2006-12-21

Mobile advertising in Japan


I with Peter Vesterbacka who made the case why Japan is an exceptional country for early-adoption of video-enabled social networking service (SNS).
1. Social networking users : 7 million, estimated 2 million using mobile
2. 3G adoption : 60 million users
3. Critical mass of mobile advertising : 50% of users, 300M$
4. Mobile video usage is emerging
1. Social networks in Japan growing to 2-3 million mobile users
Online social networks membership exceeds 7 million and expected to grow to 10 million in 2007 [Japanese Ministry of Internal Affairs and Communications]. Some examples of online services going mobile described below :
- Mixi has 4.8 million users, 70% logged every 3 days, 1 million groups and and 7 billion page views /month, 3rd behind Yahoo and Google (July 2006). Mixi mobile was released in December 2006 and forecasted to reach 2 million subscribers. Mixi name refers to mixing with other, it is an invite-only network with product reviews, blogging, photo sharing, and music clone that lets you buy tracks from iTunes.. Demographics estimated 15% 17-19 (18 minimal age) and 70% 10-29. The company was founded by Kenji Kasahara, revenues around 9 million $ and IPO forecast above 1 billion$.
- S! Town on Softbank is designed like a mobile 3D virtual world where avatars walks around, chats, shares photos, shops for music and video, personalizes a room, plays games. eXplo community platform from Gemini has been adopted by SoftBank Mobile in Japan; SmarTone-Vodafone in Hong Kong; FarEasTone in Taiwan; Nextel International in Central & South America; and Sferia in Poland. Gemini was founded in 2001 by Hiroshi Ota, Michael Tso and Scott Driggers, Gemini and over 20 million $ in two rounds, it is profitable. Japanese game company Bandai did the S! design.
- http://www.gorotto.comfunctionality includes a blog, networking, personal profile, picture/media library, calendar and newsgroups. It has a mobile version, a GIS/Google maps mash-up feature, an open architecture for integration of other services. Registered users can invite contacts.
- Love-Getty . This service was deployed in 1998 and used by 1.3 million users. I list it as a comparison point and an interesting case study. Love Getty was an oval device on a key-chain programmed the to look for others in the same mode. There were 2 sexes boys and girls looking out for each other; and 3 modes : karaoke, chat and meal. A girl’s Love Getty on karaoke mode would sound when another boy’s karaoke Love Getty was around. The inventor was Takeya Takafuji currently president senior associate of IMJ Mobile. My HP colleague Nicolas Raguideau worked on that project at the time to implement a real-time database using HP OpenCall technology.

2. 3G adoption >50 million and 40% penetration by 2007
Mid-year statistics :
. DoCoMo 30 million subscribers (WCDMA)
. Softbank 5 million subscribers (WCDMA)
. KDDI 10 million subscribers (CDMA 1XRTT)
ARPU statistics : 70 $, 65% non-voice




3. Mobile advertising reaching 60% of users with revenues of 250 million $ In 2005-2006, revenues grew 50%, from 250 million $ to forecasted 300 million US$ in 2009 (or >5$ per subscriber, on operators portals only) . This amount is similar to that of internet advertising revenues in 2000, they grew to 2 billion $ in 2006. The penetration of mobile advertising is estimated at 60 % (InfoPlant survey on usage of mobile coupons and discounts : 2-3/month 27%; 1/month 25%;1/2-3 months 20%). One of leading mobile advertising agencies is D2 Communications, jointly established in 2000 by NTT DoCoMo, Dentsu and NTT Advertising for the DoCoMo i-mode service (Takayuki Hoshuyama, COO).

4. Usage of video messaging is 9%
According to Mobile marketing association the mobile usage is
Mobile internet 76%
Picture messaging 42%
Text messaging 39%
Digital music 16%
IM 15%
Video messaging 9% (this is low but probably 3 times above usage in Europe).
Mobile TV 4.4%