Mobile IM taking off. The death of SMS ?

This interesting market research from Forrester links back to a previous post I did about IM vs.SMS.

Some interesting points:

• Mobile instant messaging (IM) adoption in Europe will grow from 8 percent (26.7 million subscribers) in 2007 to 24 percent (80 million subscribers) by 2013
• Forrester believes operators still lack a true commitment to backing the technology because of fears that mobile IM will cannibalize revenue from their highly profitable text messaging services (SMS)
• Mobile IM will displace 13 percent of SMS traffic by 2013

Very interesting talk about startups and VCs

What makes Facebook 15 billion dollars company

Tonight I was discussing with a friend about the big things of 2007, and among them is the incredible success of Facebook. Based on the recent MS investment in Facebook, the value of the company could be something like 15 billion. What made Facebook so big? Social networks have popped up like mushrooms in 2007, but Facebook was kind of unique. Here is what it came out of our discussion:

Facebook is an open platform: for the way I see it, Facebook could be compared to a middleware. The idea behind it is building a social network that can be used for a moltitude of applications. Facebook, on its own, offers a limited set of fuctionalities; what makes Facebook great is the total extensibility and the possibility that third-party applications have to take advantage of the data collected by the social network.

Facebook provides constant and real-time updates about your social network: being online is a way of living. People want to be reachable everytime; people want to interact with each other in a quick way. This is what Facebook is all about. All applications available on Facebook are basically interaction tools providing real-time feedback to its users. Users like this! Thanks to these tools dveloped by third parties, Facebook collects a lot of useful information about users behavior.

Facebook has built an entire ecosystem by offering to all developers three big things: an application framework allowing complex application development, a huge amount of useful data (the social network) and a lot of potential users. These three components contributed to the birth of so many applications, giving a great value to the company.

Companies Internationalization

A very interesting talk by Ola Ahlvarsson (a Swedish Entrepreneur) about companies internationalization

Some thoughts on Internet TV

Today two interesting articles about Internet TV appeared online. Both of them are about the announcement of a joint collaboration between Netflix and LG to manufacture a Netflix STB. The articles can be found here (EETimes) and here (NYTimes).

This confirms what I've always thought about TV: we will gradually assist to the migration of satellite and cable TV to the Internet as a transport layer. Video On Demand using the Internet is not something new. Back in 1998 I remember working on a university project focusing on VOD. I had a chance to visit an Italtel lab where they set up a VOD network for about 20 users, using ADSL and a Sun workstation as a server. The system was running very smoothly and providing all its users a terrific experience. It was really cool, but, at the time the technology wasn't ready and the cost of the bandwidth and processing power were prohibitive. Today, 10 years later I think we are ready for that. We have enough bandwith in our homes and the cost of the necessary technology has fallen dramatically. YouTube brought us video to the web and right now, many startups are trying to diversify the offer in some way.

P2P or Client/Server ?

Initially, when I tried the first version of Joost I was impressed. The quality is just ok (it's not HD) but being aware of the complexity required to design a p2p real-time video delivery network I think they did an awesome job. Differently from Joost and other p2p video companies, startups like Hulu or Netflix are using a client/server model (as far as I know) to deliver high-quality videos. Who will win? I don't know, but I believe that the sooner they will be able to bring their technology to a STB platform, the easier will be for them to widespread the product. To be honest, watching video from a PC is an alternative, but having access to a whole video archive directly from your LCD is definetly a much better user experience.

Use of the mobile phone among Japanese children

Japan has always been far ahead in mobile phone usage compared to Europe and US. Many innovative service started there and, in the world, Japanese people are the ones who spend more time in front of their phone display. An interesting article about mobile phone usage among Japanese children has been published here.
To me, the most interesting thing is the fact that almost 63% of the Japanese children use their phone to listen to music. I remember having seen more than one market research conducted in US and Europe, where most of the people preferred to have a second device to listen to their music instead of using their phone. The main reasons were limited memory capacity and audio quality. I've always liked he idea of having a single device for everything and I believe the tendency is the convergence of all services into a single device. I don't see why we have to carry around multiple devices when you can do everything with one. Well, if you think, the smartphones are gradually replacing PDAs. The same wil happen with media players. The cost of memory is dropping dramatically and phone manufacturers are realizing a good media player integrated into the phone is a good value to the customer. In this sense SE and Apple are doinga really good job.

Google trends about the mobile internet

This is a snaphot of what is produced by Google Trends with the words Mobile Internet (in red) and mobile web (in blue). It is quite interesting to see that around the half of 2007 there was a boost in search volumes of these two terms.

The mobile services ecosystem and the commoditization of mobile IP

What is the other thing that will make 2008 a great year for the mobile? The tremendous growth of mobile services and the consequent commoditization of mobile IP. If you follow the mobile market pretty closely you are probably already familiar with these names: Twitter, Jaiku, WidSets, Fring (..and I could go on and on). All these startups are focused on building services specifically designed for the mobile platform. Some companies focus on social networking, others on VoIP, but what all of them have in common is building a service or a platform that is usable from a mobile handset. And the same is happening with the big names. Take Google, for example. This year, in addition to releasing the Android platform and acquiring a lot of companies in the mobile business arena, they released two great products: Google maps for mobile and Gmail for mobile. I love these applications because of their usability. So far very few big names have put their efforts in developing a mobile application service, and the fact that is happening right now made me think alot about what's next in 2008. The other big name is Nokia. They made some important acquisitions too and they launched OVI: a set of mobile services offering maps, social networking, music and probably much more. Another great sign. Nokia, to my knowledge, has never been involved in offering services with their handsets in the past.

Now, think about it. In the coming years we will start seeing mobile services offered by many different companies that are not our usual mobile carriers. And more than ever people will start using these services, like they use Facebook, Google or Blogger today from the web. Now, what do people need to use the services? Mobile IP. In order to have access to these services you need free access to the Internet and that is what mobile IP is about. Personally I believe the demand of Internet access from the mobile phone will increase so much to be commoditized pretty quicky. And if you take a look at the market this is already happeing right now: in US for 50 $/month AT&T Wireless offers unlimited data plans, while in Italy, for just 9 Euros/month you get 50 MB of data/day which is quite a lot. The great thing is that these offerings are not targeted to the business user, but instead, to the general public.

With this mobile services ecosystem growing over the next years I personally see a decline of the power of the mobile operators. One of the obvious application consumers want more from their mobile phone is Instant Messaging. Now, in a world where mobile IM is pervasive and we all have a flat data plan, does the old SMS make sense? Probably not. I'm not saying the SMS will be replaced by mobile IM, but there are services currently offered by operators, that, with the commoditization of the mobile IP, could be threatened.