Adoption and Usage of Mobile Services - · PDF file– Internet = IP-based technologies,...

Hannu Verkasalo / Helsinki University of Technology (TKK)

Verkasalo 2008

Hannu VerkasaloHelsinki University of Technology

Hannu VerkasaloUniversity of Athens, Greece, November 2008

Adoption and Usage of Mobile Services


Verkasalo 2008

Agenda

– Mobile industry: definitions and trends

– Unique properties of mobile services

– Research on mobile service adoption

– Background and tools

– Empirical findings


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Mobile industry evolution: statistics

Comple

menta

ry


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What is mobile?

– Could be defined from different angles:

– Mobile device (handheld pocket-size devices with wireless connectivity)

– Mobile network (wireless network; typically wide area network)

– Mobile services and applications (run in mobile devices, to be used with mobile networks)

– How about offline applications?

– From mobile phones to converged devices with various wireless connectivity options

– A significant change (due to mobile phones) with regards to how electronic services can be delivered to end-users and what kind of services to deploy (unique characteristics of mobile services)


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Mobile industry traditionally vertically-oriented

Verticalorientation


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Mobile industry – new value chains

ServiceProviders (SP)

ContentProviders (SP)

TechnologyVendors (devices,

networks, etc.)

Mobile NetworkOperators (NO)

Mobile Virtual NetworkOperators (MVNO)

End-users

Customers

Advertisers

Aggregators

Mediators

Internet services

Earlier all this was owned and operated

by the operator


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Mobile industry transformations

– The traditional model: operators, device vendors, and users

– Today complex value-exchanges, for example…

– Devices through operators (handset and subscription bundling) or directly by vendors?

– Services and applications bundled with device (case Nokia)?

– Content bundled with device?

– Role of mobile advertising?

– The new forces reshaping the industry

– The open smartphone platforms are changing the game

– The mobile Internet brings transformations

– The role of end-users is changing (end-user-driven

innovation and content)


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Merging of media, Internet and telecom industries

– Not any more just one industry - many industries are merging together

– Media = content, entertainment, information, news

– Internet = IP-based technologies, the Web 1.0 (static content), the Web 2.0 (user-generated content and social networking)

– The “Web 3.0” is all about contextual and ubiquitous nature

– Telecom = connectivity

– The mobile industry converges with the other industries, and mobile phone just represent a new medium of access + use

– Tomi Ahonen calls mobile phones as the 7th mass media

– New revenue models such as advertising will emerge

– The computer industry experienced similar transformations 20 years

ago


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Mass medias

1. Print (1500s)

2. Recording (1900s)

3. Cinema (1910s)

4. Radio (1920s)

5. TV (1950s)

6. Internet (1990s)

7.Mobile (2000s)


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Mobile phones – unique characteristics

– Any time

– Anywhere

– Personal

– Payment channel

– At the point of inspiration

– Social context


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Categorization of mobile services

Source: Verkasalo, Kivi, Smura 2007

PIM

Productivity

Utilities

Device management

Other applications

Device Application Network Content

Mobile phones

Smartphones

PDAs

Ultra-mobile PCs

Laptop PCs

Desktop PCs

Other devices

Calling

Messaging

Browsing

Infotainment

Multimedia

Games

Wireless MANs

Wireless LANs

Wireless PANs

Offline

Other networks

Mobile networks

Messages

Personalization

Information

Entertainment

Web search and portals

Calls

Infrastructure

Other content

Banking / E-commerce

End-users

Device

monitoring

systems

Usage

accounting

systems

Network

nodes and

links

Servers


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Empirical research increasingly important

• Not only network or charging record statistics, or surveys, but

comprehensive research requires instead

– Coordinated consumer research on mobile consumption

• Various empirical research methods exist

Kivi 2007


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Motivation for adoption studies

• Ongoing emergence of new mobile services (technology)

• Strong push by service providers (supply-side)

• The mobile Internet and smartphones (enablers)

• STILL, people spend most of the time with legacy services, most new services have difficulties in penetrating to the market, and revenue from the mobile Internet is mediocre.

→ The adoption process is worth studying


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Device Functions

• Key features for mobile packet data usage

spreading rapidly

– EDGE 25 % � 41 %

– WCDMA 8 % � 18 %

– HSDPA 0,1 % � 2 %

– WLAN 2 % � 5 %

• Growth of 3G (WCDMA) especially rapid,

due to handset bundling

– Very steep S curve, growth

comparable to more mature features

• Share of non-handsets up to 2,1%

– From 1,4% (2006) and 0,7% (2005)

– Data cards and USB dongles, partly

explaining rapid HSDPA growth

• Other remarks

– GPS emerging (2%)

– Unidentified terminals (T) increase

somewhat penetration of all features

(2007: 4-6%, 2006: 10-11%, 2005: 5-

6%)

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

BT FM EDGE WCDMA HSDPA WLAN GPS

Sh

are

of

all

ter

min

als

2005 2006 2007

Kivi 2008


Verkasalo 2008

Device Functions

0%

10%

20%

30%

40%

50%

60%

70%

80%

Color

display

Packet

data

Java Email Camera Nokia

Series 40

Symbian

Sh

are

of

all

ter

min

als

2005 2006 2007

• Color displays, packet data and

Java mainstream features

– ~70% penetration

• Symbian OS in 18% of all mobile

terminals

– S60 growing:

66% � 74% � 84%

Series 80 decreasing:

34% � 26% � 15%

– UIQ marginal: <1%

– 54% of S60 handsets are

3rd ed. in 2007

• Other advanced OSs (e.g.

Windows, Linux, iPhone) marginal

Kivi 2008


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Handset-Based Mobile Consumption Analysis

• A new research technology– Specialized research application for handsets

– Server architecture to capture research data

– Analysis procedures with the collected data

• A panel study was deployed in 2007 to study the behavior of Finnish smartphone users– All three operators (Elisa, TeliaSonera, DNA

Finland) collaborated

– Both survey data and handset-based statistics were collected

– All together 579 panelists involved in the study


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0

10

20

30

40

50

60

70

80

90

100

0 10 20 30 40 50 60 70 80 90 100

Voice

SMS

CameraBrowsing

MMS

Music playback

Gaming

MapsVideo playback

Installations

Internet multimedia

Email WLAN

Modem

Web 2.0

Video call

IM

Tried %

Usage Frequency %

X-axis = Number of users who tried

Y-axis = Median Usage Frequency (Share of Days When Used)

Size of Bubble = Usage Activity AMONG service users

→ New mobile Internet services are emerging, but Voice and SMS are still the key services

Source: MoMI 2008

Research findings


Verkasalo 2008

Source: MoMI 2008

→ Mobile phone is not only for communications today

→ Internet and multimedia usage is increasing among early-adopters

Communication ~70% and

other ~30%

Communication ~ 60%

and other ~ 40%

Typical user: ~ 22 minutes of

usage / day

Typical user: ~ 33 minutes

of usage / day

Communication ~ 55%

and other ~ 45%

Typical user: ~ 39 minutes

of usage / day

Time Allocation in 2007

Voice call

23 %

Messaging

22 %

Other

12 %

PIM

11 %

Multimedia

22 %

Browsing

10 %


Voice Calls

35 %

Messaging

25 %

Other

16 %

PIM

13 %

Multimedia

7 %

Browsing

4 %


Voice Calls

32 %

Messaging

23 %

Other

17 %

PIM

11 %

Multimedia

12 %

Browsing

5 %

Research findings


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→ Voice and SMS are still the core services

Source: MoMI 2008

0

10

20

30

40

50

60

70

80

90

100

0 10 20 30 40 50 60 70 80 90 100

Internet commerce

Internet calls

Internet browsing

Camera

MMS

Maps and navigation

Offline music playback

Gaming

IM

Voice

Email

SMS

WLAN

services

Consider Important %

Were Satisfied %

Research findings


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→ Mobile Internet brings many kinds of new services

→ Traditional players of the mobile field are facing challenges

Internet Domain AccessesCumulative Packet Data Traffic

71%59% 63%

4%

20%

8%

2005

16%

18%

8%

2006

25%

8%

2007

Browsing

Messaging

Multimedia

Other

1%

2%2%

32%

66%

2005

34%

64%

2006

10%

89%

2007

Operator

Nokia

Public Internet

Source: MoMI 2008

Research findings


Verkasalo 2008

→ No revenue to operators from Internet and multimedia services

Usage M

inute

s p

er

Day

Usage M

inute

s p

er

Day

Source: MoMI 2008

Research findings


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→ Flat-rate is what people want

→ Operator not any more the most important actor in mobile services

62

59

45

84

SMS

Calling/voice

Internet/Data-services

% of respondents

MMS

Flat-rate is better than usage-based pricing…

45

79

33

75

Mobile device manufacturers

Internet companies

Teleoperators

% of respondents

Media companies

Actors are important in mobile service delivery…

Research findings


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Various adoption gaps exist


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Only three services experience active usage


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Performance or usability is not the issue! Main bottlenecks are context, needs and pricing!

Bo

ttle

neck

sco

re


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Conclusion of the lecture

–The mobile industry is in turmoil: new players, new services,

new business models

–Voice and SMS are being challenged by emerging services

that might complement or substitute them

–According to our studies, browsing and camera are already

widely used, though not very active yet

–Many services and applications face adoption problems

(demand does not equal supply)

– Main reasons: context (alternative devices outperform at

home and office), no serious need, pricing

–New research methods and analysis procedures are being

developed in our research team to better understand the

dynamics of mobile service adoption


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Contact Information

Hannu Verkasalo

[email protected]

+358 40 5959663

http://www.netlab.tkk.fi/~hverkasa/

http://www.netlab.tkk.fi/tutkimus/momi/

Adoption and Usage of Mobile Services - · PDF file– Internet = IP-based technologies,...

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