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7/31/2019 El Estado de Internet
1/137
StateOfTheInternet:2012HenryBlodget
CEO&EIC,BusinessInsider
7/31/2019 El Estado de Internet
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ThecommercialInternetisnow~20yearsold.
7/31/2019 El Estado de Internet
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So,howarewedoing?
7/31/2019 El Estado de Internet
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2+billionpeopleonline
0"
500"
1,000"
1,500"
2,000"
2,500"
1990" 1991" 1992" 1993" 1994" 1995" 1996" 1997" 1998" 1999" 2000" 2001" 2002" 2003" 2004" 2005" 2006" 2007" 2008" 2009" 2010" 2011"
(millions)
Global)Internet)Popula4on)
Source:(Interna-onal(Communica-on(Union,(Google(
7/31/2019 El Estado de Internet
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2/3oftheworldlefttogo
Global&Popula*on&
Internet&Popula*on&
0"
1,000"
2,000"
3,000"
4,000"
5,000"
6,000"
7,000"
1990"1991"1992"1993"1994"1995"1996"1997" 1998"1999"2000"2001"2002"2003"2004"2005"2006" 2007"2008"2009"2010"2011"
(millions)
Global&Internet&Popula*on&
Source:(Interna-onal(Communica-on(Union,(Google(
7/31/2019 El Estado de Internet
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USNewmediastockvalue3Xoldmedia
$0#
$200#
$400#
$600#
$800#
$1,000#
$1,200#
New#Media# Old#Media#
!
MarketValue
(billions)
7/31/2019 El Estado de Internet
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(WhenyouincludeApple)
MarketValue
$0
$100
$200
$300
$400
$500
$600
$700
Apple Google Amazon Facebook Disney Comcast News Corp TimeWarner
TimeWarnerCable
Viacom CBS
Billions
7/31/2019 El Estado de Internet
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Asever,powerisveryconcentrated
New Media
Old Media
$1,089 Billion Market Value
$366 Billion Market Value
Disney'
Comcast'
News'Corp'
Time'Warner'
Time'Warner'
Cable'
Viacom'
CBS'
Apple%
Google%
Amazon%
Facebook%
Yahoo% Twi6er% Hulu%Ne;lix%
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Andnowtotheactualbusinesses
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MEDIA
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U.S.DigitalAdvertisingismakinghugegains
$0#
$5#
$10#
$15#
$20#
$25#
$30#
$35#
1995# 1996# 1997# 1998# 1999# 2000# 2001# 2002# 2003# 2004# 2005# 2006# 2007# 2008# 2009# 2010# 2011#
(billions)
U.S.)Digital)Adver6sing)
Source:(IAB(
7/31/2019 El Estado de Internet
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Andnowaccountsfor~20%oftotaladspend
Offline&
Online&
$0#
$20#
$40#
$60#
$80#
$100#
$120#
$140#
$160#
$180#
1995# 1996# 1997# 1998# 1999# 2000# 2001# 2002# 2003# 2004# 2005# 2006# 2007# 2008# 2009# 2010# 2011#
(billions)
U.S.&Adver4sing&
Source:(IAB,(U.S.(Census(Bureau,(Stategy(Analy7cs.(BI(Intelligence(es7mates((
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Amongthelargestmediacompanies,more
thanone-thirdofadspendingisnowonline.
77%#
share#
62%#
share#
23%#
share#
38%#
share#
$0#
$10,000#
$20,000#
$30,000#
$40,000#
$50,000#
$60,000#
$70,000#
$80,000#
2006# 2007# 2008# 2009# 2010# 2011#
U.S.$
Adver*sing$
Revenue$
(millions)$
Source:#Company#filings#and#BI#Intelligence#esFmates.#Companies#include:#Google,#Yahoo,#AOL,#MicrosoN,#acebook,#Time#Warner,#Disney,#Viacom,#CBS,#ews##Corp,#ew#York#Times,#GanneX,#McClatchy,#Time#Inc,#Entercom,#CBS#Radio,#Clear#Channel,#Citadel,#Cum#
Online$vs.$Offline$Adver*sing$(U.S.),$2006
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TVstillbiggest.Onlineclosebehind.
Printgettingsmashed.
41%$42%$
10%$
23%$13%$
14%$
20%$
9%$
11%$
7%$
6%$
4%$
0$
10,000$
20,000$
30,000$
40,000$
50,000$
60,000$
70,000$
80,000$
2006$ 2007$ 2008$ 2009$ 2010$ 2011$
U.S.$
Adver*sing$
Revenue$
(millions)$
Source:$Represents$annual$U.S.$adverAsing$revenue$for$20$large$media$companies$based$on$company$filings$and$our$own$esAmates$
U.S.$Adver*sing,$2006:2011$
All$Other$Online$
Television$
Print$
Radio$
Outdoor$
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Newspaperadrevenuehascollapsed
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TVmaybenext.
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Over-the-topvideoisrealandgrowingfast.
Ne#lix'
YouTube'
Hulu'
$0#
$1,000#
$2,000#
$3,000#
$4,000#
$5,000#
2006# 2007# 2008# 2009# 2010# 2011#
Total'
Digital'
Revenues'
(millions)'
Source:#Company#filings#and#BI#Intelligence#esDmates#
Digital'Video'Revenue,'2006?2011'
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PayTVsubscriptionsaretrendingdown.
Source:BernsteinResearch,BIIntelligenceestimates
Cable&
Satellite&
TelCo&
Total&
!1000$
!800$
!600$
!400$
!200$
0$
200$
400$
600$
800$
1000$
1Q09$ 2Q09$ 3Q09$ 4Q09$ 1Q10$ 2Q10$ 3Q10$ 4Q10$ 1Q11$ 2Q11$ 3Q11$ 4Q11$ 1Q12$ 2Q12$
Subscriber&
Net&Addi3ons&
(thousands)&
Pay&TV&Subscriber&Net&Addi3ons&
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Inonlineads,Googleiscompletelydominant.Facebooksgainingsteam
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FacebookhasalreadyblownpastAOL,Microsoft,andYahoo
Google&
Facebook&
Microso0&
Yahoo&
AOL&
Other&
$0#
$1,000#
$2,000#
$3,000#
$4,000#
$5,000#
$6,000#
$7,000#
$8,000#
$9,000#
2Q06#3Q06#4Q06#1Q07#2Q07#3Q07#4Q07#1Q08#2Q08#3Q08#4Q08#1Q09#2Q09#3Q09#4Q09#1Q10#2Q10#3Q10#4Q10#1Q11#2Q11#3Q11#4Q11#1Q12#
Digital&
Adver:sing&
Revenue&
(millions)&
U.S&Digital&Adver:sing&
Source:(company(filings(BII(es5mates(
4%&
11%&
3%&
13%&
6%&
55%&
11%&
8%&
7%&
4%&
15%&
7/31/2019 El Estado de Internet
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Google,Facebookandahandfulofnewcompaniesarewinning,portalslosing.
80%
share!
Yahoo%
Microso+%AOL%
Google%
Other%
Facebook%
$0#
$1,000#
$2,000#
$3,000#
$4,000#
$5,000#
$6,000#
$7,000#
$8,000#
$9,000#
2Q06#3Q06#4Q06#1Q07#2Q07#3Q07#4Q07#1Q08#2Q08#3Q08#4Q08#1Q09#2Q09#3Q09#4Q09#1Q10#2Q10#3Q10#4Q10#1Q11#2Q11#3Q11#4Q11#1Q12#
Digital%
Adver:sing%
Revenue%
(millions)%
U.S%Digital%Adver:sing%Winners%And%Losers%
Source:(company(filings,(BII(es6mates(
40%
11%
30%
13%
6%
55%
11%
8%
7%
4%
15%
7/31/2019 El Estado de Internet
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Displayadgrowthisflattening.
Google&
Other&
Yahoo&
AOL&
Microso3&
$0#
$500#
$1,000#
$1,500#
$2,000#
$2,500#
$3,000#
2Q06#3Q06#4Q06#1Q07#2Q07#3Q07#4Q07#1Q08#2Q08#3Q08#4Q08#1Q09#2Q09#3Q09#4Q09#1Q10#2Q10#3Q10#4Q10#1Q11#2Q11#3Q11#4Q11#1Q12#
Display&
Adver9sing&
Revenue&
(millions)&
U.S.&Display&Adver9sing&
Source:(company(filings,(BII(es6mates(
7/31/2019 El Estado de Internet
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AndnewcompaniestakingsharefromportalsYouTube,Hulu,Glam,Twitter,Demand,etal.
Facebook(YouTube(
WebMD(
Hulu(
Demand(Media(
Twi6er(
Federated(Media(
Glam(Media(
$0#
$200#
$400#
$600#
$800#
$1,000#
$1,200#
$1,400#
$1,600#
$1,800#
2Q06#3Q06#4Q06#1Q07#2Q07#3Q07#4Q07#1Q08#2Q08#3Q08#4Q08#1Q09#2Q09#3Q09#4Q09#1Q10#2Q10#3Q10#4Q10#1Q11#2Q11#3Q11#4Q11#1Q12#
Digital(
Adver=sing(
Revenue(
millions)(
US(Digital(Adver=sing:(New(Growth(Companies(
Source:(company(filings(BII(es5mates(
7/31/2019 El Estado de Internet
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SOCIAL
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Americansnowspendmoretimeonsocialnetworksthanportals
Social'Networks'
Portals'
0'
5'
10'
15'
20'
25'
30'
Nov62010' Dec62010' Jan62011' Feb62011' Mar62011' Apr62011'May62011' Jun62011' Jul62011' Aug62011' Sep62011' Oct62011' Nov62011' Dec62011'
Average'Minutes'
Per'Usage'Day'
Average'Time'Spent:'Portals'vs.'Social'Networks'(U.S.)'
Source:(comScore(
7/31/2019 El Estado de Internet
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1/7thoftheworldspopulationuseFacebook
Monthly(Ac+ve(Users(
Daily(Ac+ve(Users(
0(
100(
200(
300(
400(
500(
600(
700(
800(
900(
1,000(
1Q09( 2Q09( 3Q09( 4Q09( 1Q10( 2Q10( 3Q10( 4Q10( 1Q11( 2Q11( 3Q11( 4Q11( 1Q12( 2Q12(
Ac+ve(
Users(
millions)(
Facebook(Ac+ve(Users(
7/31/2019 El Estado de Internet
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Withinsocial,Facebookdominates.
!"!!!!
!20,000!!
!40,000!!
!60,000!!
!80,000!!
!100,000!!
!120,000!!
!140,000!!
!160,000!!
!180,000!!
!200,000!!
Nov"2010!Dec"2010! Jan"2011! Feb"2011!Mar"2011! Apr"2011!May"2011!Jun"2011! Jul"2011! Aug"2011!Sep"2011! Oct"2011! Nov"2011!Dec"2011!
Monthly!
Unique!Visitors!
(thousands)!
Social!Networks:!Unique!Visitors!(U.S.)!
Source:(comScore(
Facebook!
Google!Sites!Yahoo!Sites!
Pinterest!Tumblr!
LinkedIn! Twier! Google+!
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So,willFacebookbebiggerthan
Google?
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Unlikely.
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Googleisthebestadproductinthe
historyoftheworldbecauseitslikeadvertisingatastore.
7/31/2019 El Estado de Internet
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Facebook,meanwhile,islike
advertisingataparty.
7/31/2019 El Estado de Internet
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Socialreferralstocommercesitesarestilltiny
Facebook referrals up 92% year-over-year
80.6%&
9.7%&7.5%& 1.7%& 0.5%& 0.02%&
0.0%&
10.0%&
20.0%&
30.0%&
40.0%&
50.0%&
60.0%&
70.0%&
80.0%&
90.0%&
Google& Yahoo& Bing& AOL& Facebook& Twier&
Percentage&
Of&Traffic&&
Drivers&of&ECommerce&Traffic&
Source:(RIchRelevance(
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eCOMMERCE
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E-Commercecontinuestotakeshare
Offline&Retail&Sales&
E.Commerce&
$0#
$500,000#
$1,000,000#
$1,500,000#
$2,000,000#
$2,500,000#
$3,000,000#
$3,500,000#
$4,000,000#
$4,500,000#
$5,000,000#
1995#1996#1997#1998#1999#2000#2001#2002#2003#2004#2005#2006#2007#2008#2009#2010#2011#
(millions)
US&Retail&Sales&
Source:(Federal(Reserve(Economic(Data66St.(Louis(Fed,(BI(Intelligence(es=mates(
7/31/2019 El Estado de Internet
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Newpure-playslaunchedinlastfewyears
E"Commerce)
$0)
$25,000)
$50,000)
$75,000)
$100,000)
$125,000)
$150,000)
$175,000)
$200,000)
2000) 2001) 2002) 2003) 2004) 2005) 2006) 2007) 2008) 2009) 2010) 2011)
Total))
Sales)
(millions)
U.S.)E"Commerce)Sales)
Source:(Federal(Reserve(Economic(Data(6(St.(Louis(Fed,(Company(Filings,(BII(Es@mates(
Pure-Play"SocialCommerce"
7/31/2019 El Estado de Internet
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Andtheyregrowingfast.
Groupon'
Gilt'Groupe'
LivingSocial'
Rue'La'La'
HauteLook'
Beyond'The'Rack'
Zulily'
Ideeli'
One'Kings'Lane'
ShoeDazzle'
Fab'
$0'
$500'
$1,000'
$1,500'
$2,000'
$2,500'
$3,000'
$3,500'
2008' 2009' 2010' 2011'
Total'Revenue'
(millions)'
Social'Commerce'Revenues'
Source:(Company(Filings,(BII(Es8mates(
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MOBILE
7/31/2019 El Estado de Internet
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Somethingprofoundhappenedlastyear
7/31/2019 El Estado de Internet
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SmartphonesalesovertookPCsales
Personal)Computers)
Smartphones)
Tablets)
)3))))
)100,000,000))
)200,000,000))
)00,000,000))
)400,000,000))
)500,000,000))
)600,000,000))
)700,000,000))
)800,000,000))
)900,000,000))
)1,000,000,000))
2000) 2001) 2002) 200) 2004) 2005) 2006) 2007) 2008) 2009) 2010) 2011)
Units)
Global)Internet)Device)Sales)
Source:(Gartner,(IDC,(Strategy(Analy5cs,(company(filings,(BI(Intelligence(es5mates(
7/31/2019 El Estado de Internet
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Andwillsoondwarfthem
Personal)Computers)
Smartphones)
Tablets)
)3))))
)500,000,000))
)1,000,000,000))
)1,500,000,000))
)2,000,000,000))
)2,500,000,000))
),000,000,000))
2000) 2001) 2002) 200) 2004) 2005) 2006) 2007) 2008) 2009) 2010) 2011) 2012E) 201E) 2014E) 2015E) 2016E)
Units)
Global)Internet)Device)Sales)
Source:(Gartner,(IDC,(Strategy(Analy5cs,(company(filings,(BI(Intelligence(es5mates(
Wearehere
7/31/2019 El Estado de Internet
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PCsales,meanwhile,areinastall
HP#
Lenovo#
Dell#
Acer#
Apple#
Other#
0"
10,000"
20,000"
30,000"
40,000"
50,000"
60,000"
70,000"
80,000"
90,000"
100,000"
1Q08" 2Q08" 3Q08" 4Q08" 1Q09" 2Q09" 3Q09" 4Q09" 1Q10" 2Q10" 3Q10" 4Q10" 1Q11" 2Q11" 3Q11" 4Q11" 1Q12" 2Q12"
Global#PC#Shipments#By#Manufacturer#
Source:(Gartner,(IDC(
iPad"released"
7/31/2019 El Estado de Internet
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TabletswillalsoblowpastPCsalesinafewyears
E"Readers)
0)
50)
100)
150)
200)
250)
300)
350)
400)
450)
500)
2010) 2011) 2012E) 2013E) 2014E) 2015E) 2016E)
Units))
Sold)
(millions)
Tablet)Sales)Forecast)
Wearehere
7/31/2019 El Estado de Internet
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Sothefutureismobile
Fixed& Fixed&Fixed&
Mobile&
Mobile&
0&
500&
1,000&
1,500&
2,000&
2,500&
3,000&
2005& 2010& 2015&
Consumer&
Broadband&
Connec:ons&
(milions)&
G>20&Internet&Access&
Source:(Boston(Consul/ng(Group,(Mary(Meeker,(Kleiner(Perkins,(Morgan(Stanley(Research,(Berg(Insight(
7/31/2019 El Estado de Internet
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Whereareweinthemobilerevolution?
7/31/2019 El Estado de Internet
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Globally,wereearly.
Feature'Phone'Sales'
Smartphone'Sales'
!"!!!!
!500!!
!1,000!!
!1,500!!
!2,000!!
!2,500!!
2010! 2011! 2012! 2013! 2014! 2015! 2016!
Global!Mobile!
Phone!Sales!
(millions)!
Global!Smartphone!Penetra>on!Forecast!
Wearehere
7/31/2019 El Estado de Internet
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TheU.S.,however,ismorethanhalfwaythere
35%$
48%$
17%$
46%$
41%$
12%$
0%$
10%$
20%$
30%$
40%$
50%$
60%$
Smartphone$ Feature$Phone$ No$Cell$Phone$
Changes(In(Smartphone(Ownership,(201172012(U.S.)(
May>11$ Feb>12$
7/31/2019 El Estado de Internet
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7/31/2019 El Estado de Internet
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IntheUS,wevehitthatpoint.
0"
5"
10"
15"
20"
25"
30"
35"
40"
Q1"
2008"
Q2"
2008"
Q3"
2008"
Q4"
2008"
Q1"
2009"
Q2"
2009"
Q3"
2009"
Q4"
2009"
Q1"
2010"
Q2"
2010"
Q3"
2010"
Q4"
2010"
Q1"
2011"
Q2"
2011"
Q3"
2011"
Q4"
2011"
Q1"
2012"
Q2"
2012"
Users%
Added%
(millions)%
U.S.%Smartphone%Market:%Year9Over9Year%Net%Adds%
Source:(comScore,(Nielsen(
7/31/2019 El Estado de Internet
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Mostoftheunder-penetratedsegmentsinUS
areolderandpoorer
56%$
43%$
31%$
18%$
16%$ 16%$
53%$
58%$
44%$
32%$
17%$
15%$
69%$
65%$
50%$
30%$
23%$
16%$
70%$
65%$
52%$
41%$
27%$
21%$
65%$
74%$
63%$
51%$
42%$
24%$
77%$
80%$
75%$
60%$
48%$
38%$
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
90%#
Ages#18##24# Ages#25##34# Ages#35##44# Ages#45##54# Ages#55##64# Ages#65+#
Smartphone#Penetra=on#By#Age#And#Income#(U.S.)#
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SothefocusisonChina,whichnowaccountsforaquarterofsmartphonesales.
Rest%Of%The%World%
China%
!"!!!!
!20,000!!
!40,000!!
!60,000!!
!80,000!!
!100,000!!
!120,000!!
!140,000!!
!160,000!!
!180,000!!
1Q11! 2Q11! 3Q11! 4Q11! 1Q12! 2Q12!
(thousands)
Global%Smartphone%Shipments%
Source:(Gartner,(IDC,(Strategy(Analy5cs,(Canalys,(BII(es5mates(
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So,whatdopeople
doonmobile?
7/31/2019 El Estado de Internet
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Well,first,theydoprettymuch
everythingtheydoonline
7/31/2019 El Estado de Internet
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Theyplaygamesandsocial-network
25# 24#
15#24#
11#
12#10#
10#7#
7#
Q1#2011# Q1#2012#
Daily&Smartphone&App&Consump4on,&Minutes&Per&Category&
Games# Social#Networking# News# Entertainment# Other#
Source:(Flurry(Analy/cs(
7/31/2019 El Estado de Internet
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Gamessessionsup20-foldintwoyears
1.0X%
5.3X%
20.5X%
Q1%2010% Q1%2011% Q1%2012%
iOS$&$Android$Mobile$Game$Session$Growth$
Source:(Flurry(Analy/cs(
7/31/2019 El Estado de Internet
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Theylistentomusic...
5%#
Pandora#
70%#
1%#
Facebook#
33%#
Twi6er#
55%#
0%#
25%#
50%#
75%#
2008# 2009# 2010# 2011#
%ofTrafficfro
m#M
obile
Source:#Mary#Meeker,#Kleiner#Perkins,#companies#
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Theyconsumecontent
134%
94%
82%
80%77%
74%
74%
72%
70%
69%
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
Health
Informa:on
OnlineRetai l Men's
Magazine
Content
Electronic
Payment
Gaming
Informa:on
JobL is:ngs General
Reference
Classifieds Auc:onSites Family
Entertainment
Total&
Mobile&
Audience&
(thousands)&
Top&Mobile&Categories&By&Growth&In&Audience,&Dec.&2010&vs.&Dec.&2011&(U.S.)&
Dec10 Dec11
Source:(comScore(MobieLens,(3(mon.(avg.(ending(Dec82011(vs.(Dec82010(
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Mobilenowaccountsfor12%ofglobalinternettraffic
Source:StatCounter
Desktop(
1%(4%(
Mobile(12%(
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
90%#
100%#
2008
-12#
2009
-02#
2009
-04#
2009
-06#
2009
-08#
2009
-10#
2009
-12#
2010
-02#
2010
-04#
2010
-06#
2010
-08#
2010
-10#
2010
-12#
2011
-02#
2011
-04#
2011
-06#
2011
-08#
2011
-10#
2011
-12#
2012
-02#
2012
-04#
2012
-06#
2012
-08#
Global(Internet(Trafic:(Mobile(vs.(Desktop(
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7/31/2019 El Estado de Internet
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TheyevenwatchmoviesandTV.
62%$
48%$
67%$
93%$
0%$
10%$
20%$
30%$
40%$
50%$
60%$
70%$
80%$
90%$
100%$
Desktop$ Smartphone$ Tablet$ Connected$TV$
PercentOfAllHoursWatched
Video'Length'
Time'Watched'By'Video'Length'And'Device'
>$10$min$ 6$to$10$min$ 3$to$6$min$ 1$to$3$min$
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Especiallyatnight
0%#
1%#
2%#
3%#
4%#
5%#
6%#
7%#
8%#
9%#
10%#
0# 1# 2# 3# 4# 5# 6# 7# 8# 9# 10# 11# 12# 13# 14# 15# 16# 17# 18# 19# 20# 21# 22# 23#
ShareOfTotalTime
Watched
Time&Of&Day&
When&People&Watch&Mobile&Video,&By&Device&
Tablet#Weekday# Tablet#Weekend# Smartphone#Weekday# Smartphone#Weekend#
Source:(Ooyala(
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TheyShopMobileaccountsfor20%ofGiltsweekdaysalesand30%of
itsweekendsales
-TheiPadaccountsfor40%of
mobilesales
38%ofU.S.consumershaveusedsmartphonestobuy
productsorservices
-comScore,Dec2011
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Theyusesmartphonestomakebuyingdecisionsinstores.
19.7%&
18.8%&
20.4%&
14.6%&
13.1%&14.1%&
8.3%&
10.9%&
6.3%&
24.0%&
22.3%&
16.2%&
20.2%&
12.3%&
10.0%&
11.1%&
7.2%&
5.2%&
Took&Picture&Of&
Product&
Texted/Called&
Friends/Family&
About&Product&
Scanned&A&
Product&Barcode&
Sent&Picture&Of&
Products&To&
Family/Friends&
Found&Store&
LocaJon&
Compared&
Product&Prices&
Found&Coupons&
For&Deals&
Research&Product&
Features&
Checked&Product&
Availability&
U.S.$Smartphone$Owners$Ac3vity$In$Retail$Stores$
Males& Females&
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Mobileisstartingtodrivesignificanttraffictoecommercesites
PC#
Tablet#Smartphone#
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
90%#
100%#
Q1#2011# Q2#2011# Q3#2011# Q4#2011# Q1#2012#
Ecommerce#Website#Traffic#By#Device#
Source:(Monetate(
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TheypayforstuffPaypalsmobilepaymentsaregrowingrapidly
$0#
$1,000#
$2,000#
$3,000#
$4,000#
$5,000#
2008# 2009# 2010# 2011#
Total##
Payment#
Volume#
(millions)#
PayPal#Mobile#Payments#Processed#
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Squarelaunchedabouttwoyearsago,anditsalreadyprocessing$16+millionaday
Payment(Volume(
Revenues(
$0#
$2,000#
$4,000#
$6,000#
$8,000#
$10,000#
$12,000#
$14,000#
$16,000#
$18,000#
3/11# 4/11# 5/11# 6/11# 7/11# 8/11# 9/11# 10/11# 11/11# 12/11# 1/12# 2/12# 3/12# 4/12# 5/12# 6/12#
Thousands)
Square(Es9mated(Daily(Payment(Volume(and(Revenues(
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Theyevenbuycontent!(0ntablets)
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
Downloaded#
Music#
Books# Movies# Magazines# TV#Shows# Streaming#
Radio#
Sports# News#
Media&Content&Paid&For&On&A&Tablet,&Q4&2011&
US# Italy# UK## Germany#
Source:(Nielsen(
7/31/2019 El Estado de Internet
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Butthereallyinterestingstuffthatpeopledoonmobile
iswhatthey
DONTdoonline
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Angrybirdshasover1billiondownloads
0"
100,000"
200,000"
300,000"
400,000"
500,000"
600,000"
700,000"
Mar"10" Jun"10" Sept"10" Dec"10" Mar"11" Jun"11" Sept"11" Dec"11"
Total&
Downloads&
Or&Sales&
(thousands)&
Angry&Birds&Downloads&vs.&Nintendo&DS&Sales&
Note:&Includes&Nintendo&3DS&Sales&
Source:Newreports,companyreleases,BIIntelligenceestimates
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Instagramhit100millionusersin2years
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BOTTOMLINE:
Thegrowthofmobile=more
Internetusage,newapplications
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Source: comScore, Telefonica, Macquarie Capital (USA), December 2011
MobilemakesInternetusage24/7
ShareOfDevicePageTrafficOverADay:
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Usageisupacrosstheboard
Sent%Text%Message%
Used%Browser%
Used%Downloaded%Apps%
Played%games%
Accessed%Social%Network%
Or%Blog%
Listened%to%music%%
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
Feb#
10#
Apr#
10#
May#
10#
Jun#
10#
Jul#
10#
Aug#
10#
Sept#
10#
Oct#
10#
Nov#
10#
Dec#
10#
Jan#
11#
Feb#
11#
Mar#
11#
Apr#
11#
May#
11#
Jun#
11#
Jul#
11#
Aug#
11#
Sept#
11#
Oct#
11#
Nov#
11#
Dec#
11#
Jan#
12#
Feb#
12#
Mar#
12#
Apr#
12#
May#
12#
June#
12#
July#
12#
ShareofmobilepopulaConthathas...
U.S.%Mobile%Content%Usage%
Source:(comScore(
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Andpeopleareconsumingahugeamountofcontentthroughmobile
41%$
27%$ 26%$23%$
59%$
53%$
29%$ 29%$
22%$
9%$ 10%$ 9%$
5%$
57%$
53%$
25%$27%$
20%$
Books$ Movies$ TV$Shows$ Magazines$ News$ Social$
Networking$
Downloaded$
Music$
Sports$ Streaming$
Radio$
Media&Content&Accessed&Through&Mobile&Device&
Tablet$ Smartphone$
Source:(Nielsen(Q4(2011(Mobile(Connected(Device(Report(
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Somobileadvertising
willbehuge,right?
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Hmm
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Thebullishmobile-adstoryisthehuge
gapbetweentime-spentandadspending.
42%$
25%$
22%$
11%$
1%$
43%$
7%$
26%$
15%$
10%$
TV$ Print$ Web$ Radio$ Mobile$
2011$U.S.$Ad$Spending$vs.$Consumer$Time$Spent$By$Media$
Ad$Spend$Per$Media$ Time$Spent$Per$Media$Source:MaryMeeker(KPCB),eMarketer,IAB
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Butmaybetheresagoodreason
forthatgap
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Thescreenisreallysmall.
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Mobilemonetizationstillbehindthedesktop
$3.87& $5.00&
$17.61&
$6.62&
$25.00&
$58.95&
Pandora& Zynga& Tencent&
ARPU,&Desktop&vs.&Mobile&&
Mobile& Desktop&
Source:(Pandora,(Zynga,(Tencent(
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MobileCPMsaremuchlower
$3.50&
$0.75&
Desktop&Internet& Mobile&Internet&
Effec%ve'CPM,'Desktop'vs.'Mobile'
Source:(comScore,(Vivaki,(Mobclix(Exchange(
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IncludingforcompanieslikeGoogleandFacebook.
!15%
!10%
!5%
0%
5%
10%
15%
4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12
Google&CPC&Growth&
Source:(Company(data,(Evercore(Group(LLC(Research(
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Overall,mobileisstillatinyfractionofdigitaladspending.
Mobile'
$0#
$5#
$10#
$15#
$20#
$25#
$30#
$35#
2007# 2008# 2009# 2010# 2011#
(billions)
U.S.'Digital'Adver7sing'Revenues'
Source:((IAB,(BIA-Kelsey,(BII(es2mates(
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AnditsgrowingmuchslowerthanTV+Internetinthefirst5years
$358%
$1,012%
$2,162% $2,162%
$3,698%
$80%$160%
$392%
$806%
$1,171%
$55%
$267%
$907%
$1,920%
$4,621%
$0%
$500%
$1,000%
$1,500%
$2,000%
$2,500%
$3,000%
$3,500%
$4,000%
$4,500%
$5,000%
Year%1% Year%2% Year%3% Year%4% Year%5%
Compara've*U.S.*Adver'sing*Media*
Annual*$*Revenue*Growth*(First*5*Years)*
Broadcast%TV% Mobile% Internet%
Source:((IAB,(McCann1Erickson,(BIA1Kelsey,(BII(es9mates( Note:(Adjusted(for(infla9on(
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Butokay,yes,mobileadsarejustgettingstarted(about~$1.25Blastyear)
Media&
Local&
$0#
$1,000#
$2,000#
$3,000#
$4,000#
$5,000#
$6,000#
$7,000#
2009A# 2010A# 2011A# 2012E# 2013E# 2014E# 2015E# 2016E# 2017E#
Mobile&Ad&
Revenue&
(millions)&
U.S.&Mobile&Ad&Forecast&
Wearehere
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Bytheway,Googleownsmobile,too
Google&
Millennial&Media&
Pandora&
Apple&Yahoo&
Microso4&Other&
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
90%#
100%#
1Q09# 2Q09# 3Q09# 4Q09# 1Q10# 2Q10# 3Q10# 4Q10# 1Q11# 2Q11# 3Q11# 4Q11#
Mobile&Ad&Market&Share&
Source:(news(reports,(company(releases,(BII(es5mates(
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Becausemobileadsaremainlyjustwebsearch+displayadsviewedonmobile
Search'
62%'
Display'
28%'
Messaging'
10%'
2011$Global$Mobile$Ad$Spend$By$Category$
Source:((IAB(
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Butnativemobileadsarefinallybeginningtoappear
Adsintimelines(Twitter/Facebook) Geo-locatedads Shareableads
7/31/2019 El Estado de Internet
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APPS
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Appdownloadsaregrowingfrantically
0"
5,000,000,000"
10,000,000,000"
15,000,000,000"
20,000,000,000"
25,000,000,000"
30,000,000,000"
7/1/08
"
9/1/
08"
11/1/08"
1/1/09
"
3/1/
09"
5/1/09
"
7/1/09
"
9/1/
09"
11/1/09"
1/1/10
"
3/1/
10"
5/1/10
"
7/1/10
"
9/1/
10"
11/1/1
0"
1/1/11
"
3/1/
11"
5/1/11
"
7/1/11
"
9/1/
11"
11/1/1
1"
1/1/12
"
3/1/
12"
5/1/12
"
Apple%App%Store%Downloads%
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Onpacetohit45billionbytheendoftheyear
0"
5,000,000,000"
10,000,000,000"
15,000,000,000"
20,000,000,000"
25,000,000,000"
30,000,000,000"
35,000,000,000"
40,000,000,000"
45,000,000,000"
50,000,000,000"
55,000,000,000"
1/1/11
"
2/1/11
"
3/1/11
"
4/1/11
"
5/1/11
"
6/1/11
"
7/1/11
"
8/1/11
"
9/1/11
"
10/1/11"
11/1/11"
12/1/11"
1/1/12
"
2/1/12
"
3/1/12
"
4/1/12
"
5/1/12
"
6/1/12
"
7/1/12
"
8/1/12
"
9/1/12
"
10/1/12"
11/1/12"
12/1/12"
1/1/13
"
Apple%App%Store%Downloads%
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Peoplenowspendmoretimeonappsthantheydobrowsingtheweb
64#
70#74# 72#
43#
66#
81#
94#
June#2010# Dec#2010# June#2011# Dec#2011#
U.S.$Mobile$Apps$vs.$Web$Consump4on,$Minutes$Per$Day$
Web#browsing# Mobile#apps#
Source:(Flurry(Analy/cs,(Alexa,(comScore(
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Andthedisparityisgrowing.
Mobile'Web''
Apps'
0"
20"
40"
60"
80"
100"
120"
140"
Mar+11" Apr+11" May+11" Jun+11" Jul+11" Aug+11" Sep+11" Oct+11" Nov+11" Dec+11" Jan+12" Feb+12" Mar+12"
Minutes'Spent'
Per'Month'
(Biillions')'
Total'Time'Spent'Using'Mobile'Web'vs.'Apps'
Source:(Nielsen(Smartphone(Analy5cs(
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Mobileapprevenueisgrowingfast,butstillrelativelysmall.
$0#
$500#
$1,000#
$1,500#
$2,000#
$2,500#
$3,000#
$3,500#
$4,000#
2008# 2009# 2010# 2011#
(millions)
Mobile)App)Revenue)
Source:(iSuppli,(Forrester(Research,(company(releases,(BII(es8mates(
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F i i th d i t
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Freemiumisthedominantbusinessmodel
7/31/2019 El Estado de Internet
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Gamesarethebiggestmoneymakers
7/31/2019 El Estado de Internet
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Mobilehasbecomeaplatformgame.
7/31/2019 El Estado de Internet
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Platformmarketstendto
standardizearoundoneortwoplatforms.
i h bil i h
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Rightnow,mobileisatwo-horserace.
Android'
Apple'iOS'
Blackberry'
Windows'
Other'
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
90%#
100%#
Q1#2009# Q2#2009# Q3#2009# Q4#2009# Q1#2010# Q2#2010# Q3#2010# Q4#2010# Q1#2011# Q2#2011# Q3#2011# Q4#2011# Q1#2012# Q2#2012#
Mobile'Pla:orm'Market'Share'
Source:(Gartner,(IDC,(Strategy(Analy5cs,(BI(Intelligence(es5mates,(and(company(filings#
d id h h l l f l b ll
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Androidhasthelargestplatformglobally.
Android'
Apple'
Symbian'
Blackberry'
Other'
Microso8'
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
90%#
100%#
Q3#2009# Q4#2009# Q1#2010# Q2#2010# Q3#2010# Q4#2010# Q1#2011# Q2#2011# Q3#2011# Q4#2011# Q1#2012# Q2#2012#
Share'of'
Global'Unit'
Sales'
Smartphone'Market'Share'By'OS'(Global)'
Source:(Gartner(
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ButAppleisdominatingapprevenue.
Apple%iOS%
Android%%
Other%
$0#
$500#
$1,000#
$1,500#
$2,000#
$2,500#
$3,000#
$3,500#
$4,000#
2008# 2009# 2010# 2011#
(millions)
Mobile%App%Revenue%By%Pla
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Tabletmarketisearly,butalmosttotallydominatedbyApple
iPad%
Android%
Kindle%
Nook%Blackberry%
0%#
10%#
20%#
30%#
40%#
50%#
60%#
70%#
80%#
90%#
100%#
Q2#2010# Q3#2010# Q4#2010# Q1#2011# Q2#2011# Q3#2011# Q4#2011# Q1#2012# Q2#2012#
Tablet%Market%Share%By%OS%
Source:(Es+mates(based(on(informa+on(from(IDC,(Strategy(Analy+cs,(and(company(filings#
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Mobileprofitsaregoingmainlytotwoplayers.
Apple%
Nokia%
Samsung%
RIM%
Motorola%
Sony%Ericsson%
LG%HTC%
!20%
!10%
0%
10%
20%
30%
40%
50%
60%
70%
80%
2007 2008 2009 2010 2011 Q12012 Q22012
Opera?ng%Profit%Share%By%Vendor%
Source:(Company(releases,(Canaccord(Genuity(es6mates(
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BONUS:
So,areweinanewtechbubble?
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No.
7/31/2019 El Estado de Internet
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Bubblesfeaturesky-highprices
relativetofundamentals.
HOUSING BUBBLE P i ti
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HOUSINGBUBBLE:Priceratiosspikedoffthecharts
Price-To-Rent: 1983-2012
STOCK BUBBLES: Price ratios
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STOCKBUBBLES:Priceratiosspikedoffthecharts
S&P PE: 1885-2012
THIS Is A Bubble
7/31/2019 El Estado de Internet
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THISIsABubble
NASDAQ,1991-2004
7/31/2019 El Estado de Internet
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Do you see that pattern yoday?
7/31/2019 El Estado de Internet
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Doyouseethatpatternyoday?
NASDAQ:1971-2012
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Aretech-companypriceratiosoffthecharts?
No Apples PE ratio has been declining for years
7/31/2019 El Estado de Internet
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No.Apple sPEratiohasbeendecliningforyears
Recent hot IPOs are downright reasonable
7/31/2019 El Estado de Internet
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RecenthotIPOsaredownrightreasonable.
2XRevenue
1.4X2012ERevenue
4XRevenue
14XRevenue
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WhataboutFacebook?
7/31/2019 El Estado de Internet
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Facebookwentpublicatanextremelyhighprice
75XEPS
7/31/2019 El Estado de Internet
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Why?
7/31/2019 El Estado de Internet
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BecauseeveryonethoughtIPOmeantfreemoney.
7/31/2019 El Estado de Internet
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Oops.
Investors learned a painful lesson
7/31/2019 El Estado de Internet
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Investorslearnedapainfullesson.
7/31/2019 El Estado de Internet
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ButFacebookstillhasanexcellentvaluation
45XEPS.
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Sodontletanyonetellyouitscheap.
7/31/2019 El Estado de Internet
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WhatshappeningtoFacebook
stock,bytheway,islikelya
commontransition
7/31/2019 El Estado de Internet
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High-growthstocksusuallygo
throughamomentumphase,
inwhichtheyreblowingawayestimates.
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Thengrowthslows,and
expectationscomeinlinewith
reality.
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Microsoft has been in this transition since 2000
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Microsofthasbeeninthistransitionsince2000.
Google since 2008
7/31/2019 El Estado de Internet
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Googlesince2008
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Multiplecompressioncanbe
followedbysteadygrowth
ordeath.
Amazon stock is back on themarch
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Amazonstockisbackonthemarch.
7/31/2019 El Estado de Internet
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Facebooksfutureisuncertain,
butitsagreatcompany,and
stockcouldreturntogrowth.
But for now multiple compression
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But,fornow multiplecompression.
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Oneareainwhichinvestorshavebeentooexuberant:
Theprivatemarket.
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Thankyouverymuch.
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Henry BlodgetFounder, CEO & Editor-in-Chief,
Business Insider
Alex Cocotas, Analyst
BI Intelligence is a new subscription research service from Business Insiderthat provides in-depth insight, data, and analysis of the mobile industry.
More info at intelligence.businessinsider.com