device wars ned may director & lead analyst [email protected] 617.722.0850 and the...
TRANSCRIPT
Device Wars
Ned May
Director & Lead Analyst
617.722.0850
And the Implications for the Enterprise
Agenda
• Why now • Device landscape• Penetration outlook• Content fit• Monetization paths• Enterprise Implications
4 © 2010 Outsell, Inc. All rights reserved.
The Device Landscape – Three TypesSmart phones
Tablets
e-readers
Three Publisher Concerns:
1. The device adoption rate
2. The content fit across each device
3. How to monetize
#1 Device Adoption Rate
Personal Media Device Sales
0.01
0.1
1
10
100
1000
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Years Since Introduced
To
tal
Un
its
So
ld (
Mil
lio
ns)
iPod iPhone Sony Reader Kindle ?iPad
Source: Outsell estimates and company reports
iPhone
iPod
Sony Reader
Kindle
iPad
7 © 2010 Outsell, Inc. All rights reserved.
Are e-Readers An Interim Device?
iPad Reaction by Device Owned
3%
28%
56%
13%6%
39%
49%
6%12%
38%42%
8%
Yes, and I can't wait to buyone
Yes, and I wi l l probablytake a closer look
Yes, but I think i t i s anoverpriced toy
No, I haven't heard aboutthese
Al l Respondents Smartphone Owners E-Reader OwnersResponses to: Have you heard about new computing tablets like Apple's recently announced iPad?Bases = Total: 803Source: Outsell’s Untethered Device Survey, Feb. 2010©2010 Outsell, Inc. Reproduction strictly prohibited.
8 © 2010 Outsell, Inc. All rights reserved.
e-Readers Become Niche
Base = 37Source: Outsell’s February 2010 e-book survey, interim results
0%
20%
40%
60%
80%
100%
Two Years or More One year Less than a yearLength of Ownership
Always Frequently Occasionally Rarely Never
9 © 2010 Outsell, Inc. All rights reserved.
#1: The Device Adoption Rate
Conclusions:
Smartphones Nearly ubiquitous
Tablets Likely high
e-Readers Low but loyal
11 © 2010 Outsell, Inc. All rights reserved.
Content Fit – Lessons from iPhone
Devices Used to Read News or Get Information
0.5%
1.2%
3.3%
3.9%
16.5%
38.7%
47.5%
64.3%
78.7%
E-READER
MP3 CD PLAYER
NO DEVICES - USE PRINT ONLY
IPOD OR OTHER HARD DRIVE-BASEDPLAYER
CELL PHONE/SMARTPHONE/PDA
RADIO/SATELLITE RADIO
LAPTOP COMPUTER
TV/CABLE/SATELLITE
DESKTOP COMPUTER
Bases = Total: 2,540Source: Outsell’s News Users Survey June 2009. Q33
12 © 2010 Outsell, Inc. All rights reserved.
Handheld Device Task Usage
4.4%
6.1%
10.0%
10.6%
23.6%
33.7%
51.6%
57.2%
60.4%
4.2%
4.4%
7.3%
8.3%
20.0%
27.5%
44.7%
50.1%
52.9%
1.7%
18.4%
28.2%
24.3%
38.3%
65.6%
72.6%
74.9%
79.9%
Other
Investing/Financial concerns
Shopping
Educational pursuits
Documentation
Reference
Managing schedule
Entertainment
Communicating w ith colleagues
Total non Iphone iPhone Users
Bases = Total: 5,660; iPhone Users: 358; Non Iphone Users 5,302Source: Outsell’s Information Markets & Users Database, December 2008 Survey, Q20f
Content Fit – Lessons from iPhone
13 © 2010 Outsell, Inc. All rights reserved.
Handheld Device Task Usage
2.6%
2.3%
3.0%
3.7%
4.3%
4.6%
4.5%
4.8%
5.6%
9.0%
11.5%
12.6%
12.6%
15.8%
17.1%
21.6%
23.0%
26.1%
29.0%
32.7%
38.8%
0.3%
8.9%
15.1%
22.6%
18.2%
20.1%
31.8%
29.9%
31.6%
33.5%
47.8%
38.5%
56.1%
56.4%
75.7%
58.9%
69.6%
71.5%
74.0%
78.2%
89.9%
Other
Textbooks
Medical/Health
TV shows
Books
Articles
Stock/Financial/Business
Movies
Video clips
Sports
News & media
Office suite documents
Weather
Games
Maps
To-do list
Photos
Music
Address/Phone numbers
Appointments/Calendar
Emails &/or text messages
Non iPhone Users iPhone Users
Bases = iPhone Users: 358; Non Iphone Users 5,302Source: Outsell’s Information Markets & Users Database, December 2008 Survey, Q20
Content Fit – Lessons from iPhone
14 © 2010 Outsell, Inc. All rights reserved.
#2: The Content Fit Across Each Device
Conclusions / observations:
e-Readers Linear / static / engrossing
Smartphones Interactive / tactical / demand driven
Tablets Engaging / rich media / leisurely
16 © 2010 Outsell, Inc. All rights reserved.
#3: How to Monetization
Conclusions / observations:
e-Readers Transactional / Subscription
Smartphones Advertising
Tablets All paths
17 © 2010 Outsell, Inc. All rights reserved.
Enterprise Implications?
Three key points to consider
1. These are side pocket devices
2. Consumer expectations will trickle over
3. Not all devices are equal
Come By and Visit UsOutsell, Inc.
In the United States:
Call +1 650.342.6060
Fax +1 650.342.7135
330 Primrose Road, Suite 510
Burlingame, California 94010
In the United Kingdom:
Call +44 (0)20 8090 6590
Fax +44 (0)20 7031 8101
25 Floral Street, London, WC2E 9DS
www.outsellinc.com
Copyright 2010
All rights reserved
Books Sales Move to e-Readers
US Trade Wholesale Electronic Book Sales
See data from International Digital Publishing Forum: http://www.idpf.org/doc_library/industrystats.htm
But What About Other Content?
Number of Handheld Apps Purchased in a Year
60.7%
31.1%
5.8% 1.5%0.9%
No App Ready Device None Bought 1 TO 5 6 TO 10 More than 10
Base = 2,787Source: Outsell’s New User Survey 2009
News Unlikely To Ever Get Paid
Amount Willing to Pay for iTunes Like News Service
93.3%
4.9%
1.5%
0.1%
0.0%0.2%
Nothing Up to $5 $5 to $10 $11 to $15 $16 to $25 More than $25
Base = 2,787Source: Outsell’s New User Survey 2009
Application Overdose
http://www.knowyourcell.com/news/415234/inapp_advertising_still_a_bad_model_for_mobile_apps.html
“A new report fromFlurry Analytics tells the
same old story wheremobile app retentionrates are concerned.
For developers,the best way to makemoney in the mobileapp ecosystem is to
take the money and run.” [6 months, 100 apps,
800 million user sessions]
B2B: Highest ROI Marketing Methods
24.3%23.0%
21.0%
20.0%13.6%
10.7%
10.4%
8.1%7.7%
7.3%
6.6%
4.2%4.2%3.9%
3.2%
2.3%1.2%
0.4%
0.4%
26.4%28.0%
54.5%
0.01%
Own company's Web site
In-person conferences
In-person exhibitions & trade shows
Print direct mail marketing
Search engine site keywords
E-mail marketing/e-newsletters
Custom print publications
Print magazines
Print directories & catalogues
Public relations
Sales collaterals
Print newspapers
Print newsletters
Industry specific trade Web site
Vertical search sites
Social networking sites
Other
Webinars/Online seminars
Marketing on Blogs
Sponsoring online content
Virtual trade shows
Online Web sites incl. News
Mobile/Wireless marketing/IMBase = 633, Target B2BSource: OutsellÕs Ad Spending Database, December 2009 Survey, Q22a©2010 Outsell, Inc. Reproduction strictly prohibited.
Advertising Not Viable Route TodayB2B: % Freq Selected in Top 3 for ROI
Some B2B Segments Showing Promise Today
Source: Outsell Advertising & Marketing Study 2009
Key Adoption Rate Findings
• Highest usage in Business and Financial Services
• Usage up more than 2x in 2009 over 2008 in maximum use industries
• Rate of use varies greatly: max 10.6% is 7x more than min 1.5%
Yet Dollars Remain Low
Source: Outsell Advertising & Marketing Study 2009
Key Spending Findings
• Highest wireless marketing spending in Business and Financial Services
• Rate of spending groups into 3 industries near 2% of total, 3 industries at one-third of that level near 0.7% and Legal trailing at a very low 0.4%
• Note that other Outsell Ad Study data shows advertisers primarily targeting consumers are spending approximately 2x the level of B2B wireless spending. Note: Percents are Based on Online Marketing Spending Excluding
Spending on Companies’ Own Sites
But Change Is Coming
“iAd is a breakthrough mobile advertising platform from Apple. With it, apps can feature rich media ads that combine the emotion of TV with the interactivity of the web. For developers, it means a new, easy-to-implement source of revenue. For advertisers, it creates a new media outlet that offers consumers highly targeted information.” Apple Inc.