Mobile Point View by Paul Ruppert

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Paul Ruppert is now blogging about global business and the mobile communications industry at www.globalpointview.com

Interview: Lisa Gersh, President Strategic Initiatives NBC Universal & Managing Director, The Weather Channel

 
Recently I had the opportunity to attend the Conference Board's Corporate Development Conference sponsored by Ernst & Young's Transaction Advisory group. The conference was attended by leading Corporate Development Officers from 3M, P&G, SAP, Microsoft, Colgate-Palmolive, Sun and others, covering such topics as Organizing Corporate Development, Repurposing Corporate Development for Challenging Times and Valuations of Multinational Acquisitions and Divestitures--my favorite panel of the day, which I stumped with my question regarding US vs ROW style M&A.

While there I had the chance to sit down and interview Lisa Gersh, President of NBC Universal's Strategic  Initiatives Group and the Managing Director of The Weather Channel.
Gersh joined NBCU in November of 2007 after the company acquired Oxygen Media, which she co-founded and served as its President & COO. Upon joining NBCU she led the multi-billion dollar acquisition of The Weather Channel Companies and is currently the executive in charge of the investment, aka, the CEO. Thanks to Lisa for spending a few minutes with me there.

With advertising revenues getting hammered in this contracting economy, is NBC Uni's Corporate Development looking to expand aggressively into different modes of media, especially the mobile platform, for future growth?

"Our acquisition of the Weather Channel is a great example of our strategy--looking at how we can leverage content regardless of platform, then swiftly positioning it to take advantage of its benefits such as its power via mobile. Weather information and related imperative content effectively applies itself across all our platforms--mobile, internet and  TV--which is why we have integrated the Weather Channel content from MSNBC to the Today Show to mobile applications. It is a great standard of defining a multiple platform strategy for NBC Universal."

How has Corporate Development and the M&A environment changed as a result of the current period of contraction?  From where you sit in the media conglomerate world, what do you see as tangible significant changes?

"One of the biggest changes is a broader consideration of what is going into the mix. While with Oxygen Media we had a strong sense of where a property might sit, what would be accomplished in its first year, all the metrics and projections worked out, very traditional financial analysis of the stakes involved.  A year later with the Weather Channel, which occurred at the first stage of the economy's troubles, we and GE were quite concerned with the human impact of a change in control in a private company, with the reality of people loosing their livelihoods in a very difficult time. The conditions made us think very differently as a company and the HR impact of the deal and the impact of integrating the Weather Channel into the GE family of companies"

"As a result, the responsibilities of communicating the value of the deal have shifted. Communicating up and down the corporate ladder has a higher scrutiny now, especially for the CDO. Essentially the more things have changed the more they have stayed the same. It comes down to the foundation, the management expectations, the synergies attained, and how effectlvely it is communicated."

On the topic of gaining synergies, do you think the weighing of deal prices and valuations, combined with the flat economy has escalated the importance of capturing deal synergies faster, slower or the same as in the past?

"I think timing is everything. Let's call this "pre-Lehman" and "post-Lehman" considerations.  Post Lehman, capturing quick synergies are critical. We're looking to bring the value of an acquisition much closer. In the past, we might have targeted 18 months for identifiable returns, now those are moving to 9 months, with a greater focus on integration needs to gain control of the business operationally and financially. This is especially true in the media business where it is critical to move quickly, as we did with The Weather Channel acquistion.  Also I think the understanding of the friction and obstacles are more candid now post-Lehman. People expect bad news and challenges in these times--no more glossy deals. In fact that makes it an improvement since now there's a more real sense of expectations and friction than pre-Lehman."

How are corporate development initiatives such as M&A opportunities managed within NBC Universal?

"Smaller, digital technologies such as mobile centric ones, or properties of that sort, are led and identified by a business unit's GM or leadership that might be utilizing it or are more closely aware of technical applications or the strategic advantages of content.  If it is cross fucntional, impacting multiple aspects of NBC Universal, than it is up to my group to identify and source the advantages and challenges of the opportunity. Plus we have an on going process analyzing a number of potential deals regularly as part of our functional responsibilities."

This was a great conference--at roughly 100 elite participants, small enough to meet everyone, many of whom both served as great panelists who then stayed for the conference, like Lisa--a true measure of its value and importance if the panelists stay on to sit in the audience. Check it out for next year.

Innovisioneering: Hunting & Harvesting Innovation

I'm always on the hunt for innovations and keen to the process of developing innovation. That can come in a number of forms, and since I'm the final filter on what interests me, there's no logic to my hunting strategy. Philosophically I believe you have to open your mind, shelve all your biases, decouple the lessons of experience and actively embrace "the different."

I've been moderately successful, perhaps because of my combined product development and corporate development experiences, but as in many business initiatives, there's a balance between the linear and logical combined with an artist's vision or instinct.

From there I apply an integration perspective, examining current trends, iconoclasts, then combining with a hard edged business perspective on what can be pragmatically achieved, then harvested. Harvesting, aka, "How one can make money with this is?" is my lodestar.

I've come to calling this "Innovisioneering."  Essentially it requires a pre-disposition to innovation, the ability to identify what is adjacent opportunities in today's market as well as identifying growing trends and wildfire events that will converge over the horizon. Then add the orienteering ability to plan a path, engineer and execute a strategy to harvest the opportunity. Hence, Innovisioneering.

Good innovisioneers look critically yet open mindedly; spanning the horizons for data, changes, feints and indicators of movement which indicate a congealing consensus of value in the marketplace. Sometimes it is an implied demand, sometimes overt. Sometimes a technical advancement in other fields which can be combined for value, sometimes direct epiphanies. Either way it requires an intimate understanding of the end consumer behavior, the process of serving the consumer, as well as the skills to operationalize innovation.

Many people have an inherent fear of innovation: that's its too risky, sporadic and doesn't pay. In my past I've been lucky to have been involved in real breakthroughs--SMS interoperability and voice activated technology--so I have some practice with tools to mitigate that risk and improve my batting average.

At CTIA I started looking at companies a month before Vegas and found two companies which caught my interest, one an enterprise mobile security play, Turns out of the five companies I met with at CTIA, these two were in the Top 5 contestants for ATT's Innovation contest. Intelligent Spatial Technologies won everything being knighted ATT's Most Innovative Application, and Boxtone came in the Top 5 for enterprise applications. In subsequent posts I'll provide more details on these innovative companies in the mobile space.

The Value of Innovation
The trouble with innovation is today's business philosophy.  Modern business thinking has led to the conclusion that organizations should focus on what they do best: that is, the day-to-day money-making activities that have won them their principal ‘customer mandate’. For most organizations - indeed, for almost all organizations - the most sensible course of action is indeed for them to stick to what they do best. After all, that is why customers come to them and are prepared to pay them money.  Few major companies can afford to employ a team of full-time innovators. Modern business thinking has led to the conclusion that companies should focus on what they do best: that is, the day-to-day money-making activities that have won them their principal ‘customer mandate’.

But how should a company pursuing a sensible policy of sticking to what it does best and fulfilling its customer mandate deal with the danger that if it does not innovate it may sooner or later lose its customer mandate to more innovative competitors?

It can't. Companies that don't innovate die.

While successful innovation once was performed in sterile corporate R&D labs, today the broad distribution of knowledge makes such a process infertile. Competitive advantage comes from gaining vision, placing an educated bet on what you see, and leveraging the discoveries of others if your company is seeking new areas of technology or entering untapped markets.

The mandate of innovation is to seek it out from all sources, inside and outside of the company, connecting and developing partners, suppliers and even co-opting competitors--the more connections, the more ideas, the more solutions. That's modern innovation. Look at IBM, Intel, and the revitalized Procter & Gamble. They know "what's next."

A company's focus on innovation should be outside-in, requiring a transformation of both external perception and internal purposes, understanding what needs are to be met and how to connect the dots between the company's capabilities and competencies—a mix of existing business lines and recently acquired companies—and bridging those to broader opportunities. In my view, innovation should be obsessed with end-user consumers in the ever changing mobile market, which can then be swiftly taken to full consequence.

Building sustainable competitive edge in a period of global competition is challenging corporations to utilize and leverage all available resources, whether internally or externally sourced. In Innovisioneering: Part 2, I'll outline my thoughts on why periods of economic contraction are the best time for innovation development, why VCs fail at identifying innovation, and how resource rich companies are executing innovation through corporate development.  Stay tuned....

25 million Chinese mobile time-bombs in India

25 million mobile handsets may turn into paper weights in India on April 15, 2009.

Chinese handset manufacturers have flooded the Indian market with over 25 million handsets over the last few years and these phones do not have IMEIs.  What is an IMEI you say?

An IMEI is a unique 15-digit code that identifies the handset. Each time a call is made, the mobile network operator uses the IMEI to identify the caller via a universal registry of phones. If a phone lacks an IMEI, the telecommunications company can still route the number to the destination, but it does not know which phone is making the call. Therein, rests the problem: India's Department of Telecommunications in the Ministry of Communications and I.T. believes these anonymous IMEI phones could be used by terrorists of any stripe or color.

India's Dept of Telecomm relayed to mobile operators in India that in " the interest of national security, all Indian telecom operators should focus on implementing checks of IMEI within two months."  That was in October 2008. Now April 15 is the deadline. Wireless service providers in India are expected to disconnect mobile phones that lack IMEI on April 15.

While Indian mobile phone users can verify their own IMEI numbers by pressing *#06# on their handsets, what if the consumer is among the unlucky  25 million who are holding one of these 25 million handsets lacking an IMEI? The DoT estimates the 25 million phones lacking IMEI in India account for about 10% of the total phones used in the country.

Indian users are clearly concerned.

And what of the Chinese mobile phone manufacturers, are they inclined to remedy this? Indeed, where is the responsible action from the Indian operators in the first place? Seems nothing at the moment for or from both.

And the ripple effect could spread to financial markets: consider both Vodafone and Airtel could have their stock price effected if suddently these phones turn into bricks. Considering that it is likely these phones are used more by bottom of the pyramid consumers than top, to get these users back, the mobile operators will have to subsidize ever more new phone purchases. A continuing drag could develop.

Wonder what tomorrow will bring?

Tipping Point 2SMS: Enterprise Messaging

Finding true trends in the sea of noise created by the hype-manufacturers in mobile is practically impossible. Last week’s CTIA was a clear example. The multi headed hydra of the pundit-ocracy clamors a singular vision. The PR flacks shed a thousand points of light on their next big things. The organizers spotlight the themes of “men on white horses”—keynote speakers and sponsors--which we mere peasants should naturally be following.

Meanwhile most journeyman attendees (like me) are too busy in meetings, pleading for face time, attending dinners conflicting with 10 pm receptions, all within an average stay of three days and two nights in the bull’s eye of Vegas’ adult distractions--this is a massively male industry mind you. Little gets really noticed, let alone understood. Less makes an impact. Ahh, least we not forget the “current economic conditions” either.  Trying to capture a true trend is like noticing a single sequin in a strip club. 

But as even a blind man can find a sequin if he's feeling for it, I think I found one of those true trends: Enterprise messaging.

Since its birth, SMS has been the finger tool of consumers, passing trillions of notes as a terse, powerful means of communicating. I consider text a fully developed medium on par with film, TV, radio, and print. It informs. It entertains. It connects. It has billions of users. It earns its keep in the mind of individuals. Now it is carrying multiple payloads, whether financial, advertising, entertainment, medical, even payments. Seems 160 characters can be quite effective.

My enterprise ‘tell’ is not the developing bubble of one shot wonders of apps developers focusing on calendar synching LBS widgets, but the growing number of scale-sized enablers which are now managing all the complexities of routing, delivering, securitizing, sorting and prioritizing the messaging needs and benefits of enterprise users.

These are not the massive aggregators managing traffic to the networks, but companies specifically developing targeted turn key solutions for enterprises, while using the back haul delivery network of a global messaging aggregator. It’s a sign of a developing, healthy ecosystem evolving beyond consumer messaging.

One stood out to me at CTIA : 2SMS.

2SMS is a British born firm, 8 years on. They provide a software based solution to enterprises providing an integrated solution beyond just mere alerts and notifications. By having a synergistic messaging notification platform provided by 2SMS, an enterprise’s employees, customers, suppliers--perhaps even share holders--can be kept current on a variety of activities, notices and actions required. This is not your father's alerts and notifications.

2SMS has obtained ISO 27001, an international standard for information security, something neither cheap nor easy to implement and maintain. A clear differentiator from the other enterprise oriented SMS providers and clear advantage for 2SMS as they overcome security challenges for text in the enterprise segment.  Usually this is the biggest hurdle for SMS in an enterprise environment alongside storage, retrieval and messaging management.

Listen to my conversation with 2SMS CEO, Tim King here (6:38)   

But the real power comes in 2SMS’ technology. Not just content with the hiding in plain sight “security” measures of SMS, their solution incorporates a proprietary component where secure messages are identified from a trusted source and naturally delivered to the recipient. But, the message doesn’t sit perilously on the handset, its in the cloud, thus protecting the user from any loss or “transfer of handset possession” e.g. being “pinched” or lost.  Plus it provides auditing and a legal trail as well.

 I spoke with Tim King the CEO of 2SMS [click here to listen to the podcast or tune in here at iTunes ]. As Tim relayed “business leaders are now recognize the power of SMS and identify with its non-financial benefits. They are going beyond financial benefits, and now see impacts  on operations or mission performance and results such as improved customer satisfaction, faster information distribution, improved productivity, improved efficiency. That’s how we harness SMS.” Having sold to enterprises in the past, the real marketing value of proof in their pudding was their tool which shows the ROI on the purchase of their services. Something buyers are always looking for to support a purchase, and a technique I've often used. Smart move as exemplified by their customers which include SnapOnTools, Exxon and Pfizzer.

2SMS’ enriched enterprise messaging services have placed the company at the leading element of a number of companies that are gaining traction and scale. Unlike Twitter texting, here’s a concrete business model with secure messaging services within a broader segment that pays the bills. This is a company that has many of the pieces in place, prepared as the wave of opportunity is breaking towards them.

2SMS and their noble competitors developing the enterprise messaging segment will add another wave of growth to SMS usage and further the next evolution of text. Check them out.

AKQA Mobile: Advertising for the Digital Mobile Age

AKQA is a global digital advertising agency that is at the top of the mobile advertising game, having won AdAge's Digital Agency of the Year for 2008, and being named the 48th most innovative company in the world by Fast Company. Mobile is a key component to their digital advertising practice is a key component to their strength, but their mobile  initiatives are their reals bench strength.

AKQA brought in Dan Rozen about a year ago, a long standing mobile marketing veteran in the UK, and since then they have grown to a dedicated mobile team of 20 with campaigns for Coca Cola, Visa, ESPN, Orange, Nike and most mobiley noteworthy Smirnoff vodka.

Listen to my interview with Dan Rozen, GM of AKQA Mobile here:

Smirnoff made its first stab at mobile with a WAP site built by AKQA. Rather than simply re-creating the Web experience on the phone, AKQA opted for an on-the-go cocktails and nightlife guide. In the U.K., the mobile site reaped about one-third the traffic of the Web site, reports Michelle Klein, Smirnoff's global digital marketing director, who calls AKQA "at the bleeding edge. They know what's happening in the technology space and they bring those ideas to us. They have their fingers on the pulse. They came with a big idea and then blew the idea out."

In other words, while mere ad mortals struggle to understand the social MOBILE web, Dan Rozen and his trailblazers are already deep into the next big thing.

RCR Wireless goes dead

In a surprise move, RCR Wireless announced today it is shutting down after 25 years of covering the wireless segment. I've read the trade mag on and off over the last 15 years and in many ways am not surprised.

First, it reflects the expanding destructive effects of news gathering via the web as opposed to newsprint. But it can't be ignored that it also reflects the problems in the wireless business as well. RCR focused mostly on the US market, and had an emphasis on the old "wireless business" tracking mostly the public traded entities--none of which are doing very well--and missing the development of developers' influence and the growing fragmentation of the industry. It's style reflected that of a mid tier US city local business rag, think Kiwanis, local bankers and lawyers, instead of a global industry media outlet covering the  constantly ebbing and flowing--mostly due to the tastes and choices of trend following 15 to 35 year olds--of a global pool of users. As a result it skewed its coverage to infrastructure and has struggled in breaking news regarding the shift towards apps and content framing the ecosystem, a the expansion of adjacent opportunities migrating to mobile, advertising, location, payments, video, plus the plethora of start ups in the mobile segment--all magnified on a global level You could easily see coverage of repeaters, tower exes, and handset wars, but how often was there something on say, SpinVox or Mobile Dreams?

No doubt there will be those newly arrived upstarts who felt it was just a mouth for "the carriers" or the US' CTIA, instead of kowtowing to the the newly arrived religions of the iPhone and Andoid. But, service usage absent revenues isn't a business model, apps are not a business--unless you own "the store", and dial tone reliability isn't going to be provided by some High School Harry developer in a garage. The reality is that the industry needs balanced coverage between the two. The best I've seen to date is Charged and Mobile Communications International. Two slick publications which reflect the old guard and the new, US and Rest of World, in a balanced manner. Check them out and develop fresh reading habits.

Blast Effects on Mobile

With the constant drumbeat of the downward economy, evidence is emerging that there are distinct regional differences in mobile's economic strength across the world.

Informa recently noted that the subscribers continue to sign up for services in some of the most desperate economies of the Africa and Southern Asia, while the the over saturated and nearly satureated markets of Europe and US are in for either a quick or slow contraction.  India has become the world's laregst market in terms of net adds for the first time in 2008, with 102 million new subs, exceeding China.

I'm Reconsidering my position

The Mobie Pundit-ocracy has been positioning that mobile has been resilient to the deteriorating global economy, focusing primarily on the stablilty of operators making plans to lower costs, and downsize their businesess. Handest and network equipment vendors are thought to be the first line to be effected with consumers putting off the upgrade or replacement of their handsets, with the indirect ripple effect causing contraction in the network infrastructure flattens due to differed data usage and less than expected usage rates forcing operators to delay any network upgrades.

The blank spot in most of these analyses is the complete over focus on the biggest players--those publicly held entitites or uber-mobile players such as (of course) Apple, Google, Nokia, Motorola, Ericsson and the rest, and the lacking acknowledgement of how much the industry is about to change due the lack of funds and operating oxygen smaller players are facing and how that is going to change the ecosystem. Layer on the contraction of the venture industry, and collectively mobile is likely to be a very dull and (further) disappointing segment. 

The reality is that the global recession started in early 2008, with the impact in the second half of 2008, and now the blast effects worsening in 2009. Consider that the  world's mobile subscription market grew by 18.5 per cent year on year in 2008, down from 22.5 per cent growth in 2007, and is set to increase by just 12.7 per cent this year. That's a 44% drop in global handset growth in 18 months.

Unsurprisingly, the world's developed markets will be hit especially hard with the total device market in Western Europe set to contract by 13 per cent in 2009, and it could take as long as three years for the European and American device markets to get back to 2008 sales levels given that replacement cycles are likely to increase by a wopping ADDITIONAL 8 mohths in 2009, moving handset holding periods approaching 2 years on average.

Lesson Here: Avoid investments in handsets and infrastructure providers, and weigh carefully any applications plays.

Noteworthy Predictions

I came across one of the more thoughtful group of Mobile Predictions at Mobile Messaging 2.0, by Airwide Solutions' Chris Lennartz.

       Here's the 9 Top Line Predictions for 09.

1. Mobile Messaging will defy the economic downturn
2. Less Developed regions will fuel new peaks in SMS activity
3. China will fuel MMS uptake
4. Personalization will come of age
5. Mobile Marketing & Advertising will surge ahead
6. Mobile internet will overtake 'tethered internet' usage
7. Focus on mobile security will increase with the coming of mobile commerce
8. The Digital Youth will drive transformational changes in communications
9. Mobile will go green

All are spot on, and reflect reasonable goals and perspectives in a field which is usually fraught with hype. If you drop by www.mobilemessaging2.com there's also a group of slides reflecting special research commissioned by Airwide with Commscore M:Metrics. A nice bonus....

In times like these, any company in mobile should keep a candle to the winds of pessimism, and pursue a practical path of focusing on gaining a better understanding of, and more effectively manage the needs of, their customers and secure customer loyalty--a priceless advantage at any time, whether in 2009 or into the future.

 

Mobile Point View's 2009 Predictions on the Mobile Industry

Ah, the end of the year approaches (thank God) and requires the usual journalistic right of passage--predictions for the upcoming New Year in the mobile industry.

For my reading audience, as well as those tuned into the Mobile Influencers Podcast at iTunes, here’s Mobile Point View's 2009 Mobile Industry Predictions

iPhon-ification Continues
Consider the following.

• Roughly 13 million iPhones were sold by Sept. 30, 2008—as recorded by Apple in their Q408 financials   

• The iPhone store had 200 million downloads in the first 100 days, so that is 2 million downloads/day.

• Those 13 million iPhon-iacs downloaded approximately the same number of apps in 30 days that 250 million non-iPhone owners downloaded in 90 days.  

• That’s a 60x multiple in terms of the likelihood that an iPhon-iac will download an app than a non-iPhone owner.

• Conclusion: You need 780  million non-iPhone owners--iPhon-ophobes?-- with access to your application before you could match the actual reach of 13 million iPhone owners. 

• 5500 apps in the App Store have created $1Billion annual run rate in App Store revenue. A billion dollars boys and girls.

• Apple has leapt into second place worldwide in terms of smartphone sales with their Q4 figure of 6.9MM units sold, selling more iPhones than Blackberries. iPhones now own 17% of the worldwide smartphone market.

• With Wal-Mart’s recent announcement of the iPhone availability at the world’s largest retailer, the halo effect of the iPhone migrating to lower economic segments will only accelerate its market penetration.

Mobile will “reset” just as the rest of the economy is being re-set
With the rest of the world’s economy engaging in a ‘re-set’ over the coming year, the economics of the mobile business will have to be re-set within the minds of analysts and operators. GE CEO Jeff Immelt stated in November that the economic crisis projecting into 2009 “represents a re-set, ...with the biggest reset will be government involvement in the economy, and in the affairs of business, for better or worse.”

Incremental penetration of mobile communications across all economic segments will not abate, but the tough reality is the “mobile money party” is likely to be over. Savage choices by consumers will be made with a higher unemployment rate by mid-year, and ARPU may decline precipitously in the coming months even with increasing gross net ads of subscribers.  Yes, there still is a need for voice and data, but don’t expect double digit growth in the segment for sometime.

The Emerging US Broadband Gap
In the US, incoming President Obama’s initial inclinations are to make a big government ‘infrastructure’ investment to counter attack the recession. Let’s hope that it goes beyond bricks and "bridges to no where” to include digital bridges as well.  The US woefully lags behind other nations in the upload and down load speeds of its wireless networks, and even broad mobile functionality as compared to other country markets around the world. Why isn’t anyone talking about how we should be investing in faster mobile networks, whether as part of broader Wi fi coverage or wide area mobile networks? They will be. Soon. JFK got elected on the back of the “missile gap”, expect some enterprising American politicians to start bringing attention to this sorely overlooked topic of the mobile bits and bytes infrastructure in 2009.

Interoperability Part 2
Thirteen years ago interoperability surrounding text messaging had just been implemented in Europe, with the US soon to reach that same stage of development. Under the covers, messaging now has a de facto hub and spoke structure between aggregators and carriers. Look for that to solidify, not to the benefit of say MMS, but to its detriment. Innovations such as Syniverse’s IM SMS interoperability hub will ignite the broader offerings of mobile IM by carriers, greater usage by consumers, thus narrowing the offer of MMS to the niche of picture transfer, and even there it doesn’t always work. Look for big steps to be taken for IM and SMS interoperability in 09.

Chill of potential regulation over Mobile Marketing
There are growing fissures in the mobile marketing business model. The announcement by Verizon in October to increase the fee paid by others to deliver into their network for the purpose of mobile delivered advertising, aka "standard rate termination fees" has caused a significant chill in the market. Not necessarily with the operators, nor the consumer, but the guys who pay the freight: Brands and advertisers who see an unstable pricing model by a core supplier as a real risk and big uncertainty. Notwithstanding the growth of mobile marketing as well as its huge potential, the expectation that 2009 is the year of mobile marketing may be extended. Layer on Capital Hill, as well as state level Attorney General offices, are getting more interested in this segment, its costs structures and business model of mobile advertising. Greater transparency is the new zeitgeist so If the ecosystem isn't careful, 2009 might bring a cold blast from the likes of Wisconsin Senator Herb Kohl who chairs the Senate Commerce Committee. 

China will finally launch the iPhone...sometime in 09
Apple is facing the dilemma of a choice between the Dragon and the Deep Blue Sea. Either get into the world’s largest mobile phone market (currently nearing 700 million subscribers) or break the imposed revenue sharing model with operators currently in effect in other countries around the world. Having worked and lived in China, as well as negotiated with China Mobile and China Unicom, when I see quotes as those from GSM Asia in Macau last November: “Secondly, our business model does not entail sharing revenue with terminal producers -- we don't share revenue. That's a Chinese rule," said a China Mobile executive," makes me believe the Chinese have the advantage. Apple has 365 days to give, which they will.

Strong Balance Sheets, Emerging Corporate Venturing and Over Fragmentation
2009 will bring the close of many VCs. It's inevitable, there has been many marginal funds that are not going to last, many of which were making early stage investments, some in mobile. The contraction within the VC industry, as well as the general contraction in the economy will spur an emergence of more venture activity by Corporate Venture and Innovations Groups. During tough times, leaders move to consolidate their industry position as well as 'catch a march' or 'lengthen their stride' against their rivals, and as the vacume increases from diminished venture fund activity, expect to see an increase in large private and public companies to expand their activity in venture funding. Those that have strong balance sheets will lead this effort. One result may be the lessening of  'serial entrepreneurs' who have little or no mobile experience, and instead look to see C level changes as both VCs are forced to make savage choices and corporate innovations groups leverage their investment by placing seasoned and successful entrepreneurs back at the helms of mobile companies--meaning older, grayer, and more experienced executives who have navigated and successfully survived past recessions.  Mobile suffers from over fragmentation, and consolidation will be a definer in 09'er.

Operating Efficiencies
In the spirit of Sequoia’s notice to its venture investments, I’m cutting back by 30% in my predictions this year to conserve my muse resources, demonstrating higher efficiencies and lower burn rates, reflecting a 'shrink to grow' mentality. Of course that begs the question of my impact and productivity....

Happy New Year to all my readers and supporters of Mobile Point View around the world. May your immediate and intermediate time lines be stable, and your over the horizon be prosperous.

Or as the Chinese say:  gōng xǐ fā cái !

"Nurse, mobile please": Surgery by SMS

From the Congo comes a life or death story of a 16 yr old boy who was operated on by a leading vascular surgeon while on assignment with Doctors without Borders.

The boy required the amputation of his forearm. The surgeon, a former doctor for Tony Blair was faced with conducting a surgery where he had to amputate near the shoulder and collar bone. A procedure he had not performed before, with only one pint of blood available and limited available supplies. 

Dr.David Nott, placed a voice call to a colleague in London, but the mobile networks were not connecting. He tried an SMS. It connected.

His colleague, vacationing in the Azores, replied with text messages detailing the procedure, with a "Easy! Good luck" closing boost between friends

Nott successfuly performed the surgery, and the boy is recovering. Dr. Nott told the U.K.'s Mail Online, "God works in mysterious ways, and this time he was working via text message."

Cer8 @
I wonder how many "textonyms"--meaning replacement words used while texting, linguistically called paragrams, but commonly known as textonyms, adaptonyms or cellodromes -- were used in the SMS exchange between the two docs, especially given the complexity of such a procedure?

Reminds me of a medical story, I covered a year ago here, "Birth by Mobile Light" on how a surgeon delivered a baby by the light of a handfull of mobiles.

Just two stories behind the expected 3 TRILLION SMS to be sent this year....

Now on iTunes: Mobile Point View Podcasts

Ever seeking a chance to expand my communications efforts and marketing of Mobile Point View, my Mobile Influencers Podcasts are now available via iTunes and the iTunes store.
 Log into your iTunes account and either search for "Paul Ruppert" or "Mobile Point View by Paul Ruppert" and you can select from any of my growing library of podcasts--all 38 will soon be available on iTunes for your listening convenience spanning over 9 hours of interviews with leading CEOs, innoavtors, and Mobile Influencers. Plug in and add it to your "life soundtrack, and feel free to add a Customer Review while your there. Much appreciated.

Psychology not Technology: On TV at the Mobile Marketing Association

BnetTV.com's correspondent Michele Sklar interviewed me at the Mobile Marketing Association forum in San Diego, CA on November 12th.

You can view the 8 minute interview by clicking here. Covering the range of issues at the MMA's Forum event I spoke of how advertisers need to be focusing on the psychology of making mobile impressions instead of the draw of the technology of mobile. The contextuality of mobile, it's "lean forward" and small screen more dynamics require emphasis  on the creative side of mobile advertising instead of being drawn to mobile's power to provide more impressions over other types of traditional media.

Mobile Culture Codes across the Globe
The context of differences are more important than similarities once you go global, and Michele and I covered how differences between the North America, Asian and European mobile advertising markets are shaping the development of mobile marketing globally.

Case Made: Recession Proof Business Models for Mobile Marketing

With economic ripples crashing against our ecosystem we also covered the false reality of a shrink to grow strategy under stressful economic conditions, and why mobile is well suited to survive as a component in broad advertising intiatives because of it's impact, high return and competitive strength against other larger, ahem less effective components of an overall advertising campaign.  Learn more by viewing the entire interview here.

Coca Cola & Mobile Marketing: Reach & Refreshment

Within Arm's reach of Desire
The Coca Cola Company, aka Coke, has been a leader in mobile advertising for some time. Going back to 2005 when they launched a bottle top short code campaign in Turkey and the UK, Coke has been forward leaning into the potential of mobile. BTW, I led the carrier connectivity supporting that project while I was at Mobile 365; we delivered the SMS payload for Coke to mobile subscribers in both countries, hence I've had a long standing interest in their leadership in mobile marketing.

Coke's view of the mobile world is that every person on earth should have a Coke product "within arm's reach of desire."  Good mobile advertising looks to capitalize on a first mobile impulse and Coke is effectively executing in both areas. Coke provides 1.4 billion servings a day, and there are 3.4 billion mobile phone users in the world. Hence they are slightly behind and need to fill a 2 billion gap by driving arm's reach demand, naturally through the mobile phone.

The Language of Refreshment
Does anyone actually want to view ads on a mobile phone, let alone interact with them?  Silly question, of course they do. Coke actively recognizes the singular opportunity to interface with the world's most intimate electronic device, a mobile phone. Moving well beyond the simple messaging which I was involved in, The Coca Cola Company is into viral advertising enabling shared content via your social graph enabled via your mobile device, as well as providing idle entertainment through limited reach bluetooth zones--for more, listen below. No mobile frontier will be left unexplored for the most recognized brand on earth.

Listen to my conversation with Tom Daly of Coca Cola who heads up their global mobile marketing efforts 13 mins

Recently at the Mobile Marketing Association Forum in San Diego, I had the chance to talk to Tom Daly, Group Manager--Strategy & Planning for Global Interactive Marketing at The Coca Cola Company. Tom's the key guy--globally--at the forefront of their digital marketing and mobile is a key component to their strategy--not surprising.

Refreshment is a language everyone understands. No one speaks it better than Coca Cola.

Verizon Launches Video UGC: See What I See-SWIS-Services ?

Verizon has partnered with mobile media services provider FunMobility in launching a person to person video sharing service--and implied mobile social network. The service is called "America's Best Mobile Flix" or aFlix. The service allows Verizon subs to create mobile videos and share their UGC with mobile connections across other operator networks. Essentially P2P interoperable mobile video--I think!

Much like YouTube, customers can also review, comment, rate and share every video on aFLIX from their handset directly, and the best clips will be featured in a monthly "Best Videos" category. Users are automatically presented with the highest-rated video they have not yet seen when they open the aFLIX app. aFLIX will run alongside FunMobility's existing America's Best Mobile Pix photo sharing application.

What's significant in this is the interoperable part.

Mobile video has been advancing in the mobile commentariat, but has been taking baby steps with consumers. Transmiting video sharing from person to person is defacto video interoperability. If you look at the text messaging comparable--around 1996 when full interoperability occured for SMS in the UK, or 2002 when it occured in the US, the market exploded at a 6x multiple within 12 months. Just as SMS provided "here's what I'm thinking" full video interoperability, as claimed, will provide SWIS services --'See What I See' services.

SWIS services can, if priced right, become the video equivalent of video messaging services. The fact that Verizon enables this cross carrier is quite significant. A potential poaching of subscribers could ensue if this were to really take off without the other operators offer similar services in due course. Keep your eye on this one.

Mobile Cataclysm: Angels, VCs, Capital & Confidence?

No one can avoid all the noise these days regarding partial, full or potential bank nationalizations (depending upon what country you're in), CDO swaps, the recent edict of venture capitalists in their Menlo towers to their start up investments: drastically reduce burn rates & batten down the hatches, as well as the general pessimistic view that the sky is falling in all segments across all economies. Which is constantly  perpetuated by the cable media to sound the alarm--any alarm--to capture audience. 

Somewhat ironic for me personally since in my past career as a legislative policy pusher, I was once responsible for the George Herbert Walker Bush administration's legislative docket for the now infamous Fannie Mae & Freddie Mac. [Note: Don't believe that this is a problem of the last eight or sixteen years, it has been a systemic threat for the last 30 years. But I digress from why you visited MOBILE Point View today, not FINANCIAL Mess Point today.]

As the crises has continued to build I've started thinking about "slumping tech" caused by ripple effects of the impending 'uber recession'. Yet, in more contemplative moments I've asked myself,and others repeatedly, whether anyone thinks this cataclysm is going to hit mobile as hard as it hits everything else? The collective opinion by more than a few 'wireless influencers' is: NO. 

Last week I spent a morning with a group of Angel investors in Washington DC reviewing potential companies--two which had mobile components to their value proposition. At the breakfast before there was some grousing that individually the attending angels had experienced some "contraction" but as a group they were not running to liquidate all holdings and defending cash positions, which we should not forget is where fledgling companies get their funding from. As a group--extremely experienced as both technologists and investors--they were still looking for investments to make, especially now with time to build out companies which can rebound higher later. No angels were running for the exits.

The same day in the afternoon, I was talking to a senior IT exec at a public company. On mobile his perspective was straightforward: "All this talk from the financial pundacracy that tech is going to contract so radically is BS. Bottom line is guys like me already have 90% of our budget mandated, required, by core functionality. If we cut back on that, we cut back on core services. That isn't likely to happen. It is the 10% variance which we play with that may get affected. But even there, where do you capture efficiencies best? Automation and mobilization." There's that mobile component that can't be ignored. "Depending upon how highly leveraged a tech company is, the bottom line is we are not falling back into a pre-industrialized economy," he said smartly.

The following day I reached out to a few VCs and asked them about their proclivity to invest now. As one put it, "I've been successfully raising money for my next fund for over year. I'm not going to pull back on making the investments, let alone the pressure from my LPs will not subside to get the money to work."  Um, guess the focus continues to be on the future.  Not surprising given that VCs examine risk and opportunity all the time, at least the good ones do. Those that were pushing the alarm last week, one has to ask how many of these guys have ever really had to make payroll? That's a post for the future. Net net, full speed ahead, just look out for some adjacent storms.

Last point. Just look at the continuing trend of mobile penetration around the world, especially in developing countries. There may be lesser growth rates in the mature markets of Europe and the US, but where mobile is being fueled in China, India, Africa and South America, consumers will substitute or do without in order to get a mobile phone and benefit from it's conveniences. ARPU is already low in many of these regions, but operators there are capturing value even in these bottom of the pyramid plays--don't believe me?

Did you know that when Reliance was looking to acquire MTN in South Africa, they were willing to pay more than Microsoft had priced Yahoo? Really. If three data points constitute a trend, don't bet against mobile. Tomorrow I'm in New York city for three interesting days there.

Alternatively during these turbulent times, consider the following....

In 1923, some of the most successful and richest men consisted of:

president of largest steel company in the US
president of largest gas company in the US
president of the NYSE
greatest wheat speculator in the US
president of the bank of international settlement

What became of these men and their fortunes?

Carol Schwabb, of the largest steel company, died as a pauper
Edward Hobson, of the largest gas company, went insane
Richard Whitney, president of the NYSE, eventually released from prison and died at home
Arthur Cougar, the wheat speculator, died abroad--penniless
C.B. Livermore, lion of wall street, committed suicide.

Yet that same year, 1923, Gene Sarazen, a professional golfer, won both the US Open and the PGA Championship. He died in 1999 at 95 years old. Played golf until he was 92, and was solvent at the time of his death.
Conclusion: Stop worrying about business and spend more time playing golf!