Mobile Application Developers

Miko Matsumura SVP Kii Corporation

MS Neuroscience Yale Univ MBA, San Francisco State Univ Limited Partner, Focus Ventures

Java Evangelist, Sun Microsystems VP Chief Strategist Software AG

VP Platform, Kii Corporation

Why Mobile?

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Worldwide in-application events measured by Flurry (billions)!!

Unstoppable Market Growth

Source: Flurry Analytics, May 2008 – November 2012, Billions!

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675

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March 2009 December 2009 August 2010 May 2011 July 2011 October 2011 April 2012 June 2012 September 2012

iTUNES APP STORE GOOGLE PLAY

Competition for Consumers Continues to Increase

Over 1.4 million available apps on iOS and Android

Sources:  Google,  Apple;  number  in  thousands  

Active smartphone & tablet devices!

Addressable Market to Surpass 1 Billion Next Year

Aug 2009 Aug 2010 Aug 2011 Aug 2012 Aug 2013E

23 M 76 M

331 M

800 M

1.1 B

Source: Flurry Analytics!

Total Addressable Market!Aggressive: 5B WW Mobile Device Owners!Conservative: 2B WW Adults, Middle Class or higher!

Upside: !Smartphones – dropping prices, especially Android!Tablets – little replacement, mainly new; sub for PCs!Connected TVs – to be shipped!

Reference:!2.3 Billion Internet Subscribers today!

181 167

35 28 27 22 19 19 14 14

US China UK Japan S. Korea Germany France Canada Brazil Spain

Source: Flurry Analytics active devices Oct 2012!

Top Countries by Active iOS & Android Devices (millions)

A Global Phenomenon

293% 269% 260%

235% 209% 202% 197%

181% 180% 180%

China Vietnam Colombia Chile Ukraine Venezuela Turkey Philippines Egypt Russia

Source: Flurry Analytics, Oct 2011 – Oct 2012, countries with at least 500k active devices as of Oct 2011!

Fastest Growing iOS & Android Markets by Active Devices

30+ Countries Doubled in Last 12 Months

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10%

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90%

100%

Oct 2011 Oct 2012

Source: Flurry Analytics!

UNITED STATES (TOP RANK) REST OF TOP 10 (RANKS 2 – 9) REST OF WORLD

48%

25%

27%

29%

32%

39%

App Economy Expanding Internationally

Distribution of iOS and Android App Sessions

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Dec 2010 Dec 2011 Dec 2012

Sources: comScore, Alexa, U.S. Bureau of Labor Statistics, Flurry Analytics!

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66 72

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Mobile Applications Web Browsing Television

How Mobile Stacks Up Against TV and The Web

Web vs. Mobile App vs. TV Consumption, Minutes per Day !

Smartphones Tablets

Games 39%

Social Networking

24%

Utilities 17%

Health & Fitness

3%

Lifestyle 3%

Entertainment 3%

Other 11%

Games 67%

Social Networking

10%

Entertainment 9%

Utilities 4%

News 2%

Productivity 1%

Other 7%

Tablet Usage More Games & Entertainment Oriented

Time Spent per Category, Smartphones versus Tablets !

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2008 2009 2010 2011 2012

App Revenue Is Scaling Bi

llions

Source: eMarketer, Mary Meeker (KPCB)!

Virtual Goods Advertising

ARPDAU among top 1,000 grossing iOS free-to-play games

Gaming: Money, Midcore and Maturity

Sep 2011 Sep 2012

Source: Flurry Analytics, 480 free-to-play games!

Under $0.25, 53%

$0.25 - $0.75 32%

Over $0.75, 15%

Under $0.25, 82%

$0.25 - $0.75 15%

Over $0.75, 3%

Loyalty by Application Category

Mobile Game Loyalty Matrix (Freemium, iOS)

Mobile Game Age & Gender Matrix (Freemium, iOS)

SILICON VALLEY, USA THE NUMBER ONE TECH MARKET

330 MILLION US MOBILE SUBSCRIBERS

LARGEST SIZE OF SMARTPHONE MARKET WITH 101 MILLION SMARTPHONE SUBSCRIBERS

40% OF ALL SMARTPHONES ARE SOLD IN US (THEREFORE MOST ATTRACTIVE MARKET FOR OEMS)

VERIZON #1 MOBILE DATA ANNUAL REVENUES AT $23.7 BILLION

JAPAN HAS THE WORLD‘S HIGHEST DATA REVENUE PER USER

122 MILLION MOBILE SUBSCRIBERS

122 MILLION MOBILE SUBSCRIBERS

99% PENETRATION OF 3G HANDSETS

47% MOBILE WEB USERS OF WORLD MOBILE SUBSCRIBERS (US IS 22%)

47M “TAP-AND-GO” PHONES MOBILE PAYMENT MARKET

#1 AND #2 LOWEST CHURN WORLDWIDE NTT DOCOMO AND KDDI

WITH ONE BILLION MOBILE SUBSCRIBERS, CHINA IS THE BIGGEST MARKET

你好 ^_^  

1 BILLION MOBILE SUBSCRIBERS !!!

HIGHEST NUMBER DAILY SMARTPHONE ACTIVATIONS

#1 AND #2 BIGGEST TELCOS IN THE WORLD

277 MILLION MOBILE WEB USERS UP 43 MILLION IN SIX MONTHS

118 MILLION 3G USERS

HOME TO MOST HANDSET MAKERS/ HARDWARE OEMs

Some Segmentation

SILICON VALLEY USA

BARCELONA BEIJING CHINA

TOKYO JAPAN

SINGAPORE

TAIWAN

SEOUL

Kii: Profitable Global Platform for App Developers

APP MAKERS KII PROVIDES:

How Kii Helps App Developers

•  Great Idea •  Passionate users •  App “Genius”

INVESTMENT MONETIZATION TECHNOLOGY

Venture Capital Distribution & Monetization

Cloud technology

•  5 star ratings •  9M downloads •  User community

BEFORE Kii NOW WITH Kii

USERS LOVED ASTRO NOW ASTRO IS A PROFITABLE BUSINESS

$

US$550k

•  $550k Series A funding

•  Distribution deals in Japan and China

•  Six figure multi-year advertising deal

•  Cloud technology for ASTRO Backup product

•  Subscription Revenue opportunity

CLOUD SERVICES TO

POWER YOUR MOBILE APPS

Developer Platform Value Propositions

Idea Examples Save  Cost Revenue Avoid  Hard  or  Tedious  Work

Get  to  Market  Faster

Access  New  Markets

Acquire/Retain  Users

Increase  revenue  per  user

Compute  Cloud P P

Mobile  App  Cloud  Svcs   P P

Mobile  Cross  PlaIorm P P Personal  Cloud  and  Sharing P P App  Networks P P P Mobile  &  PC  Sync P P P Mobile  AnalyLcs  +  App  network P P P P Ad  Network P Online  Payments P P Mobile  and  Web  Game  SNS P P P P P

Market Summary: we are in the MBaaS market

•  Past, Present, Future: Kii Cloud is late to the game

Parse  Stackmob  Kinvey  Kii  Cloud  

Smaller MBaaS YorAPI Cloudmine CloudyRec FeedHenry iKnode ScottyApp Applicasa

Flurry  

Sencha  Amazon  

Heroku  

“Pure Play MBaaS”

Build your own

Full Stack

Analytics+

Enterprise MEAP Antenna Appcelerator Verivo Kony

Appcelerator   Trestle  

Others  Urban  Airship  APIGee  Twilio  

INSTANT BACKEND WITHOUT WRITING A LINE OF SERVER CODE

SO YOU CAN FOCUS ON USER HAPPINESS J NOT SERVERS

Mobile backend in minutes, not months! USER MANAGEMENT

DATA MANAGEMENT

ANALYTICS

MONETIZATION

!

We‘ll take care of •  Writing server code •  Server configuration •  Database management

•  Data schema lock-in •  Mobile customizations

11:30AM Lunch coupon for

favorite restaurant

The Kii Cloud is so reliable that the world’s toughest quality-conscious carrier uses it

•  RELIABLE Met NTT DoCoMo’s tough Quality Standards

•  PRACTICAL Backup and Content Deliver services

•  SCALABLE 12M paid subscribers of sync service

•  DURABLE Nonstop for years even through earthquakes

•  PROFITABLE Drives over $150M USD in revenue

12:45PM Concert information on favorite artist

22:45PM Tomorrow‘s schedule

17:50PM Info about specials

at a nearby store

7:00AM Traffic updates for

commute route

Multimillion-user app makers use Kii Cloud

Leading media privacy vault

35 million downloads

5 million downloads

Launching soon

14 million downloads

Kii CLOUD COMPONENTS

SUCCESS

DESCRIPTION Couples app Leading photo app

Leading Android file manager

STOP HIRING SERVER ENGINEERS WE HAVE DOZENS!

SAVE THOUSANDS OF HOURS AND DOLLARS KEEP YOUR FOCUS ON KEEPING USERS HAPPY

NEW HIRES

Server Engineer

System Admins

Database Adminis

Ad Traffickers

Grand total:

AVG. SALARY

US$ 91,000

US$ 77,000

US$ 83,000

US$ 41,000

US$ 292,000

Source: USA National Averages 6/12/2012

Indeed.com

ON USER HAPPINESS J COMPETING IN THE APP STORE PUMPING OUT NEW APP VERSIONS

Kii CLOUD COMPONENTS

USER MANAGEMENT

DATA MANAGEMENT

ANALYTICS

MONETIZATION

API ACCESS IS AVAILABLE FOR REST FULL SDKs FOR ANDROID, iOS AND JAVASCRIPT

USER MANAGEMENT

Android iOS

PROFILES & MANAGEMENT •  Store JSON key/

values •  Query attributes •  Session management •  Password reset/

change

GROUPS & PERMISSIONS •  Create groups •  Manage members •  Customizable access

control for all objects

LOGIN & REGISTRATION •  Basic registration/login •  Social registration/

login •  Anonymous login •  Account verification

OBJECT STORAGE •  Store/retrieve JSON

objects •  Flexible datatypes •  No fixed schema

DATA MANAGEMENT

FILE STORAGE •  Store/retrieve files •  Query attributes •  Sync/backup across

devices •  Share files via URL

DATA HANDLING •  Utilize buckets

optimized for access •  Customizable ACL +

scope •  Query objects & files

API ACCESS IS AVAILABLE FOR REST FULL SDKs FOR ANDROID, iOS AND JAVASCRIPT

Android iOS

ANALYTICS

OBJECT STORAGE Intrinsic Number of users, clicks,

etc. are backed-in Cloud data Defined based on

application data Custom Send any raw data for

aggregation

MANAGE •  Data aggregation across metrics •  Data visualization •  Manipulate and view both intrinsic and

custom metrics

API ACCESS IS AVAILABLE FOR REST FULL SDKs FOR ANDROID, iOS AND JAVASCRIPT

Android iOS

INVENTORY TYPES •  Direct Ads (sell your

own) •  Regional Ads (high

performance in Asia) •  Mediated Ads (Fill

unsold inventory using networks)

FILE STORAGE •  Dynamic configuration

via web portal •  Get analytics for clicks

and impressions

MONETIZATION

API ACCESS IS AVAILABLE FOR REST FULL SDKs FOR ANDROID, iOS AND JAVASCRIPT

Android iOS

ALL COMPONENTS EASILY MANAGED THROUGH THE Kii DEVELOPER PORTAL

Programs

• Events • PR • AR • Direct Marketing • Partner Marketing • Partner Selling

Platform Viability

Users                                                .  .                                                            

Money  

Features                Growth   Profit  

Profitable  

Growth  

Nirvana  

Successful  PlaIorms    have  3  Things:  1)  Features  2)  Users  3)  Money  

Global Trends •  Growth of Global Languages (see MyGengo.com)

–  1B+ speakers: Mandarin, English –  500M+ spkrs: Spanish, Hindi, Arabic

•  Smart Device Proliferation –  mobile, tablet, TV, console, etc

•  More Young, More Old ($$$) Users Online •  More Bandwidth, More Video, More Social, More Mobile •  Wealthy Chinese + Indian, Web + IRL Globetrotters ($$$B) •  Acceleration of Global Payment, E-Commerce •  Dramatically Reduced Cost: Product Dev, Customer Acqstn •  Global Distribution Platforms

–  US/EU: Apple, Facebook, AMZN, GOOG (Search, YouTube, Gmail, Android), Twitter –  Asia: Tencent/QQ, Taobao/Alibaba/AliPay, Youku, MediaTek, Rakuten, DeNA, Gree

Defining platform business: repeatable contracts

Repeatable Contracts    API EULA Licenses Invest Biz Dev

Unagi

X   =  

US Apps

JP Apps

OEM Apps Kii Cap CN

Apps 3rd

Party

Ramen    

Platform Product = Sticky & Recurring $

Increase Decrease

Platform Competition

Platform Commoditization Platform Monetization Features

Network Effects

Reus-ability

Open-ness

Dev Appeal

pARPU

pUsers

pApps Lack of

Technical Stickiness

Lack of Contract

Stickiness

Deal Quality

Platform Design

Market Condition pRevenue =  

Platform User

Acquisition Features

Network Effects

Good Ramen

Contracts

Competitively Differentiated

What makes a good platform?

Data Network Effect

Monetization Social Network Effect User Acquisition Features

Business Intelligence

Stickiness Network Effect

Strong Value Prop

App Network Effect

Developer Appeal Openness Reusability

Solid,  Reusable  Contracts  

TURN YOUR APP

INTO A GLOBAL BUSINESS

CAPITAL DISTRIBUTION TECHNOLOGY

Miko Matsumura !SVP Developer Relations!!Web: http://developer.kii.com!Twitter: @mikojava!Email: miko@kii.com!