Universal Mobile Interface

The iPad – how it may influence the mobile arena

Posted in UMI by Martin Vendel on April 16, 2010

Another hyped and as always well orchestrated launch by Apple. The iPad is since launch scrutinised and the comments are many. And what is really the iPad? Many views are posted on blogs like this one. All try to compare the iPad to some existing device: a laptop; a mobile device; a Kindle etc. It could be that the iPad does not really compare to any existing device but defines a new market. What need the iPad really can and will meet only the future can tell. The key difference to a laptop is probably not the lack of a real key board, missing USB ports etc. The iPad merge the large screen and usability of a laptop with the business ecosystem and the elegant UI of the iPhone/iPod touch. And as in most mergers one of the cultures may eventually be more pronounced.

Why does the iPad get all this attention? The main reason is that it is launched after the huge success of the iPhone and its app store. But is the iPad really building on the success of the iPhone? In many aspects the iPad is a lap top size iPod touch. The success factors of the iPhone/iPod are a superior UI making it very easy to find, explore, buy, access and use relevant Internet services and a working business eco-system incentivising 3rd party developers and companies to invest in the development of apps. In both these aspects the iPhone and the iPod has excelled compared to the competition and the key to the success has been a closed environment fully controlled by Apple. The competitive edge is on the other hand not so obvious anymore when doing the same for a lap top size device. A superior UI is nice to have but does not bring huge benefits and a working business eco-system is in many aspects already in place for computers.

What one may assume Apple hopes to achieve is yet another closed Apple environment where Apple guarantee the end user a superior user experience at the same time as they fully control the business eco-system within this closed environment, further driving hardware sales. The ambition is to extend the successful business model of the iPhone and its app store to more computer like devices. Many support this thinking, especially media conglomerates and publishers now see the opportunity to finally get a working business model, getting paid for digital versions of their news papers and magazines as well as new opportunities for advertising.

Sometimes we seem to forget what really made the PC and the Internet into the huge successes. And what ones almost killed the Mac in the process. It was certainly not a superior UI or a closed environment but rather the opposite. We may question the dominant position of Microsoft but getting one ubiquitous operating system, Windows, made it possible to launch services and software reaching the full market independently of device brand or ISP. The limited fragmentation and easiness by which you could address the market spurred innovation and diversity. This is unfortunately not the case within the mobile area and will not be for the foreseeable future, the mobile operating system jungle is here to stay. The success of the iPad can therefore not rely on the same criteria as the iPhone and we will most probably not accept a development where we now at this level of maturity get more closed environments within the personal computer area.

The iPad may find a niche as for instance a wireless reading device, such as the Kindle, where users are expecting a closed environment. But if the iPad becomes more of a general lap top for any media consumption the users are likely to expect more of an opened environment. Apple will, in this case, most probably be forced to open up to meet the customer expectations and not to limit the iPad to a few niche markets. With the similarities between the iPad and the iPhone it may be hard for Apple to justify a more closed environment for the iPhone. What may first have been seen as a very clever idea to expand the successful business model of the iPhone into the computer market may backfire and gradually open up the iPhone eco-system. The present willingness to pay for services in the mobile arena may be transferred to the online environment and maybe vertical approaches are a way to get there but it can’t be a general and sustainable solution.

The successes of vertical approaches such as the iPhone confirm the enormous potential of Internet services accessed through the mobile as well as the willingness to pay for useful services. To fully capitalize on this huge opportunity the answer is not to build more verticals, but rather to make services and communication platforms work across all mobile platforms unleashing the true potential. This is what the UMI concept is all about.

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Will the business models of web 2.0 services work when expanded to the mobile?

Posted in UMI by Martin Vendel on May 11, 2009

Over the last years, many successful web 2.0 services have been launched, well received by the end users but many times struggling to reach break even and profit. Some made impressive exits based on future revenue potential and good timing. The business is often based on an advertising model and follows a standard Internet approach. First launch a very compelling free service with potential to spread virally, with the primary target to attract many users and gain significant penetration. In a second step, capitalise on the digital real estate by offering advertising space, premium services and sponsored links. Several have succeeded in getting the service and distribution right, but a quite limited number have made real money as the costs quite often by far exceed the limited revenues per user. You can always hope for an exit, but eventually someone needs to make a profitable business out of the service. In addition, operators are concerned by the increased IP traffic advocating more traditional telecom business models, reflected in the debate about net neutrality. The rights issues are not obvious as technology is at least one step ahead of the legislation. The financial ecosystem surrounding these new services has not stabilised and matured fast enough to judge the sustainability of the models.

New Picture (10)Even with quite unproven business models within the present context, many of these players are now working on expanding their scope adding mobile access to their services. The purpose is to increase the usage by existing users, further improving stickiness and value of the services, but also to acquire new users and initially gaining an edge to the current offer. Already having difficulties with existing business models, will expanding into the mobile space further increase the pain or will adding the mobile channel significantly improve the overall business case? To convince and ask investors for additional funding may many times be a tricky pitch to make. Why expand into a new channel already before the concept has been proven financially? Especially given the financial climate and due to that advertising spending may not develop as once predicted. No wonder that many players are cautious investing time and money into going mobile. And many of them should be, while for some going mobile may be exactly the correct move.  

The mobile arena is the place to be and all predict a growing global business of very large magnitude: we soon reach 4 billion mobiles; it is the most personal device; it is always on etc. But will the existing business models be supported when the web 2.0 services are used trough the mobile? The following factors may impact the existing business model substantially and may make the web business model hard to transfer into the mobile context:

  • There is much less room for banners etc.
  • The service may find a very large audience but in markets that may be less relevant for the service and with an unfavourable ratio between revenue potential versus cost
  • The usage pattern between the mobile and the PC will differ, resulting in shorter sessions and more to the point usage
  • Present premium services may not be relevant in the mobile context
  • Significant additional cost may arise depending on chosen technology
  • Acquisition costs may rise due to cost of sms and clients
  • Keyboards, if any, are used to a much lesser extent
  • Search is less developed and users can not be expected to click on a link and banners if not really relevant
  • Data speeds are limited
  • Existing content rights may not be cleared for this media

New Picture (11)The existing business model may still work well given the characteristics above, but for most this will not be the case. Then you either have to accept the fact that the mobile will mainly be a cost that should be balanced by increased loyalty, gaining new customers etc. or you can refine the model adjusting it to the limitations of the mobile and focus on what creates value in this new environment. Some assets of the existing web services can become very valuable when utilised in a correct way. As predicted below relevant links and ads will become very valuable. The end user is expected to rely much more on trusted parties such as micro communities and peers and will be much more inpatient demanding useful stuff just a click away. That given, a service holds a substantial potential if it can or can be adjusted to:

  • Give a good user experience on the mobile, given its constrains in window size and keyboard functionality
  • Be designed to be used regularly on the mobile
  • Be capable, by profiling etc., to recommend very precise and valuable links
  • Offer non intrusive and opt in advertising
  • Act as recommendation engine based on peer to peer, blogs etc
  • A natural home of relevant links where users share even sponsored links
  • Encourage selection on relevant links on the web to be saved directly into the mobile user interface
  • Offer premium services useful through the mobile

This is not any more about putting ads with limited value for the user all over your sites, this is now a game about being one of the ten to twenty preferred services and giving really relevant offers and links to the specific customer and at the right time and place. If you can do that, then you are in the position create substantial value, if you can’t then not even big volumes will save you.

This all applies to web 2.0, but what about other services? For those that mainly use the web for marketing of old fashioned profitable products and services the mobile will undoubtedly be a very important part of the marketing communication mix and will, correctly used, be a quite profitable and necessary component. These players should also consider developing their services in line with the above to further strengthen profitability.

In conclusion, the mobile may be just what many web 2.0 services need to capitalise on their core assets. Utilised wisely it should even be possible to make up for the presently weak existing business cases. In addition, the mobile channel will increase reach, loyalty and usage supporting the overall case at large.

Why search will not be as powerful when accessing Internet through the mobile

Posted in UMI by Martin Vendel on April 27, 2009

The new digital era has made the vast range of content available and just a few clicks away. This has resulted in that the end user has so much to chose from that it becomes hard to find what you really look for and that it’s very difficult for a publisher to become visible. This issue is addressed by search engines, such as Google, but as we all experience it is still a challenge to find what you look for and for those publishing it’s not really obvious why competing sites are ranked high by the search algorithms. There’s today a growing business in advising companies in how to optimise the sites to get a better score.

new-picture-9For many of us we start a session at the PC with search, and most of us use search every day and for sites that we visit regularly we don’t even save bookmarks as it is so easy to just type in a few search words or many times the URL directly. Many have predicted a similar behaviour on the mobile but this has not been the case and will most probably not be the case. The mobile is different; it is used in another context and has obvious limitations when it comes to screen size and keyboard.

When using the computer you usually click through for instance a news site from the start main page, then to for instance sports and from there to the specific results you’re interested in. Many take this path to what they are interested in even though they could have saved a bookmark for the specific pages of interest to gain direct access. On the mobile it is much more probable that you save bookmarks to the relevant information, as clicking through less relevant pages is painful.
new-picture-8The mobile is neither well suited to run an ordinary search as it is not easy to type in words and as the long lists of results are hard to digest and select from. In addition, the mobile is used in situations where you need specific information fast and you are not expected to have long sessions surfing around. There’s a need to get more or less direct access to the specific content of your choice based on your needs on the move. There will still be a need for search when using the mobile, but it will most probably be less important compared to other means to explore new content.

So now when companies eventually have learned about the importance of search engine optimisation etc. there is unfortunately some bad news, this will not be sufficient for gaining visibility and presence in the mobile. Should then those publishing on the web bother about this? They should, as been discussed in a previous contribution to this blog, all trends show that the mobile will become an increasingly important media over time. In addition, there are also extreme differences between developed and developing countries when it comes to the ratio between PC and mobile penetration. So how to combine the very personal need for specific individual “long tail” choice of information and that search is not the primary tool to explore new content?

Key to visibility in the mobile is to get a link on pages visited by the user. As the user can’t be expected to use search to a large extent, other means such as recommendations etc. will be used to find new links to save into the individual collection of bookmarks. The following ways to get new links can be expected to grow in importance:

  • Recommendation of sites by trusted parties such as friends
  • Links promoted on specific and trusted niche sites and portals
  • Preinstalled links on new browsers/portals/UMIs
  • Links down loaded directly from web pages used on the PC
  • To some extent non intrusive opt-in high quality recommendations and sponsored links

Ads may also be important and can target quite well defined segments utilising the user profiling available by different mobile platforms. The number of ads will be limited due to the small mobile screen and as general surfing will be less frequent compared to the PC. The possibility to target specific segments and as the number of ads are limited, will make the advertising space quite valuable and expensive, but most probably a good investment when used correctly.

I recommend publishers the following to gain visibility in the mobile:

  • Use existing digital channels to promote and download links to the mobile
  • Don’t waste money on search engine optimisation etc. for mobile search
  • If possible, be visible on link start packages when new browsers/portals/UMIs are downloaded
  • Use advertising and sponsored link investments wisely and very well targeted
  • Make it easy for the mobile users to share your links
  • Incentivise users to share links and support viral distribution of your services
  • Be directly visible in services, such as maps, travel information etc.
  • Be visible on trusted niche sites/portals to reach the correct segment directly

On average a user can be expected to have about 20 bookmarks where maybe half are very personal (micro communities etc.) and all are saved to get direct fast access when on the move. The individual link collection thereby represents a significant value to the user, giving her direct access to really valuable content. And not to lose her own collection of bookmarks when changing phone or operator becomes very important. All these features are key strengths of the UMI concept. The significance of the link collection to the individual results in a collective quality control of all links saved. This will further strengthen the peer to peer exploration of new content but may also create a barrier for new content to find an initial audience.