Follow the mobile money
CS5011/CS4032:
Mobile Computing
Bruce Scharlau, University of Aberdeen, 2013
There are two sides to this coin
Money generated by the mobile ecosystem
Money used by people in their daily lives
tied to the use of their mobile
Bruce Scharlau, University of Aberdeen, 2013
Mobile applications reduce friction
Bruce Scharlau, University of Aberdeen, 2013
Smartphones overtake PCs
http://www.canalys.com/n
ewsroom/half-billion-pcsship-2013-tablet-salesrocket
http://mobilephonedevel
opment.com/archives/16
57
Bruce Scharlau, University of Aberdeen, 2013
Mobile almosts matches population
http://communities-dominate.blogs.com/brands/2012/08/the-mobile-moment-is-only-monthsaway-preparing-for-the-biggest-number-ever-yes-that-day-is-near-whe.html
Bruce Scharlau, University of Aberdeen, 2013
Mobile applications are becoming
more popular
http://www.upsidelearning.com/blog/index.php/2012/05/23/6-drivers-of-mlearning-in-the-workplace/
Bruce Scharlau, University of Aberdeen, 2013
There are a lot of mobiles
5.5 billion handsets (including1.2bn smartphones)
with global population of 6.8 billion
Near New Year’s 2013 will
be one phone per person
Above 100% mobile rate in developed world
59% in emerging world
Emerging world still on WAP for data –
this is were 5.6 billion people live
http://communities-dominate.blogs.com/brands/2012/10/a-look-at-the-handset-industry-market-andinstalled-base-in-2012.html
Bruce Scharlau, University of Aberdeen, 2013
All are SMS capable
PREVALENCE OF SELECTED FEATURES OF THE INSTALLED BASE
SMS capable handsets . . . . . 100%
MMS capable handsets . . . . . . 85%
Cameraphones . . . . . . . . . . . . 81%
That means 4.4bn
Bluetooth . . . . . . . . . . . . . . . . 79%
camera phones
FM Radio . . . . . . . . . . . . . . . . 63%
3G or faster cellular . . . . . . . . . 41%
WiFi . . . . . . . . . . . . . . . . . . . 25%
Touch screen interface . . . . . . 23%
Smartphone . . . . . . . . . . . . . . 22%
Dual SIM . . . . . . . . . . . . . . . . . 9%
Source: TomiAhonen Phone Book 2012
This data may be freely shared
http://communities-dominate.blogs.com/brands/2012/10/a-look-at-the-handset-industry-market-andinstalled-base-in-2012.html
Bruce Scharlau, University of Aberdeen, 2013
Price for mobile touch all ranges
HANDSET PRICE PYRAMID 2012
Premium Smartphones . . . over $450 . . . . 11%
Mid-price Smartphones . . . $150-$449 . . . 13%
Low-cost Smartphones . . . $80-$149 . . . . 17%
Featurephones . . . . . . . . . $40-$79 . . . . . 21%
Ultra Low-cost Phones . . . under $39 . . . 38%
Source: TomiAhonen Phone Book 2012
This data may be freely shared
‘smartphones’ are fighting over the 11% band
http://communities-dominate.blogs.com/brands/2012/10/a-look-at-the-handset-industry-market-andinstalled-base-in-2012.html
Bruce Scharlau, University of Aberdeen, 2013
Zero to $1trillion in 28 years
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Mobile industry only 28 years old
Fixed line moving to mobile
Internet moving to mobile
Media content moving to mobile
Bruce Scharlau, University of Aberdeen, 2013
Let’s breakdown the 1.1trillion
• 900bn service revenues
– 625bn call revenue
– 175bn mobile messaging
– 100bn mobile data
• 200bn for hardware
– 160bn handsets
– 40bn network infrastructure
Bruce Scharlau, University of Aberdeen, 2013
SMS makes lots of money
• Mobile messaging is broken down with
– 120bn SMS
– 35bn MMS
Bruce Scharlau, University of Aberdeen, 2013
Mobile data is bigger than
internet
• 275bn data revenues means it’s bigger
than internet related advertising, content
and access fees (ie broadband and dial
up)
• 98bn from premium data (4x what’s paid
for on internet)
• 5bn from ringtones (2.5x what iTunes
makes)
Bruce Scharlau, University of Aberdeen, 2013
Average RPU is $13/month
• Average phone user pays $13/month
– $50/month in US
– > $5/month in emerging countries
– $1/month in Nigeria and Bangladesh (and
companies still make money…)
Bruce Scharlau, University of Aberdeen, 2013
Over 1 billion new handsets/year
• 1.3bn new handsets a year
• About 16% are smartphones
Bruce Scharlau, University of Aberdeen, 2013
Mobile banking developed most
in developing markets
• Right were banking didn’t have vested
interests in established practices (leapfrog)
• WAP experiments in 90s not go anywhere
• Czech Republic and S Africa – SMS alert
when money being withdrawn from ATM –
then nationally in Philippines
• Phone wallets in Japan in early 2000s
• Still developed catching up with developing
Bruce Scharlau, University of Aberdeen, 2013
Virtual money greater in
developing world too
• Habbo hotel of Finland the oldest which
predated Second Life and has 175mn
users all under 15 and generates $75mn
from premium SMS for in-game purchases
• Forerunner of Farmville, etc
Bruce Scharlau, University of Aberdeen, 2013
M-Pesa provides virtual <->real
interface
• Started in 2006 as banking for unbanked –
now 58% use mobile banking
• Deposit real money to account and w/draw
or transfer to other m-pesa users via SMS
• No more moving real money around where
even $2/day wage was target for theft
• Now represents around 25% of GPD
Bruce Scharlau, University of Aberdeen, 2013
Every phone becomes payment
terminal with mobile money
• Swap money via SMS at market, shop, etc
• The change has to come from operators –
every phone can authorise payments and
evey phone can receive payments
Bruce Scharlau, University of Aberdeen, 2013
Virtual to real change
• Buy credits in shop means shops (G-cash,
M-Pesa, Smart Money, etc) can sell you
airtime, etc which means they have too
much cash
• Let people withdraw money against airtime
means cash goes out – solves problem
(banking without banks)
• South Korea – most advanced – has credit
cards on sim card so can move/pay with
phone and not need physical card
Bruce Scharlau, University of Aberdeen, 2013
Mobile reduces crime
• Already mentioned Africa and m-pesa
means less crime as people don’t have
cash
• Works with machines too: parking meters
all mobile in some countries – reduces
crime against meters
• Sweden now has mobile bus fares – and
end of cash (reduce waste of metal, paper,
etc)
Bruce Scharlau, University of Aberdeen, 2013
Mobile applications reduce
friction
They make life easier
Bruce Scharlau, University of Aberdeen, 2013