In Beijing at GMIC I am listening to a Russian Internet entrepreneur (iFree) tell us how his company, a Russian portal developer, is shifting strategy for the growth of mobile platforms.
He begins by saying that of the 142 million people in the former Soviet Union, only 43m are on the Internet. The use of the Internet is growing rapidly, and changing even as it grows. Portals, his firm’s core product, are destined for slow extinction (my observation, not his). In a market growing so quickly, social networks are already three of the five most visited Russian internet sites. More staggering, a whopping 50 % of incoming email in Russia is alerts from social networks.
Russian content and services are a $1.9 billion market that started with messaging in 2005, followed by portals in 2006, ring tones in 2007-8 and m-commerce in 2009. Those were the historical market drivers. This year, customization Is huge, especially ringback tones.
But since the percentage of mobile Internet is still only 19%, expected to grow to 30% this year, huge business model disruptions are inevitable.This turbulent and growing market has led portal developer iFree to a new strategy particularly for mobile, in which fourteen trends led them to ten assumptions, which led the company’s management to one decision
Some of the Trends: Rise of smart phones
Mobile apps
Mobile Internet use
Social social networks
SNS
Tagging of objects in the real world
Tagging of people
New forms of Image delivery
Augmented realIty Trends like these led the company to these assumptions: App stores outside of operators control will give mobile users control over their experience E-money and e- payments will become most convenient way to pay
Social networks will give users most of the infrastructure they need
There is a place for new big brands coming from mobile and social apps market
There will be an enormous integration of real and digital worlds, with the mobile device as the mechanism So iFree decided to form an entirely new venture hub to leverage resources for fast growth in these newly forming markets. From what I can gather, top management has stepped back from day to day operations to focus completely on innovations in mobile. I bet they end up cannibalizing their current business in order to move forward. Go I-free!
Francine Hardaway, Ph D
GV: 816.WRITTEN
Some of the Trends: Rise of smart phones
Mobile apps
Mobile Internet use
Social social networks
SNS
Tagging of objects in the real world
Tagging of people
New forms of Image delivery
Augmented realIty Trends like these led the company to these assumptions: App stores outside of operators control will give mobile users control over their experience E-money and e- payments will become most convenient way to pay
Social networks will give users most of the infrastructure they need
There is a place for new big brands coming from mobile and social apps market
There will be an enormous integration of real and digital worlds, with the mobile device as the mechanism So iFree decided to form an entirely new venture hub to leverage resources for fast growth in these newly forming markets. From what I can gather, top management has stepped back from day to day operations to focus completely on innovations in mobile. I bet they end up cannibalizing their current business in order to move forward. Go I-free!
Francine Hardaway, Ph D
GV: 816.WRITTEN
{ 6 comments… read them below or add one }
Enjoying your insights.
Can app builders create a brand? People seem to search for and pick apps based on perceived functionality, which is in turn based on user comments or friends' recommendations. The app builder is rarely considered. Will some app builders build a brand based on consistent functionality, ease of use, reliability, efficiency, beauty, etc? Google might have, but seems to have failed the consistency test.
Thank you. I love writing about all this :-)
Francine Hardaway, Ph D
GV: 816.WRITTEN
Thank you. I love writing about all this :-)rnrnFrancine Hardaway, Ph DrnGV: 816.WRITTEN
Rock You built one, as did Zynga, but the economics of apps is that if you get 100l customers at $50/yr that makes your company valued at $25m on $5m revenue and then you sell. that's according to Dave McClure
Francine Hardaway, Ph D
GV: 816.WRITTEN
Rock You built one, as did Zynga, but the economics of apps is that if you get 100l customers at $50/yr that makes your company valued at $25m on $5m revenue and then you sell. that’s according to Dave McClure rnrnFrancine Hardaway, Ph DrnGV: 816.WRITTEN