MoMoTLV Israel March 2010 - Aviv Revach - Mobile Apps Monetization Overview

Mobile Apps Monetization Overview

Aviv RevachCo-Founder, VP Business Development @ Mo’Minis

Co-Founder @ MobileMonday Tel-Aviv

Mobile Apps Overview - Agenda

Monetization What are the main monetization models?

Which distribution channels exist?

How should I choose my distribution channels?

Updates What has changed from last year?

What has NOT changed from last year?

What about the future?

Paid-For One-Time-Download Subscription / Rental (e.g. Jamba) Freemium – Free version, Premium features costs money Newer Models

“Virtual Goods” – mainly for games Flexible Payments

In-App Advertisement Pre-Roll / Post-Roll Video Ads Been around for a few years, but now actually kicks in Rewards developers for customers reuse

What are the main monetization models?

Application Stores Mobile Operators (e.g. Orange AppShop) Vendors (e.g. Appstore, Ovi) Independent (e.g. Handango)

Aggregators (e.g. Connect2Media, Zed, B!)

Direct-To-Consumer (D2C) Destination Website (WAP/Web) On Device Portal (e.g. OnMobile) Social Networks

Retail (e.g. Retalika) - new

Which distribution channels exist?

Popular Parameters: Potential volume (comparable best-sellers?) Pricing (avg.? flexible? pricing points?) Geography, Demography Revenue Share

Less Intuitive Parameters: Competitors (saturated?) Handset Compatibility (Aggregator’s 400-800 handsets lists..) Growth expectations Application Promotion Reports (trusted? on time?) Support & Feedback

How should I choose mydistribution channels?

More mobiles handsets – 4.6 billion subscribers (ITU, 2009) ~ 4 times the number of PCs

More mobile platforms Portable media players: Apple iPod / iPod-Touch, Sony Walkman,

… Tablet computers: Apple iPad E-Book platforms: Amazon Kindle, Sony Reader, …

More distribution channels Appstores – From 8 to 38 (GetJar, March 2010) New mediums:

Social networks Retail

What has changed from last year?

More Revenues – Apps market is boom’ing! Mobile Application Stores Market

2009 - $4.2 billion 2010 is projected to reach $6.7 billion 2013 is projected to reach $29.4 billion

(Gartner, January 2010)

Lower App Prices 2009 Avg. price - $1.9 Until 2012 – 29% decrease, Avg. price – $1.34

(GetJar, March 2010)

Finally - some Ad-Based monetiziation 2009 – 12% of all Apps revenues 2012 is expected to reach 28%+ of all Apps revenues

(GetJar, March 2010)

What has changed from last year?

Handsets Fragmentation Still no standards!

Java ME, Symbian, iPhone SDK, Android SDK, MeeGo

High development & porting costs ($10k-$100k’s per app/game)

Distribution is still a “bottleneck” Past challenges - partially solved

Limited “Shelf Space” No true solution for long-tail

And even more.. Distribution fragmentation Tough moderators (e.g. Apple)

What has NOT changedfrom last year?

Standard APIs / Cross-handset platforms Sun JavaFX, Adobe Flash GSMA OneAPI, Vodafone JIL

Web & Mobile Convergence Yahoo Appstore? Mobile Web Apps?

Flexible In-App Billing

Mobile Analytics – optimize revenues Enabling In-App Ads (e.g. innerActive)

What about the future?

What’s Next