Global yet fragmented, innovative yet beset by technical challenges, growing explosively yet constrained by the carriers—the mobile internet tsunami is bursting upon us, bringing tremendous opportunities for entrepreneurs and exciting new possibilities for users worldwide. The SDForum Mobile Internet Tsunami Conference, held on the Microsoft campus in Mountain View on December 10, 2010, brought together entrepreneurs, investors, and experts in the field to explore the trends.
The Art of Enchantment
Guy Kawasaki, popular author, co-founder of Alltop.com, and former chief evangelist at Apple, presented the opening keynote entitled “The Art of Enchantment,” telling the audience how Steve Jobs sold the iPhone not as a device, but as a dream. Emphasizing the enchanting possibilities of mobile computing, Kawasaki told the story of a violinist in a London coffee shop who was so engaged with her mobile device that she failed to notice the theft of her expensive violin. In the keynote, Kawasaki gave the audience a preview of his forthcoming book, Enchantment: The Art of Changing Hearts, Minds, and Actions.
The Mobile Internet—Taking it Anywhere
Following the keynote, Joe Jasin, Managing Director of DNA Investment Partners, led a panel discussion during which the leaders of several mobile firms discussed their strategies for seizing the mobile opportunity.
Jeremy Geiger, Founder & CEO of Retailigence, told of how his firm uses analytics and mobility to enable consumers with greater information and to help retailers learn more from customers. Monique Farantzos, co-founder and CEO of doubleTwist, explained that her firm seeks to become the Switzerland of digital media by providing a neutral platform for interoperability between devices. Jeff Haynie, Co-founder and CEO of Appcelerator, said that Appcelerator offers a solution for the problem of multiple platforms, accelerating the mobile strategies of enterprises both large and small. Jeff Smith, CEO and Co-Founder of Smule, said that Smule’s mission was to redefine what music means on mobile.
All of these executives agreed that mobile is inherently global, with businesses gaining customers overseas almost as soon as they begin operations. Over half of Smule’s customers are outside of North America. Appcelerator has business customers in thirteen countries. doubleTwist serves consumers in over 150 countries. Geiger, who has previously taken multiple businesses international, explained that a successful international strategy requires capital, partners, and strong references from the home market.
The Fall of Brick and Mortar to Mobile
After the first panel and following the morning exhibition break, Ted Sheldon, CEO, Open-First, moderated a panel discussion on the experience of large enterprises with the mobile internet. Panelists included Alan Boehme, Senior Vice President and Head of IT Strategy & Enterprise Architecture, ING; Debby Hopkins, Chairman of Venture Capital Initiatives and Chief Innovation Officer, Citigroup; and Kevin Nix, Senior Vice President, Enterprise Mobility, SAP.
Nix emphasized the speed of user adoption, the tremendous value of mobile when information is urgent and rapidly changing, and the need for enterprises to experiment in order succeed in mobile. Hopkins stated that mobile represents a lifestyle shift and offers enterprises value through data analytics, personalization, and targeted marketing. And Boehme added that mobility offers opportunities for organizations to simplify processes and improve the user experience, but that innovators should expect opposition from IT operations and change control boards.
Fireside Chat with GetJar
After the panel discussion, Kevin Efrusy, a General Partner at Accel Partners, held a fireside chat with Chris Dury, COO of GetJar, an Accel portfolio firm and probably the first Lithuanian technology firm funded by Silicon Valley-based venture capital.
Dury told the story of how GetJar, started by a few Lithuanian game developers as a site for mobile game beta testing, grew to become the world’s second largest app store with over a billion downloads to date, second only to the Apple App Store. The company now provides more than 75,000 mobile applications to consumers in more than 200 countries. Recently, GetJar became the exclusive distributor of the Android-version of Angry Birds, the most popular iPhone game.
The Investment Landscape
Following a networking lunch, Harold Yu, a Partner in Orrick’s Emerging Companies Group, moderated a panel discussion on the mobile investment landscape with leading venture capitalists: Lars Leckie, Principal, Hummer Winblad; Brook Wessel, Senior Investment Manager, T-Venture Holding; Sharon Wienbar, Managing Director, Scale Venture Partners; and Richard Yen, Director, Private Equity, Saban Capital Group.
The rise of Apple and Google in the mobile spaces, said Leckie, has brought greater promise to the mobile industry for investors, easing what had been a “matrix of pain” caused by fragmentation and a proliferation of platforms. Disagreeing, Wienbar stated that fragmentation has returned in 2010. Apple no longer dominates; there are ever more form factors; and new players are gaining traction.
Asked about opportunities in mobile gaming, Yen responded that start-ups based on mobile games can succeed but only if they introduce a suite of games, not just a single title. Wienbar agreed on the necessity for multiple titles, explaining that firms must use existing games to advertise new titles. Emphasizing the exciting growth in the space, Leckie explained how mobile game developers are inventing new distribution models on the fly and expanding the very concept of gaming.
Addressing mobile advertising, Leckie stated that mobile ads represent a new paradigm for advertising. Expanding on the theme, Wessel explained that mobile advertising will be driven by analytics and personalization. Yen, while predicting strong growth in mobile ads, expressed his caution as an investor given the huge market power of the dominant players in the space, Apple and Google.
Mobile my World: Mobile Internet—The Sequel
After the venture capital panel, Susan Welsh de Grimaldo, Director of Mobile Broadband Opportunities at Strategy Analytics, presented the afternoon keynote. The critical elements needed for innovation in mobile, according to de Grimaldo, are simplicity, personalization, and focus on the user experience. Growth in the field is so explosive, said de Grimalso, that market research cannot predict what will come next. Just as customers before the introduction of the automobile would have asked for a faster horse, customers today cannot express what they want from the mobile internet.
The mobile internet, de Grimalso explained, is expanding into new fields such as the automotive industry and healthcare. These fields include many players enmeshed in complex relationships. To succeed, mobile firms must form partnerships. No one firm can succeed alone. Beyond automotive and healthcare, the entire field of machine-to-machine (M2M) computing represents a tremendous opportunity for mobile, one that is soon to grow into a mass market.
The Mobile Industry Perspective
Following de Grimaldo’s keynote, Howard Greenfield, President of Go Associates, led a panel on the mobile industry perspective. The panel included John Loughney, Product Manager, Nokia; Satya Mallya, Director of Mobile, Orange, San Francisco; Dr. Vach Kompella, Senior Director of Mobile Gateways, Alcatel-Lucent; and Ben Riga, Senior Technical Evangelist, Microsoft.
Asked about the greatest hurdles facing the mobile industry, Mallya pointed to the explosion of data, with average data consumption per user growing rapidly and more devices joining the fray, all of which puts a strain on the available bandwidth. Kompella explained that mobile networks were designed for telephone communications, not data. Aggravating the situation, many developers program for mobile as if it were wired, wasting bandwidth. In addition to bandwidth, Loughney pointed out that battery life likewise represents an important constraint for mobile development. Riga noted that mobile developers face a challenge in achieving scalability, which they can seek to address through cloud computing.
Discussing how the industry should tackle bandwidth issue, Mallya explained the potential for tiered pricing as an incentive for efficient use. Kompella described how traffic could be offloaded to Wi-Fi where available. Loughney said that he expects devices to become more intelligent about how they use bandwidth.
Where’s the Money
In the last panel of the conference, Gamiel Gran, Partner, Sierra Ventures moderated a panel discussion among several entrepreneurs in the mobile space: Aaron Emigh, Co-Founder and CTO, Shopkick; Vishal Gurbuxani, CTO, Mobclix; and Ben Lewis, Co-founder and Vice President, Mobile Product, Tapjoy.
In response to a question on analytics, Lewis, whose firm Tapjoy provides mobile publishers solutions for application discovery, rich advertising, and virtual good sales, stated that analytics offer tremendous advantages when embedded in applications to provide data on usage. For Mobclix, a mobile ad exchange, Gurbuxani explained that analytics are critical for targeted marketing. Emigh, whose firm Shopkick makes shopping in the physical world more social and interactive through mobile apps, stated that analytics enables his firm to demonstrate to retailers the return on the marketing investment.
In the exciting growth field of the mobile internet, Lewis exclaimed, two to three person shops can, without any funding, build an app and start a successful business.
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