experiences. Traditionally, mobile operators have answered our requirement for an “always-on” digital lifestyle with services to help us store and manage our life’s content. But now they face serious competition as device makers, platform providers and Web giants expand their offers in a battle to win and own the users’ digital content experience.

A turning point came this year when Apple officially announced its move into ‘content cloud’ services with iCloud. The service, baked into its apps and devices, was developed to keep content in sync and ‘remember’ important data, such as device settings, home screen layouts, and text messages, and make that information available if users upgrade or replace their iPhone or iPad. The news was read as an answer to offers from top rivals Amazon and Google. Amazon launched Amazon Cloud Drive, a web storage application, in March to provide users with storage space for their digital music content. Once the music is stored in Amazon Cloud Drive, a user can choose to download it to an Android device using the Amazon MP3 application, or download it to the computer using the Amazon MP3 Downloader. Google’s offer, “Music Beta by Google,” is a similar approach that allows users to access content and sync it to the cloud. But, more importantly, songs can also be cached locally. Does the entry of the BIG-3 mean the race is run – or just starting? Steve French, VP Global Marketing at NewBay, a cloud software platform provider, believes it’s the latter. In his view, the winner’s circle will only include the companies that understand and address what users really want in a digital content service: simple and easy access to their media and networks anywhere, anytime. Moving forward, these services cannot live in silos, but must be truly interconnected – operating as an extension of ourselves – supporting, protecting, connecting and satisfying our digital needs.

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A prime example is Pinger. Its TextFree messaging application, available in the U.S. only, enables mobile users with Android and Apple devices to send free SMS and MMS to both TextFree and non-TextFree users, and to make free on-net calls. Pinger generates business-to-business revenues from TextFree by selling advertising and space on the company’s ‘offer wall’ to brands and other application developers. It generates business-to-consumer revenues by selling add-on packages of voice minutes (similar to SkypeOut) and an advertising-free annual subscription. Pinger claims to have about 2 million active users a day and about 4 million active users a month, who exchange about 1 billion text messages a month. Plans are to expand the service to Europe by end-2011.

But Pinger is just one company gaining traction in the free-messaging marketplace. Gogii, with its TextPlus service, pursues a similar business model. But there are some notable differences: TextPlus focuses on group messaging and communities of users, while Pinger has only recently added group-messaging capabilities to TextFree. Other providers of IP-based messaging applications include: WhatsApp, Kik, Nimbuzz and KakaoTalk.
FIGURE 3:
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Selected mobile-group-messaging applications, 2Q11
Company Appconomy Application Groupedln Launch date 1Q11 Mobile OS Apple iOS Features Aggregation of group communications across SMS, in-app messaging, e-mail, Facebook, Twitter, LinkedIn, others Max group size Not known

Facebook

Beluga

4Q10

Apple iOS, Android

Group messaging via SMS or IP (inNot known app messaging), notifications, location, photo sharing Group messaging via SMS or IP (in15 app messaging), notifications, location, photo sharing Group messaging via SMS or IP (in-app messaging), personalization, photo sharing Group messaging via SMS or IP (inapp messaging), notifications, polls Group messaging via SMS or IP (inapp messaging), notifications, conference calling, location photo sharing Not known

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FastSociety

FastSociety

3Q10

Apple iOS, Android

Gogil

TextPlus

2Q09

Apple iOS, Android

Google GroupMe

Disco GroupMe

1Q11 Beta launched Sep10, 2.0 launched 1 Q11

Apple iOS, Android Android, Apple iOS,RIM, BlackBerry

99 25

Source: Informa Telecoms & Media

Meantime, Clark-Dickson notes that Apple’s recent announcement of iMessage, which will be a key feature of its iCloud digital storage and synchronization service, has “provoked mild hysteria about the future of SMS as a source of revenues for mobile operators.” iMessage is a service that will enable users of devices based on the iOS 5 operating system – the iPhone, iPad and iPod touch – to send unlimited messages over mobile data networks or Wi-Fi. It will also enable iOS-device users to aggregate and synchronize images, videos, contacts and location information, and to access features such as group messaging. This also makes Apple the second handset vendor after BlackBerry to launch an application enables mobile users to send “free”, IP-based messages to other users of the same messaging application, though users will still need a mobile data plan to access the service.

Vision trumps volume How might messaging applications like WhatsApp, and now iMessage, impact mobile operators’ hold on SMS traffic and revenues? The figures are sketchy, however the future Informa Telecoms & Media predicts is cloudy. According to Informa reports, KPN Netherlands admitted in April 2011 that IP-based messaging applications, especially WhatsApp, had cannibalized SMS and voice revenues generated by its youth and early-adopter demographic. What’s more, T-Mobile Netherlands stated in May that WhatsApp penetration among their users had reached 70 percent penetration on smartphones within three months. Given the high penetration of IP-based messaging applications among early adopters, and the significant penetration of services like BlackBerry Messenger, we appear to be witnessing the beginning of the end for SMS as a significant source of revenues for mobile operators, at least in developed markets. Or are we? Informa’s Clark-Dickson reminds us these messaging applications target the smartphone user segment, not all mobile users. Since smartphone penetration in several regions in the world is still below 50 percent, SMS is “still going to be the fallback messaging bearer simply because the penetration of SMS is universal.” As we noted in the last chapter, (Transaction, page page 72) recent mega-trends data compiled by venture capital firm Kleiner Perkins Caufield & Byers (KPCB)CL pegs the number of smartphone users worldwide at 836 million, compared to a whopping 5.6 billion feature phone users. For now, the lower level of global smartphone penetration will likely limit the advance and use of IP-based messaging services on a global scale. While it is true that mobile operators’ SMS traffic growth has slowed, this is to be expected in mature markets. Granted, alternative messaging services are gaining traction. But SMS is also increasing. In fact, mobile operators in both developed and developing marketing continue to experience year-on-year traffic growth in excess of 20 percent, according to Informa, meaning that total SMS traffic continues to increase. Where else should mobile operators focus their efforts? Clark-Dickson is bullish about the opportunities around innovative approaches that make it easier for mobile subscribers to use SMS and MMS in new and different ways. An example is United Arab Emirates mobile operator Du. It has launched an online portal that is accessible via mobile, which also includes a storage offering for photos and videos. A particularly ambitious service comes from mobile operator O2 in the U.K. It has enabled its mobile subscribers to share photos on Twitter using their MMS-capable device. The functionality has been enabled through Telefónica O2’s BlueVia developer platform, and specifically the BlueVia MMS API. As a result, O2 UK customers will be able to associate their mobile number with their Twitter account on the Twitter website.

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They will then be able to share photos on Twitter by sending an MMS to the short code 86444, for which they will be charged standard MMS rates. “There is a huge requirement to have the integration of communications, to aggregate all the channels by which you communicate, and by which people communicate with you,” Clark-Dickson explains. New world(s) Ironically, the idea of bringing together all our communications channels is hardly new. The concept of a one-stop access to everything dates back to the late 1990s, when Unified Communications (UC) was the popular buzzword. However, key factors – such as open operating systems, wireless broadband, cloud computing and our own desire to have what we want the way we want it – were not yet aligned to make the vision of truly unified access possible. A decade later, and new services and scenarios abound to transform long-established business models around content, communications and connectivity. As a result, we are more empowered to lead truly digital lives. But there is also more confusion about the value chain that will deliver us these capabilities moving forward. What will distinguish the leaders from the also-rans? While scale continues to be important for over-the-top players such as Google, Apple and Amazon, winning in a digital world requires much more than market position. It demands flexibility, agility and a keen focus on the customer. Hence, the winner’s circle will most definitely include those companies that are adroit at extracting customer insight – and at converting that insight into action to give the people what they want the way they want it. But first these companies must earn our trust. It’s a virtuous cycle. As Seth GodinCL, groundbreaking marketer and author of Permission Marketing, points out: Trust comes from frequent interactions and grows as we become more familiar and comfortable. Gain people’s trust and companies have access to the information (demographics, preferences, interests) that allows them to better serve their customers. Serve customers better, and they will volunteer more information that allows companies to do an even better job. However, trust is a contract without the small print. Social networking giant Facebook found out the hard way. In 2010 Facebook reneged on its privacy promises and made much of people’s profile information public by default. This prompted privacy and consumer protection organizations in the U.S. to file a complaint with the Federal Trade Commission, charging that Facebook had engaged in unfair and deceptive trade practices in violation of consumer protection law. The upshot: Facebook’s handling of privacy issues damaged its reputation and effectively broke our trust, an asset it is not likely to regain so quickly.
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In contrast, mobile operators follow a modus operandi that brings obvious advantages. Because mobile operators own the customer relationship, for example, their databases are chock-full of information that allows them to connect the dots in our digital bread crumb trail (browsing behavior, personal preferences, purchasing patterns). But rather than be concerned about a potential loss of privacy, we look forward to the convenience and quality experience we can enjoy when content, services and other digital stuff is delivered in sync with our digital lives and lifestyles. In an era where the consumer is in control companies must be transparent about what they offer, and what they expect in return. Companies must also be up front about the players and partners that play in their wider business ecosystem. Trust, to borrow from Godin, is nontransferable and can be cancelled at any time. Thus, companies that have our trust should guard it with everything they have because it is at the core of every sustainable business model. Companies that lack this asset should brace themselves for a rocky ride. As we observed in this chapter, the services that will truly transform our digital lives must be interconnected and converged, operating as an extension of ourselves with a singular aim to support, protect, connect and satisfy our digital needs. To allow these services to play such a pivotal role in our lives we must first trust the companies that deliver them to understand our requirements and act in our best interests. The next chapter will explore the role of trust, and how growing trust, grows responsibility and – ultimately – profits.

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IN SUMMARY:
• Mobile is transforming long-established business models around the content, communications and connectivity that make up the fabric of our digital existence. And it doesn’t stop there. Recent advances in personalization and Artificial Intelligence (AI) allow us to increasingly rely on our mobile devices (turned smart helpers) to make our daily decisions. • The spread of affordable bundles, the penetration of IP-based applications and the entrance of over-the-top (OTT) providers have transformed messaging services – and the value chain that enables them. Expect an increase in services, players and competition as one-to-many broadcast models flourish. • The consumer is in control. Winning is about understanding and addressing what people really want in a digital content service (simple and easy access to their media and networks anywhere, anytime, for example). However, the capabilities required to support, protect, connect and satisfy our digital needs are not linked to technology prowess. The ability to truly transform our digital lives and experiences belongs to the companies that can earn – and keep – our trust.

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Pamela Clark-Dickson | Senior Analyst, Mobile Content & Applications, Informa Telecoms & Media

messaging momentum
Anytime, anywhere and any device. Digital Life Management services began with a sharp focus on mobile and Web solutions to help us protect, organize, and share our content. Fast forward, and back-up and synchronization services are just part of the equation. Consumers also require the ability to manage their conversations with friends, families and social networks. Regardless of mobile network or mobile device, consumers want the freedom and flexibility to interact with their preferred Web communities via MMS, mobile e-mail and mobile instant messaging. Additionally, applications that support person-to-person messaging, application-to-person messaging, and person-toapplication messaging are also in demand. Pamela Clark-Dickson discusses the competitive landscape and the innovative models taking messaging and sharing to a new level.

Apple with iMessage has become the second handset vendor, after BlackBerry, to launch an application enabling mobile users to send free, IP-based messages to other users of the same messaging application. What is the wider significance of this announcement and the potential impact on business models?

Apple has managed to create this overwhelming interest in applications, and I think this has very much acted as a catalyst for the heightened interest in messaging applications that we are seeing this year. For example, according to Informa Telecoms & Media, more than 130 app stores have been launched worldwide, by companies including mobile operators, device manufacturers, application developers and independent providers. So, the whole increase in appetite for apps has, in turn, led to the rise

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FIGURE 1:

Global, app stores by company type, 2Q11

in reality, it’s not really free of charge because it does require the user of the application to have a smartphone and a mobile data plan. So, messaging applications are evolving to be much more, and to enable messaging over IP.
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25, 4% Mobile operator 2, 9% Other 4, 3% Mobile 2, 2% Handset manufacturer and OS developer 8, 0% Handset manufacturer 57, 2% Mobile

Source: Informa Telecoms & Media

of mobile-specific instant-messaging applications. These include WhatsApp, Kik, and Kakao Talk in South Korea. These instant messaging applications are developed specifically for the mobile phone, and they’re not enabling subscribers to access Yahoo! Messenger or Windows 5 Live Messenger, for example. Instead, these new mobile-instant-messaging providers are independent developers, creating their own applications – which are turning out to be quite popular because these applications are available across different device operating platforms. This is very different from a BlackBerry-centric application like BlackBerry Messenger, or an Applecentric application like iMessage. So, the cross-platform availability is one key advantage for these applications. Another advantage – and what these providers are building on – is the cost. The developers of these applications are saying to users: ‘Don’t send an SMS, just use our application you will be able to use messaging for free.’ Although,

What’s the impact of models? We’re starting to see the rise of applications that enable one-to-many messaging. In practice these allow users to create or add groups, and send messages out to those who join the group. As a result, we have one-to-many broadcast models springing up where communities are forming around messaging using these applications. These applications also tend to make use of SMS, aiming to make it easier for people to use SMS for group messaging. Mobile-specific instant messaging applications and group messaging applications are not the only areas in which we are seeing innovation. There are also applications gaining traction which make it easier for mobile subscribers to use SMS and MMS in new and different ways. Examples of this come from O2 UK and its MMS Twitter updates, TigerText and its message recall/delete application for SMS, Doot and its locationbased personal messaging alerts application/service – as well as a number of SMS auto-reply/scheduling applications we see on the market. However, I would like to stress that these applications target the smartphone user segment, not all

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mobile users. Remember, smartphone penetration in several regions in the world is still below 50 percent. So, SMS is still going to be the fallback messaging bearer simply because the penetration of SMS is universal.

We have discussed messaging, what are you seeing in relation to sharing content using mobile? Is there also innovation and disruption from providers and applications providers?

advertising and by offering space on its ‘offer wall’ to brands and other application developers. In addition, the company sells add-on packages of voice minutes and an advertising-free annual subscription. More recently, Pinger has partnered with Tapjoy to enable its ‘offer wall’. Essentially TextFree users can earn free voice minutes by downloading specific applications from the offer wall. Because these messaging applications are now so powerful it makes it much easier to share content, such as an image or a video or a voice message, within the message, or to share a link to some content within the message. At the end of the day, it’s about bringing together all the ways people can access content and putting it into the one application so people don’t have to use several different applications in order to be able to access or share information or content with their buddies.

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Some of the group messaging providers in the U.S. are exploring different ways that they can generate revenue. Again, this comes back to the sharing of content, and they’re looking at virtual gifts, for example. Several players are leaving their mark on the competitive landscape. Gogii, the makers of the TextPlus group messaging application, enables its users to send and receive SMS and MMS for free. It generates revenues via advertising and sponsorship, annual subscriptions (without advertising), premium phone numbers, and from the sale of digital content for use with the application, namely, sound packs. Another company operating in this space is Pinger, which has developed a calling and a messaging application called TextFree that enables users of iOS-based devices – primarily iPods – to send free SMS and MMS to both TextFree and non-TextFree users. Pinger generates revenues from TextFree by selling banner

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As you point out, all of this happens via your messaging client on the device, or it’s all integrated into the messaging client on the device. Where do the social networks come into play?

Integration with social networks is also becoming another key feature of these messaging applications, allowing users to connect to Facebook to post or view status updates from within these applications, connect to Twitter to tweet. For example, Goggi has just added Facebook connectivity to its TextPlus application.

I think we’re going to see a lot more integration like this. People basically want to be able to have the ‘one’ application that lets them do everything: message, connect share, tweet, post – the works. Still, I expect users aren’t above still using a separate application, if it provides them with a benefit like free messaging.

Our requirement for convenience and unified access brings me to the Cloud and cloud computing. There’s a lot of hype about the technology, but there is also significant take-up....

devices have – and then have that synchronized with your mobile device. An example is e-mail. Think about the way some consumers use e-mail on their mobile devices. Consumers might use mobile e-mail to check their e-mail and to manage their inbox, but many don’t use mobile e-mail to actually view or reply to their emails. The Cloud supports this and is therefore attractive to a significant segment of consumers. The next step is to build more business models around the Cloud. After all, once mobile operators have the infrastructure in place to be able to offer cloud based services, it’s not just the access to services that they will be able to provide. The Cloud should hopefully also enable them to offer features, such as security, and generate more traffic, which indirectly helps them to generate more revenue.

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Well, I think that it is certainly attractive for mobile users to be able to have access to all of their content, all of their messages, in The Cloud. It makes it easier for them to manage and to access their all social interactions in one place. Is that a business driver? It certainly becomes something that mobile operators can charge for because they’re providing the storage and an extra level of value to mobile users. Enabling the mobile cloud is a valueadd because it lays the groundwork for a truly unified communications mechanism. By that I mean users can access the Cloud via both their mobile devices and their PCs – as well as number of other connected devices. In my view, there is tremendous value in being able to do the fiddly things – tasks that require a QWERTY keyboard and a larger screen than most mobile

Much of this reminds me of the promise of unified communications and the discussion we’ve had since the late 1990s around how to bring together communication services such as instant messaging and chat with voice, e-mail and text. Where is the industry now and where are the growth opportunities?

There is a huge requirement to have the integration of communications, to aggregate all the channels by which you communicate, and by which people communicate with you. As you said, it’s not necessarily a new imperative.

The industry has been talking about unified communications for a long time now. But – I think that on the mobile at least – we are moving closer towards enabling unified communications. Consider applications like Nimbuzz, Palringo, eBuddy and Miyowa’s InTouch. All of these applications enable the aggregation of multiple Internet-based instant messaging communities, social networks and social media sites. And they make this capability accessible via mobile and PCs. So, from the one client on your mobile device, or your PC, you can sign in to the IM communities, social networks and social media sites where you are a member. Mobile operators are also active in this space. United Arab Emirates operator Du has launched an online portal that is accessible via mobile, which also includes the Vault storage offering for photos and videos. And let’s not forget O2’s Bluebook, which was one of the first services in this space. On the handset manufacturer side, we have Apple’s forthcoming iCloud and Nokia’s Ovi - to name a few.

of applications and services, or aligning themselves with partners. Telefónica, for example, is determined not to be a dumb pipe. It’s working on the BlueVia initiative, making it easier for partners to work with them and providing their partners with business models that help both the operator and the developer to make money from the various new services that are developed and deployed. Telefónica has obviously decided that it needed to take the initiative on this. Whatever progress is happening with initiatives like One API is obviously not happening quickly enough, and the same goes for the Wholesale Application Community (WAC).

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And the implications?

I think players like Telefónica have concluded these initiatives are not progressing quickly enough. And they need to be a lot faster if operators are going to compete successfully against the OTT [over-the-top] providers like WhatsApp, for example. I sense that operators like T-Mobile and Telefónica are a little bit frustrated with the slow rate at which things have progressed. They’re not ruling out being part of this multi-operator pan-network ecosystem. Instead, they are doing things in tandem with it and hoping that – if the multi-operator initiatives do succeed – they can then hopefully feed back into those initiatives. At the end of the day, some of the operators,

As you point out, the space is exciting – and crowding. Where are the mobile operators now, and moving forward?

I think it depends on the individual operator. If they want to become more involved, if they want to become more than just a transport network for communications, then they have to start investing in the development

especially the Tier 1s, want to be smart pipes and not bit pipes. Then again, some operators will always be quite happy just to provide the network..
FIGURE 2:

Gmail SMS Chat mobile operator partners
by region, Jul-11

You mention OTT players, and that’s a great segue to Google, Facebook and the Web giants moving in on messaging. Please describe the competitive landscape and the companies that really leave their mark.

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Operator Africa Angola Cameroon Ghana Kenya Liberia Malawi Mozambique Negeria Senegal Tanzania Tunisia Uganda Zambia Asia Pacific Indonesia Philippines Middle East Bahrain Iraq Israel Jordan Kuwait Palestine Saudi Arabia North America US
Source: Google

Unitel MTN Airtel, Tigo Airtel, Orange, Safaricom Cellcom Airtel, TNM Vodacom Glo Mobil, Starcomms Orange, Tigo Vodacom, Tigo Tunisiana Orange, MTN, Uganda Telecom Airtel, MTN

Yes, there are a few players that truly stand out. One is Facebook, which wants to be everywhere in mobile and is making significant investment to ensure that happens. Facebook has worked with Vodafone in India to launch the 555 Blue phone in that country, which is being marketed as the Facebook Phone. Facebook also has the Facebook Zero mobile data initiative, and in August it announced Facebook Messenger, its standalone messaging application. And, in October, Facebook released its long-awaited Facebook Platform on mobile, which brings all of the social channels to mobile apps and websites. Facebook has also cleverly focused on enabling Facebook via USSD and SMS in emerging markets. This is smart if you look at Facebook’s user numbers. Sites such as Socialbakers reveal Facebook has quite a high user base in emerging markets such as India, which is one of Facebook’s top five markets globally. Twitter is an interesting one. At Mobile World Congress the company said its whole DNA is mobile – and they mean it. They’re enabling their service via SMS in several countries, and they have agreements with about 200 operators worldwide.

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Indosat, Telkomsel Globe, Smart, Sun Cellular

Zain Zain Orange, Pelephone Zain, Wataniya, STC Jawwai, Wataniya STC

All operators

Google is also another one to watch. We just saw it tie up with Orange to enable Gmail SMS chat across Orange’s 19 operating companies in Africa. Google had already rolled out Gmail SMS chat with 29 operators in Africa and the Middle East . So,

Google is definitely determined to gain share in both emerging and developing markets. But Google is also looking horizontally as well. Google+ got off to a blazing start, but it will be interesting to see whether Google will be able to maintain the momentum.

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Steve Douty | VP of Applications and Mobile Products, Yahoo!

personalizing the content cloud
Yahoo! is the premier digital media company, creating deeply personal digital experiences that keep more than half a billion people connected to what matters most to them, across devices and around the globe. To complete the business ecosystem Yahoo! has developed a unique combination of Science + Art + Scale that allows advertis-

Mobile and social are converging. sumers who build their businesses. Steve What are the trends and future Douty provides insight into the U.S. mobile developments high on your radar?
marketplace and the global Yahoo! Mobile strategy to offer fast, easy, and intuitive mobile experiences innovate on the unique attributes of mobile devices, empowering advertisers to reach customers with the right messages at the right time.

ers to connect and engage with the con-

Mobile is now more than mainstream. We are moving toward a time where people in all markets will interact with the Web more frequently through connected devices – phones, tablets, televisions, consoles and beyond – than through personal computers. IDC anticipates the number of users accessing the Internet using mobile devices to double, from 600 million in 2010 to 1.2 billion in 2014. Simultaneously, we are seeing that the traditional “three screens” concept (phone, personal computer, television) is becoming outdated as the tablet establishes itself as an equally important “fourth” screen. In fact, a November 2010 report by IDG states that tablet sales will cannibalize personal computer sales at a rate of 33 percent to 33 percent in 2011.

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As people increasingly traverse these four screens, digital media, content, and communication services will coalesce in compelling new ways for consumers and advertisers alike.  For example, Yahoo! is rethinking mobile experiences and how content can act as a companion as people increasing co-browse across connected devices. This consumer behavior is evident in a recent McKinsey report looking at iPad consumer usage. It points out 62 percent of iPad users don’t take their iPad out of their homes and actually use it as a co-browsing device while watching TV or doing other things.  In the future we will see a convergence of devices as their respective roles begin to blur and overlap. Why not use a tablet or mobile phone to control the TV and have content you can “flick” from device to device? Yahoo! is working to make device interactivity a reality, enabling tablets, mobile phones, and TVs to sync and interact in new and exciting ways. 

model where new developments are being built first for the tablet, then for mobile phones and the PC.

In view of this continuing convergence of devices and service, what are the opportunities in mobile?

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Utilization of cutting edge technologies such as HTML5, CSS3 and JavaScript represent a continued and growing opportunity to offer enhanced, refined, and interactive interfaces, and content that ensures each mobile platform and infrastructure is contextually compelling and easy to use. eMarketer states that the time spent on mobile per day among U.S. adults increased from 32 minutes in 2008 to 50 minutes in 2010, a 56 percent increase in 2 years. In contrast, time spent on newspapers and magazines declined from 63 minutes in 2008 to 50 minutes in 2010. This is a clear opportunity for Yahoo! to take its core strengths in content and personalization at mass scale, and re-imagine them into a new kind of Yahoo! experience, which we are spearheading through Livestand from Yahoo!. Livestand will offer effortless content personalization in a rich and immersive experience, based on an individual’s interests, time of day, and location.

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Cisco has stated that the “Mobile-only” Internet population will reach 788 million by the end of 2015 – mainly made up How does increased adoption of emerging markets – and Yahoo! of smartphones globally is not underestimating this growing impact this industry? importance of mobile - we are pivoting It’s clear that smartphones are to a mobile-products-first development quickly becoming a commodity

product, overtaking PCs, especially in developing countries where people‘s first access to the Web is via their mobile device. In fact, a recent Yahoo! survey showed that the smartphone is becoming the device of choice in the home, even in developed nations, with increasing numbers of young adults choosing it over a laptop or desktop computer. An indication that this is part of a larger trend comes from IDC, which reports that smartphone shipments surpassed PC shipments in Q4 2010 for the first time. At Yahoo! we also see this happening. In February 2011 comScore in the U.S. ranked Yahoo! Mobile the #1 mobile destination for mobile email, sports scores and news, with more than half of Yahoo! Mobile users currently accessing Yahoo! content on a smartphone, that’s over 45 million unique users per month.

device, and on the go.  We already live in an “always –on” world. In the future, the Web won’t start or stop based on your device, your content will move with you wherever you are.

How do you deal with the proliferation of devices and platforms? Least common denominator or micro-segmentation?

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Despite the challenges of the increasingly fragmented mobile market, Yahoo! creates mobile experiences across all the devices people choose to use. These immersive experiences are available on a variety of mobile platforms and browsers by investing in the most advanced technologies, including HTML5, CSS3 and Java Script. We are placing a strategic bet on HTML5 to deliver the richest experience to the greatest number of people, and to build innovative, interactive advertising campaigns. HTML5 enables a “build once, publish everywhere” reality, despite competing OS platforms. It fuels our ability to deliver truly crossdevice experiences like browsing the same content on a tablet and TV at the same time. Yahoo! is focused on building interactive mobile

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This has huge implications for digital media companies like Yahoo!, that remain focused on providing consumers with content that matters most to them, offering an engaging and seamless experience across

experiences, not an OS or device. The mobile Web is always connected to the cloud. In a sense, a user’s “personal cloud” that is behind every click on Yahoo! and for mobile, enables the production of rich, personalized consumer experiences on any device. Yahoo!’s content cloud has grown to 200+ petabytes in size, is growing 50 terabytes a day, and processes more than 100 billion events daily on 40,000 Yahoo! servers.

increasingly becoming more powerful, giving advertisers new canvases for reaching distinct audiences at the scale that needed to drive results.  Yahoo! is committed to innovating unique, branded, monetized experiences that will lead the industry into the future.  Of the Fortune 500 companies, 200 – including Toyota, Subway and VISA – already advertise on Yahoo! Mobile. This is because Yahoo! enables marketers to reach mobile audiences with the right message in the right place at the right time. Yahoo! is able to work with advertisers to create targeted advertisements through the most advanced advertising formats. Yahoo! Mobile leverages HTML5, CSS3 and JavaScript for animation, interaction and analytics to offer rich media display advertisements and bring a more compelling ad experience to mobile devices. Additionally, Yahoo! delivers the unique combination of Science + Art + Scale offering the most personalized way for advertisers to meaningfully engage with their audience at scale, through innovative, relevant and screen-optimized advertising experiences, across any device.

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What is the role of advertising in the mobile-social space and how has this evolved? We see that several players continue to grapple with this, which leads us to questions whether social networks and the eyeballs they attract can truly be monetized. What approach is required?

The proliferation of connected devices is requiring advertisers to find new ways to engage with their audiences, at scale, across multiple devices. The result is an increasing shift away from traditional, static advertising formats toward the delivery of highly personalized, meaningful and relevant advertising experiences.  Devices are

What defines a good user experience?

With the sheer scale of content moving across the Web today, we can only ever access a minuscule segment of it all in our lifetime, let alone at any one time.  Today is not about access to everything everywhere, we have entered a phase

of recommendations, where content is personalized to your needs, location, interests, social connections and so on. Yahoo! is dedicated to connecting people to what matters most to them and providing a personalized content experience that is seamless across all Connected Devices. Yahoo! reaches over 680 Million users, more than half of the internet population.  We are able to leverage this scale to ensure we deliver the most timely, relevant and engaging content experience for each and every user. Yahoo!’s leadership in science and scale has been responsible for creating the engine that powers this level of personalization. CORE (content optimization and relevance engine) is a big part of this. It is a suite of technologies — developed in Yahoo! Labs and based on deep science — that delivers personalization, optimization, and user control to all our apps and service, including APIs that power third-party experiences. The secret behind its success is a perfect matchmaking of scientific fact and human insight and expertise. Put simply, it blends editorial voice and data-driven ranking – based on content algorithms – to find a sweet spot that optimizes both real time click-through rates while driving longer-term engagement. 

Research shows that people increasingly want access to digital content in real time as well as when they’re offline. To help satisfy that need, Yahoo! is re-defining the asynchronous and synchronous digital content and communication experiences to let people connect with relevant content on their own terms, at their preferred time and location, and through any device.  Gone are the days of content being pushed at us, through one TV channel or a daily newspaper - consumers have increasing control over how, when and what they consume. With an over saturation of choice now online, publishers are having to work even harder to provide something compelling and relevant to engage the consumer. With the onset of the tablet, the roles of connected devices are also beginning to blur.  As I have already mentioned, 62 percent of tablet devices do not leave the living room. Thus, smartphones and tablet devices are fast becoming the device people prefer over PCs or laptops when accessing the Web at home – and that‘s when it comes to accessing the Web. Consumers are also regularly multitasking and interacting with content and people across devices at any one time. A recent US Yahoo! survey showed that 57 percent of us often multitask while watching TV for example. We are looking to different devices to compliment experiences with the richness and interactivity of the Web.

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Please elaborate on how consumers interact with your service and any changes in customer behavior you have observed.

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“The more essential relationships become, the more trust becomes a factor.”
Kevin Kelly, author, blogger and co-founder of Wired magazine

As mobile becomes more integrated in our lives, an increasing number of security concerns move to the forefront. While there are some risks to face, there are also vast opportunities opening up around new life-enhancing services designed from the ground up to provide us access to blockbuster movies, premium content and a myriad of mobile payment mechanisms. What is driving this new breed of mobility services? In a word: us. We are using our devices, which are capable of downloading a huge variety of applications from the Internet, to do more than ever before. As we show in the Transaction and Transformation chapters, mobile has become our constant companion, allowing us to research purchases, make transactions and manage the minute details of our daily (and digital) existence. Research firm Gartner reports smartphones are gaining serious traction, with penetration nearly doubling since 2010. It estimates sales of mobile devices in the second quarter of 2011 grew 16.5 percent year-on-yearCL. Moreover, smartphone sales grew 74 percent year-on-year and accounted for 25 percent of overall sales in the second quarter of 2011, up from 17 percent in the second quarter of 2010. Even though smartphone users account for less than one-sixth (835 million) of total mobile users (5.6 billion), analysts remain bullish about the rapid uptake of smartphones. According to Morgan Stanley, smartphones have already surpassed feature phone shipments in the U.S. (as of Q1 2011) and Western Europe (as of Q2 2010). Security needs But there is a trade-off. While mobile is clearly driving new and innovative business models, our devices are also increasingly vulnerable to the threat of malicious code and malevolent applications. Smartphones, because they are essentially mobile computers based on software platforms, are bringing up a special concern. Juniper Networks, for example, released a study that revealed a record 400 percent

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increase in Android malwareCL. But it’s not just Android users who need to worry. The study warned that all devices we use to download apps are at heightened risk of attack. Specifically, the study found that both enterprise and consumer mobile devices are exposed to an increasing number of highly targeted Wi-Fi attacks that target email and social networking information. Another security risk is text messaging. Some 17 percent of all reported infections came from SMS Trojans, which sent texts to premium rate numbers, incurring major charges to the unsuspecting users. “These findings reflect a perfect storm of users who are either uneducated on or disinterested in security, downloading readily available applications from unknown and unvetted sources in the complete absence of mobile device security solutions,” Dan Hoffman, chief mobile security evangelist at Juniper Networks, said in a statement. Related research from Lookout Mobile SecurityCL estimates three in ten Android owners encounter a Web-based threat on their device each year. Specifically, Android users were 2.5 times more likely to encounter malware in June 2011 than they were just six months earlier. Moreover, an estimated half million to one million Android owners were affected by mobile malware in the first half of 2011. Moving forward, analysts reckon our mobile devices will be exposed to additional security risks. A report published by the Georgia Tech Information Security Center (GTISC), which releases an annual Emerging Cyber Threats ReportCL based on information contributed by a variety of experts, suggests the shift to an all IP mobile network architecture and the growing adoption of mobile VoIP will open cellular infrastructures up to the same threats that have plagued other network architectures. Payments on the rise Clearly, the explosion in mobile banking and commerce services delivers users greater convenience and flexibility in how they make purchases and conduct financial transactions. However, analysts FIGURE 1: Need for Mobile Security Factors are also concerned attackers could take advantage of this development to deploy Increased more sophisticated techniques, such Smartphone Penetration as upgrade attacks, to take control of personal data. Mobile As a recent report from research Banking, High NEED FOR SECURITY Payments & Volume of firm Juniper ResearchCL states: “The Ticketing Data Usage Adoption increasing adoption of mobile commerce and banking by users means that distinct Proliferation of security measures are required for the Free & Paid Apps different types of threats and risks they face.”

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Source: Juniper Research

The report, which outlines the main security issues for smartphone and tablet users, stresses the threats to mobile phone users from malware, spyware, spam and unauthorized access are relatively small today, but bound to increase.

Mobile money milestones Indeed, a review of mobile banking and commerce developments over the last 12 months confirms significant growth in both services and usage. Uganda MTN Uganda reports significant growth in its mobile money service, recording over UGX500 billion (US$200 million) in transfers in August 2011 alone. MTN Mobile Money was launched in 1Q2009 and has introduced financial services to millions of Ugandans who lack formal banking services. Zimbabwe Leading mobile operator NetOne announces it will deploy Gemalto’s Mobile Money Transfer solution to provide underbanked access to secure banking services. The offer, marketed as the OneWallet service, works on all handsets, enabling consumers to make peer-to-peer money transfers, pay every-day bills and top up their prepaid phone cards. United States Verizon Wireless and credit card company American Express have signed a new mobile payments deal to integrate the Serve mobile payments system into some Verizon devices. Serve uses the phone’s mobile number as the authentication tool when subscribers make payments

from their mobile phones. India Finnish handset manufacturer Nokia has formed a separate company called Nokia Mobile Payments to roll out a mobile money service across India. Its mobile payment services have been successfully piloted in several cities including Chandigarh, Chennai, Delhi, Mumbai, Nasik and Pune. Kenya Orange Kenya has introduced two new access channels to its mobile money service. Customers will be able to access the Orange Money service both via Wireless Application Protocol (WAP) and through a Java download application. Orange Money was launched in November 2010 in partnership with Equity Bank to provide mobile money transfer and banking services. Philippines Mobile operator Smart Communications has partnered with BICS to enable a remittance corridor between Belgium, Qatar, the U.K., and the Philippines. The corridor will enable mobile subscribers to send money to the mobile phones of relatives and friends in the Philippines, who are users of Smart’s Smart Money mobile wallet, via BICS’ HomeSend global remittance hub.

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Delivering enhanced security Connect the dots, and the widespread adoption of new services enabling transfers, transactions and payments creates a requirement for stronger security. Another driver is the emergence of entertainment services that are perfectly matched with our new device capabilities, supporting HD video playback and streaming, mobile TV broadcast reception and console-quality 3D games. All this functionality consequently increases the need for security solutions around content management, content protection and Digital Rights Management (DRM). Several organizations and initiatives, including The Open Mobile Terminal Platform, the Trusted Computing group, and the Open Mobile Alliance, have been formed to address security concerns.

Content integrity Netflix, which has a heritage of streaming to PCs, Macs, game consoles, Internet-connected TVs, iPhone and iPad, and many set-top-boxes, recognized early on the need to bring its content service to the broader mobile market. But delivering high-definition content to smartphones was not just a technology issue. Netflix would also have to satisfy film and TV studio demands for platform security and content protection. In search of a high-security approach to ensure the integrity of digital content, Netflix found a semiconductor partner in Texas Instruments, a leader in semiconductor innovations and a member of GlobalPlatform, a not-forprofit association that identifies, develops and publishes specifications to facilitate the secure and interoperable deployment and management of multiple embedded applications on secure chip technology. In July Texas Instruments became the first partner to achieve the Netflix Silicon Reference Implementation (SRI) certification

for the Netflix application on Android smartphones, with chipsets integrating the Trusted Foundations™ security solution from Trusted Logic. This marks the first time Netflix has certified its high-definition 1080p streaming application with end-to-end protection on a mobile device. It also ensures that Netflix members everywhere Netflix is available can watch TV shows and movies on their Android devices. Specifically, achieving the coveted certification is an important step towards ensuring “a balance of performance, security and power efficiency as Netflix experiences migrate to the mobile world,” Fred Cohen, director of the OMAP User Experience team within Texas Instruments, said in a statement. “Our OMAP processors deliver rich, life-like experiences on mobile devices, while our M-Shield technology stands as the guard dog, protecting customer, content provider and consumer assets. It’s the best of both worlds, driving new growth opportunities for Netflix in the Android marketplace.”

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Global groundwork However, it’s GlobalPlatform that has produced the technical specifications that are most widely regarded as the industry standard for building a trusted end-to-end solution. More importantly, GlobalPlatform’s approach resolutely addresses the needs of all the key stakeholders, including service providers, mobile operators, application developers, device manufacturers, silicon vendors and platform providers. GlobalPlatform work lays the groundwork for a mass market. To achieve this it identifies, develops and publishes specifications to facilitate the secure and interoperable deployment and management of multiple embedded applications on secure chip technology. Currently, the not-for-profit organization counts 60+ members including American Express, ARM, Gemalto, Giesecke & Devrient, Nokia, Orange, ST Ericsson, Trusted Logic and Texas Instruments, which is a participating member. To offer all stakeholders the best route to meet their security objectives, GlobalPlatform has introduced the concept of a Trusted Execution Environment (TEE)CL. The TEE is a secure area that resides in the main processor of the mobile phone and guarantees that sensitive data is stored, processed and protected in a trusted environment. The ability to offer safe execution of authorized security software, known as trusted

applications, enables the TEE to enforce protection, confidentiality, integrity and access rights of the data belonging to those trusted applications. This, in turn, provides end-to-end security.  This level of security is essential because, as we showed in the first two chapters, people are using their smartphones and tablets to do much more than ever before. The advance of these devices means that users can download applications from an application store. But that isn’t all they can access.
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Architecture of the TEE

Source: TexasInstruments

“Obviously, these devices are open, so they are not only open to the valid applications users download. They are also open to attack from malware, similar to the viruses and malevolent applications we know - and are still experiencing - on the PC,” Christophe Colas, Marketing Director, Trusted Logic, told Netsize in an interview (page page 101). “It’s a difficult balance because users have an open device and want to have a lot of applications on it. But they also need to maintain a certain level of security on the device.”

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Without the standards and specifications provided by the TEE, application developers, service providers and other ecosystem players would be forced to make investments to provide services such as mobile banking and content streaming for each smartphone platform, such as Apple or Blackberry. Thus, creating standards ultimately leads to greater economies of scale – and greater service innovation that benefits everyone. A lack of standards would force this innovation to take a very different path. In an interview with Netsize Gil Bernabeu, Technical Director, GlobalPlatform, suggests innovation be “highly proprietary” and disadvantage application developers and service providers seeking to address a global market. “Entering markets and broadly marketing their applications development is going to be much more costly for them since they will have so many more platforms to develop to, and so many more to maintain,” Bernabeu explains. From a global perspective, the standardization around the TEE would create a mass market, and potentially grow services for the next billion, for whom mobile is the only screen.

Confidence and control Clearly, the TEE standardization will enable a large ecosystem of Trusted Application providers, paving the way for new value-added services and offers across sectors including finance, mobile/telecom, government, healthcare, retail and transit. What does high-level security enabled by the TEE provide the end-user? Philippe Galvan, IP Domain Director at Texas Instruments, summed it up in one word: confidence. As Galvan sees it: “You need security to make the end-user confident that the information gathered is fully protected, but can also give them opportunities, discounts, and loyalty points they can redeem for benefits. It’s also information that shouldn’t get into the wrong hands. Therefore, they need to have an infrastructure that gives them what is good and protects them from what is bad. Here the TEE has a role to play because it has the ability to coordinate all these flows of information, and to store and process this information securely inside the TEE.” The TEE also provides the foundation upon which we can build (and experience) our truly digital lives. Interestingly, the convergence of devices and services across the three screens (mobile, Internet, TV) has created a new requirement for security solutions. However, it may be the convergence of our networks (home, corporate, personal) that will significantly increase our need to protect information and maintain trust. As Galvan sees it: People are “going to require security to both enable and control convergence” between the home network, the personal network and the corporate network. “This convergence is inevitable and this is where we are all going to need security to make sure our personal assets, our home assets and our corporate assets are protected at the right level,” Galvan explains. “So you have to find the right balance. You want to open it to your family members, friends and co-workers, but not to strangers. That is the challenge and the opportunity.” Trust or bust Clearly, our lives and our devices have become inextricably intertwined. As we have demonstrated, mobile empowers us to capture and consume content; it influences how, when and where we connect with friends and family; it increasingly assists us in daily decision-making; and it ultimately links our physical and digital worlds. Thus, mobile has evolved to take a central role in our lives. However, the future of mobile will not be decided by technology. It will be determined by our very human requirements for simple, transparent services we can trust.

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Yes, we rely on our devices to do a lot. We make calls, consume content and download apps. And that’s just the beginning. Now devices and services that are truly transformational are breaking onto the mainstream market. However, before we use them to their full potential, we must be confident that the integrity of our assets – bank accounts, personal data, digital content – is protected.
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Trust may seem like a vague and intangible notion, but its value is decidedly real and concrete. In fact, nothing is more fundamental to how we live, manage and enhance our digital lives than the belief that we can truly trust the devices, services and companies we interact with to deliver on their promises. At the other end of the spectrum, the ability to create trust is also the most fundamental competency required of all the players that make up the digital business ecosystem. In fact, building and maintaining trust with an increasingly broad set of stakeholders is emerging as a key determinant of success. In a world where trust is more perishable than ever, players across the ecosystem will need to focus on how to effectively build a lasting trust asset. They must also better understand what trust means to their customers, and their customers’ customers, and build trust-based relationships with them based on greater insights into what they really want. Significantly, only a relationship built on trust will provide companies access to the customer insights and information that will allow them to develop and deliver the applications, devices, services and infrastructure that will transform our lives and – ultimately – allow them to stay relevant, competitive and profitable.

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IN SUMMARY:
• The explosion in mobile apps, increased demand for mobile banking, mobile payments and e-ticketing services, and growing interest in accessing and consuming premium TV and movie content on smartphones are changing all the rules. While they offer consumers more choice and flexibility in how they use their devices, mobile users should also be aware that their smartphones – like their PCs – are open to attacks from viruses and malware. The outcome is an increased requirement across the ecosystem for high level security on the device, not just the software. • To achieve this the industry is standardizing and promoting adoption of the Trusted Execution Environment (TEE), a secure area that resides in the main processor of the mobile phone and guarantees that sensitive data is stored, processed and protected. In practice, this architecture provides security to mobile devices running open operating systems, supporting end-to-end security and safe execution by enforcing protection, confidentiality, integrity and access rights of the data belonging to trusted applications. • Integrity and responsibility breed trust. Our mobile devices have become portable companions we rely on to help manage every detail of our digital lives, delivering us services, assistance and advice we believe are best for us. Hence, we have come to trust our devices, a relationship that places mobile at the center of our digital existence. The next phase of growth and innovation in mobile is about delivering us services, content and connectivity we can trust. Companies must also gain our trust; only then will we provide them the insights and information to deliver us what we want. The responsibility now lies with vendors and service providers take to the actions that will create a fertile ground for this trust to grow and flourish.

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Gil Bernabeu | Technical Director, GlobalPlatform

securing an open world
Growing demand for mobile security has led to the formation of GlobalPlatform, a notfor-profit association that identifies, develops and publishes specifications to facilitate the secure and interoperable deployment and management of multiple embedded applications on secure chip technology. These freely available specifications also provide the foundation for market conver-

government, healthcare, retail and transit sectors. To further stimulate the develop-

Please detail the reasons for gence and innovative new cross-sector establishing GlobalPlatform. partnership as the technology is adopted Specifically, what has shifted by players in the finance, mobile/telecom, in the market to make this body necessary?

ment and deployment of trusted applications on mobile devices GlobalPlatform recently hosted an industry seminar to educate companies across the business ecosystem on the vast opportunities presented by the Trusted Execution Environment (TEE). Gil Bernabeu discusses the requirement for end-to-end security and GlobalPlatform’s own road map to ensure the long-term interoperability of secure chip technology.

GlobalPlatform was established in 1999. Back then, there was concern by the companies issuing smartcards – network operators, governments and banks – around increasing fragmentation in the absence of industry-wide standards. At the time an overarching standard was ISO 7816, but it did not address many of the administrative commands that would have had to be standardized in order to have chip interoperability. Thus, GlobalPlatform was established to address those key issues of interoperability at the chip component level. As security methodologies have changed over time, so has the architecture in the chip. As a result, the means and mechanisms by which we

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personalize the chip have also changed. In mobile, we can now do over-the-air activation of services, for example. So, when we look at putting richer applications on a mobile handset, the industry faces issues around security and interoperability. And we also face issues around new services because application developers want to have a known and standard platform to develop toward, and know the applications they write can be deployed broadly across several different platforms. The analogy I would use is the PC. The software programs don’t care if the underlying hardware platform is from IBM, Dell or HP because the operating environment is largely standardized. When you call up an application, up comes an installation wizard, and the wizard knows exactly what to do.  For developers, this means they can develop that application and trust that its performance will be the same on any operating environment. We are endeavoring to do this in the mobile world and create – via Global Platform- the construct for that common operating environment.

providers, to software vendors and device makers. We are educating the industry on how – and why – the mobile industry is coming together to standardize security run-time execution in mobile handsets. The next 12 months will see us take a three-step approach to maintain this momentum. First, we will have agreement on the basic technology to develop a TEE-which is being standardized by GlobalPlatform – by the end of this year. The next step, which will take place in the next six months, will allow us to have the first compliance program in place to verify the endto-end security of the TEE, including technology compliance and certification to known industry standards. Finally, in 12 months, we aim to have the complete infrastructure in place. So, it’s basic technology by the end of the year; compliance programs and functional checks in six months; and the complete environment in 12 months.

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That’s a very focussed and ambitious road map. Why is it so important to move so quickly?

What are the milestones and achievements so far? What are GlobalPlatform’s key focus areas and objectives for the next 12 months?

It is significant that we can go out to the industry and explain the value of the technology to service providers. To this end we have reached out to the ecosystem, from service and platform

The driver is value-added services and the opportunity that they represent to companies and service providers eager to offer them. Take banks, for example. Many are offering just a few services on smartphones. The banks are ready to invest more in terms of developing and deploying applications. However, to be able to do this under current conditions, they would have to develop for each handset platform. The TEE represents

a way to ensure the development of trusted applications – mobile payments, for example – that can be run securely in open environments, such as Android, Windows Phone and Linux. In parallel, another driver is the high risk of attacks from viruses and malware. People understand that this can be a very strong barrier to the deployment of value-added services that require a high level of security.

have collaboration to be able to able to enrich and grow the ecosystem.

I understand the TEE will provide end-to-end security. Does this reduce the need for other threat management solutions? Or does it create an entirely new market?

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You bring up barriers. What are the challenges top of mind with GlobalPlatform?

The challenge is linked to the fact that we need to create a new ecosystem to enable the development and deployment of trusted applications on mobile devices. We need to bring players together that are not accustomed to working together, let alone sitting at the same table. We did this in the beginning with GlobalPlatform when we brought the banks, the operators and the chip manufacturers together. Now we need to do the same in a new environment and with new players like the software vendors and the platform providers. In other words, we need to involve the companies that use the chips. And we need to have the service provider seated at the same table. That will allow an exchange that will help everyone understand the value for each member of the overall ecosystem and the value chain that it creates. This is a challenge because there is much competition between the players. We need to

It’s a good question. I foresee there will be a place for both. There will be a high level of security that is required by applications related to banking, for example. Users will have secure access to their banking application, which is crucial on an open device. And there will also be other applications that will require a less secure environment and will therefore be more the responsibility of the user. Since these applications will be software-based, there will naturally be a need for software that blocks malware or alerts the user so they can take control and decide to download or block the application.

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Clearly, premium content and mobile banking are two types of value-added services that are served and can benefit from the TEE. What are some other scenarios?

A: As our mobile phones become devices that accept and execute transactions that require a high level of security, we will see more use cases. There are two levels here. The first is about having more security to access value-added services and premium content, such as movies and music. This is certainly the first phase of the

TEE.  The second phase of the TEE is all about the new ways consumers can use the phone to interact with these services – using the keyboard, for example – to enter PIN codes and store personal digital information. We should also not forget how this might evolve with innovation in mobile phones. Micro-sensors pave the way for new features that go beyond GPS to include sensing real-time context such as temperature. To protect their privacy, people will likely want to have access to specific blocking features inside the smartphone that will allow them to block applications from accessing data stored on the device or use the phone’s built-in NFC or Wi-Fi capabilities, for example.

outcome: a large ecosystem of application vendors in numerous segments and industries, which ultimately leads to greater economies of scale. This is the opportunity.
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GlobalPlatform is not the only organization working on end-toend models to ensure a high level of security on mobile devices. The GSMA, for example, is working to establish a framework for mobile payments, while the OMTP is taking on the definition of a Trusted Execution Environment for the mobile phone. How do you feel they compare to GlobalPlatform?

So, there really isn’t a competing developmental effort out there, other than the efforts that go on within individual companies themselves. If the market is permitted to evolve that way – requiring a service provider to do things one way for one type of architecture, and another way for another architecture – then it will prevent the creation of a mass market. Put simply, the application providers will have to make too much investment to reach the many different types of device platforms.  It will retard the growth of the industry.  Standardizing a TEE gives the application provider or service provider a way to make their investment and know that they can truly reach a mass market.

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It’s a difficult question to answer in a simple way..However, there is no similar initiative focused on achieving our goals. We want to set a requirement for a well-defined and standardized TEE inside the phone. This, in turn, creates a broader level of alignment in the industry around commonly deployed security frameworks and associated software and APIs. The

And if we want to have these value-added services around premium content and payments, we won’t get there is each camp is doing their own thing…

Not exactly. Innovation would continue, but it would be highly proprietary. In other words, innovation would take a different path – one that is not to the advantage of the application developer. Entering markets and broadly marketing their applications development is going to be much more costly for them since they will have so many more platforms to develop

to, and so many more to maintain.

And this is also critical from a global perspective. Lack of standards is not only preventing a mass market, but it would also prevent us from reaching the next billion, for whom mobile is the only screen…
I think you stated it well. If you have a global vision, you need to be able to deploy value-added services around the world.

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Philippe Gillet | Director, IT Strategy and Innovation, BNP Paribas

crossing channels
One of the Europe’s largest banks, BNP Paribas operates about 2,250 retail branches in France and has approximately 4,000 additional locations in some 85 other countries. The company and its myriad subsidiaries specialize in retail banking, corporate and investment banking, and asset management. In 2009 BNP Paribas acquired a 75 percent stake in beleaguered Fortis Banque, adding some 1,450 retail branches in Belgium and Luxembourg and further cementing BNP Paribas as a top European bank. Phillippe Gillet discusses the role of mobile in the bank’s efforts to enhance customer service and boost loyalty.

From contactless payments trials to delivering advanced services via mobile and mobile apps, your bank has developed a strong focus on mobile. Please detail the role of mobile in your strategy and its place in your wider innovation and cross-media strategy.

As one of the largest banks in Europe, we have a significant presence in mature markets. Our footprint in Africa, in countries including Morocco and Tunisia, gives us a significant presence in emerging markets. So, we pursue two different approaches with respect to mobile. In mature markets it’s about the benefits of communication and using mobile to maintain our market share. In emerging markets, it’s different and we see that leveraging mobile is a way to expand our share and attract new customers. BNP Paribas is active in mobile. We were one of the first banks to implement software on the iPhone and Android.

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Additionally, we have developed an application to help our customers find the nearest BNP Paribas. In France we have a partnership with PayPal. In Belgium, together with the leading banks and telcos there, we are testing a new service for micropayments. In Turkey we have some trials with providers to allow our customers to pay their bills using their mobile phone. Africa is another area that is involving in mobile payments and banking. Together with Orange we kicked off news services with Orange Money available to customers on the Ivory Coast, Senegal and Burkina Faso. We have not yet disclosed details, but we are also looking to offer mobile banking with other African countries in the future where we would provide some micro-credit services.

After all, some industry experts expect that the next two years will see the same level of use of the Internet on the Android or iPhone as we do now on the personal computer.
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But it also goes beyond developing systems and services on Android or iPhone. Mobile is part of a multi-channel approach to CRM. With it you can manage contact with the customer. For example, the call center can arrange a follow-up appointment with the customer on their mobile phone and then forward this appointment and all the details directly to the customer manager in the branch office. Thus, the relationship with the customer is enriched and managed across all channels: ATMs, personal computers and, of course, mobile. It’s important to have a completely integrated view of the relationship with the customer.

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Apps are hot, with a lot of brands using apps to engage with their customers. You have your own app as well. What role does or will apps play in your own global strategy, in terms of marketing, selling and delivering financial services?

The main motivation for building an app was to develop more and more direct relationships with our customers across new channels. It’s easy for customers to do everything using their smartphones. So, if a bank is not present on an iPhone or Android phone, it is a disadvantage. Apps are at the center of building and keeping a good customer relationship.

As you mentioned, we are going to be using mobile devices just as much as we use our own PCs. This increase in use heightens concerns about security and malware. What are your concerns as a bank and how are you enabling secure payments and banking via mobile?

It’s a very complex situation, and cultural factors also have to be considered when looking for solutions. In Belgium, for example, people are accustomed to doing their home banking with the help of a phone connected card reader that effectively provides the token to enable and secure

the home banking transaction. And they use the same security set-up to conduct e-commerce on the Internet. In France, it’s different. There we started two years ago with banking and payments on the Internet based on a low level security that requires a date of birth, for example. Next, customers are required to input their One Time Password to verify transactions. On mobile in France we authenticate the transaction using a one-time password with SMS. I think that what is most important in security is to let the system evolve in the direction of the approaches that are effective, such as mobile and SMS.

such as banking and micro-credit.

The value chain is in a constant state of flux. Some analysts suggest we are heading for a showdown between the banks and financial institutions and the mobile operators. What is your view? Must we view mobile payments as a zero-sum game?

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Analysts and reports indicate that the real opportunities for mobile banking and payments are in the developing world, where regions are underbanked and mobile is the ONLY screen. What is your view? As a global bank, where do you see the growth opportunities and the difficulties?

Different consumers habits and regulations mean the value chain can be different in each country. It is clear that mobile operators have a role to play because they have a network. Working together to offer mobile payments makes sense - particularly in unbanked countries. Of course, the concern is that we lose part of the relationship, or the important part of a relationship, with new customers. How do we approach this? We have to recognize that our main skill is that we know the customer. We also understand good risk management and we know how to provide payments and credit to customers. In most of these countries telcos know it’s our business strength, not their business. So, in developing markets we have to provide these services directly on the mobile in partnership with the telco, not compete against the telcos. It may have been a battle a few years ago, but today telcos understand there are two ways to develop banking services. Because it is the mobile channel, telcos could just go ahead and deliver these services alone. However,

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For growth opportunities, it’s definitely the emerging markets. In Morocco, for example, we have only 300 branches. That was enough a few years ago, but today the market development requires the bank to offer services for the mass market and to do that cost-effectively. If we want to compete against the other banks in Morocco, we have to do it with mobile. We don’t have the capacity to build out our branch offices in that country quickly enough. And so, the only way to increase our market share in Morocco, or to maintain it, is to offer mobile services

telcos realize it’s not their business area to provide or manage credit. In Senegal, Burkina Faso, Orange specifically asked us to work with them. They didn’t want to do this alone.

Looking to the next 12 months, what are the three key trends or scenarios that excite you the most?

Let’s discuss the role of mobile in CRM. Many argue that text SMS messaging — because everyone can text and all phones support it — is THE format for effective outreach in the form of loyalty programs and other CRM schemes. What are your views and why?

For me, there is just one development that matters. In the next months, we will know more about Google’s mobile payment trials in New York and in California. What is the impact when a player like Google moves into payment services? An, by the way, we can ask the same about Apple. For Google, the most important thing is to know – and they already know this very well today – is what the end-users are doing. Google knows this in the Internet because it knows what people search for and do on their computers and on their mobile phones. Now with Google at the point-of-sale, Google will also know what users want to do – and – buy. Google will know my complete shopping patterns and behavior. So, it’s like: “Mr. Gillet, I know you very well, what you are buying on the Internet and what you buy at the shop near your house.” Based on this I could receive advertising. Direct advertising could be the next step. This very relevant and targeted advertising related to my purchases is very important, it’s also unsettling. It’s a little bit like Big Brother watching you.

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The way to have a relationship with the customer is to maintain a high level of service and provide these services using all the formats available: text messaging, mobile apps and the mobile Internet. At first SMS was used to inform customers on their current balance, deliver stock alerts or promote offers and services. But on the Android and on the iPhone, it’s efficient - and possible - to do much more. If a customer wants to know their balance, we can deliver the answer and use the opportunity to deliver an advertising message, depending on the context, of course.

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Jean-Philippe Galvan | IP Domain Director, Texas Instruments

orchestrating security
As mobile devices become increasingly complex, connected and common, the need for security on the handset has become essential. Most security solutions available today are software based, and – like the software we know from our PCs - are inherently more vulnerable to hacking, viruses and malicious attacks. This serious shortcoming creates demand for more robust Let’s start with a high level view security that is hardware-based, providing of M-Shield and your view of by ecosystem players – including content Execution Environment (TEE) owners, service providers, mobile operators and financial institutions – for solutions to protect their digital assets and enable transactions. Jean-Philippe Galvan walks us through the evolution of Texas Instruments’ M-Shield™ mobile security technology solution and its role in industry efforts to address the increasing convergence between the mobile and Internet worlds. a foundation to address the requirement the requirement for a Trusted

to ensure that proper security is implemented. TI’s OMAP 4 processor platform integrates a Trusted Execution Environment (TEE). What drove the decision to integrate security in the platform?

As you point out, the TEE is part of our M-Shield security technology. This security technology combines three dimensions: hardware, software and tools. The security provided by the TEE is a software capability, which relies on hardware resources offered by the platform. In addition, we then provide tools and documentation that explain how to use both the hardware and the software of the platform. We also provide a development kit to help people develop secure services inside the TEE. M-Shield is a technology that we have supported on our OMAPTM

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platform since OMAP 2 processor family. So, it’s nearly nine years that we’ve been working with the M-Shield technology and the TEE, and that has become what the TEE is today on the OMAP platform. With the OMAP 4 platform, we made even more improvements and, as the TEE becomes more of a standard, we have made the TEE comply to those standards and particularly to the GlobalPlatform API standards. So, TI has always been very conscious about bringing the best possible level of security to our customers.
FIGURE 1:

customers would not face jail breaking, or people trying to hack the device or clone the device. With time, software platforms emerged, like Linux and Android, and the industry moved from closed proprietary environments to open software that is also exposed to attacks and malevolent applications. This is when it really became obvious that our original plans of separating between a non-secure world and a secure world could greatly benefit this emerging environment, so we reinforced our TEE to make it stronger with more capabilities and more features. Thus, the emergence of open platforms means the role of the TEE is more important than ever.

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Architecture of the TEE

Open platforms are also a huge step away from fragmentation, paving the way for a mass market of consumers using phones that are more capable - and more open to attack – than PCs...
Source: Texas Instruments

The prime driver, beginning with OMAP 2 processors, was the protection of the device with features like secure booting, and the capability of offering an isolated, secure world separate from the operating system where we could protect security credentials like the keys, the security data and the security assets. Put another way, the original motivation was to protect the device so that our

Absolutely. The smartphone you buy today has the same capabilities as the PC you bought a couple years ago. However, there are a few critical differences. A smartphone can be more easily lost or stolen, and can be connected to networks everywhere, including potentially very hostile networks and locations around the world. So, the security risks are quite larger than the ones you face on your PC at home. And the connection to cloud services that you are going to get on your smartphone or tablet imposes additional security rules

on you, which are required by the service providers who offer these services on the cloud in the first place. Companies like Netflix or PayPal will not offer their premium services on your device unless your device brings a high level of protection.

movies – on Android devices. What else can we expect?

That’s a great segue to the news that Texas Instruments has become the first partner to achieve the Netflix Silicon Reference Implementation (SRI) certification for the Netflix HD application on Android. In plain text this means that your
FIGURE 2:

The M-Shield Security Technology

Being the first to achieve this coveted certification and to provide the solution that ensures a strong balance of performance, security and power efficiency as Netflix experiences migrate to the mobile world, is a huge achievement for us. In the months to come we’re sure to see more service providers determined to bring their content to mobile devices while fulfilling the demand for a high level of security. I’m thinking here of services like Amazon Instant Video (AIV), MobiTV or Hulu Plus [an adsupported, premium subscription service that includes HD access to full season runs of shows from U.S. broadcasters Fox, ABC, and NBC]. This is the same situation as with Netflix, where the service provider demands to provide its high-quality content only to those devices that have guaranteed content protection to ensure the content is protected on the device, and can’t be stolen or hacked. So, in the months to come we will see a number of devices from a number of companies which are implementing the Netflix application on top of the OMAP platform. And, for our customers, the fact that the OMAP platform is certified by Netflix dramatically reduces the time to market for their devices because their certification time with Netflix is also reduced. This means that a customer using the OMAP 4 platform today will only have to go through a

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Source: Texas Instruments

OMAP 4 platform, complete with M-Shield security technology, has met the Netflix requirements for mobile content streaming, including the ability to run up to full high-definition video within strict security measures. It’s a milestone that paves the way for Netflix to deliver us their content – TV shows and

very simple delta certification with Netflix compared to a very lengthy full certification that they would have to go through if they were not using the OMAP platform. You’ll see those devices coming onto the market in the second half of 2011 and more coming onto the market in 2012, including devices that will also offer payment capabilities.

companies backing up the payments. You can imagine payments based on cloud computing, rather than on the secure element processing on the device or on the plastic card.
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Content providers require robust security on the device to protect the integrity of the content. However, there are also huge opportunities when we look at mobile payments and mobile banking. Please share some of the use cases this security technology enables.

But, it’s not just about payments. More important than the cash itself, which is transitioning in the payment process, is the statistical information: fidelity information, discount information, customer history tracking information. All these information flows are associated with the payment. It’s not cash, but this is still information that has great financial value. And, it is also going to require a TEE in order to process along the lines of a complete monetization or payment transaction. Say you buy a flight and reserve a hotel room using your mobile device. You input your credit card, your airline company credit card, and then maybe you have a discount coupon for the hotel booking you got as part of a mobile advertising campaign. You have all of this information associated with a payment transaction, and it needs to be secure. And I think this convergence of the payment and data associated with the payment is going to be a booming space where we can take advantage of the capability and importance of the TEE.

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The mobile payment space is truly booming. An area of particular interest is proximity payments, where you use your device to pay at the point-of-sale. And, this is booming because of recent developments, such as the launch of Google Wallet. At the moment, proximity payments are very much a credit card mimicking capability. The security is inside the secure element, which is inside the NFC chip. It mimics a credit card payment model, and the NFC with secure element takes on the role of the smartcard in the plastic card. However, there are many more payment capabilities that can be developed, and not necessarily with traditional banking or credit card

And it’s not just the payment data. We are also providing personal data about our shopping preferences and patterns. Is securing this another

opportunity for the TEE and the security technology you offer? If so, how do you see this evolving?

chip technology. This year marks significant progress in standardizing the TEE in mobile Yes. This is all connected to the devices and the APIs that will statistical data. Consumers respond to help make the use cases you offers delivered to their mobile devices; discussed possible. With this they get discounts, coupons and in mind, please describe the receive and send data during those ecosystem and how players transactions that must be secure. work together to deliver the The TEE has a role in this because all secure services you discussed.
this information needs to be processed very securely – particularly since people are already sensitive and have privacy concerns when it comes to the data their devices are collecting about them. So, you need security to give confidence to the end-user that this information gathered is fully protected but also able to give them opportunities, discounts, loyalty points they can redeem for benefits. It’s also information that shouldn’t get into the wrong hands. Therefore, they need to be provided an infrastructure that gives them what is good and protects them from what is bad. Here the TEE has a role to play because it has the capability to coordinate all these flows of information, and to store and process this information securely inside the TEE.

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First and most importantly, OS framework providers like Google are part of this ecosystem. For instance, Google embeds a security framework that Android developers access in order to use the security capabilities available on the platform. In other words, Android is supporting a TEE, and the same could happen for other operating systems. The second ecosystem is made up of the players that are going to provide the secure services that will run inside the TEE. These include DRM agent providers, mobile payment engine providers, over-the-air providers. All of these companies can provide variants of their software. But inside their software they delegate the security execution, for instance for authentication or for payment, to a secure service that is running inside the TEE. The third family of the ecosystem partners are the people who are going to provide applications that run inside the high-level operating system and can use the secure services, which they assume will be on the platform,

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The role of the TEE is also expanding, driven by work within the GlobalPlatform, the organization – which counts Texas Instruments as a member along with Giesecke & Devrient, ST Ericsson, and Trusted Logic – standardizes the management of applications and secure

to develop an application. For instance, I can develop a commerce application that assumes a secure payment engine is available in the TEE on the platform and therefore can run on or can be downloaded onto a mobile device where this payment engine has already been installed. Overall, the ecosystem has three dimensions, and it has to go in three steps. First, we have to have the infrastructure ecosystem vendors involved, and this is the case within the GlobalPlatform and through the standardization it has achieved so far. Secondly, you have to have the security service providers, and today several are involved and this number will grow very fast with the standardization progress this year that you mentioned. And, finally, you have the application developers who will then transform the application to capitalize on the existence of the security services deployed on the devices.

bedroom, as well as the temperature of your house. Today we see the home network is happening and it’s also going to require security to both enable and control that convergence.
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And when it all comes together we have the ecosystem to enable the use cases you described around premium content and mobile payments. What are the other scenarios that excite you when you look to the future of mobile security?

Consumers will need security because they don’t necessarily want to mix the information they have with the information their kids, relatives or visitors have. People will want and need some isolation between the networks within the home network because they have levels of privacy to protect. Say your friends come by and they bring their own devices into your home. Maybe their device somehow gets connected into your home network, or maybe you offer them access to the Internet via Wi-Fi at your home. There is data that you don’t want them to access in your home network and that is what you need to protect. You also need to make sure the content they have on their devices is not coming to your network because, for one, you don’t have the rights to get the content that they have on their device, despite the fact that their device becomes part of your network. And there are other networks to consider. You work at home so your home network converges with your personal network and your corporate network. You have to be able to draw the line. Imagine a colleague from work comes to your home to work on a project. They bring their device into your home network and they are connected to your corporate network.

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Ten years ago I was working on a kind of tablet device that acted as the point of control in your home network. With this tablet you could control your TV, your recorder, the stereo in your

Suddenly, your home network gets connected with your colleague’s mobile network and your enterprise network. You need to have isolation between your home network and your home assets and your corporate assets and what your colleague is bringing as he joins your network to do this project work at your home. So you can see how convergence is going to blur the lines between the

home network, the personal network and the corporate network. This convergence is inevitable and this is where we are all going to need security to make sure our personal assets, our home assets and our corporate assets are protected at the right level. So you have to find the right balance. You want to open it to your family members, friends and co workers, but not to strangers. That is the challenge and the opportunity.

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Rob Brown | Director of Marketing, Secure Services Division, ARM

enter the trustzone
Mobile phones have evolved into open software platforms capable of downloading a huge variety of applications from the Internet. New business models are emerging, from the capability to pay for, download and view the latest Hollywood blockbuster content to the ability to manage bank accounts remotely from a handset. Opportunities are vast – and so is the threat of malicious code

Please provide a high-level view and malevolent applications that can target of your TrustZone technology. smartphones. To help combat the threat What are the merits of your ARM has developed TrustZone® technol- approach, and why is a systemwide approach necessary?
ogy, a system-wide approach to security on huge array of applications including secure

high performance computing platforms for a payment, digital rights management (DRM), and web-based services. Robert Brown discusses the increasing requirement for robust security solutions and the progress to date.

TrustZone is a security technology that is complementary to existing secure technologies because it’s filling a gap between handsets with rich operating systems that are full of flexibility and functionality – but also open to attack from malware – and some of the more secure technologies associated with smart cards and secure elements. The smart card has evolved to provide a strong tamper-resistant function that allows it to store highly sensitive assets like bank keys and EMV applications. When you place one of those secure elements in a handset, effectively you place a secure island into the handset that’s useful for some security functions. However, the secure element doesn’t have a keypad, and it doesn’t have a display, so where’s the security for

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a keypad and display going to sit? It has to sit inside the system-onchip that has a direct connection to the user interface, and that’s where the security needs to be added. That’s where TrustZone comes in. It enables us to provide an isolated environment, a Trusted Execution Environment (TEE), in which the more security sensitive functions of an application, such as user input and display can be run separate from the rich OS but on the same hardware as the rich OS. So, what you really want to run in a TEE is a very small secure OS and small secure applets - the fewer lines of code that you have, the less likelihood of bugs and backdoors that can be exploited. For that we looked to the smart card vendors – with their smart card OSs – to develop them and port them into TrustZone systems–on-chip.

operating system. A trusted execution environment, on the other hand, would be in the realms of a few tens of kilobytes of code. So there are several orders of magnitude of difference in size. The rich OS is designed to do all the things that app developers want, such as make things look great on the display and provide plenty of APIs for easy application development. The Trusted Execution Environment is designed to handle some highly security specific functions, such as encryptions, hashing, capturing PINs and passwords. We want to keep the functionality small, because we don’t want to run a full application in the trusted execution environment. It wouldn’t be trusted, because there would be too much code running in there. So to answer the question, picture a banking application, sat on a future handset with a Trusted Execution Environment and a Secure Element. The vast majority of code for that banking app would be running in the rich OS that handles the user interactions, the look and feel and flow of the app itself. A smaller amount of code would handle things like securely capturing the user’s password, or securely displaying a transaction amount. And an even smaller amount of code would potentially sit in a corresponding secure element, which would handle PIN verification and authorization to enable a transaction in an offline environment. Obviously there’s got to be a mechanism to communicate to a Trusted Execution

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Apps are hot. In an application, where does the OS leave off, and where does the Trusted Execution Environment begin?

To start, let’s compare a rich operating system with a Trusted Execution Environment. A rich OS may have many hundreds of megabytes of code that form the code-base of that

Environment from a rich OS, and that’s handled by a driver with a standard interface – the Global Platform TEE API.

What are the use cases that are driving this?

A chief one is content protection. The studios want to know that – when users download and play the content they offer – their high value content assets are protected. In order to offer their content to end-users in the first place, these providers demand security in an end-user device, such that they can have a high level of confidence in the transaction. They have to be sure if they sell high-definition premium content to an end user, then that content is going to the person they sold it to and no further. A high level of security on the device paves the way for new services, like being able to access high-definition content before it is released on DVD.

go an hunt down my wallet and enter pages of information, I’m much more likely to buy just at the moment I’ve decided that I’d want to watch the film. With this simplicity of purchase we’re opening up new sales opportunities just from having security baked into the device. Security should make things easy for users, and when payments are made easy, commerce will thrive.

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Payments are intrinsically tied to content services you can envision? too. As a film-lover I read reviews of One is loyalty applications. Today, your films currently playing in the cinema supermarket loyalty card is a plastic on my tablet computer, and often think card in your wallet. It’s a number that after reading a review that “I trust this is associated with you and allows the reviewer, and yes, I’d go and see that supermarket to track and reward your film”. But reality kicks in when my two purchases. Place that loyalty card young kids and no babysitter demand number into an unprotected device, that I stay at home. All thought of seeing and it becomes a unique identifier that the film vanishes and I’ll have forgotten anyone who has infected your device all about it by the time it comes to DVD with malware can use to track you. If or satellite TV. If that same film review the loyalty number is linked to coupons I’m reading on my tablet has a purchase and vouchers, then - again - this is link on it, and the purchase experience something that someone could hack was so simple that I could click on it, to steal your discounts and offers. enter a pin, and buy the rights to watch the film without the need for me to Supermarkets don’t necessarily need

What are other scenarios and

the same level of protection that a bank does. But they would want to have some level of trust and protection to ensure that their app is protecting their user’s identity, and to convince the individual user that their app will be used by the supermarket and nobody else. Many supermarkets have spent years building trust in their brand between themselves and their users and it only takes one breach of trust to erode goodwill built over decades. But it’s not just about protecting consumer privacy; it’s also about being able to offer some enhanced services to the user. Shops could send me offers they know – from tracking my past purchases – which I will likely appreciate and make them location aware as well. For instance if the sun is shining (a rare event in the UK), and they know I’m at home, the supermarket could push an offer for discounted steak to me. That may give me an idea to post a Facebook invite to my friends to come for a barbeque; then off I go to the supermarket, with my discount coupons already loaded onto my device. All in one seamless action I can redeem the coupons while paying at the checkout. There’s a sale completely generated from having a trustworthy device. It’s not possible today because the devices are not that trustworthy.

standardizing the technology and certifying it. So let’s talk about the enablement. To date ARM processors are found in over 95% of the world’s mobile phones. TrustZone is an ARM technology that is found in ARM processors targeting the advanced application processor system-onchip sockets in smart phones and many silicon providers already have TrustZone in their designs. However, TrustZone needs to be correctly configured by a chip manufacturer and to that end we’re working with chip manufacturers, enabling them to create chips that will meet the needs of service providers that demand security including banks, content owners, aggregators and network operators. We are standardizing interfaces as full member of Global Platform, which means we are working with companies like Gemalto on creating levels of inter-operability for deploying applications written to Trusted Execution Environments. ARM donated its TrustZone API to Global Platform over a year ago and since then the Global Platform members have revised it and published it as the Global Platform Trusted Execution Environment API. Certification is a big challenge. Efforts are focused on proving a level of security for banks to make informed decisions on risk management. To achieve this we need something that the banks find familiar, something like Common Criteria evaluation. But the

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These are great scenarios. What is ARM doing to make them possible?

We are taking a three-pronged approach: enabling the market,

mobile value chain is vastly different from the smart card market. We can’t go about imposing smart card like evaluations on mobile handsets, simply because nobody in the handset market has the time to go through such an evaluation. So, what we have to do is focus on an evaluation process that proves security by design. And to do this we’re taking on the challenge of proving, at the base layer, that our TrustZone architecture provides levels of isolation and security that are necessary. This approach, with each chip implementation, would see each device manufacturer building upon a base certification to end up with a composite program that certifies at the device level, such that the device has been correctly implemented to make use of TrustZone.

challenge has been the handsets. The mobile phones people really want are smartphones and the NFC-enabled handsets that manufacturers have been selling are two-year old handsets that nobody wants anymore because they’re so dated. The breakthrough opportunities arise when it comes to this bringing NFC to open OS devices. This is where the Trusted Execution Environment really comes into play. Put another way, we’re not reliant upon NFC to drive adoption of the Trusted Execution Environment. In fact, the Trusted Execution Environment can actually assist with driving NFC into the smartphone. There is a lot of work to do in building payment applications to make use of Trusted Execution Environments. How this plays out is down to the service providers, and the success of industry efforts to bring them up to speed and educate them as they start to create apps. After all, what’s driving adoption is the rise of the smartphone and the apps we download. The smartphone is fantastically open and has brought us hundreds of thousands of new apps, but it also brings us many new threats into the mobile world. This is one of the key drivers for the Trusted Execution Environment.

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The Trusted Execution Environment is at the core of secure services around payment and banking. Where does NFC fit in?

We’ve been promised mobile payments and NFC for eight years now, and it seems that it’s always just on the cusp of mass scale deployment. The

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Christophe Colas | Marketing Director, Trusted Logic

foundation for a secure world
Our need for seamless mobility has opened up a world of new possibilities, but it also presents the industry with two major challenges: interoperability and security. Trusted Logic, a subsidiary of Gemalto, is a major player in the digital security market addressing the growing requirement for open and secure embedded systems and solutions for smart cards and wireless devices. The company, which serves 200+ customers in the telecom, banking, transportation and government sectors, has successfully positioned itself as a key enabler, paving the way for a variety of services ranging from mobile payments to e-ticketing. However, Trusted Logic’s value to its customers does not end there. The company is also a leader in Trusted Execution Environment (TEE) and committed to supporting the TEE specifications from GlobalPlatform, the body that standardizes the secure and interoperable deployment and management of multiple embedded applications on secure chip technology. Moreover, Trusted Logic as part of the Gemalto group is a full member of GlobalPlatform, participating in the various GlobalPlatform Committees and task forces. Moreover, Christophe Colas is chairing the GlobalPlatform Device Committee. Christophe discusses the developments driving the demand for digital security and the key milestones that mark significant progress.

Let’s start with a high-level view of Trusted Logic and recent innovations that allow you to achieve your goal of providing secure and interoperable products and solutions for digital services.

With our Trusted Execution Environment product, Trusted Foundations™, we were the first to align with the latest TEE specifications from GlobalPlatform. By incorporating the requirements of this standard, Trusted Foundations becomes an open platform based on standard interfaces, making it easier for service providers to develop applications. By way of background, GlobalPlatform’s TEE defines a standard that makes it easier to use secure environments within the various smartphone operating systems. Trusted Foundations, implementing a TEE, provides an isolated environment to secure sensitive applications on the mobile device itself. It is already widely deployed on Android and Symbian smartphones

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from major handset manufacturers. It also fulfills the security level required for premium content protection and digital rights management, as well as corporate applications on smartphones and mobile financial services. In addition, Trusted Foundations’ unique Trusted User Interface brings a further level of security by protecting against malicious applications, and prompting end-users when they can enter sensitive information. This is critical for securitydemanding applications such as mobile financial services. After all, our mobile devices are rapidly evolving from a simple telephone to an all-inone wallet, bank account, cinema, library, and more. It is therefore crucial to ensure security while allowing a rich application eco-system. Incorporating the requirements from GlobalPlatform specifications provides even stronger readiness to host applications from a wide variety of sources. For example, chip specialist Nvidia has selected Trusted Logic’s Trusted Foundations software product to secure sensitive applications on super phones and tablets powered by the Nvidia Tegra mobile super chip. Target applications include mobile commerce, mobile banking, and corporate services. The product has also been combined with TrustedShow digital rights management, to allow consumers to enjoy the highdefinition video-on-demand service on Tegra-powered super phones and tablets. Trusted Foundations is now being integrated in Tegra, and can leverage hardware-based security

such as the ARM TrustZone.

How do you define security? Specifically, what is driving the requirement for security on our devices, as opposed to software-based solutions?

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Smartphones and tablets, basically open devices, are sharpening the industry focus on security. The advance of these devices means that users can download applications from an application store. Obviously, these devices are open, so they are not only open to the valid applications users download. They are also open to attack from malware, similar to the viruses and malevolent applications we know - and are still experiencing - on the PC. It’s a difficult balance because users have an open device and want to have a lot of applications on it. But they also need to maintain a certain level of security on the device. Overall, the security can be spread between something that you do in the Cloud and something that you will do within the device. If we focus on the device, there are four areas where you can add security. In the first level, everything is simply done within the application. However, this is only a software-based approach to security and open to the malware that can we know attacks all software. At the second level of security, you could have some security embedded inside the operating system and that could be used indirectly by all the applications that are downloaded to

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the device. But this is still softwarebased security, so it will not stand up against elaborated software attacks including device rooting or jailbreaking.

How do companies choose the level of security? That is up to the providers. Naturally, premium content companies and providers demand the highest level of security and a hardware-based solution ensures the content is protected on the device, and can’t be stolen, compromised or hacked. That was also the motivation of Nvidia when it selected out Trusted Foundations software product to secure sensitive applications on super phones and tablets powered by its Tegra mobile super chip.

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To be truly secure the approach has to be hardware-based. That is where the third category of security, known as Secure Elements (SE), comes in. The Secure Elements are smartcard-based technology that can be part of the SIM card, a dedicated Embedded SE or a MicroSD card. Secure Elements are effectively hardware-based but with a specific additional hardware element. Fourth and last, and where we are having our major focus in Trusted Logic, this is a Trusted Execution Environment or TEE. The TEE is a secure area that resides in the main processor of the phone and guarantees that sensitive data is stored, processed and protected in a trusted environment. Its ability to offer safe execution of authorized security software, known as trusted applications, enables the TEE to enforce protection, confidentiality, integrity and access rights of the data belonging to those trusted applications. This, in turn, provides end-to-end security. 

Let’s talk about the growth opportunities. Premium content is one. What are the others?

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The market is booming because of smartphones and tablets. Consumers want to do more with these devices because they can. This activity has captured the attention of service providers that want to provide services to the consumer and monetize them. Wherever companies want to monetize services this has to be backed up by security features that are spread between some security features on the Cloud and some security features on the devices. This is a growth opportunity for Trusted Logic, and for the entire ecosystem. The more services there are on the phone – the more service providers coming in to the phone – the more there is an interest in making money with these services. With service providers like Netflix lining up to deliver video, as well as companies that allow you to

connect your devices so you download to your smartphone and watch on your TV, it’s clear there is new revenue being created here. And this represents new and exciting opportunity. Right now we’re speaking about mobile phones and tablets. But it will grow to include home networks, automotive and the enterprise. At the same time, we will see this spread into everything related to mobile payments and transactions – so NFC, proximity payments, mobile banking, money transfers between individuals. Here again companies and banks are requiring a higher level of security. And, here again, this is a huge growth opportunity for Trusted Logic, as well as for other ecosystem players.

practice the user can securely enter a PIN code or a passcode to validate the transaction and to be sure the PIN code is managed securely within the TEE. That way the user can also be sure that the transaction information which is displayed on the device is correct and no malware has changed it. This is critical. Without it you could not be sure if malware hadn’t somehow changed important data such as the amount of a money transfer, or the bank details of the recipient. With the Trusted Execution Environment and the Trusted User Interface you can be sure the sensitive part of the user interface, the part open to attack from malware, is completely secure.

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Let’s talk about payments. How are you facilitating payment security as Trusted Logic and also as a member of GlobalPlatform?

The unique value we add to the ecosystem is the so-called Trusted User Interface, which we are implementing for the TEE. It allows there to be a trusted transaction on the mobile device. Say you do a financial transaction on the mobile using an Android application. The user interface – everything that you are typing onto the phone and the information that is displayed on the phone – is controlled by the Android system. This means it is also open to a malware attack. The Trusted User Interface implemented within the TEE allows users to validate the transaction. In

Let’s discuss GlobalPlatform. You are a leading member and you, personally, chair the Device Committee. Please detail your roadmap and your deliverables. I understand that October marked a milestone in the organization’s progress and outreach to players in the industry...

Within GlobalPlatform significant progress has been made toward standardizing both the Secure Elements and the Trusted Execution Environment. With regards to Secure Elements, the work there started quite early and a lot of progress has been made. However, there are still points about to be fine-tuned in terms of NFC. The technology is mature. But the NFC value chain is quite complex, and there are lots of players involved. To

do NFC payments you first need the Secure Elements. There are different forms of Secure Elements and there are also different players that own and control these Secure Elements. In some cases it’s the OEM, in others it’s the mobile operator. The Secure Element can also be controlled by other entity like Google in the case of Google Wallet. So you just don’t need the technology; you need to have an agreement between the players in the value chain about the business model and how all the parties work together. On the TEE technology, we have already defined some key pieces of the technology. We have defined the TEE Client API last year that allows software residing in the main mobile OS to communicate with the TEE. We are completing for end year a first version of the TEE Internal APIs that will be used

by service providers to develop Trusted Applications running within the TEE. We have an active roadmap for next year to further standardize the TEE. We will add new functionality in the TEE internal APIs such as adding the communication with the Secure Elements. We are defining also the compliance program for the TEE, the remote administration of the TEE and the security certification program for the TEE. The objective of the standardization is to grow the ecosystem of the TEE. This is made up of service providers developing secure applications for the TEE and the platform providers that must be able to implement this standard technology. So, the goal is very much to grow this key ecosystem and to reduce any fragmentation in this emerging technology.

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SOLUTIONS AT A GLANCE

SOLUTIONS AT A GLANCE
108 NETSIZE 112 GEMALTO 117 TRUSTED LOGIC

NETSIZE
the mobile commerce enabler

Operator billing in

45+ countries
NEtsizE

SMS messaging in

200+ countries

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THE MOBILE COMMERCE ENABLER

Active in the mobile market since 1998, Netsize is a leading global provider of mobile messaging and mobile payment solutions. Our customers use Netsize solutions to drive their businesses forward, mobilizing consumer relationships, enhancing brand loyalty and optimizing business processes. They also use our solutions to successfully deploy m-commerce strategies, enabling consumers to use mobile and online payment to buy premium content, digital and virtual goods and services. Netsize is uniquely equipped to help its customers deploy mobile services on a multinational scale. With 9 Netsize offices in Europe and Australia, and as part of the Gemalto organization our reach is truly global.

Mobile Messaging CORPORATE ENTERPRISES BRANDS & RETAILERS ENTERTAINMENT & MEDIA

Platforms Infrastructure Back office

120+
Mobile Operators & Access Providers Carrier Billing

END USERS MACHINES

Global Deployment and Distribution of Mobile Services, Applications and Payment Solutions • Single point of access to reach across many operators • Reliable infrastructure for messaging, mobile marketing, and mobile payment • Modular solutions: From end-to-end applications to single service components

Mobile Messaging
The Netsize Mobile Messaging offer enables enterprises and merchants to deploy SMS and MMS mobile messaging applications in 200+ countries globally, including information services, promotions, mobile marketing and CRM retention campaigns. SMS messaging is the universal business-to-consumer channel with the best possible targeting. By 2015, SMS traffic is expected to exceed well over 12 trillion messages, and a very large portion will be Business-to-Person messaging.

Netsize Mobile Messaging products
mGateway
NEtsizE

High-performance, feature-rich SMS/MMS messaging gateway with three levels of coverage. Netsize Push SMS Direct connections and Two-Way SMS Direct connections to more than 100 mobile network operators provide the highest level of message control and deliverability, based on local contracts with every single destination operator. Netsize Push SMS Optimix connections offer reliable local connections at good  price for high-volume destinations, while Netsize Push SMS Economy connections give you global reach and attractive pricing based on roaming architecture and SS7 direct connections.
mMarketing

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THE MOBILE COMMERCE ENABLER

Powerful solution for launching mobile campaigns using SMS. A rich set of features enable you to precisely target and schedule your one-time or recurring campaigns, receive and manage text replies, and analyze campaign progress and results. mMarketing is software as a service (nothing to install) and can be used from any web browser.

Mobile Payment

The Netsize Mobile Payment offer enables merchants to authenticate and charge mobile subscribers, by providing them with a mobile payment platform that permits billing transactions using direct carrier billing, online (web & WAP) billing, as well as Premium SMS billing in 45 countries globally. Also credit card billing is supported.

mPayment billing options
SMS/Web Billing WAP/Web Billing Direct Billing Credit Card Billing Billing via Premium Message Billing via MNO billing platform Server to server billing via MNO platform Non-MNO billing MO Premium, MT Premium Netsize and/or Mandatory MNO pages MSISDN, IP, Alias, IMSI NEtsizE

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THE MOBILE COMMERCE ENABLER

Netsize Mobile Payment products
mPayment

Powerful mobile micropayment platform for Content Providers and Application Stores. Enabling Direct carrier billing, Online (WEB & WAP) billing, Premium SMS billing, In-app billing as well as billing via credit card, you choose the method and let mPayment take care of the technical intricacies. mPayment supports pay-peruse (one-off) and subscription business models.
mTools

Utilities for optimizing services revenues, including opt-in flows management , statistics , portability, billing ratios and billing retry schemes.

When you launch a mobile service, take these aspects into account:
What storefronts will be used to address end users?

Nowadays, consumers might discover your goods & services in many ways. Online, via PC or notebook, on their tablet, smartphone or gaming console, on in traditional channels such TV or in a magazine. It is therefore key to your business to pick the storefronts (SMS, WAP site, WEB site, Mobile Application) which allow you to successfully address  your end users. Does your mobile payment solution provide you with the flexibility to use it with whatever storefront, or is your choice limited to just a subset of channels? Netsize Mobile Payment can be used with all storefronts.
What access channels are allowed?
NEtsizE

The channel through which users can access your storefront is highly dependent on the type of storefront. Can you easily authenticate a user who is visiting your store, via any access channel? A smooth payment transaction depends on it. Netsize can propose you various authentication methods to identify an end user whatever the access channel – fixed line, wireless / WiFi, and cellular.
What billing channels are available?

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THE MOBILE COMMERCE ENABLER

There are various billing channels for mobile payment. Which methods you can use varies by country, mobile network operator, and local regulations. The end user transaction flow might also vary depending on the method chosen. The sold item’s end user price is also of influence. In each country/operator you want to deploy, Netsize will provide you with a matrix of possible billing channels for your storefront. By providing a choice of billing methods , Netsize helps merchants monetize with the right combination of best revenue shares and conversion rates. The use of mobile payment methods is subject to many rules and regulations. Netsize offers consulting and legal services to help merchants navigate this subject, and design and launch services that are compliant with local codes of conduct and law, including VAT rules. Merchants that use our experience in this field reduce project lead times and time-to-market, and can implement financial flows that are compliant with tax requirements. Netsize can further help you to optimize conversion, billing and retention rates for your service in order to maximize your revenue. Our experience in what works best and how to reduce friction in the payment flows is rooted in the many payment deployments across a very large number of operators. By working with Netsize, merchants can enjoy the best possible conversion rates.

GEMALTO
Mobile Marketing Services
Whether building customer loyalty, promoting your brand or selling new services, mobile marketing is all about reaching consumers in an interactive, personalized and respectful way. People carry their mobile phone everywhere, so this channel ensures you can always reach the right customer with the right content at the right time.
GEMALtO

Ensuring success of mobile marketing campaign is giving consumers exactly what they want

Promotion & Ad targeting efficiency depends on fresh and abundant data about consumers — what they’re doing, where they’ve been, where they go and how they interact with their phone. Consumers are, however, increasingly concerned about privacy issues and relevance of information they get. Therefore it is key to allow them to control the engagement and choose promotions or ads they will receive. This is where Gemalto is ideally positioned: bringing its experience in managing security, user privacy and interactivity to the mobile marketing market. To achieve this goal of privacy management, control and relevance for mobile users, Gemalto offers mobile operators & brands the benefits of a full-service mobile marketing solution implementing its powerful and unique SmartMESSAGE.

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MOBILE MARKETING SERVICES

Boosting mobile marketing campaigns with SmartMESSAGE, the most responsive channel

Gemalto’s unique touch is the SmartMESSAGE, a message piloted by a SIM application using the SMS channel. It enables new types of campaigns with mutiple screens and decision trees. smartMESSAGE channel delivers superior user experience: It’s always seen as it appears on the idle screen and is fully designed to enable a smooth and interactive user experience for opt-in, qualification & direct marketing. It is easy to use, intuitive and requires only a single click to reply, without any short codes. Messages can be fully personalized to match the profile of each enduser and it is free of charge for end-users to reply back.

• REACH 100% of handsets • ALWAYS SEEN sitting on the idle screen • EASY TO USE 1-click access the next screen • HIGHER ACCEPTANCE RATE 2 to 10 times higher than SMS campaigns

Powering mobile marketing campaign for Mobile Operators & Advertisers with Smart Message
Gemalto supports Mobile Operators in implementing efficient Mobile CRM campaigns. Gemalto Mobile CRM solution enables operators to manage their user data base and run efficient CRM programs. This way, they can enrich their subscriber database by collecting and managing opt-in information, building the knowledge of their customers through interactive mobile questionnaires and securing customer’s response rate and engagement.
Mobile Marketing Center a one-stop-shop solution • User friendly interface • Simple to design, test & deploy • Sharp measurement • Data collection & storage

GEMALtO

By building, designing and planning efficient mobile CRM campaigns operators better engage with consumers and thus increase their loyalty, boost revenue and reduce CRM operating cost.

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MOBILE MARKETING SERVICES

For Advertisers, Gemalto offers Lassoo, a messaging marketplace to deliver powerful and targeted mobile CRM campaigns over smartMESSAGE and across multiple operators

1| 2| 3|

Raise interest and develop brand presence: inform, push news & promotions Drive traffic and service use: Couponing, ticketing, promotional, ooffers, pre and post shopping actiovation Intensivy emgagement: Survey. post shopping experience, profile setting enhancement, service registration

As permission-based marketing, smartMESSAGE campaigns complies with privacy policies, so messages are sent only to opt-in databases provided by the sender.
CAMPAIGNS Innovative type of campaigngns via decision trees, multiple screens ... AUDIENCE Privacy, relevance and control for mobile audience REACH SIM based solution with universal reach

Digital Life Management Services
Convergence between mobile and PC worlds is now within reach. With the evolution of network speeds and the wide spread of smart phones, users can now do almost everything they used to do from a desktop PC with their mobile while they are on the go. Personal data such as the mobile address book, photos, videos, calendar and more can be synchronized across multiple devices for anytime access.

At the same time, social networking sites have become powerful communication platforms, integrating address book, photos, videos, email and instant messaging on a single platform. With these web-based services coming to the mobile phone, the mobile market landscape is set for big changes. This market shift has generated strong expectations among mobile users in terms of how they access and share their personal data. Smart phones, which are offering a rich and integrated experience have flooded the market on a global scale, yet there are still many users across the world that use phones that do not provide embedded applications for synchronizing and sharing mobile content for instance. Yet these users have the same needs in terms of data protection and communication or sharing and this represents a great opportunity for mobile operators.
GEMALtO

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MOBILE MARKETING SERVICES

Protect, Organize, Communicate and Share
Gemalto has developed a set of white label services for operators to allow their subscribers to protect, organize, communicate and share their digital lives. They can run on different platforms according to the operators’ strategy and the nature of their subscriber base, tThe entry point being the SIM card, the mobile phone or the web. This unique positioning allows Gemalto to serve operators in emerging or developed markets. The SIM based applications offer a text based menu that can be used by anyone, regardless of the type of mobile phone. As the service runs using the SMS channel there is no need for a data subscription. This is especially relevant for emerging markets, where most people are prepaid users with a basic mobile phone and have a plain voice/SMS subscription. Protector, SIMessenger & Facebook for SIM are tailored for the mass market, and allow users to backup their data, stay in touch with their Facebook friends, or chat with their messaging communities from any phone. Life Mobilizer is designed for markets with a larger number of internet users be it from a computer or from a mobile phone. Life Mobilizer allows bringing together

phone, computer, social network content and conversations in one place and access content from any device. We have 100 Digital Life Management Services deployments worldwide with more than 60 million people using our solutions on a monthly basis, and we are protecting over 3 billion contacts!

GEMALtO

Bridging the gap between personal and social life
Gemalto Life Mobilizer is an end-to-end, white label solution for operators. It provides mobile clients as well as a web user interface designed to bring subscribers’ digital life together and accessible from everywhere with a unified, operator branded user experience.

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MOBILE MARKETING SERVICES

Life Mobilizer Protector Edition - personal data and communication channels on a single platform

Protector Edition can gather contacts stored on the SIM card as well as those stored in the mobile address book, or both. On the handset side, events, tasks, text messages, photos, music and videos can also be synchronized. Once the mobile content retrieved it is accessible from a web user interface for easy management of the different address books from SIM, Mobile and PC as well as the multimedia content which is uploaded into a media gallery. The web UI also allows sending SMS and sharing pictures via MMS. The unique combination of SIM, mobile, and web technologies allows to ensure service continuity and strong brand presence for mobile operators as well as an optimal customer journey as to maximize service uptake rate.

Life Mobilizer, mobilizing social life and syndicating it on any device
Social networks represent a true business opportunity for operators due to the growing number of mobile users on these networks.

By merging subscribers’ personal and social life on a unique platform, the mobile operator is able to offer an integrated communication experience while standing at the center of their users’ digital life. Accessible from the web UI as well as through a social client on the mobile phone, Life Mobilizer offers:
• a social address book bringing

together contacts from the mobile phone, Outlook, web mails and social networks • a communication hub merging SMS, MMS and social feeds • a unified calendar including social events • a social media gallery gathering media from the mobile and the PC, for sharing photos and videos on social media sites

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GEMALtO

TRUSTED LOGIC
a pioneer in security solutions for digital solutions
Trusted Foundations™
Enabling value-added services on smartphones and tablets

Wireless devices allow us to enter the digital world of personal entertainment and business. Increasingly we mix the use of these devices – we use personal tablets for work, and our work smartphones for personal things. Their powerful, open platforms support countless applications, but at the same time are vulnerable to malware and attempts to obtain illegal access to what needs to stay secure. It is therefore essential to isolate, on the device itself, services that require strict security from less controlled general-purpose applications. Trusted Logic has led the way in enabling users to access services anywhere, anytime, securely, by spearheading the development of the Trusted Execution Environment (TEE), a security architecture that leverages device processor and system-on-chip hardware security features. GlobalPlatform – the cross industry, not-for-profit association that fosters interoperability to allow multiple applications on embedded systems – is promoting the TEE as a solution for device security. TRUSTED FOUNDATIONS™ √ √
Is ready for any security case Leverages all platform and hardware security features: ARM TrustZone, secure memory, firewalls, secure touchpad, cryptography accelerators and keys, secure clock, fingerprint reader … Offers rich, uniform, platform-independent SDK for any security service provider Is compliant with standards: GlobalPlatform TEE specifications, OMTP/GSMA security requirements … Passes standardized security certification Connects to back-end infrastructure for easy and secure management: Trusted Service Manager (TSM)

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A PIONEER IN SECURITY SOLUTIONS FOR DIGITAL SERVICES

tRUstED LOGiC

√ √ √ √

Trusted Foundations™ is Trusted Logic’s implementation of the GlobalPlatform Trusted Execution Environment specifications. It is a mature solution that is in mass deployment since 2008, used by the top five mobile phone vendors. Trusted Foundations is included in tens of millions of smartphones and tablets with a variety of mobile operating systems, including Android, Symbian, and Windows Phone. It is the leading TEE solution in the market today.

Trusted Foundations supports multiple use cases including premium content protection, mobile financial services and enterprise security. The Trusted Foundations software development kit enables service providers to develop secure applications easily.

Main OS Environment
(Too rich to be certified)

Trusted Execution Environment
(Small enough to be certified)

Security-demanding Applications Trusted Foundations™ Functional API GlobalPlatform TEE Client API

Secure Services

Secure Service API
Secure Storage

Open Environment

Trusted Foundations™

Cryptography & Key Management Secure Date Trusted User Interface

!"#$

Wireless Platform

Secure Drivers

tRUstED LOGiC

TrustedShow™
The multi-scheme DRM client solution

The increasing range of devices and services providing premium content (movies, e-books, applications, etc.) requires an efficient solution to monetize this content. TrustedShow™ is the solution for an easy implementation of multimedia services on devices. TrustedShow™ is a multi-scheme DRM solution applicable to any device. Integrated with a multimedia framework and leveraging hardware security, it provides the best performance and security for devices. The security level meets compliance and robustness rules as required by leading service and content providers. TRUSTED SHOW™ √ √ √ √ √
OMA DRM v2 Microsoft® Windows Media® DRM 10 Microsoft® PlayReady™ DRM Marlin Extendable to support other DRM schemes such as CPRM

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A PIONEER IN SECURITY SOLUTIONS FOR DIGITAL SERVICES

Moreover, the modular architecture of TrustedShow™ allows fast and easy integration on any platform, with any multimedia framework and any operating system including Android™, Windows Phone, Linux and Symbian OS.

THE GLOBAL MOBILE MARKET

THE GLOBAL MOBILE MARKET

5 surprising facts about
global digital traffic
comScore has recently introduced a new solution providing insight into digital traffic coming from all types of devices on a global basis. Device Essentials utilises comScore’s Unified Digital Measurement (UDM) methodology, which captures media web traffic coming from more than a million domains tagging with comScore around the world. In May alone, comScore observed 150 billion census-level page views worldwide.
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Our visibility into this detailed activity on web entities has provided us with a treasure trove of new data that is helping us understand the complexities of the increasingly fragmented digital media environment. Here are a few interesting new findings based on our analysis of the 15 countries currently reported:
1 Mobile phones are second only to computers in driving digital traffic

While we saw computers accounting for at least 93 percent of digital traffic across the 15 markets studied, we also saw mobile contributing the most amount of traffic following computers. The US has the highest share of non-computer device traffic at 6.2 percent, with mobile phones making up about two-thirds of that traffic (4.2 percent overall). Singapore and the UK, which also have considerably high shares of non-computer device traffic at 5.9 percent and 5.3 percent, respectively, also show mobile comprising the majority of that traffic. In the UK, the iOS platform accounted for 59.9 percent of all non-computer device traffic, with 29.9 percent of non-computer traffic coming from iPhones, 21.3 percent from iPads, and 8.7 percent from iPod Touches. Next to mobile phones, tablets contribute a significant share of total non-computer device traffic. Two-thirds of the markets in this analysis saw tablets driving more than 20 percent of all non-computer device traffic. Tablets account for 21.6 percent of non-computer traffic in the UK. Apple accounts for 98.6 percent of all tablet traffic in the UK.

2 Apple leads the way for non-computer device traffic across markets

3 Tablets account for a significant share of non-computer traffic

4 Apple dominates the tablet market around the world

In all of the markets included in this analysis, the share of total digital traffic coming from tablets was driven largely by iPads. In 13 of the 15 markets, Apple captured at least 95 percent of the tablet market, while Android tablets accounted for most of the remaining tablet share. Device Essentials measures traffic from other web-enabled devices beyond computers, mobile phones, and tablets, such as e-readers and gaming consoles. In all of the markets studied, these other devices contributed less than 1 percent to overall digital traffic, with the highest share of traffic seen in Canada and the US at 0.6 percent. Other web-enabled devices account for only 0.5 percent of total traffic in the UK.

5 E-readers and gaming consoles barely register any traffic

From these preliminary Device Essentials data that there are many insights about traffic patterns across the digital landscape today that we’re just beginning to uncover.
FIGURE 1:

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Share of Total Traffic by Device Type in the UK

97, 7% 3, 6% 1, 2% 0, 5%

Computer Mobile Tablet Other Devices

Source: comScore Device Essentials. UK, May 2011

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Mark Newman | Chief Research Officer, Informa Telecoms & Media @ w

as over the top players dominate, mobile operators will transition into enablers
Where there were once mobile value-added services there are now smartphones and the mobile Internet. Where there were operator portals there are now application stores. And where there were once mobile operators there are now Internet giants and Silicon-Valley start-ups.
THE NETSIZE GUIDE: TRULY MOBILE

The entry of Internet players into FIGURE 1: Mobile, Portable and fixed internet users, the mobile business has been long2010-2015 heralded but it has taken the smartphone 4.0 and touchscreen revolution to make it a TOTAL MOBILE 3.5 MOBILE 2.5 reality. For players such as Facebook, FIXED 2.0 Google and Twitter, mobile is now 1.5 1.0 the engine driving their businesses 0.5 PORTABLE forward. By the end of 2011 there will 0 2010 2011 2012 2013 2014 2015 be 1.24 billion mobile (small-screen) Internet users, according to Informa Source: Informa Telecoms & Media Telecoms & Media and in 2012 there will be twice as many new mobile Internet as fixed Internet users. The mobile growth figures of the leading Over The Top players are staggering: • Facebook announced in September that more than 350 million people are accessing the service via a mobile device every month. Facebook has 800 million users worldwide. • In the same month Twitter said that 55% of its 100 million active users – 55 million people – use the service on a mobile device. This represents a 40% increase on the previous quarter. • Google is activating more than 550,000 Android devices per month. Informa Telecoms & Media estimates that 153 million Android devices will ship in 2011, up from 63 million handsets in 2010. In total there will be 366 million smartphones shipped in 2011. • YouTube Mobile gets 320 million views a day, up 60% since January. • Mobile users are generating $2.5 billion per year for Google (largely through search), a figure that has gone up 2.5 times over the last 12 months
INTERNET USERS (BIL)

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The rapid growth in smartphone adoption has created the platform for the explosion in mobile Internet usage. There will be 387 million smartphones shipped in 2011. In North America and some European and developed Asian markets 40% of all mobile users have adopted smartphones. This is not to say that all smartphone owners are mobile Internet users – while one in five Vodafone subscribers globally have upgraded to smartphones only half of these have taken data plans with their subscriptions. In the mobile Internet some services are available to all (smartphone) users while others are available only on specific platforms. Services such as Facebook, Twitter, Google and YouTube are available on all platforms. And every smartphone offers the user the opportunity to browse the open Internet and to access either fixed or mobile web pages. But a large proportion of mobile Internet usage on Android devices and on the iPhone is made up of applications created specifically for those platforms. And not all developers create applications for all platforms. Before 2011 developers tended to develop first for the iPhone while the other competing platforms – principally Symbian, Android, Blackberry and Windows OS – all had their own devotees but were some way behind the iPhone in FIGURE 2: terms of applications development. Now Apps comparisons, 4Q09 - 2Q11 that Android has overtaken Apple as the leading mobile OS it has become as popular as Android among developers while Symbian has fallen away. Blackberry and Windows OS are vying for third place behind the Android Market and Apple Apps Store and both need more support from developers if they are Note: Figures refer to quarter-end. Source: Informa Telecoms & Media to become serious rivals. Communications apps create a stir While each of the apps stores have different apps categories, games, content and personalization services dominate on all platforms. The majority of Apple apps are paid-for (62%) while the most Android apps are free (61%). Applications such as music and games do, in some cases, compete with mobile operators’ own services although these have never been major revenue earners for operators. The global mobile entertainment market was worth $26 billion in 2010 according to Informa Telecoms & Media. But a much bigger threat to the mobile operator business is a new breed of

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“communications” apps – mobile VoIP and mobile instant messaging services – that started to gain significant traction in 2011. They include services such as What’s App, a cross-platform messaging service which was specifically mentioned by Dutch operator KPN as a contributor to a 6% decline in its first quarter SMS revenues. According to consumer research by KPN, What’s App was being used by 85% of its Android customers. Another example is Viber, a mobile VoIP service which launched in 2010 and already has 15 million users. Mobile operators’ voice and SMS businesses were worth $818 billion in 2010 and so even if these new Over The Top services were to take just 1-2% of the total market for these services – and assuming that they are direct replacements for the operators own services – this would result in a $10bn+ hit to their bottom line.
FIGURE 3:

THE NETSIZE GUIDE: TRULY MOBILE

Viber is doing to mobile what Skype did to fixed line telephony in 2003
• Launched in December 2010 • 1 m downloads in the first 3 days • 10 million downloads (Feb11 end) • 15m users today • Available on iPhone only for the 4-5 months • Beta version of Android now available (may-Jun 11)
Source: Informa Telecoms & Media

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Operators are still trying to figure out the best competitive response to services such as What’s App and Viber. Their first reaction is to block such services but this approach has evolved to more guerrilla-like tactics with operators sporadically deprioritising or blocking the service to undermine their perceived quality. Some are making the services available only on their higher-priced mobile broadband price plans. And we are now beginning to see operators respond by offering their own mobile VoIP services, either made in-house or white-labelled from a third party. Increasingly operators will seek to minimise the threat posed by Over The Top players by introducing integrated price plans that comprise a bundle of voice, SMS and data and making it difficult for their customers to reduce their spend on voice or SMS and use their data plan for Over The Top voice and messaging services. Operators turn to Over The Top There is a realization among many operators that if they want to develop services that compete with these Over The Top players they need to enter the Over The Top market themselves. Telefonica already owns three Internet companies – Latin American video service provider Terra networks, Spanish social networking site Tuenti and mobile VoIP company Jajah. France Telecom has taken more of a partnership approach. It is working with music streaming service provider Deezer and offers the service in several Orange markets as a competitor to Spotify. And it owns a 49% stake in video-streaming site Daily Motion.

The challenge for mobile operators is to allow these businesses to retain their independence and grow a global business (which may involve working with other operators) but at the same time develop their own unique services. In Telefonica’s case it is using its Over The Top businesses to help drive innovation generally within the group. Another Over The Top strategy adopted by a growing number of operators is to offer their own Android storefronts. Operators believe that their channels add value by offering a more select set of apps, tested for quality and adapted to local needs, rather than what they would describe as the daunting and hit-and-miss choice available in the main store, which is crammed with hundreds of thousands of apps. In other words, they see themselves as offering quality over quantity. By acquiring stakes in Over The Top businesses, operators are entering the online and mobile advertising business via the back door. But operators generally are making stuttering progress in mobile advertising. Most of the smaller operators have decided that they cannot compete in this space with online players such as Google and Facebook. The exceptions are the larger operator groups such as Telefonica O2 and Vodafone. In the UK, O2 employs more than 30 people in its O2 Media business and there are plans to join forces with rival UK operators Vodafone and Everything Everywhere in 2012. O2 has developed an opt-in service called O2 More which offers its customers benefits such as special offers and new services in return for accepting advertising and marketing messages. An impressive 6.5 million O2 customers have signed up for O2 More. By offering advertisers and retailers access to these subscribers and giving them behavioural and location-based information, O2 believes that it can provide something unique and compelling that cannot be matched by online and traditional advertising. Monetisation forces operators to look elsewhere for revenues The mobile advertising market will grow from $2.5 billion in 2010 to $17 billion in 2015, according to Informa Telecoms & Media forecasts produced earlier this year. But operators’ share of these revenues will decline over the period from 26% to 21%. As such mobile advertising will generate little more than just pocket money for the $ trillion operator business and will contribute little to the cost of operating mobile broadband networks. Operators have explored a number of different options for monetizing services and offsetting the enormous cost of rolling out and expanding 3G and 3.5G networks. Operators are spending more than $100 billion per year building on mobile broadband networks but most of the services delivered over them are provided by third party Over The Top providers.
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The idea of taxing Over The Top players is popular among operators but has been flatly rejected by the Over The Top community which believes – with some justification – that if it did not exist there would be no data access business for operators today. Revenues from smartphone data plans and mobile subscriptions were worth $116 billion to mobile operators in 2010.
FIGURE 4:

Global mobile opreators revenue, 2010

Source: Informa Telecoms & Media

Operators are now pursuing the more realistic ambition of working with Over The Top players to build content delivery networks (CDNs) which reduce the volume of long-distance and international data traffic by storing it locally. But even here operators may be disappointed. Informa Telecoms & Media knows of one Latin American mobile operator which was asked to contribute to the cost of a local caching capability installed by an Over The Top player. It had little choice but to pay because the payment was less than the cost of carrying the traffic without the cache.

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Faced with this avalanche of data traffic and limited options for monetizing consumer services, Informa Telecoms & Media believes that operators should pursue two strategic directions: 1 Introduce new, innovative data price plans for different market segments as an extension of their initial moves into tiered pricing. New price plans will be enabled by technologies that make it possible for operators to charge for specific applications and application categories and to vary pricing based on location, time of day and the level of congestion on the network. 2 Re-evaluate their position in the mobile services value chain and transition into service enablers providing connectivity and services to third parties. New opportunities in mobile payments, connected devices and M2M all involve the operators becoming B2B2C service providers. Operators are now working with applications developers and stores to provide carrier billing capabilities and this can also be seen as being more of a business than a consumer service.

Mapping out the future of mobile content and services The smartphone has changed the mobile services landscape. But we should not forget that only one in 10 mobile phone subscribers in the world today are smartphone users. In China smartphone penetration is only 5% and in India, just 2.6%. Is it just a matter of time before smartphone prices fall below $100 and start achieving mass market penetration in these countries? And will the Over The Top players ultimately dominate as they have in Europe and North America? The rapid decline in smartphone prices is inevitable and the next-generation of feature phones will also be optimized for Internet access. But this does not necessarily mean that usage trends, data pricing and the role of the operator will be the same in emerging markets as in more developed economies. Hundreds of millions of people will experience the Internet for the first time via a mobile phone in the coming years. There will be roles for operators, OEMs, platform providers and Internet companies to stimulate and harness the market for local content and applications and to find ways of delivering them to end users.

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COUNTRY DATA
GLOSSARY
Population Country population, end 2010. GDP per capita Gross Domestic Product in US$ per capita. Mobile penetration rate Percentage of number of active SIM cards and/or connected lines versus total population, end 2011. Broadband penetration rate Percentage of fixed line and (SIM-based) mobile broadband connections versus total population, end 2011. Tablet PC connections Devices with SIM. Facebook user Number of Facebook users in the country. Total (prepaid) subscriptions Number of active SIM cards and/or connected lines carrying traffic, forecasts for end 2011 and end 2014. 3G/4G subscriptions Number of SIM cards connected to a WCDMA (Wideband Code Division Multiple Access), HSPA (High Speed Packet Access), EV-DO (Evolution-Data Optimized), or LTE (Long Term Evolution) device. Total revenues Total telecommunications revenues in US$, including services and hardware sales. Data revenues Data services revenues in US$. Content & application revenues Revenues in US$ from non-messaging data services, including value-added services and mobile applications that provide entertainment, information or a combination of the two. Mobile content can be delivered in a number of genres such as news, sports, games, video or picture messaging, and can be repackaged formats of existing media such as television, radio or Internet.

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Monthly ARPU Monthly Average Revenue per User in US$. Prepaid and postpaid ARPU refer to the ARPU for prepaid and postpaid subscribers, respectively. Blended ARPU is defined as the weighted average of prepaid and postpaid ARPU. Subscriptions market share Mobile network operator market share based on total number of subscriptions. Growth rate Growth of the number of (prepaid or postpaid) subscriptions from 2010 to 2011. Net additions Net increase in number of subscriptions in 2011. Mobile Virtual Network Operators (MVNOs): Subscriptions numbers and financials of MVNOs are included in their host Mobile Network Operators.

DATA SOURCES
Population data Informa Telecoms & Media / United Nations. Country information, Mobile telecommunications market, Mobile operators data Informa WCIS World Cellular Information Services / Informa WBIS World Broadband Information Services, Informa Telecoms & Media. Telecommunications market and operator metrics are end 2011 / 2014 forecasts from Q1 2011. Amounts are denominated in US dollars.
> www.informa.com

Top smartphone application usage comScore MobiLens, comScore, Inc. MobiLens data is derived from an intelligent online survey of a nationally representative sample of mobile subscribers age 13 and above. Data on mobile phone usage refers to a respondent’s primary mobile phone and does not include data related to a respondent’s secondary device. > www.comscore.com Non-PC data traffic comScore Device Essentials, comScore, Inc. Traffic patterns by non-computer devices (mobile phones, tablets, music players, e-readers, gaming devices, and other web-enabled devices) for selected countries, May 2011. www.comscore.com Facebook users Socialbakers Ltd. > www.socialbakers.com Netsize billing methods, Industry associations, regulators & codes of practice Netsize SA > www.netsize.com

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SMS revenues Revenues in US$ generated by person-to-person text messages and person-to-application premium rate messages (such as SMS voting, and news/information requests) but not including content downloads.

FIGURE 1

Broadband penetration rate

> 110% < 110% < 100% < 75% < 50% < 10%

BROADBAND PENETRATION RATE
COUNTRY 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 Korea United States Portugal Sweden Finland Austria Italy Luxembourg New Zealand Canada Denmark Singapore Poland Australia Japan Spain UK France Ireland Greece Switzerland % POPULATION 132.0% 126.4% 126.0% 125.0% 121.0% 119.4% 107.0% 106.9% 106.0% 105.5% 104.0% 103.0% 102.6% 102.0% 101.0% 100.0% 94.0% 91.0% 90.0% 86.8% 82.0% 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 COUNTRY Norway Germany Belgium Netherlands Slovakia Slovenia Romania Russia Hungary Czech Republic Turkey Mexico Malaysia South Africa Brazil China Ukraine Morocco Thailand India % POPULATION 77.1% 68.0% 62.0% 61.0% 61.0% 54.0% 52.0% 51.0% 45.7% 39.6% 33.0% 27.5% 26.0% 26.0% 21.6% 15.0% 12.0% 10.0% 9.0% 4.0%

Source: Informa Telecom & Media

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FIGURE 2

Facebook users

> 50% < 50% < 40% < 30% < 20% < 10%

FACEBOOK USERS IN % OF POPULATION
North America Australia & Oceania Europe South America Asia Africa 40.9% 38.2% 27.0% 24.5% 5.0% 3.8% 14 Belgium 15 Argentina 16 Uruguay 17 Bahrain 18 Finland 19 Turkey 20 Portugal 21 Luxembourg 1 2 3 4 5 6 7 8 9 Singapore Norway Un. Arab Emirates Denmark United States Australia Canada Sweden New Zealand 55.4% 54.4% 52,7% 50.5% 50.3% 50.1% 50.1% 49.6% 49.4% 48.9% 46.4% 45.2% 44.6% 22 Qatar 23 Hungary 24 France 25 Switzerland 26 Italy 27 Colombia 28 Venezuela 29 Slovakia 30 Czech Republic 31 Slovenia 32 Spain 33 Greece 34 Austria 42.1% 41.8% 41.2% 41.2% 39.2% 39.2% 38.0% 37.8% 37.4% 36.2% 35.9% 35.6% 35.4% 35.3% 35.2% 34.1% 33.6% 33.2% 32.9% 32.6% 32.1% 35 Netherlands 36 Lebanon 37 Kuwait 38 Jordan 39 Palestine 40 Mexico 41 Philippines 42 Germany 43 Tunisia 44 Thailand 45 Poland 46 Romania 47 Brazil 48 Morocco 49 South Africa 50 Korea 51 Japan 52 Russia 53 Ukraine 54 India 55 China 31.9% 31.3% 30.3% 29.8% 27.2% 26.8% 26.8% 26.3% 25.9% 19.4% 18.5% 17.5% 15.1% 12.4% 9.3% 9.2% 4.1% 3.5% 3.4% 3.2% 0.04%

10 United Kingdom 11 Israel 12 Malaysia 13 Ireland

Source: Socialbakers Ltd. / www.socialbakers.com Table shows a selection of countries. The full list is available at SocialbakersCL

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COUNTRY DATA

COUNTRY DATA
132 AUSTRALIA 134 AUSTRIA 136 BELGIUM 138 BRAZIL 140 CANADA 143 CHINA 144 CZECH REPUBLIC 146 DENMARK 148 FINLAND 150 FRANCE 153 GERMANY 156 GREECE 158 HUNGARY 160 INDIA 163 IRELAND 165 ITALY 167 JAPAN 169 KOREA 170 LUXEMBOURG 172 MALAYSIA 174 MEXICO 176 MOROCCO 178 NETHERLANDS 180 NEW ZEALAND 182 NORWAY 184 POLAND 186 PORTUGAL 188 ROMANIA 189 RUSSIA 191 SINGAPORE 193 SLOVAKIA 194 SLOVENIA 196 SOUTH AFRICA 198 SPAIN 201 SWEDEN 203 SWITZERLAND 205 THAILAND 206 TURKEY 207 UKRAINE 208 UNITED KINGDOM 211 UNITED STATES

AUSTRALIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 21,600,000 57,435 136.6% 102.0% English & others AUD 9,368,600 230,000 10,659,580

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 29,835,000 11,241,000 22,773,000 51.8 17,861 7,631 2014 35,003,000 12,592,000 32,717,000 52.0 21,355 10,824

MOBILE OPERATORS DATA Telstra Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 41.4% -10.0% 28.7% 10,565,000 1,445,000 52.6 Optus 32.4% -3.4% 12.8% 6,279,000 1,439,000 47.2 Vodafone 16.1% -7.6% 7.4% 2,912,000 1,092,000 55.5 3 Australia 10.1% -4.2% 7.7% 3,017,000 237,000 55.5

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AUstRALiA

AUSTRALIA
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Direct billing √ √ 30 Partial WAP billing N/A √ N/A N/A N/A 30 All √ P-SMS √ √ √ √ √ 6.6 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Australian Communications and Media Authority (ACMA) > www.acma.gov.au Communications alliance Australian Communications Industry Forum > www.commsalliance.com.au Content classification Classification Operation Branch of the Attorney General’s department (previously OFLC) > www.classification.gov.au Industry Association Australian Direct Marketing Association (ADMA) > www.adma.com.au Industry Association Australian Interactive Media Industry Association (AIMIA) > www.aimia.com.au Industry Association Telecommunications Industry Ombudsman (TIO) > www.tio.com.au Industry Association Australian Mobile Telecommunications Association (AMTA) > www.amta.org.au

NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smart- phone Feature Phone Other devices iPod Touch Other Share of traffic 25.9% 0.5% 0.0% 50.0% 10.5% 3.8% 1.8% 7.1% 0.4%

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AUstRALiA

AUSTRIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 8,390,000 48,276 155.0% 119.4% German EUR 3,224,900 31,000 2,639,220

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 13,036,700 3,590,000 7,783,700 26.3 3,807 1,615 2014 14,375,000 3,671,000 11,925,000 21.9 3,729 1,928

MOBILE OPERATORS DATA mobilkom Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 41.2% -4.7% 7.2% 3,080,000 501,500 29.3 T-Mobile 30.7% 11.8% 3.0% 1,818,000 336,200 27.1 Orange 17.8% -3.7% 3.3% 1,540,300 108,100 33.2 Drei 10.3% 27.8% 24.1% 1,345,400 140,600 31.1

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AUstRiA

AUSTRIA
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription WAP billing N/A √ N/A N/A N/A 10 Partial √ P-SMS √ √ √ √ 10 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Regulatory Authority for Broadcasting and Telecommunications Rundfunk und Telekom Regulierungs-GmbH (RTR-GmbH) > www.rtr.at

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AUstRiA

BELGIUM
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 10,710,000 43,531 118.7% 62.0% Dutch, French, German EUR 2,994,600 11,000 4,385,720

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 12,766,300 6,140,000 3,039,300 32.5 4,854 1,442 2014 13,872,000 6,426,000 11,049,000 29.9 4,922 1,843

MOBILE OPERATORS DATA Belgacom Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 40.1% -4.2% 5.6% 1,543,000 793,000 38.6 Mobistar 32.0% 15.4% -3.0% 1,188,000 613,000 42.8 Base 27.9% 7.2% 9.1% 304,000 291,500 20.0

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BELGiUM

BELGIUM
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription WAP billing N/A √ N/A N/A N/A 10 Partial √ P-SMS √ √ √ √ √

4/2 (subsc.) All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Institut Belge des services Postaux et de Télécommunications (BIPT) > www.bipt.be Industry Association WASP Forum > www.wasp-forum.be

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BELGiUM

BRAZIL
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 197,660,000 12,298 112.3% 21.6% Portuguese BRL 28,045,000 115,000 30,453,260

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 229,548,400 187,892,000 35,003,400 14.1 36,202 6,347 1,813 1,835 1,373 2014 279,762,800 233,478,000 112,478,800 13.3 42,670 9,776 4,222 2,609 1,672

MOBILE OPERATORS DATA Vivo Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 28.8% 11.6% 25.4% 10,105,000 3,269,850 15.6 TIM 25.1% 26.8% 15.3% 9,757,000 5,313,290 13.4 Claro 25.0% 15.8% 29.3% 12,583,000 4,328,570 10.5 Oi 18.7% 13.2% 2.2% 1,783,000 753,400 13.4 Nextel 2.0% 0.0% 29.5% 142,600 0 70.0 CTBC 0.3% 31.0% -6.3% 96,600 35,100 21.4

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BRAZIL

BRAZIL
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial Direct billing √ √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Anatel > www.anatel.gov.br/portal/exibirportalinternet.do

NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smart- phone Feature Phone Other devices iPod Touch Other Share of traffic 31.8% 1.6% 0.0% 21.0% 11.7% 11.3% 17.3% 4.1% 1.1%

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BRAziL

CANADA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 34,050,000 46,446 72.4% 105.5% English, French CAD 10,353,400 460,000 16,908,380

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 26,476,100 4,941,000 18,089,100 58.2 17,871 5,134 1,837 2,321 1,843 2014 31,613,200 5,834,000 29,971,200 56.7 20,916 8,514 3,467 3,171 2,380

MOBILE OPERATORS DATA Rogers Wireless Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 35.8% 9.0% 5.0% 5,460,000 2,000,000 62.1 Bell Wireless Affiliates 28.8% -5.1% 9.9% 5,915,600 1,542,070 54.6 Telus Mobility 27.9% 2.6% 7.9% 5,373,000 1,402,500 60.7 SaskTel Mobility 2.4% 5.5% 5.1% 248,800 99,550 N/A MTS Mobility 2.0% 5.6% 5.5% 266,700 115,200 61.2

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CANADA

CANADA
MOBILE OPERATORS DATA Wind Mobile Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 1.6% N/A 4552.8% 430,000 197,360 28.5 Videotron 0.8% N/A N/A 200,000 102,600 N/A Mobilicity 0.7% N/A N/A 195,000 105,000 N/A Public Mobile 0.1% N/A N/A 0 0 N/A Shaw 0.0% N/A N/A 0 0 N/A

NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription All Direct billing √ √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Canadian Radio-television and Telecommunications Commission > www.crtc.gc.ca/eng/home-accueil.htm Industry Association Canadian Wireless Telecommunications Association (CWTA) > www.cwta.ca

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CANADA

CANADA
TOP SMARTPHONE APPS Application type Social networking Weather Maps Search News Bank accounts Sports information Movie information Photo or video sharing Entertainment news Digital books/magazines Accessed by 34.3% 33.7% 26.6% 16.0% 14.0% 13.4% 12.7% 12.6% 11.4% 9.1% 8.9%

NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smart- phone Feature Phone Other devices iPod Touch Other Share of traffic 33.5% 0.4% 1.3% 34.6% 8.2% 3.6% 1.5% 14.9% 2.0%

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CANADA

CHINA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 1,360,000,000 4,341 70.3% 15.0% Mandarin & others CNY 77,066,600 680,000 493,460

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 961,317,000 753,348,000 26,191,000 9.2 101,337 34,799 13,880 18,261 15,075 2014 1,217,329,000 964,429,000 157,998,000 8.8 124,054 51,117 18,907 22,539 17,198

MOBILE OPERATORS DATA China Mobile Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 67.0% 1.5% 8.9% China Unicom 20.2% 1.4% 15.6% 26,191,000 12,131,000 7.2 China Telecom 12.8% 5.7% 5.6% 7.6

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Ministry of Information Industry > http://www.miit.gov.cn/

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CHiNA

CZECH REPUBLIC
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 10,420,000 20,935 136.4% 39.6% Czech CZK

1,692,500 2,450 3,430,900

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 14,240,000 6,165,000 1,482,000 22.0 3,669 978 2014 15,231,000 6,225,000 7,934,000 19.2 3,496 1,181

MOBILE OPERATORS DATA T-Mobile Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 40.5% -4.8% 3.4% 117,000 112,800 22.9 Telefonica O2 34.9% -7.2% 6.3% 1,050,000 438,000 25.2 Vodafone 23.5% 2.6% 9.4% 169,000 122,000 26.1 Mobilkom 1.0% 32.5% 0.7% 146,000 96,000

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CzECH REPUBLiC

CZECH REPUBLIC
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ -

√ 99 All -

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Český telekomunikační úřad (ČTÚ) > www.ctu.cz Premium Rate Services work group Asociace Provozovatelů Mobilních Sítí (APMS) > www.apms.cz

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CzECH REPUBLiC

DENMARK
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 5,490,000 56,695 137.5% 104.0% Danish DKK n/a n/a

2,786,000

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 7,555,200 1,156,000 2,312,800 38.5 963 200 3,451,500 2014 8,320,000

MOBILE OPERATORS DATA TDC Mobil Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 43.5% -23.1% 9.3% 1,368,600 n/a 34.7 Telenor 27.8% -15.0% -0.6% 1,179,100 n/a 32.7 Telia 20.1% -29.4% 1.5% 942,000 n/a 40.2 Hi3G 8.6% 120.0% 30.3% 650,700 n/a 50.9 Ice.Net 0.0% n/a 24.3% 2,800 n/a n/a

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DENMARK

DENMARK
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ √ √ √ 200 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Telestyrelsen - National Telecom Agency (NTA) > www.itst.dk Operators Forum Telecommunication Industries Association in Denmark > www.teleindustrien.dk Codes of practices Danish Consumer Ombudsman > www.forbrugerombudsmanden.dk CPA guidelines Framework Agreement for Mobile Content and Payment Services > www.rammeaftalen.dk

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FINLAND
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 5,354,000 US$35,400 177.6% 121.0% Finish, Estonian and English EUR 0 n/a 2,061,420

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 9,541,400 882,580 6,103,400 29.1 838 25 n/a n/a 2014 10,852,000 1,003,810 9,803,000

MOBILE OPERATORS DATA Elisa Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 38.7% -10.4% 13.0% 2,407,200 707,200 27.6 Telia Sonera 37.8% 3.2% 5.6% 2,389,000 639,000 29.9 DNA 23.4% -23.2% 9.8% 1,307,200 357,200 30.4

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FINLAND

FINLAND
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription WAP billing N/A √ N/A N/A N/A 20 All P-SMS √ √ √ √ √

20 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom Regulator Viestintävirasto Kommunikationsverket (Finnish Communications Regulatory Authority) > www.ficora.fi Telecom Regulator Finnish self regulatory committee for Premium Rate Services > www.mapel.fi Codes of practices Consumer agency and consumer Ombudsman > www.kuluttajavirasto.fi CPA guidelines Set of norms for providing premium electronic services > www.mapel.fi/set_of_norms_in_english

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FiNLAND

FRANCE
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 62,760,000 41,230 104.8% 91.0% French EUR 19,733,500 445,000 23,248,340

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 66,022,000 19,885,000 34,948,000 40.9 31,712 9,905 3,140 5,828 4,965 2014 72,855,000 20,976,000 66,112,000 37.9 32,681 13,022 5,128 7,188 5,811

MOBILE OPERATORS DATA Orange Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 46.6% 4.4% 4.0% 14,399,000 5,004,000 45.6 SFR 35.9% 8.7% 4.6% 15,082,000 5,419,000 47.2 Bouygues Telecom 17.5% 0.0% 8.1% 5,467,000 2,467,000 53.6

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FRANCE

FRANCE
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial Direct billing √ √ Web billing N/A N/A √ N/A √ 10 All √ WAP billing N/A √ N/A N/A N/A 10 All √ P-SMS √ √ √ √ 4.5/3 (subsc) All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Electronical communications regulator Autorité de Régulation des Communications Electroniques et des Postes (ARCEP) > www.arcep.fr Industry Association Agence Française du Multimédia Mobile > www.afmm.fr Industry Association Association Française du Multimédia Mobile (AFMM) > www.afmm.fr Industry Association Groupement des Editeurs de Services en Ligne (GESTE) > www.geste.fr Industry Association Association pour le Commerce et les Services En Ligne (ACSEL) > www.acsel.asso.fr Industry Association Forum des Droit sur Internet (FDI) www.foruminternet.org > industry association Association Française du multimedia Mobile > www.smsplus.org Advertising regulator Le bureau de vérification de la publicité (BVP) > www.bvp.org

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FRANCE

FRANCE
TOP SMARTPHONE APPS Application type Weather Social networking Maps News Business directories Bank accounts Television guides Search Sports information Entertainment news Movie information Accessed by 25.5% 23.2% 20.2% 15.6% 13.9% 12.5% 11.9% 11.0% 10.7% 10.4% 8.4%

NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smartphone Feature Phone Other devices iPod Touch Other Share of traffic 26.9% 0.6% 0.0% 34.3% 17.1% 5.7% 5.5% 3.9% 6.0%

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FRANCE

GERMANY
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 81,985,000 40,407 131.5% 68.0% German EUR 26,720,800 830,000

21,634,380

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 107,656,000 58,597,000 51,339,000 21.8 27,653 9,530 4,036 4,715 3,910 2014 116,293,000 63,836,000 106,773,000 20.3 28,038 12,062 7,946 5,485 4,133

MOBILE OPERATORS DATA T-Mobile Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 33.1% -13.4% 1.0% 15,119,000 7,486,320 22.9 Vodafone 31.7% 10.7% -6.8% 20,046,000 6,512,560 21.9 E-Plus 18.5% 14.4% 6.1% 4,707,000 2,827,710 17.2 O2 16.7% 8.4% 9.8% 11,467,000 3,624,370 19.4

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GERMANY

GERMANY
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Direct billing √ 20 All WAP billing N/A √ N/A N/A N/A 20 All √ P-SMS √ √ √ √ √ 10 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Bundesnetzagentur für Elektrizität, Gas, Telekommunikation, Post und Eisenbahnen (BNETZA) > www.bundesnetzagentur.de AVS Freiwillige Selbstkontrolle der Filmwirtschaft > http://fst-ev.org AVS Kommission für Jugendmedienschutz > www.kjm-online.de Code of Conduct Verhaltenskodex Premium SMS/Mobile Dienste und web-basierte Dienste

TOP SMARTPHONE APPS Application type Weather Social networking Maps News Search Photo or video sharing Sports information Bank accounts Traffic reports Television guides Digital books/magazines Accessed by 22.4% 19.5% 18.6% 12.9% 11.6% 9.1% 9.1% 8.0% 7.8% 7.8% 7.6%

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GERMANY

GERMANY
NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smart- phone Feature Phone Other devices iPod Touch Other Share of traffic 29.4% 0.9% 0.0% 35.1% 16.2% 4.6% 2.8% 8.3% 2.5%

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GREECE
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 11,191,159 27,310 138.9% 86.8% Greek EUR 3,888,800 2,200 3,500,300

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 15,563,000 10,719,000 6,894,000 21.4 3,968 560 2014 17,059,000 11,632,000 15,057,000 18.0 3,648 836

MOBILE OPERATORS DATA Cosmote Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 53.4% -11.9% -1.6% 2,444,000 1,272,100 21.4 WIND Hellas 23.7% -36.0% -4.4% 1,916,000 735,000 20.0 Vodafone 22.9% -19.3% -4.7% 2,534,000 522,000 25.9

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GREECE

GREECE
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ √ √ √ 3.62 All -

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator National Telecommunications and Post Commission - (EETT) > www.eett.gr Operator Cosmote > www.cosmote.gr Operator Vodafone > www.vodafone.gr Operator Wind > www.wind.gr

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HUNGARY
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 9,960,000 13,430 114.5% 45.7% Hungarian HUF 1,583,300 5,400 3,620,640

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 11,384,800 6,039,000 2,383,800 18.2 2,445 577 2014 12,231,000 6,554,000 9,517,000 17.0 2,463 763

MOBILE OPERATORS DATA T-Mobile Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 45.6% -12.9% 28.5% 684,000 184,000 18.6 Telenor 31.6% -8.2% 11.7% 1,097,700 815,700 19.7 Vodafone 22.8% -0.8% 22.1% 595,800 310,800 22.3

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HUNGARY

HUNGARY
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ √ √ √

1875 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator National Media and Infocommunications Authority of Hungary (NMIAH) - Nemzeti Média- és Hírközlési Hatóság > www.nmhh.hu Industry association Magyar Mobilmarketing és Tartalomipari Egyesület (MMTE) Hungarian Mobile Marketing and Content Industry Association > www.mmte.hu Govermental body Nemzeti Fejlesztési Minisztérium (NFM) - Ministry of National Development > www.kormany.hu/en

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HUNGARY

INDIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 1,220,000,000 1,266 79.0% 4.0% Assamese, Bengali, Bodo, Chhattisgarhi, Dogri, English, Garo, Gujarati, Hindi, Kannada, Kashmiri, Khasi, Kokborok, Konkani, Maithili, Malayalam, Manipuri, Marathi, Mizo, Nepali, Oriya, Punjabi, Sanskrit, Santali, Sindhi, Tamil, Telugu, Urdu INR 33,209,200 150,000

38,045,000

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 973,076,300 940,658,000 30,883,300 2.6 26,180 3,419 4,288 3,033 2,669 2014 1,430,203,000 1,395,475,000 313,536,000 2.1 34,542 7,566 8,620 5,800 4,475

MOBILE OPERATORS DATA Vodafone Essar 17.6% 25.5% 20.7% 171,000,000 26,520,100 3.7 Reliance Communications 15.0% 7.7% 9.8% 146,000,000 23,321,020 2.3 Idea Cellular 11.1% 9.2% 15.0% 108,000,000 9,410,100 3.5 Tata Teleservices 9.8% 8.9% 10.2% 95,000,000 18,616,000

Bharti Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 19.4% 6.2% 6.6% 189,000,000 16,727,900 4.2

BSNL 10.0% 6.6% 6.3% 96,999,200 3,927,100 3.0

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iNDiA

INDIA
MOBILE OPERATORS DATA Aircel Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 7.6% 10.8% 11.9% 74,000,000 13,229,100 1.5 35,000,000 7,125,200 2.2 Unitech Wireless 3.6% Videocon 1.6% 15.4% 26.2% 16,000,000 7,079,000 Shyam 1.5% 15.5% 16.2% 15,000,000 3,625,850 1.8 Etisalat DB Loop Telecom Mobile 0.7% 40.7% 35.2% 7,077,000 5,846,210 0.7% 2.4% 2.4% 7,000,000 3,831,790

MOBILE OPERATORS DATA MTNL Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 0.7% 1.9% 2.3% 6,500,100 1,072,600 1.4 S Tel 0.5% 17.3% 17.7% 4,500,000 1,191,200 Quadrant 0.2% 19.3% 19.2% 2,000,000 628,600

NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial Direct billing √ √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Telecom Regulatory Authority of India > www.trai.gov.in

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INDIA

INDIA
NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smart- phone Feature Phone Other devices iPod Touch Other Share of traffic 4.0% 0.5% 0.0% 2.8% 6.0% 14.1%

71.9% 0.6% 0.0%

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IRELAND
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 4,618,000 44,511 135.1% 90.0% English, Irish EUR 1,612,500 6,000 2,060,740

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 5,564,800 4,027,000 3,940,000 43.1 2,986 1,116 2014 6,111,000 4,251,000 6,490,900 37.0 3,022 1,356

MOBILE OPERATORS DATA Vodafone Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 45.5% 1.8% 6.6% 1,865,000 790,000 54.3 O2 30.1% -5.5% 0.2% 828,000 378,000 48.6 Meteor 19.0% -7.8% 20.9% 444,000 144,000 n/a Three 5.4% -15.8% 32.0% 302,500 -7,500 n/a

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IRELAND

IRELAND
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ √ √ √

5 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Independent Regulator of the content and promotion of Premium Rate Telecommunications Services Regtel > www.regtel.ie Telecom regulator Commission for Communications Regulation (ComReg) > www.odtr.ie

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iRELAND

ITALY
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 60,150,000 34,196 145.7% 107.0% Italian EUR 24,476,200 360,000 20,576,700

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 87,759,000 69,122,000 49,972,000 25.5 26,368 7,851 3,786 5,147 4,255 2014 94,787,000 69,764,000 85,971,000 23.3 26,183 9,890 6,136 6,195 4,760

MOBILE OPERATORS DATA Telecom Italia Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 36.0% -1.3% 15.8% 16,672,000 7,056,420 25.7 Vodafone 31.7% -2.8% 11.2% 18,822,000 3,981,270 28.6 Wind 24.7% 5.7% 31.3% 7,811,000 3,411,000 22.9 Tre 7.6% 0.7% 8.0% 6,667,000 481,720 31.1

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itALY

ITALY
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Direct billing √ √ 15 Partial WAP billing N/A √ N/A N/A N/A 15 Partial √ P-SMS √ √ √ √ √ 2.4 (PPU)

All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Autorità per le Garanzie nelle Comunicazioni (Agcom) > www.agcom.it Authority over competition Autorità Garante della Concorrenza e del Mercato > www.agcm.it Goverment (Ministry) Ministero dello Sviluppo Economico > www.sviluppoeconomico.gov.it Industry association Associazione dei fornitori di contenuti e servizi a valore aggiunto per telefonia cellulare (AssoCSP) > www.assocsp.it

TOP SMARTPHONE APPS Application type Maps Social networking Weather News Photo or video sharing Digital books/magazines Search Sports information Gaming information Tech news Entertainment news Accessed by 14.8% 14.0% 12.5% 8.2% 7.8% 7.8% 7.5% 6.6% 5.8% 5.4% 5.3%

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JAPAN
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 126,870,000 42,985 136.6% 101.0% Japanese JPY 18,062,300 1,800,000 5,241,440

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 126,817,000 1,113,000 120,815,000 57.5 85,349 45,981 19,726 12,307 3,924 2014 142,760,000 782,000 138,897,000 51.0 85,915 57,796 20,459 14,461 4,584

MOBILE OPERATORS DATA NTT DoCoMo Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 47.6% -22.9% 0.7% 58,246,000 800,600 61.0 KDDI 27.1% -4.5% 1.1% 31,410,000 57.1 Softbank Mobile 22.3% 3.8% 2.8% 27,478,000 1,339,300 51.8 eAccess 3.0% 7.1% 7.2% 3,681,000 340,000 35.2

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JAPAN
INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Ministry of Internal Affairs and Communications > www.soumu.go.jp/english/index.html TOP SMARTPHONE APPS Application type Weather Maps News Search Entertainment news Financial news Sports information Traffic reports Social networking Electronic payments Tech news Accessed by 23.5% 13.8% 13.7% 12.2% 9.7% 9.2% 9.0% 8.3% 7.9% 7.0% 5.9%

NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smartphone Feature Phone Other devices iPod Touch Other Share of traffic 11.3% 0.0% 0.0% 49.5% 30.6% 0.2% 2.6% 4.7% 1.1%

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KOREA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 48,565,979 20,764 111.0% 132.0% Korean KRW 18,148,100 680,000 4,483,320

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 54,047,000 139,000 46,270,000 34.3 21,675 6,757 3,331 2,796 1,573 2014 61,742,000 93,000 58,370,000 33.1 24,075 11,106 3,573 3,284 1,681

MOBILE OPERATORS DATA SK Telecom Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 50.2% -13.2% 4.5% 24,411,000 5,022,400 36.7 KT Corp 31.7% -73.5% 4.8% 16,280,000 1,632,000 30.9 LG U+ 17.4% 3.2% 3.2% 5,032,000 27.8 3.4% 362,000 -12,100 KT Powertel 0.7%

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Ministry of Internal Affairs and Communications > www.soumu.go.jp/english/index.html Telecom regulator Korean Communication Commission > www.kcc.go.kr/user/ehpmain.do

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LUXEMBOURG
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 494,602 111,739 150.9% 106.9% Luxembourgish, French, German EUR n/a n/a 187,980

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) 755,000 261,590 339,000 48.8 108 617,000 2014 801,800

MOBILE OPERATORS DATA P&T Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 50.9% -11.1% 11.9% 137,000 37,000 65.0 Tango 34.4% -16.7% 11.4% 122,000 37,000 40.2 Orange 14.7% -0.6% 21.7% 80,000 30,000 72.4

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LUXEMBOURG

LUXEMBOURG
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ √ √ √ 3 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Institut Luxembourgeois de Régulation (ILR) > www.ilr.public.lu

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MALAYSIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 28,130,000 8,525 128.3% 26.0% Malay, English, others MYR 5,231,900 45,000

11,816,200

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 36,644,000 28,745,000 13,200,000 15.8 6,737 2,374 2014 44,499,000 34,693,000 33,176,000 14.4 7,465 3,369

MOBILE OPERATORS DATA Maxis Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 36.6% -3.3% 3.4% 5,134,000 1,090,000 16.9 Celcom 33.8% 11.5% 7.9% 5,842,000 1,786,400 16.2 DiGi 26.4% 14.6% 14.9% 1,026,000 487,180 16.5 U Mobile 3.3% 110.6% -32.4% 1,198,000 308,000

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MALAYsiA

MALAYSIA
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial Direct billing √ √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Malaysian Communications and Multimedia Commission > www.skmn.gov.my

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MALAYsiA

MEXICO
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 111,100,000 10,308 89.0% 27.5% Spanish MXN 8,734,900 53,000 30,121,400

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 99,275,000 85,560,000 14,195,000 14.9 17,050 4,720 2014 116,625,000 100,327,000 48,516,500 14.4 19,897 6,587

MOBILE OPERATORS DATA Telcel Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 69.1% 22.7% 8.0% 10,790,000 4,696,890 13.1 Movistar 22.4% 16.9% 12.0% 1,004,000 2,698,400 7.6 Iusacell 4.4% 24.4% 13.6% 216,000 102,000 16.3 Nextel 4.1% 5728.9% N/A 123,000 735,700 48.0

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MEXiCO

MEXICO
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial √ √ Direct billing

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Federal Telecommunications Commission COFETEL > www.cft.gob.mx

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MEXICO

MOROCCO
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 32,600,000 3,196 122.7% 10.0% Arabic, French MAD n/a n/a 3,926,740

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 40,434,000 32,762,510 2,469,000 9.0 3,864 N/A 2014 47,399,000 N/A 13,452,000

MOBILE OPERATORS DATA Maroc Telecom Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 45.0% 6.1% 19.8% 1,159,000 610,000 10.7 Meditel 29.4% 12.5% 12.8% 437,000 212,600 6.0 Wana 25.6% 522.1% 398.8% N/A N/A n/a

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MOROCCO

MOROCCO
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ -

20 All -

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Agence Nationale de Réglementation des Télécomunication (ANRT) > www.anrt.net.ma

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NETHERLANDS
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 16,679,000 47,035 117.9% 61.0% Dutch EUR 5,977,400 52,500 5,361,200

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 19,728,000 7,931,000 9,820,000 37.1 8,450 2,927 2014 21,715,000 8,049,000 19,403,200 33.5 8,598 3,807

MOBILE OPERATORS DATA KPN Mobile Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 50.1% -9.0% 16.3% 3,688,000 1,745,070 34.0 T-Mobile 26.3% 8.2% 11.7% 2,316,000 1,003,460 35.7 Vodafone 23.6% 3.6% 11.2% 3,816,000 447,180 43.9

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NEtHERLANDs

NETHERLANDS
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription WAP billing P-SMS N/A √ N/A N/A N/A 10 Partial √ √ √ √ √ 1.5 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator OPTA > www.opta.nl Consumer Law Supervisor Consumentenautoriteit > www.consumentenautoriteit.nl Industry Association Stichting SMS-Gedragscode > www.smsgedragscode.nl Industry Association SMS dienstenfilter > www.smsdienstenfilter.nl Industry Association mijn mobiele betalingen (for mobile online payments) > www.mijnmobielebetalingen.nl

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NEW ZEALAND
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 4,300,000 32,633 133.0% 106.0% English, Maori NZD 1,795,000 80,000 2,080,940

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 5,487,700 3,949,000 3,002,000 24.6 1,613 596 2014 6,492,800 4,468,000 5,447,800 23.1 1,772 802

MOBILE OPERATORS DATA Vodafone New Zealand Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 44.9% -2.9% -3.0% 442,000 344,000 28.0 Telecom New Zealand 39.1% -6.1% -1.1% 1,596,000 859,400 21.0 Two Degrees Mobile 16.0% 58.0% n/a 17,000 24,500 13.0

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NEW zEALAND

NEW ZEALAND
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ √ √ √ 10 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Operator Forum Telecommunications Carriers Forum Inc > www.tcf.gov.nz Advertising Association Advertising Standards Authority Incorporated of New Zealand > www.asa.co.nz Regulatory Body Department of Internal Affairs > www.dia.govt.nz

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NORWAY
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 4,873,000 54,600 126.8% 77.1% English, Norwegian NOK 0 0 2,545,520

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) 6,229,000 n/a 3,768,000 50.5 997 5,579,000 2014 6,892,100

MOBILE OPERATORS DATA Telenor Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 53.5% 1.0% 4.0% 2,069,000 469,000 52.2 Netcom 36.8% 2.1% 4.0% 1,610,000 260,000 48.2 Network Norway 8.5% 9.1% 5.4% Ice.net 1.2% 54.6% 54.6% 64,000 2,000 38.0

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NORWAY

NORWAY
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Direct billing √ √ 200 Partial √ WAP billing N/A √ N/A N/A N/A 200 Partial √ P-SMS √ √ √ √ √ 200 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Post- og teletilsynet (PT) > www.npt.no Authority for Lottery Lotteri- og stiftelsestilsynet > www.lottstift.no The ombudsman Forbrukerombudet > www.forbrukerombudet.no CPA guidelines Cpa riktlinjer > cpa.telenor.no/cpa/guidelines/2004-12-01%20cpa%20retningslinjer%20ver%201.1.pdf

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POLAND
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 38,013,000 13,109 129.5% 102.6% Polish PLN 7,062,100 5,500 7,112,020

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 49,158,900 24,252,000 32,438,900 14.4 8,343 2,359 2014 53,419,800 25,996,000 46,998,300 13.7 8,723 3,110

MOBILE OPERATORS DATA Orange Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 30.7% 4.6% 2.9% 10,517,000 3,077,800 14.8 Polkomtel 28.0% 0.4% 0.8% 8,681,100 1,481,100 15.3 T-Mobile 27.0% -0.1% -0.9% 8,086,000 986,000 15.7 Play 13.2% 21.3% 38.5% 5,020,000 2,703,900 15.4 Mobyland 0.6% 20.4% 863.0% 9,300 9,300 Centernet 0.5% 47.9% 312.0% 6,500 6,500 2.3

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POLAND

POLAND
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ 16 All -

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Urząd Komunikacji Elektronicznej (UKE) > www.uke.gov.pl

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POLAND

PORTUGAL
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 10,740,000 21,369 158.6% 126.0% Portuguese EUR 3,685,600 60,000 4,081,460

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 17,045,000 11,916,000 10,939,000 17.9 3,564 1,012 2014 18,853,000 13,215,000 18,266,000 15.5 3,468 1,275

MOBILE OPERATORS DATA TMN Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 45.2% -0.1% -3.2% 4,600,000 -233,480 18.4 Vodafone 34.8% 1.8% -1.9% 4,214,000 547,390 21.6 Sonaecom 20.0% 15.0% -10.5% 2,125,000 129,140 18.6

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PORtUGAL

PORTUGAL
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Direct billing √ √ 6 Partial WAP billing N/A √ N/A N/A N/A 6 All P-SMS √ √ √ √ √ 4 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Autoridade Nacional de Comunicações (ANACOM) > www.anacom.pt Industry Association Associação Portuguesa de Informação, Tecnología e Entretenimento Digital (APITED) > www.apited.com

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PORtUGAL

ROMANIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 21,109,000 7,500 128.7% 52.0% English, Romanian, Hungarian, Ukrainian EUR 2,895,600 4,800 3,847,600

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 30,985,500 20,505,000 7,275,500 1,830.6 2,119 288 2014 34,978,000 23,532,000 22,324,000 1,680.4 2,263 583

MOBILE OPERATORS DATA Orange Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 36.2% 3.0% -16.9% 2,546,000 1,356,000 Vodafone 33.7% -9.6% -8.1% 3,131,000 1,541,000 Cosmote 23.7% -7.2% -2.0% 10,800 9,000 RCS&RDS 4.9% n/a 2.8% 1,526,000 103,000 Telemobil 1.3% -32.3% 12.9% 59,100 37,150 Rom telecom 0.2% n/a 57.6% 2,600 2,600

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator National Authority for Management and Regulation in Communications of Romania (ANCOM) > http://www.ancom.org.ro Industry Association Asociatia Operatorilor Mobili din Romania (AOMR) > http://www.aomr.ro

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ROMANIA

RUSSIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 140,000,000 13,543 160.0% 51.0% Russian RUB 25,011,100 167,000 4,868,360

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 234,366,700 194,322,000 25,259,900 9.7 26,551 6,232 3,932 2,041 1,839 2014 262,479,900 214,377,000 114,965,900 9.9 30,893 10,311 7,115 2,352 1,911

MOBILE OPERATORS DATA Mobile TeleSystems Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 32.0% 1.8% 6.4% 9,714,000 4,924,700 n/a MegaFon 26.2% 8.0% 16.5% 4,745,000 2,675,100 11.1 Beeline (Vimpelcom) 22.9% 3.4% 17.9% 9,001,000 3,846,500 n/a Tele2 9.2% 19.3% 19.2%

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RUssiA

RUSSIA
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription All √ P-SMS √ √ √ -

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Providers association Association of providers of mobile services and content > www.cspa.ru Goverment (Ministry) Russian Ministry of Telecommunications >english.minsvyaz.ru/enter.shtml DM Association Russian Direct Marketing Association > www.radm.ru/pages/79

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RUssiA

SINGAPORE
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 4,860,000 46,044 166.2% 103.0% English, Mandarin, Malay, Tamil, others SGD 3,737,600 140,000 2,602,920

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 8,147,000 3,843,000 6,048,000 32.6 3,050 1,069 2014 9,180,000 4,310,000 8,686,400 30.8 3,336 1,463

MOBILE OPERATORS DATA SingTel Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 37.8% 24.2% 3.6% 2,341,000 631,500 42.5 MobileOne 31.4% 2.4% 1.0% 1,946,000 146,000 28.3 StarHub 28.4% 1.7% 1.4% 1,761,000 566,000 36.9 0.3% DNA Comms 2.4%

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SINGAPORE

SINGAPORE
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Direct billing √ √ 20 Partial P-SMS √ √ √ 20 Partial -

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Infocomm Development Authority of Singapore (IDA) > www.ida.gov.sg

NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smartphone Feature Phone Other devices iPod Touch Other Share of traffic 26.2% 1.4% 0.1% 51.9% 10.0% 3.9% 1.5% 4.8% 0.2%

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siNGAPORE

SLOVAKIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 5,414,000 16,160 115.1% 61.0% Slovak, German, English EUR 375,850 2,050 1,864,400

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 6,507,800 2,624,000 2,190,800 16.0 1,665 353 2014 7,253,000 2,862,000 5,095,000 14.3 1,673 479

MOBILE OPERATORS DATA Orange Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 44.7% -4.1% 5.0% 2,073,000 382,500 28.4 Telefonica O2 37.1% 31.4% 59.1% 108,000 345,030 n/a T-Mobile 18.2% -10.1% 2.8% 9,800 26,000 21.4

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Goverment (Ministry) Ministry of transport, post and telecommunications > www.telecom.gov.sk/index/index.php - lang=sk

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sLOVAKiA

SLOVENIA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 20,270,000 23,630 103.3% 54.0% Slovenian, English, Croatian EUR n/a n/a

665,420

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 2,210,700 712,000 682,700 29.0 200 50 1,712,400 2014 2,446,400

MOBILE OPERATORS DATA Mobitel Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 30.1 26.1 n/a n/a 60.1% 8.1% -5.8% 576,000 Si.mobil 29.4% 4.7% 9.2% 93,000 Tus Mobil 10.3% 16.5% -24.3% 11,300 1,200 T-2 0.1%

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sLOVENiA

SLOVENIA
INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Electronical communications regulator Agencija za pošto in elektronske komunikacije Republike Slovenije > www.apek.si Terms and Regulations (Mobitel-largest operator) Terms and regulations for service providers > eng.m-vrata.com/terms-conditions/mvrata Legislation regarding prize games Office for Gaming Supervision > www.uradni-list.si/1/content?id=42367 Advertising Slovenian Advertising Chamber > www.soz.si Consumer protection Consumer Protection Office of the Republic of Slovenia > www.uvp.gov.si/en Government (Ministries) Government of the Republic of Slovenia > www.vlada.si/en/

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sLOVENiA

SOUTH AFRICA
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 50,600,000 7,075 116.0% 26.0% English, Afrikaans, Zulu, Xhosa, Sotho, others ZAR 8,643,000 26,000 4,567,640

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 58,790,800 46,602,000 11,952,600 21.4 14,071 2,937 2014 70,747,100 56,019,000 48,646,300 21.1 17,560 5,439

MOBILE OPERATORS DATA Vodacom Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 49.4% 22.7% 15.9% 6,947,000 1,597,000 20.8 MTN 34.8% 16.9% 10.9% 4,310,000 2,010,000 19.2 Cell C 14.3% 24.4% 0.4% 476,000 346,000 14.6 Telkom Mobile 1.5% 5728.9% 413.6% 167,000 132,000 6.8

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SOUTH AFRICA

SOUTH AFRICA
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ 30 All -

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Self Regulator WASPA > www.waspa.org.za Operator MTN > www.mtn.co.za Operator Vodacom > www.vodacom.co.za Operator Cell C > www.cellc.co.za

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sOUtH AFRiCA

SPAIN
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 45,510,000 31,113 128.4% 100.0% Spanish EUR 20,808,500 425,000 15,289,440

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 58,897,000 21,070,000 33,973,000 30.7 21,181 4,632 2,901 2,692 2,036 2014 64,506,400 21,930,000 59,466,700 28.0 21,297 6,194 4,969 3,100 2,120

MOBILE OPERATORS DATA Telefónica Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 41.9% -4.8% 5.6% 10,925,000 1,444,260 33.2 Vodafone 29.4% -4.8% 7.8% 12,480,000 3,227,310 33.0 Orange 23.7% 27.1% -0.6% 7,650,000 1,218,000 31.1 Yoigo 5.0% 41.7% 52.8% 2,918,000 635,000 28.3

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SPAIN

SPAIN
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial Direct billing √ √ Web billing N/A N/A √ N/A √ 7 Partial √ WAP billing N/A √ N/A N/A N/A 6 All √ P-SMS √ √ √ √ √ 1.2/6 (PPU double optin) All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Comisión del Mercado de las Telecomunicaciones (CMT) > www.cmt.es Industry association Asociación de Empresas de Servicios a Móviles (AESAM) > www.aesam.org

TOP SMARTPHONE APPS Application type Social networking Maps Weather Search Photo or video sharing Digital books/magazines News Bank accounts Sports information Tech news Entertainment news Accessed by 15.4% 14.8% 12.4% 7.8% 7.7% 7.1% 6.7% 6.3% 5.1% 5.0% 4.8%

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sPAiN

SPAIN
NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smart- phone Feature Phone Other devices iPod Touch Other Share of traffic 27.4% 0.8% 0.0% 34.2% 22.1% 7.2%

2.7% 3.6% 1.9%

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sPAiN

SWEDEN
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 9,313,000 49,053 145.2% 125.0% Swedish, Finnish SEK 5,682,000 128,000 4,499,180

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 13,586,000 5,015,000 9,843,000 37.4 5,907 1,764 2014 15,224,000 5,360,000 14,143,000 36.9 6,637 2,565

MOBILE OPERATORS DATA TeliaSonera Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 45.9% -21.8% 24.7% 4,395,000 740,000 32.0 Tele2 28.0% -1.3% 16.1% 2,249,000 848,000 29.3 Telenor 15.6% -5.1% 7.5% 1,772,000 211,000 42.9 Tre 10.2% -5.1% 2.9% 1,381,500 284,810 50.9 Ice.Net 0.3% n/a 31.7% 45,500 10,500 n/a

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sWEDEN

SWEDEN
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Direct billing √ √ 200 All √ WAP billing N/A √ N/A N/A N/A 200 All √ P-SMS √ √ √ √ √ 200 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Swedish electronic communications and postal sectors Authority Post- och Telestyrelsen (PTS) > www.pts.se The swedish gaming board Lotteriinspektionen > www.lotteriinsp.se The ethical council Etiska rådet > www.etiskaradet.se Industry organization MORGAN Morgan > www.morganforum.com/ CPA guidelines Code of Conduct > www.morganforum.com/regler/code-of-conduct

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sWEDEN

SWITZERLAND
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 7,608,000 68,967 127.8% 82.0% German, French, Italian, Romansch CHF n/a n/a 2,710,160

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 9,758,000 3,902,000 4,852,000 55.4 1,508 381 8,843,000 2014 10,611,600

MOBILE OPERATORS DATA Swisscom Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 62.1% 1.7% 5.3% 3,201,000 661,000 54.4 Sunrise 21.8% 18.1% -0.4% 837,000 117,000 52.4 Orange 16.2% 16.4% -7.6% 814,000 172,000 63.1

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sWitzERLAND

SWITZERLAND
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription P-SMS √ √ √ √ 5 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Office fédéral de la Communication (OFCOM) > www.bakom.ch Telecommunication Law Loi sur les Télécommunications (LTC ) > www.admin.ch/ch/f/rs/c784_10.html Price indication Law Loi sur l’Indication des Prix (OIP) > www.admin.ch/ch/f/rs/c942_211.html Regulation Laws Code Pénal Suisse (CPS) > www.admin.ch/ch/f/rs/c311_0.html Regulation Laws Loi contre la Concurrence Déloyale (LCD) > www.admin.ch/ch/f/rs/c241.html Telecom regulator Ordonnance sur les Ressources d’Adressage dans le domaine des Télécommunications (ORAT) > www.admin.ch/ch/f/rs/c784_104.html Codes of practices Code de conduite relatif aux services de téléphonie mobile à valeur ajoutée (CoC) > www.mobiletechnics.ch/files/downloads/code_of_conduct_v3_en.pdf

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THAILAND
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 68,320,000 4,679 114.1% 9.0% Thai, Yawi, Teochew, others THB 10,045,200 20,500

12,881,800

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 78,329,000 70,333,000 3,929,000 7.9 7,123 1,053 2014 88,717,000 80,167,000 33,635,000 7.5 7,916 1,617

MOBILE OPERATORS DATA AIS Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 42.7% 1.7% 1.3% 46,000 46,000 7.9 DTAC 29.9% 1.9% 0.4% 1,783,000 1,783,000 8.6 True Move 23.7% 1.3% 3.4% 1,190,000 1,190,000 3.3 HutchisonCAT 1.8% -0.3% -8.0% TOT 1.2% 5.1% 7.0% 910,000 910,000 CAT 0.8% 9.1% 0.0%

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator National Telecommunications Commission (NTC) > eng.ntc.or.th

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THAILAND

TURKEY
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 76,000,000 9,799 82.8% 33.0% Turkish TRY 7,407,800 4,000 30,473,280

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 66,321,000 45,012,000 17,454,000 12.6 9,703 2,519 2014 77,657,000 50,726,000 61,737,000 12.2 11,107 3,768

MOBILE OPERATORS DATA Turkcell Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 12.5 12.7 13.1 54.1% 0.3% 11.5% 2,469,000 Vodafone 27.1% 1.6% 55.2% 704,000 Avea 18.9% 9.1% 3.2% 1,411,000

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Telecommunications Authority (BTK) > www.tk.gov.tr Telecom regulator Ministry of Transport and Communications > www.ubak.gov.tr

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tURKEY

UKRAINE
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 45,000,000 3,489 114.0% 12.0% Ukrainian UAH 4,450,500 95,000 1,551,840

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues 52,073,900 46,291,000 2,154,000 5.1 3,150 571 2014 55,357,000 48,925,000 19,866,000 5.1 3,370 1,047

MOBILE OPERATORS DATA Kyivstar Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU n/a n/a 4.7 48.1% 12.5% 28.0% 586,000 MTS 37.0% 7.2% 8.6% 651,000 Astelit 11.8% -18.8% -45.9% 103,000

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Goverment National Commission for Communications Regulation of Ukraine > www.nkrz.gov.ua

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UKRAINE

UNITED KINGDOM
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 62,060,000 36,308 132.0% 94.0% English, Welsh, Scottish GBP 25,338,700 780,000 30,481,300

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 82,375,000 43,901,000 55,363,000 30.5 29,362 11,162 3,104 6,871 6,002 2014 87,772,000 46,461,000 80,299,000 30.5 31,802 15,304 5,125 7,492 6,068

MOBILE OPERATORS DATA Everything Everywhere (Orange & T-Mobile) Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 38.4% -8.5% 9.3% 16,275,000 5,025,000 30.4

O2 30.2% 5.6% 1.4% 13,201,000 4,201,000 32.3

Vodafone 21.5% -6.2% 11.1% 12,754,000 5,004,000

Three 9.9% 19.8% 8.5% 6,192,500 684,500 36.0

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UNITED KINGDOM

UNITED KINGDOM
NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial Direct billing √ √ Web billing N/A N/A √ N/A √ 10 All √ WAP billing N/A √ N/A N/A N/A 10 All √ P-SMS √ √ √ √ √ 10 All √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Regulatory body for all premium rate charged telecommunications services Phonepayplus > www.phonepayplus.org.uk Independent regulator and competition authority for the UK communications industries Office of Communications (Ofcom) > www.ofcom.org.uk Industry Association Mobile Entertainment Forum (MEF) > www.m-e-f.org Industry Association Association for Interactive Media & Entertainment (AIME) > www.aimelink.org Industry Association Mobile Marketing Association > www.mmaglobal.com/uk Industry Association Mobile Data Association > www.themda.org Industry Association 160 Characters > www.160characters.org

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UNITED KINGDOM

UNITED KINGDOM
TOP SMARTPHONE APPS Application type Social networking Weather Maps News Search Auction sites Photo or video sharing Sports information Entertainment news Digital books/magazines Television guides Accessed by 35.2% 26.9% 26.8% 17.6% 13.4% 11.5% 11.2% 11.0% 9.0% 8.6% 8.2%

NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smartphone Feature Phone Other devices iPod Touch Other Share of traffic 21.3% 0.3% 0.0% 29.9% 15.1% 15.0% 8.2% 8.7% 1.5%

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UNITED STATES
Population GDP per capita Mobile penetration rate Broadband penetration rate Language Currency Smartphone connections Tablet PC connections Facebook users 319,110,000 46,146 94.9% 126.4% English USD 127,757,000 10,600,000 155,981,460

MOBILE TELECOMMUNICATIONS MARKET 2011 Total subscriptions Prepaid subscriptions 3G/4G subscriptions Blended montly ARPU Total revenues (million) Data revenues Content & applications revenues Messaging revenues SMS revenues 319,368,300 37,903,000 224,542,900 47.1 175,724 67,101 29,827 25,124 18,405 2014 372,516,100 45,298,000 337,577,100 44.1 192,512 98,685 39,923 32,572 21,928

MOBILE OPERATORS DATA AT&T Mobility Subscriptions market share Prepaid growth rate Postpaid growth rate 3G/4G subscriptions 3G/4G net additions Monthly ARPU 32.9% 14.8% 9.0% 82,568,800 21,632,800 48.2 Verizon Wireless 30.0% -3.8% 16.5% 85,396,000 21,396,000 52.5 Sprint Nextel USA 16.3% 28.5% -0.8% 38,024,000 13,924,000 48.4 T-Mobile USA 10.6% 13.6% -3.7% 12,934,100 4,734,100 46.0

Metro PCS Other 2.9% 11.5% 19.2% 138,000 88,000 40.5 -5.9% 5,482,000 3,443,180 7.2%

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NETSIZE BILLING METHODS Order channel SMS Mobile site Web Appstore In-app Max. amount Coverage Subscription Partial Direct billing √ √

INDUSTRY ASSOCIATIONS, REGULATORS & CODES OF PRACTICE Telecom regulator Federal Communications Commission (FCC) > www.fcc.gov Short Code Ordering Common Short Code Administration > www.usshortcodes.com Industry Association Mobile Marketing Association > www.mmaglobal.com

TOP SMARTPHONE APPS Application type Weather Social networking Maps News Search Photo or video sharing Sports information Bank accounts Restaurant information Movie information Entertainment news Accessed by 36.6% 35.2% 30.4% 17.8% 17.7% 13.4% 13.1% 12.9% 11.7% 11.3% 10.7%

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NON-PC WEB TRAFFIC Device class Tablets Model iPad Android Other Tablet Mobile phones iPhone Android Other Smartphone Feature Phone Other devices iPod Touch Other Share of traffic 21.8% 0.6% 0.1%

23.5% 35.6% 6.7% 2.4% 7.8% 1.5%

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COLOFON
The Netsize Guide by Gemalto Publication date: November 2011 Published by: Gemalto N.V. 6 rue de la Verrerie - 92197 Meudon Cedex - France Phone +33 (0)1 41 27 56 00 Editor: Alexander Vlasblom, Gemalto Written by: Peggy Anne Salz, Chief Analyst & Publisher, MobileGroove.com, for Gemalto and Netsize Design and layout: Marko de Hoop, Markodehoop.nl Photo credits: Cover: © Chanpipat, Dreamstime.com. Photos and images supplied by the interviewees are published under their responsibility. Country data: Informa Telecoms & Media, Netsize SA, comScore, Inc., Socialbakers Ltd. ISSN : 1772-1598 ISBN : 978-2-9523533-7-3
© 2011 Gemalto N.V. Gemalto N.V. All rights reserved. Gemalto, Gemalto logos and product and/or service names are trademarks of Gemalto N.V. or its affiliates. The reproduction, duplication, distribution, publication, modifi cation, copying or translation of any of the material contained in this guide, without the express and written authorization of Gemalto and Netsize, is strictly prohibited. Counterfeiting shall be pursued. NetsizeTM is protected by French, EEC and international intellectual property laws. All other trademarks and copyright material quoted in this guide are the sole property of their respective owners. Where a trademark or a copyright material is quoted in this guide by third parties contributing to it, Gemalto and Netsize do not thereby represent that such third parties have an ownership interest in, or a license to use, any such trademarks or copyright material. No copyright material in this guide may be copied or further disseminated without the express and written permission of the legal holder of that copyright. While Gemalto and Netsize have attempted to make the information in this guide as accurate as possible, the information in this guide is provided “as is” without any express or implied warranty of any kind. Gemalto and Netsize exclude all liability to any person arising directly or indirectly from using this guide and any information from it.
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Acknowledgements Many thanks to the interviewees and all who have worked together to produce this edition of the Netsize Guide by Gemalto: Anthony Balogun (Informa Telecoms & Media), Gil Bernabeu (GlobalPlatform), Berit Block (comScore), Marta Bordonada (Gemalto), Rob Brown (ARM), Salvador Carillo (Mobile Dreams Factory), Pamela Clark-Dickson (Informa Telecoms & Media), Christophe Colas (Trusted Logic), Tom Daly (The Coca-Cola Company), Steve Douty (Yahoo!), Jean-Philippe Galvan (Texas Instruments), Philippe Gillet (BNP Paribas), Thecla Mbongue (Informa Telecoms & Media), Donovan Neale-May (CMO Council), Mark Newman (Informa Telecoms & Media), Gavin Stirrat (Millennial Media), Madeline Tan (SingTel), Nigel Tatlock (Atlas Premium Brands), Gonzague de Vallois (Gameloft), and the teams at Gemalto, Netsize and Trusted Logic.

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THE NETSIZE GUIDE
The Netsize Guide is a comprehensive annual industry report, documenting the state of the global mobile content and services market and drawing on exclusive interviews with industry executives to provide an essential analysis of the developments impacting the industry –and our society– at all levels.

TRULY MOBILE
ST
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In this 10th edition we go one step further to discuss the future evolution of mobile and how the interplay of three key themes – TRANSACTION, TRANSFORMATION, TRUST – define the next stage of mobile growth and innovation.
TRA NS

ABOUT GEMALTO

The Netsize Guide by Gemalto analyzes how this will impact mobile network operators, device manufacturers, service providers, application developers, brands and countless vertical industries that seek to connect with people on their mobile devices. The Netsize Guide by Gemalto features: • 14 interviews with industry senior executives at leading companies including; ARM, Atlas Premium Brands, BNP Paribas, CMO Council, The Coca-Cola Company, Gameloft, GlobalPlatform, Informa Telecom & Media, SingTel, Texas Instruments, Trusted Logic and Yahoo!. • Mobile telecommunications market data, app and mobile device usage (including tablets and smartphones) and social media statistics covering 41 countries, from Informa Telecom & Media, comScore and SocialBakers. • A wealth of companion links–CL– to online reports, research, market analysis.

Gemalto (Euronext NL0000400653 GTO) – the world leader in digital security with 2010 annual revenues of €1.9 billion delivers on the growing demands for personal mobile services, identity protection, payment security, authenticated online services, cloud computing access, modern transportation, e-healthcare and e-government services. Netsize, a Gemalto company, is a leading mobile communications and commerce enabler. Netsize provides Mobile Payment solutions in 45 countries using Direct Carrier Billing, Online web / WAP Billing, Premium SMS Billing and ISP Billing (mPayment); and Mobile Messaging solutions with SMS and MMS delivery in 200 countries (mGateway and mMarketing). www.gemalto.com

9 782952 353373

ISSN 1772-1598 ISBN 978-2-9523533-8-0

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