WW-177 -- Mobile Content and M-Commerce Business Still Growing

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Issue No. 177 Thursday August 28, 2008
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Mobile Content and M-Commerce Business Still Growing

The mobile business in the walled garden of the carriers grew by
23% in 2007 to 10 billion dollars, according to a report
released by the Japanese Ministry of Internal Affairs and
Communications in July. However, the garden is getting very
crowded - there were more than 16 thousand mobile sites listed
on the carrier decks offered by 4,300 companies.

Mobile content sales accounted for about 4 billion dollars of
which 1.5 billion was spent on music. Due to the introduction
of flat data rate plans by the carriers, users do not have to
bother anymore about data usage, causing a shift to
consumption of rich contents. Downloads of full-length songs
reached 1 billion dollars, while the traditional ring tone
business fell 34% to 500 million dollars. Sales on e-books,
the fastest growing content, doubled last year to 200 million.
Popular genres are books about current TV dramas and movies,
mystery, comics, and history.

NTT DoCoMo reported in June that the monthly content sales
were about 200 million dollars. The number of unique users has
stopped growing – but the content sales per user is still
increasing. According to DoCoMo, the page views of video related
websites grew by 500% in one year.

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Mobile commerce is growing faster than the content business –
total revenues were about 6.5 billion dollars in 2007.
M-commerce is divided in three categories: shopping, services,
and transactions. Services - including sales of concert tickets,
hotel and restaurant reservations, airline and train tickets –
grew by 41% to 250 million dollars. The size of the mobile
advertising and promotion market was 550 million dollars in
2007.

Like on the PC, the search on mobile phones is a battle between
Google and Yahoo! Contrary to the PC world, MMD Labs, a market
research firm, found that Google Mobile is number two in the
Japanese market with a share of 52.5%, while 74.9% frequently
uses Yahoo Mobile. Most popular search categories are artists
and comedians, music, and vocabulary. Almost 40% of all
searches are for multiple key words.

OneSeg, the mobile digital television service, is gaining
momentum. A recent user panel survey by Net Asia revealed that
26% is watching mobile TV. It is not clear how the business
model around OneSeg will be defined. It might take until 2010
until market players – producers, TV stations, carriers,
advertisers and advertising agencies – have found a way to
monetize OneSeg.

Stay tuned.

The Japanese mobile eco-space is still evolving.

By Arjen Van Blokland

----------------- ICA Event - Sept 11 ---------------------

Event: SUMMER NETWORKING PARTY!!

Topic: Joint event with ACCJ ICT Committee and the
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Details: Complete event details at http://www.icajapan.jp/
(RSVP Required)

Date: Thursday, Sept 11, 2008
Time: 6:30-8:30pm - includes open bar and buffet
Cost: 6,000 yen (members), 7,000 yen (non-members)
Open to all-venue is The Foreign Correspondents' Club of Japan
http://www.fccj.or.jp/aboutus/map

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