Tomiahonen Almanac 2015 Freeware Edition

Published opinions of previous editions of the Tomi
Ahonen Almanac & Phone Book statistical volumes:
Tomis Almanac is the definitive collection of stats on the Mobile

industry. In my work convincing brands in the Healthcare Industry
to go Mobile First it's an invaluable tool. Simply brilliant."
- David Doherty, Co-Founder, 3G Doctor
"Whenever I need a stat, Tomi seems to have it, so I'd highly

recommend this for any aspiring mobile fact junkie."
- Russell Buckley, MD Admob Europe, Chairman Mobile
Marketing Association
"Speaking of statistics, Tomi Ahonen has put together the Tomi

Ahonen Almanac as an eBook for mobile nuts. In it, you can
quickly find out the mobile penetration of say, Thailand, or that
51% of the Earth's population has at least one cellphone, and one
in 8 mobile subscribers usually walks around with 2 phones in
their pockets! (even I don't do that normally).
- Ricky "The Guru" Cadden at Symbian Guru
""Tomi Ahonen is the king of mobile statistics and knows more

about the mobile space than any one I know"
- Paul Poutanen, Founder and President of Mob4hire
"If you're interested in mobile statistics, you really need to pick up

a copy of Tomi Ahonen's Almanac. The Almanac is full of hard to
find information."
- WAP Review
Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

Tomi Ahonen Almanac
2015
Mobile Telecoms Industry Review
an eBook
By
Tomi T Ahonen
Copyright 2015 TomiAhonen Consulting

www.tomiahonen.com

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Copyright 2015, 2017 TomiAhonen Consulting

issue date 17.02.2017
First Electronic Edition (paid edition)
2015
Second Electronic Edition as Free Shareware
2017
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Certain statements in this document are forward-looking. Although

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Prebook vii
Contents
Chapter 1 - Intro to this Almanac . . . . . . . . . Page 1
Chapter 2 - Size of Industry . . . . . . . . . . . . . . . . . . . 6
Chapter 3 - Customers . . . . . . . . . . . . . . . . . . . . . . . 24
Chapter 4 - Handsets . . . . . . . . . . . . . . . . . . . . . . . . 41
Chapter 5 - Mobile Messaging . . . . . . . . . . . . . . . 62
Chapter 6 - Mobile Internet . . . . . . . . . . . . . . . . . . . 80
Chapter 7 - Seventh Mass Media Channel . . . . . . 96
Chapter 8 - Music on Mobile . . . . . . . . . . . . . . . . . 109
Chapter 9 - Mobile TV and Video . . . . . . . . . . . . . 114
Chapter 10 - Mobile Gaming . . . . . . . . . . . . . . . . . 124
Chapter 11 - Mobile Social Networking . . . . . . . . 131
Chapter 12 - Other Mobile Content . . . . . . . . . . . 138
Chapter 13 - Smartphone Apps . . . . . . . . . . . . . . 147

Prebook viii
Chapter 14 - Mobile Advertising and Marketing . 153
Chapter 15 - Voice Calls . . . . . . . . . . . . . . . . . . . 164
Chapter 16 - Business/Enterprise Services . . . . 170
Chapter 17 - Other Mobile Data . . . . . . . . . . . . . . . 173
Chapter 18 - Network Infrastructure . . . . . . . . . . 176
Chapter 19 - Digital Divide . . . . . . . . . . . . . . . . . . 177
Chapter 20 - History and Milestones . . . . . . . . . . 190
Tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199
Index of Mobile Leadership for 30 advanced countries
60 Major Countries
25 Countries by Most Mobile Subscribers
25 Countries with Highest Mobile Penetration Rate
25 Countries with Highest 3G Penetration Rate
20 Biggest Mobile Operator Groups
About the Author . . . . . . . . . . . . . . . . . . . . . . . . . . 211

Other books by Tomi T Ahonen

Chapter 1 - Introduction 1
Preface to Tomi Ahonen Almanac 2015

Free Edition
My gift to my readers and fans
The TomiAhonen Almanac has become an annual

tradition. I am very satisified with the growing repeat
customer base and the reputation the TomiAhonen
Almanc is receiving in the industry.
The normal TomiAhonen Almanac comes out around

the end of February of any year and has all data
updated to the start of the year, ie the latest edition,
TomiAhonen Almanac 2016 edition is current in its
data to January 1, 2016. (This free 2015 Edition has all
data current as of January 1, 2015, two years ago.)
The price of the Almanac is only 9.99 Euros, and for a

statistical review of the rapidly evolving and dynamic
Trillion-dollar mobile telecoms industry, it is the best
value among paid statistical resources to the industry.
I have found, from time to time, that some people ask for
information which they need that is in the Almanac but
the person requesting it honestly has no budget, is for

example a student or retired person or charity, etc. I

have been looking for a way to be able to deliver some
of the insights of the Almanac without killing the
business of the 'real' paid version. A few years ago I
came upon this idea, to release the two year old version
for free, and I think it perfectly suits this need. I am not
doing this every year, but occasionally, I release a
previous full edition of the full Almanac. This is one of
those rare years.
This free edition has all the data and all analysis, total
same content as the TomiAhonen Almanac 2015 had,
when it was sold as a new edition in early 2015. It
includes all 105 tables, charts and graphs as in the
original edition. It includes the full text of the original 212
page edition, but adds several bonus pages mostly in
forms of short advertisements about other eBooks
recently published by Tomi T Ahonen.
If you like this Almanac, pleased do share it with your

friends and/or encourage them to go to Lulu.com to
download a fresh copy for themselves.
If you need more updated data, please visit

www.tomiahonen.com to see the latest edition of the
TomiAhonen Almanac and its sister publication. the
TomiAhonen Phone Book.

I
Intro to the Tomi Ahonen Almanac
Leading the world economy after downturn
Welcome to the 2015 edition of the TomiAhonen

Almanac, to discuss the size and status of the mobile
telecoms industry. The Almanac and its first 'spin off' ie
the companion volume TomiAhonen Phone Book 2014
have achieved far greater success and popularity than I
could have imagined. The data is increasigly referenced
in various other sources and for an annual data volume,
these two eBooks have several data items that are very
difficult to find from most other sources costing even 100
times more than these two ebooks.
I had been giving annual reviews of the state of the

mobile telecoms industry for more than a decade at the
Communities Dominate blog. Then for 2009 I finally
figured out a practical way to offer more of the data, as
well as graphical illustrations of the data, in this new
form of eBooks. I was extremely pleased with the
response to the 2009 Almanac and can report, that
even where many of my readers and fans think that I

have memorized every conceivable industry statistic - I

myself access my latest copy of my Almanac (and now
also the Phone Book) several times every single week,
most weeks I check the Almanac daily. I hope you will
find this 2015 edition of good value as well, and find
plenty of opportunity to use the data in it.
I want to comment on the big number. The data in the

Almanac is always a short-term forecast based mostly
on data points that emerged in the previous year. Then
in the new year, as the Spring and Summer months
come along, most of the data points of my Almanac also
get confirmed. In a few cases (mobile handset and
smartphone sales) the actual annual number is already
known by February when the numbers for the current
Almanac are finalized. But one very significant number
is aluding us.
2014 was the year when the planet hit and passed the
100% mobile phone subscription penetration per capita.
There is one active mobile subscription for every human
alive, if the actual active subscriptions were spread
evenly. Obviously in reality not everyone will have a
mobile phone. Very young children dont need them and
babies could not even know how to use them. So the
number is distorted by the fact that many of us,
employed adults, carry two phones. Then there is a
large section of the population who cannot afford two
actual phones but want two or more subscriptions so

they can optimize their traffic on the networks, by

switching the SIM card modules but using one phone.
They have multiple subscriptions. Europe as a continent
has passed 150% penetration rate per capita. In the
most highly dense markets by subscription penetration
rate, like Hong Kong and the UAE, the penetration rate
has passed 200% per capita.
When I examine the growth rates of the largest countries

by mobile phone subscribers - China, India, USA,
Indonesia, Brazil, Pakistan, Russia etc - I have noticed
that only the USA is showing signs of slowing down in its
national mobile subscription rate but the other big
countries keep reporting growth rates at levels of the
recent past. In my forecast model I had already factored
in that the Industrialized World countries would be
slowing down so the USA number was baked in into my
model.
I also report on all numbers released into the public

domain either on my blog if they are the main industry
benchmark numbers or else commenting on the
released statistics in my Twitter feed. Most public
sources have generally released numbers quite
consistent with those of my Almanac over the past years
but in rare occasions that they differ meaningfully, I will
also draw attention of my readers to any quarreling
statistics. For those who want to keep track of my
writing, my blog is www.communities-

dominate.blogs.com and my Twitter feed is at

@tomiahonen.
Compared to the 2014 edition of the Almanac, I have
updated all charts and tables. For returning readers, I
have tried to keep all graphs in the same formats for
colors etc (and where blue reflects users, red reflects
revenue, violet refects the traffic, etc). The sequence for
most charts and most chapters is the same. In a few
cases as better data has come in for some information, I
have updated or revised numbers for previous years, but
mostly the data tends to be very consistent.
All data in this Almanac, that is not explicitly attributed to

another source, is source: Tomi Ahonen Almanac
2015. The facts are all short-term forecasts, mostly
based on 2014-2015 data points projected to January
2015, based on industry analysis and various published
reports by TomiAhonen Consulting, as well as the
commentary at the personal blogs of Tomi T Ahonen.
Please use "Tomi Ahonen Almanac 2015" as the
source if you quote facts from this Almanac.
My digital home is of course www.tomiahonen.com

where you'll find links to all of my digital presence, from
recent videos to press, conferences and my social
media footprint. In 2012 Forbes measured my impact
and rated me the most influential expert in the mobile
industry. The blog has passed 6 million visits, I have
over 15,000 Twitter followers, I have Klout score of over

60 and Kred measures me in the 1% most influential in

all social media of any topics, not just mobile. But as is
true in social media, you have to be honest, engage,
and have a loyal following. I could not have gotten here
without wonderful readers, active followers, and eager
audiences around the world.
I hope you will enjoy this Almanac and I do welcome

comments to tomi@tomiahonen.com. My blogsite is
www.communities-dominate.blogs.com and if you
are on Twitter, you can find me as @tomiahonen.

Chapter 2 - Size of Industry 8
II
Size of Industry
Understanding the landscape
This chapter examines the size and scope of the mobile

telecoms industry at the start of 2015. It will look at the
overall aggregate numbers for subscribers handsets and
revenues, as cumulative numbers and on an annual
level, and make comparisons with other industries and
media. This chapter also gives a brief overview to the
size of the telecoms services and mobile media market.
SUBSCRIBERS AND REACH
Total Mobile Subscribers Globally in Billions
8.0
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0.0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Source: TomiAhonen Almanac 2015

Mobile telecoms as an industry has now 7.2 billion

mobile phone subscriptions for a planetary population of
7.2 billion humans alive. The 7.2 billion subscriptions are
paying customers and are the fundamental statistic of
the industry from which most other data is derived. The
global mobile subscription rate grew by 250 million in
just one year (3.5% growth rate).
To compare, there are 3.0 billion internet users with 1.7

billion personal computers (all desktops, laptops and
tablets combined). 2012 was the first year that PC sales
peaked and started to decline. There are 2.1 billion total
TV sets but only about 1.1 billion of those have a paid
subscription to cable or satellite TV. 2011 was the first
year that television sales peaked at about 250 million
and started to decline. There are 2.7 billion people with
at least one credit card in their wallet. Of fixed landline
phones, there are 1.0 billion of those and their number
has peaked and is now in gradual decline.
INDUSTRY REVENUES
The aggregate mobile telecoms industry, hardware and

services combined, passed 1 Trillion dollars (1,000
billion dollars) in annual revenues in 2008. The industry
keeps growing revenues and for 2014 reached 1.6
Trillion dollars in total value of goods and services sold
within one year.

Mobile Industry Revenues 2014
Operator Voice
Operator Data
Content Partners
Handset Vendors
Accessories
Network Infrastructure
The total industry grew 5% from the year before. The

majority of that revenue is telecoms traffic related.
Since 2011 the service industry side of mobile alone is
worth more than one Trillion dollars. The rest of our
industry comes from the sales of hardware: handset
sales (smartphones and dumbphones) and their
accessories; as well as the network infrastructure sales.
The hardware part of the industry has seen strong

growth in 2014 due to the ever faster consumer
migration from low-cost basic mobile phones costing
less than 25 dollars to smartphones that on average
cost about 273 dollars. The average cost of all phones

when dumbphones and smartphone prices are weighted

by their unit sales volume, is 188 dollars in 2014
Mobile Industry Revenues 2014 & 2013

2014 2013 Growth
Mobile Services $1,195 B $1,153 B 4%
Voice $ 671 B $ 673 B 0%
Data $ 525 B $ 480 B 9%
Messaging $ 195 B $ 199 B - 1%
SMS $ 139 B $ 141 B - 1%
MMS $ 39 B $ 43 B - 10%
VAS Data $ 330 B $ 282 B 15%
Mobile Advertising $ 44 B $ 31 B 42%
Smartphone apps $ 31 B $ 26 B 24%
Business apps $ 10 B $ 9B 11%
Consumer apps $ 21 B $ 16 B 31%
Handset Sales $ 322 B $ 281 B 15%
Networks and Accessories $ 130 B $ 125 B 5%
TOTAL $1,647 B $1,558 B 6%
(Note: The subdivisions under Messaging and VAS Data do not add up as
other messaging and VAS data services types are not included in the above
summary. See later chapters for full details.)
The majority of the service revenues comes from voice

calls and SMS text messaging which combined account
for 71 cents out of every dollar earned in the mobile
services industry. The revenue and profit engine for the
mobile industry, voice calls and SMS text messages,
had come under pressure from various OTT (Over The
Top) services like Skype and Whatsapp. Consequently

the revenue for both has stopped growing and is now in

gradual decline.
Mobile Service Annual Revenues 2000 - 2014 (Billions of USD)
1400
1200
1000
800
600
400
200
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Mobile phone based messaging, mostly SMS text

messaging, is worth 195 billion dollars in annual
revenues. The hypergrowth period for SMS is over and
heavy users are now rapidly migrating most messaging
traffic to OTT. We will look at OTT more closely in the
messaging chapter in this Almanac.
After SMS, the second biggest mobile messaging type

by revenues is MMS which has now stopped growing
reveues similar to SMS and has seen its first revenue
decline to 39 billion dollars. It is important to note, MMS
growth is not on the person-to-person picture messaging

side; MMS is a powerful media channel for news,

entertainment and advertising.
Non-messaging value-add data services, including

media content on mobile (music, gaming, news, apps,
etc) grew strongly in 2014 at 18% and reached a value
of 330 billion dollars. In terms of data services
industries, non-messaging mobile data alone is already
larger than all content-related income on the internet
including advertising. Or to put it another way, non-
messaging based 'premium mobile data' alone is now
starting to approach the value of the global television
revenues which are somewhat under 400 billion dollars
in total value globally.
COMPARISONS
Currently the world has about 425 million daily

newspapers by circulation. There are in round terms
about 1 Billion cars on the roads worldwide.
Approximately 1.7 billion people use email and about 3
billion is the total user base of the internet including PC
and mobile users as well as those who access via a
shared PC such as at an internet cafe. About 2.8 billion
unique people have a banking account. The world has
2.1 Billion television sets in use, and has passed 4.2
Billion radio receivers.

Those numbers compare with 7.2 billion mobile phone

subscriptions. Of the paid mobile phone subscriptions,
5.5 billion represents actual connected mobile phones
(either smartphone or dumbphone) registered, paid for,
connected and in use.
Comparison of Sizes Globally End of 2014
Cars registered in use 1.0 billion

Fixed landline telephones 1.1 billion
Cable/satellite TV subscriptions 1.1 billion
Facebook active users 1.4 billion
PCs in use including laptops and tablet PCs 1.6 billion
Television sets 2.1 billion
Smartphones in use 2.2 billion
Credit cards - unique owners of 2.3 billion
Banking accounts - unique owners of 2.7 billion
Internet active users (using any access) 3.0 billion
MMS active users 3.3 billion
FM radio receivers 4.3 billion
Mobile phones - unique subscribers 4.8 billion
Mobile phone handsets in use 5.5 billion
SMS messaging active users 5.8 billion
Mobile phone subscriptions use 7.2 billion
The world has 4.8 billion unique mobile phone

subscribers (when multiple subscriptions and second
phones are removed). With the total population of the
planet at 7.2 billion people, there is literally an active,
paid and used mobile phone subscription for more than
63% of the population on the planet, counting every

human alive of any age. 5.8 billion people use SMS and
already 3.2 billion mobile phone subscribers are active
users of MMS picture messaging globally, which is more
than total active users of the internet on any device.
And finally, 2.7 billion mobile phone owners are active

users of the 'mobile internet', browsing to HTML web
and/or WAP pages on phones, which is obviously more
than all PC based users of the internet. Essentially half
(46%) of those who access the internet, do so using
both a mobile phone and a PC (which in this definition
and in this Almanac always includes tablet PCs like the
iPad).
Annual Sales of Major Devices by Type
1400
1200
1000
800
600
400
200
0
Desktop PCs Laptop PCs Televisions Tablets Dumbphones Smartphones
The first laptop was released by Toshiba in Japan in

1985. It took 25 years for half of all PCs in use to be
portable types including laptops, netbooks and tablet
PCs. Today about 350 million PCs are sold annually.

Mobile telecoms started six years earlier in 1979 but

mobile phones sell over 1.9 billion new phones annually.
When we split out the types of devices by the main form

factors, the annual sales of smartphones now form the
largest single category. Featurephones come second,
far ahead of televisions as third. The computer types
split so, that tablets now are the largest-selling
traditional computer type, selling more annually than
laptops. Desktop PCs are the smallest type of computer
sold to consumers, by the volume of annual sales
COMPUTERS - LATEST DEFINITION
TomiAhonen Consulting was the first tech industry

analyst to report on annual computer sales with the
broadened defintion that smartphones are also counted
as computers. This is increasingly now accepted as the
definition of what is a computer and follows the
generational evolution from stand-alone purpose-built
computers, to modular but still room-sized mainframe
computers, to the desktop and then laptop computer.
Each generational shift broadened the total market for
computers and each also introduced vast new markets
for software. Each new generation also reduced the
complexity of using computers so that today even
untrained and even illiterate people can use a modern
smartphone with its touch screen interface.

The chart is increasingly dominated by handset makers.

Of classic PC makers HP has returned to also sell
smartphones. Lenovo has increased its investment in
smartphones by buying the Motorola unit from Google.
LARGEST COMPUTER MANUFACTURERS

(When Smartphones Included In Computer Count)
Rank Manufacturer Units 2014 Share
1 Samsung 354 M 20%
2 Apple 256 M 15%
3 Lenovo 131 M 8%
4 Huawei 75 M 4%
5 Xiaomi 61 M 4%
6 LG 59 M 3%
7 Hewlett-Packard 56 M 3%
8 ZTE 46 M 3%
9 Coolpad 45 M 2%
tie 10 TCL/Alcatel 41 M 2%
tie 10 Dell 41 M 2%
Others 575 M 33%

TOTAL 1,740 M
MOBILE SUBSCRI{TIONS
In 2014, the world reached 7.2 billion mobile phone

subscriptions. As a statistical measurement, as

'penetration rate per capita' as other major technologies

are counted and measured, the percentage of human
population mobile phone subscription for 100% of the
total planet and now reaches more people than have
access to electricity or running water. Mobile is by far
the most widely-spread technology on the planet. In
more than 100 countries the subscription penetration for
mobile has exceeded 100% per capita, and the first
countries are starting to report penetration rates past
200% such as UAE, Hong Kong, Qatar and Macau.
Hong Kong Q1 mobile penetration rate in 2014 was
238% according to the regulator.
Penetration Rates of Mobile per Capita, Regionally
180%
160%
140%
120%
100%
80%
60%
40%
20%
0%
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The worldwide airline industry transports about one

billion passengers per year. The TV industry has about

one billion paying subscribers to pay-TV such as cable

or satellite. 1 Billion people own and operate a car,
paying for its insurance, petrol and other operational
costs. About 1.1 billion people pay for a fixed landline
phone subscription. 1.7 billion personal computer
owners subscribe to an internet connection, most of
those are now on broadband connections.
There are 1.8 billion households so someone pays the

mortgage or rent, plus various electricity, water, etc
utility bills. Against those numbers, 7.1 billion mobile
phone accounts are active on the planet. And here we
need to look at the total number, not unique users, as
some people have two homes, or two cars, or two paid
internet connections etc. When we focus on the money,
the picture gets into very sharp focus. Mobile truly is the
giant among lilliputs.
SMS text messaging is the single most widely used data

application on the planet. There are 5.8 billion active
users of SMS text messaging, which is 82% of all mobile
phone subscriptions. Compare that with about 1.9 Billion
active users of any kind of 'IM' Instant Messaging
including those popular 'OTT' services such as
Whatsapp, iMessage and Blackberry Messenger. 1.3
billion people are registered users of Facebook. There
are about 1.7 billion active users of email worldwide.
Mobile messaging, SMS (and MMS) utterly tower over
these other messaging technologies with 5.8 billion

active users in 2014. Mobile messaging has its own

chapter in this book.
MOBILE INTERNET
TomiAhonen Consulting has been tracking the shift from

the old legacy fixed internet to the mobile internet since
its very beginning, and for 2013 finds that 42% of the
world's internet access is exclusively from mobile, only
10% is exclusively from a PC, and 48% of internet users
access the internet using both mobile and a PC.

This Venn diagram illustrates the partially overlapping

ways to measure 'mobile and fixed' internet, and you
can see why there is such discrepancy in how some
report on these numbers. Please note that tablets are
counted as personal computers in this Almanac unless
separately indicated.
The total number of users who accessed the internet via

a mobile phone at least part of the time, passed the total
of users who accessed via a PC at least part of the time,
for the first time in 2008, and the gap has been growing.
Today of the 3.0 billion internet users, 2.7 billion people
accessed the "mobile internet" (including WAP) via a
phone, and 1.7 billion accessed via a PC of any kind
including tablets. 1.3 billion internet users do not use a
PC to access the internet at all. Not at home, school,
work or internet cafe. That number keeps growing and is
already 44% of all internet users globally. This
phenomenon is particularly strongly observed in the
Emerging World markets among the young digital
connected population segments.
Year 2013 became the cross-over point when more

mobile data revenues were earned on the mobile
internet than the traditional fixed internet. Mobile data
revenues excluding messaging revenues are today
worth 330 billion dollars. This compares to the total
traditional internet revenues that were 210 billion
dollars in 2013 (PriceWaterhouseCoopers 2013). The

mobile internet phenomenon is discussed in its own

chapter of this Almanac later.
MEDIA
The first service of downloadable paid content for mobile

phones was a simple form of music: the ringing tone
which launched in 1998. While the internet paid content
industry is nearly twice as old, the mobile content
industry shot past the internet content industry by
revenues in 2004 and today towers over internet
content, generating 330 billion dollars of content
revenues in 2014. Note first, this is NOT the highly
hyped-up story of 'smartphone apps' which only account
for 10% of total 'non messaging' mobile data revenues!
Yes, if you are in 'apps' you are the hungry child of
mobile. Others, on other mobile data concepts and
technologies have discovered where 90% of the money
(and essentially all the profit) lies in premium mobile
data. It is not in apps, inspite of Rovio's magnificent
success with Angry Birds. Several mobile media
categories have passed the 30 billion dollar level in
annual income and are discussed in the mobile data
services chapter later.
Advertising is also on mobile. While most revenue on

the PC based internet is advertising, on mobile,
advertising is a minor part, delivering only 13% of the
total revenues of the mobile (non-messaging) content

industry. Similarly for the global advertising industry

where mobile advertising accounted only about 10% of
industry income. This reflects partly the healthy
ecosystem of mobile, where users are willing and able to
pay for content; but also reflects the relative immaturity
of advertising on mobile. Whats more, many who
measure the mobile advertising market, bizarrely ignore
mobile messaging and only measure the banner ads
and other smartphone-oriented ads like video pre-roll
adds, which tend to be poorly performing copycat
solutions of poorly performing ad formats of legacy
media like television and the older fixed PC based
internet. This Almanac of course measures the full
mobile ad reach of mobile, including of course SMS and
MMS based mobile advertisements.
BIGGEST GLOBAL CORPORATIONS OF INDUSTRY
Five years ago, I did the first global survey of the biggest
companies in the mobile industry, when factoring only
the revenues they earned out of their mobile business.
So for Samsung, I removed the revenues for their
plasma screen TVs, their microchip business etc. For
Apple I counted only iPhone and App Store related
revenues, excluding the PC business, iPods, iPads etc.
Similarly for Vodafone, I removed the income they earn
from their fixed telecoms assets, etc.

Top 25 Biggest Companies in Mobile in 2014

(when measured by their mobile revenues only)
1 Apple iPhone, USA $ 123 B smartphones
2 Samsung Galaxy, SK $ 114 B handsets
3 China Mobile, China $ 103 B operator
4 Verizon Wireless, USA $ 88 B operator
5 AT&T Wireless, USA $ 71 B operator
6 Vodafone Mobile, UK $ 58 B operator
7 Telefonica Movil, Spain $ 54 B operator
8 T-Mobile, Germany $ 52 B operator
9 NTT DoCoMo, Japan $ 49 B operator
T10 Orange Mobile, France $ 43 B operator
T10 America Movil, Mexico $ 43 B operator
12 Huawei Mobile, China $ 38 B smartphones
13 Sprint-Nextel, USA $ 36 B operator
14 Telecom Italia Mobile $ 35 B operator
15 KDDI Keitai, Japan $ 31 B operator
16 China Unicom $ 29 B operator
17 Ericsson Mobil Sweden $ 24 B networks
18 Softbank Keitai, Japan $ 22 B operator
19 Bharti Airtel, India $ 19 B operator
20 Nokia Telecom Finland $ 17 B networks
21 SK Telecom, S Korea $ 17 B operator
22 MTN, South Africa $ 15 B operator
23 Google Mobile, USA $ 14 B search
24 AlcatelLucent Mobile Fr $ 13 B networks
25 Lenovo-Moto, China $ 13 B smartphones

Note on the above table - the names in bold are real companies as they exist
today, all others are 'virtual' companies, with revenues calculated or estimated
on their mobile business units only. Google in the above includes their
acquisition of Motorola. Note several European operators reported major
declines due to EU regulations affecting their interconnect revenues in this
period, dropping the whole European operator/carrier community down in the
rankings. To understand how they would relate to the real world of business,
China Mobile was ranked in 2013 as the 71st largest corporation in the world
by Fortune Global 500, Sprint-Nextel as 310th (and 87th on USA-only Fortune
500).
The resulting data gives us a snapshot of who are the

biggest global companies of the mobile-only industry.
Similar to the overall industry, the majority of the largest
companies are involved in the mobile operator/carrier
business, not handsets or networks. A few changes
happened in 2014. Googles sale of Motorola didnt drop
Google out of the chart, just on its mobile search and
modest app store royalties, Google remains in the Top
25. Lenovo who bought the Motorola business now
enters and kicks out Blackberry. Nokias sale of its
handset business didnt end its standing and powered
by its networking business, Nokia stays but Microsoft
could not convert its Nokia handset business into an
entry into the Top 25. Nokias acquisition of Alcatel-
Lucent will increase its position for 2015

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Chapter 3 - Customers 26
III
Customers
Who feed this industry
The consumer of mobile telecoms is evolving as the

industry and handsets evolve. A decade ago the
'obvious' primary use of the mobile phone was to place
and receive voice calls. That is no longer true. While
voice calls still generate the most revenues, for most
users in all advanced markets, the phone is no longer
primarily a voice communication device.
Yes, it is still a communication device and not for

example an 'internet device' or media consumption
device (or application platform). The preferred means of
communication on mobile has shifted away from voice
calls and today in most markets, the customer base
considers messaging to be the primary use of a
mobile phone. Voice calls come in as an optional extra,
far down on the list of necessary features and services.
SUBSCRIBERS AND UNIQUE OWNERS
The mobile phone is within arm's reach 24 hours a day

and is the only device we literally sleep with. The mobile
phone is our alarm clock. I have been saying for years

that the mobile is the last thing we look at before we go

to sleep and the first thing we see when we wake up.
This phenomenon was tested in the Mobility Poll by
Time across 8 countries in 2012 and 44% of mobile
phone users said that was true of their phone behavior.
MULTIPLE SUBSCRIPTIONS
Mobile Subscribers, Phones in Use and Unique Owners
8
7
6
5 Total Subscribers
4 Phones in Use
3 Unique Owners
2
1
0
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Of the 7.2 billion active mobile phone subscriptions, that

is not the same as 7.2 billion unique users of a mobile
phone (or of "subscribers"). The 7.2 billion subscription
count reflects cases of multiple phone ownership, such
as an Apple iPhone owner also having a Blackberry. It is
becoming increasingly common for users with one
phone to have two or three subscriptions to save on

calling and messaging charges, to optimize traffic by

switching networks.
The trend to multiple mobile phone subscriptions is a

universal trend, first witnessed in Finland obviously, and
reported in my second book M-Profits in 2002 and I
have been seen as the foremost analyst to study and
understand this phenomenon of the multiple subscription
and reporting on it to the industry.
Unique Phone Owners & Multiple Subscribers, by Region
3,500
3,000
2,500
2,000
1,500
1,000
500
0
ed
ng
da
ica
st
st
t
a
es
ric
Ea
Ea
pi
nc
na
er
W
lo
Af
va
Ca
Am
e
pe
ve
pe
dl
ad
ro
de
&
id
ro
tin
Eu
AC
M
A
Eu
ia
La
US
As
AP
When we remove duplicates from the 7.2 billion

subscriber count, we arrive at 4.8 billion unique mobile
phone subscribers. This is a metric rarely reported in the
industry but Ericsson provided a contrasting number of

4.3 Billion unique users they counted at the end of 2012

(Ericsson 2013). Note that it is exactly the same number
as I reported in that years edition of the Almanac,
giving a good verification point for this rarely-reported
statistic.
When we examine the phenomenon of multiple

ownership, only 56% of all mobile phone owners have
only one subscription or account. Thus 44% of us have
two or more mobile accounts which splits out so, that
31% of mobile phone users have 2 active mobile
accounts and 15% have 3 or more accounts.
There are 5.5 Billion actual connected mobile phones in

use for those 4.8 Billion unique users, meaning that 1
billion mobile phones in use today are 'second phones'
for the one unique user. So 22% of the unique mobile
phone customers on the planet carry physically two
mobile phone handsets that both also are on an active
mobile subscription.
FURTHER DETAILS OF SUBSCRIBERS
A special note should be made about telematics

subscriptions and shared phones. Roughly speaking
400 million of the 4.8 billion unique mobile phone
subscribers use the cellular connection for data use.
They are 6% of all subscriptions, and 9% of the unique
users. The majority of this group is various telematics

uses like utility metering, various remote control and

remote metering solutions etc. The telematics
subscriptions are counted both in the 7.2 billion total
subscription count as well as the 4.8 billion unique user
count.
Mobile Customers 2014 & 2013
2014 2013 Growth
Subscriptions 7.2 B 7.1 B 2%

Unique users 4.8 B 4.6 B 4%
- of which 1 only 2.8 B 2.6 B 6%
- of which 2 accts 1.4 B 1.4 B 0%
- of which 3+ 0.6 B 0.6 B 0%
2nd+ accounts 2.0 B 2.0 B 0%
Phones in use 5.5 B 5.3 B 5%
Also a growing use of especially 3G and 3.5G mobile

subscriptions are for laptop PC modem use through data
dongles and datacards. The total number in use has
now passed 300 million. Almost all such users will also
have a separate mobile phone account so the data
access users tend to have at least one phone account

as well and thus most of these 300 million are counted

in the 2 Billion who have two or more counts, and
probably are often among those 600 million who have
three (or more) active mobile accounts.
While many technology writers are now obsessing about

tablets (and many confuse a tablet being just a larger
smartphone - which it is not. The use cases for tablets
are significantly different from those of smartphones with
of course plenty of overlap too) this Almanac does have
to focus on the big picture and relevant statistics. The
total global tablet phenomenon is still a mere drop in the
bucket of the IT industry. Just in installed base,
smartphones outnumber all tablets in use by a factor of
6. Yes six times more people own smartphones than
tablets. Even that is a statistic that favors the tablet.
When compared to the whole mobile industry - object of
this Almanac - tablets would be 5% of the size of this
industry. Not meaningful for us to consider in for
example its own chapter (yet).
Separately in the Emerging World there is a segment of

the population where phones are so rare that they are
shared. So families and sometimes whole villages will
share a phone. The operators and handset makers have
incorporated special community features such as
several phone numbers for one phone, with unique
profiles for a phone, so each user can have
personalized ringing etc. The phone use records like

phonebook, message history and call logs can then be

personalized for each user.
TomiAhonen Consulting estimates that currently about

250 million people in poor parts of Africa, Latin America
and Asia are users who share a phone. The average
family household size in the Emerging World is 4.3
people according to United Nations, thus approximately
230 million shared phones reach 1.1 billion family users,
or add 825 million to the total reach of mobile telecoms
above the unique user count. Obviously in most of the
rest of the world, mobile phones are not shared.
When shared phones are added to the total subscriber

base, we find that mobile phones reach a total of 5.3
billion actual users (4.8 billion unique subscribers and
825 million more shared users). When we remove the
400 million telematics subscriptions (non human) we
arrive at 4.9 billion humans, who today can be reached
by mobile phones which is or 69% of the total population
alive on the planet today. For the purposes of this
Almanac, the original 'owner' of the phone, often the
head of the family, is counted as the 'unique' subscriber.
ADDICTION TO MOBILE
The Nokia Global Messaging Study in 2001 suggested a

dependency on SMS text messaging "similar to an
addiction". I reported on that finding in my second book

M-Profits in 2002. The first university study to address

mobile phone addiction was Catholic University of
Leuwen in Belgium in 2004, an addiction, in particular
with SMS text messaging. A follow-up study at the
Queensland University in Australia in 2005 found that
SMS text messaging was the most addictive of any
technology compared in the study, and as addictive as
cigarette smoking. In 2012 a University of Chicago study
of German mobile users found that Twitter use on
mobile, and Blackberry email use is also as strong, rated
as addictive as cigarette smoking. A 2013 survey by
Halifax in the UK found that 28% of British citizens had
experienced a texting collision of bumbing into
something while walking and texting. Also as
smartphones become more prevalent, they also become
the preferred means of accessing email. Already 30% of
all emails are opened on mobile phones (MMA 2013).
USAGE
The primary use of the phone is messaging which for

most users is still SMS. The US presidential elections in
2008 surprised many when then-candidate Barack
Obama announced his Vice Presidential choice by SMS.
SMS is not new to politics however. The Tony Blair
government of the UK was using SMS in 2004 in cabinet
meetings so members could send unobtrusive SMS
messages during meetings, while the Kenyan election
results were reported also via SMS in that year. The

Slovenian Prime Minister was already sending out his

cabinet agenda by SMS back in 2001.
Mobile Phone Ownership (unique owners) Globally
6-10
11-15
16-20
21-25
26-30
31-35
36-40
41-45
46-50
51-55
56-60
61+
0% 20% 40% 60% 80% 100% 120%
In 2012 the Obama campaign used a powerful SMS

voter activation method, by sending to registered and
opted-in Obama supporter mobile phones a simple SMS
text message: Would you like to make one phone call
on behalf of Barack Obama to an undecided voter
today. That campaign resulted in an avalanche of
volunteer telephone calls to undecided voters on

election day and changed a razor-thin election into a

landslide for Obama.
I have been monitoring the global shift in mobile phone

usage away from voice calls, and into messaging. In
2011 an international survey by the British regulator
Ofcom verified for the first time, that the global tipping
point has been passed, today more people use their
mobile handsets to send messages, than to originate
phone calls. My analysis of global markets finds that
SMS now is used by 82% or 5.8 Billion actual mobile
subscribers, while voice calls are used by 73% or 5.2
Billion actual mobile subscribers. I am reminded of the
Finnish Prime Minister's voicemail from years ago which
said, "Please don't leave me voicemail, send me an
SMS text message." Incidentally, voicemail itself is
slowly going the way of the fax and the telegraph, what
was once the second most used service of our industry
is now only used by 44% of mobile phone owners.
Ahead of voice we also today see the camera and the
clock/alarm.
YOUTH
The youth the world over now says their preferred

gadget is the mobile phone. Some say the phone is their
friend. When older people may make a call to share an
emotion, young people make a call to have an emotion.

Common Usage of Phone Features

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Send SMS
Camera
Clock or alarm
Voice call
Received advertising
Listen to music
Use MMS
Voice mail
Surf Web Pages
News and alerts
Search
TV voting
Social networking
OTT messaging
Download app
Gaming (not pre-installed)
eMail
Make payments
Map/navigation
Ringback tones
VOIP voice calls
Source: TomiAhonen
Almanac 2015
The phone is an extension of the persona and the key to

connecting with friends. Perhaps nothing shows it more
concretely than mobile phone use in schools. An Intel
survey in 2011 of 212 high school teachers in the USA
found that 62% of the teachers reported that students
send SMS text messages during class, 33% had seen
students answering a phone during class, and 19%
caught students attempting to cheat in tests using SMS.

These are only the latest trends in studying youth

behavior. For example 42% of US youth can send SMS
messages blindfolded (Nielsen 2010)
Some other interesting findings include snooping,

among US adults one in four partners or spouces will
snoop inside the phones of their partners (Best Buy
2009) which in Australia is one in three (Virgin Mobile
2008). A 2012 survey of 1,000 UK office workers by
WhatsYourPrice found that 55% of women and 60% of
men who had experienced an office romance, said it
started by having 'virtual kisses' ie the letter X inserted in
SMS text messages between the office colleagues.
221 TIMES PER DAY
Nokia reported in 2010 that the average consumer on

the planet looks at their mobile phone 150 times per
day. That statistic was separately verified by T-Mobile
USA in 2012 and Telstra in Australia. In 2014, a new
measure was reported based on a study of UK users by
Tecmark which found that British smartphone users look
at their phone already 221 times per day. My
consultancy calculated out a likely usage scenario of the
original number of 150 times per day and found how that
would fit other reported numbers on mobile phone
behavior. I have now also done the same analysis for
the 221 times per day newer number and show both
here.

Average Mobile Phone User Looks At Mobile 150 Times Per Day
Messaging 15%
Voice calls 15%
Clock 12%
Alarm 5%
Calendar 3%
Music 9%
Gaming 8%
Social Media 6%
Video 4%
Other web 4%
News 4%
Camera 5%
Other 9%
Above 150/day all phones, below 221/day smartphones.

Average Smartphone User Looks At Mobile 221 Times Per Day
Messaging 37%
Voice calls 13%
Clock 12%
Alarm 5%
Calendar 3%
Music 9%
Gaming 13%
Social Media 25%
Video 7%
Other web 7%
News 4%
Camera 9%
Other 11%

The colors and sequence for the usage is consistent so

the two graphcs can be compared. The below
smartphone user diagram shows how much OTT
messaging and social media use increase but also
reflects the rapidly growing phenomenon of selfie
photographs taken by the user.
To understand the usage, consider normal voice call

(not Skype) use. For a typical user placing on average 3
calls, the user also receives on average 3 calls per day.
For the 3 successful calls made, there is typically one
failed attempt (phone is nor answered, or we are not in
coverage, etc). For the six calls we are on daily, typically
one is interrputed requiring a reconnection. We also look
at incoming calls, and typically, once per day, we reject
an incoming call for whatever reason - not a good time,
don't want to talk to that person now, don't recognize the
number, etc.
We also discover, typically once per day, that there was

a call attempted at our phone, which we missed. For
every call we do conduct on the phone, the call also has
to be ended - that requires us to look at the phone
again. And finally, we anticipate calls, so a typical user
might glance at the phone 5 times per day, looking if
there was a call. When we add all that up for the 150x
per day normal user, it amounts to 22 times just relating
to our voice call usage, daily. (Smartphone users use
less voice calls and some use VOIP calls like Skype)

30 MINUTE, 3 MINUTE AND 30 SECOND TASKS
I have been explaining how the mobile opportunity is not

mutually exclusive with the PC opportunity, using the 30
minute/30 second metaphor, from my third book, 3G
Marketing, with Timo Kasper and Sara Melkko in 2004.
There are "30 Minute Tasks" such as sorting pictures,
writing documents, creating powerpoint presentations,
doing calculations, and managing email. For leisure
these include watching favorite TV shows, sports
games, the nightly TV news etc. These are planned,
done while seated, with a good screen, keyboard etc.
Then there are also "30 Second Tasks" which arrive

suddenly without planning, often onto our phone. The
tasks need immediate attention, are done while standing
or walking, using only what is immediately available.
This can be IM Instant Messaging or for example using
Twitter, but most often it is SMS text messaging and
various mobile phone services. 30 Second Tasks are
done with the best available services, devices, networks
and connections, often even at premium costs, such as
during travel. This helps isolate emerging opportunities.
The 30 minute/30 second metaphor helps explain why
mobile will not replace the internet, but is an additional
technology.
Now that the early data is emerging from tablet users, its
clear that tablets do sit somewhat in the middle of those

two, but also have their own distinct usage patterns. I

have added now the 3 Minute category of the usage.
This is the updated and revised table to illustrate the
similarities and differences of the three digital platforms.
30 Min / 3 Min / 30 Sec Tasks
30 Minute Tasks 3 Minute Tasks 30 Second Tasks
PCs/Laptops Tablet Mobile Phone

Planned use Both uses Unplanned use
Sitting Sitting Standing/walking
Booked time Sudden time In hurry
e-mail Social media SMS & OTT
Creating info Modifying info Consuming info
Focused attention Multi-tasking Multi-tasking
Note that industry guru Zahid Ghadiali argued that this

same tool can be expanded to predict smart watch
behavior, where the smart watch would be a 3 Second
task. We need to monitor the smart watch phenomenon
to see if this becomes true.
RAPID ADOPTION
We report a lost credit card the next day but a lost

mobile phone within 30 minutes (Visa 2008). A Nokia
2006 global survey found 73% use the clock on the

phone rather than wristwatch, and 72% use phone alarm

to wake up. A 2010 study by Mintel of UK users found
that 91% had a mobile phone while only 84% are still
wearing a wristwatch. By that study, 28% of the youth
had already stopped wearing wristwatches.
A 2009 survey by Lightspeed found that 53% of the

British will keep their phone not only within arm's reach
at night, but with the ringer on, for waking them for
incoming text messages or phone calls at night. Quite
literally, mobile has become the first mass medium
which will reach us even in our sleep. As to media
consumption, one in every seven minutes of media on
any legacy medium in the USA involved also a mobile
phone. So phones are used when watching TV, or
sending messages after (or even during) movies, or
responding to radio shows etc (Universall McCann
2009).

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Chapter 4 - Handsets 43
IV
Handsets
The driver to the industry
Handset sales have been growing quite steadily in step

with the growth in mobile subscribers. Year 2009 saw a
dip in sales due to the global economic crisis but the
growth pattern returned the following year and in 2014
total handset sales grew by 3% and achieved a total
sales level of 1.9 Billion units.
Mobile Phone Sales Annually in Millions of Units
2000
1800
1600
1400
1200
1000
800
600
400
200
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20

ANNUAL SALES
For scale, compare over 1.9 billion new phones sold per
year with the PC industry that sells approximately 350
million personal computers and the television industry
which sells less about 250 million TV sets per year and
you start to understand the scale. No other consumer
gadget like cameras, music players, videogaming
consoles, GPS receivers etc, comes even close.
PHONE MARKET SHARES
New Mobile Phone Sales Market Shares Full Year 2014
Samsung 24%
Microsoft(Nokia) 10%
Apple 10%
Huawei 5%
LG 4%
Lenovo 4%
ZTE 3%
TCL/Alcatel 3%
Sony 2%
Coolpad 2%
Others 33%
Samsung took over the title as the world's largest

handset maker from Nokia in 2011. Now Samsung sells
one in four handsets sold globally. Apple climbed to tied
second place with the faltering Nokia unit bought by

Microsoft. Chinese brands populate 5 out of the top 10

with Huawei, Lenovo, ZTE, Alcate/TCL and
Coolpad/Yulong. Lenovos numbers now include the
Motorola handset business it bought from Google in
2013.
There are ever more handsets on offer globally, with the

range of handset makers expanding worldwide as over
2000 new handset models are released annually by over
500 manufacturering brands from over a dozen
countries with local brands appearing ever more and
even expanding abroad. From a manufacturing point of
view, 70% of all handsets sold in the world are
physically manufactured in factories based in the rapidly
growing megacity of Shenzhen in China, situated just
North across the border and over the bridge from Hong
Kong.
2013 was the first year when more smartphones were

sold than traditional dumbphones. 67% of all phones
sold in 2014 were smartphones. With this shift, the
Almanac will diminish focus on the dumbphones side
and focus more on details of the smartphones side of
the hardware industry. But of the whole industry the
average sales price (ASP) of mobile phones for 2014
was 188 US dollars. That breaks down to 273 US dollars
on average for new smartphones sold in 2013 and 24
US dollars for dumbphones, globally (these prices are
real prices ie with handset subsidy removed).

PHONE FEATURES AND GENERATIONS
The installed base of all phones in use is still heavily

tipped in favor of featurephones or simply
dumbphones. When smartphones are removed out of
the total base of 5.4 billion mobile phones in use, there
are 3.4 billion dumphones still in use worldwide by the
end of 2014. That is still close to twice the number of
total smartphones in use. Most of the dumbphones
today have an internet browser and can take basic apps
such as those written in Java.

Please note that data-capable phones ie 2.5G and 3G

phones in the above table are phone capability only, not
that all such phones are connected in that way to a
network or the owner has purchased the data plans, so
2.5G and 3G usage will be less than the capable phone
population in the wild.
New Phone Sales by Generation
100%
90%
80%
70% 3.5G
60% 3G
50% 2.5G
40% 2G
30% 1G
20%
10%
0%
00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
Thus customers tend to get 3G phones even before they

upgrade their subscriptions to 3G services; or even in
many countries where 3G networks have not been
launched commercially, such as in many African
countries today, there are already early adopters who
want the top phones and get 3G phones.

Currently the most desired feature and the specification

which most drives new phone sales is the inbuilt camera
and its resolution, again verified by a Nokia consumer
survey in 2012. The first cameraphones were
manufactured by Sharp and introduced in Japan by J-
Phone (since Vodfone KK now Softbank) in 2001. Today
the vast majority of all phones in use are cameraphones.
Installed Base of Cameraphones by Camera Resolution
100%
90%
80%
12MP
70%
8MP
60% 5MP
50% 3MP
40% 1MP
VGA
30%
None
20%
10%
0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Source TomiAhonen Almanac 2015
(Note change to previous editions of the Almanac, as newer larger camera

resolutions are added to the picture, I have now colored the no camera type of
basic mobile phones as grey.)
The cameraphone resolutions have also increased each

year. An annual survey of European new phone models
by TomiAhonen Consulting has observed that the most
frequent cameraphone resolution for new phones in

2005 was VGA (0.3 megapixel). By 2006 the most

common cameraphone resolution had growth to 1
megapixel. In 2007 it was 2 megapixel and by the end of
2008 that was up to 3 megapixel. By 2010 the most
common camera resolution of new camera handset
models had grown to 5 megapixels. In Japan today for
the 2013 model year, top-end cameraphone cameras
now are being upgraded from 13 megapixels to 16
megapixels. Obviously in 2012, Nokia delivered the
cameraphone resolution bomb with the gargantuan 41
megapixel sensor on the 808 Pureview, the current
global champion besting even top Canon professional
camera sensors by pixel count by more than 2 to 1.
(One should remember, there is much more to picture
quality than just megapixels, the optics, the size of the
sensor and the picture handling software etc all matter.)
A 2013 study by Hati and Skoll reported that the

cumulative global number of photographs taken since
the camera was invented in 1827, across all camera
types and formats, has reached 4.3 Trillion. More than
one fifth of those, 910 billion pictures were taken during
year 2012. Meanwhile 1000 Memories estimated in
2013 that the average cameraphone owner takes 150
pictures per year. That would be 680 billion pictures
across the existing base of cameraphones. So while the
stand-alone camera is optimized for picture-taking and
used by mostly professional and semi-pro
photographers who may shoot 100 pictures on a given

day, the simpler cameraphones today account for 75%

of all photographs taken per year worldwide.
SCREEN SIZE RACE
In 2008 Christian Lindholm predicted that the Apple's

iPhone 'giant' screen size of 3.5 inches would soon
generate a screen size race, to see who dares to put the
biggest screen on a phone. That became reality in 2010
and 2011 as the top smartphone screen sizes grew past
4 inches and today we have many phones with 5 inches
and the biggest phones at about 6 inches - the area
between a tablet and smartphone, some call the
'phablet'.
The top end flagship phone screen size 'arms race' has
also resulted in a global growth of screen size. IE Market
Research has observed the growth of mobile phone
screen sizes at about half an inch per year and was at
2.5 inches for 2009. By that trend held we are today at
an average screen size of about 4 inches but no recent
study has reported on that metric. Meanwhile the ultra-
large screens of phablets are gaining ground. Deloitte
reported in January 2014 that for 2013, 15% of all
smartphones sold or 150 million units had a screen
between the size of 5 inches and 6.9 inches (7 inch size
is considered to be a real tablet).
GROWTH OF PHONE CAPABILITY - 11 C'S

I introduced my theory of the 8 C's evolution description

to help explain how the mobile phone has grown in
capability and features. That was expanded to 11 C's in
2010. The expansion of the phone beyond a basic
communication device happened in the past eleven
years from 1998.
The first C of Communication comes from the birth of

the mobile phone as a mobile voice calling device.
During the first generation of cellular telecoms, analogue
systems, the mobile phone could not do more than voice
calls. With 2G digital networks, starting with GSM in
1991, the mobile telecoms services added messaging,
but that was still a communications service.
From 1998 the phone added in short succession the

abilities to Consume media content, in 1999 the ability to
Charge i.e. pay or use the mobile for money. In 2000 the
Commercials or advertising appeared on mobile. The
Creation ability was added in 2001 with the advent of the
cameraphone and the Community or social networking
ability in 2003. From 2005 the phone has also been a
Cool item i.e. a fashion statement.
Next appeared the ability of Control, using the mobile
phone for remote control of other digital remote control
devices and abilities from unlocking the front door at
apartments in Japan to turning on the remote control tea
kettle in Britain to turning on the saunabath in Finland.

Today they already sell household robots in South

Korea that are controlled by mobile phones.
11 C's of Cellphones: How phone evolved
1st C - Communicate (voice & SMS) - 1979

2nd C - Consume (media) - 1998
3rd C - Charging (money) - 1999
4th C - Commercials (advertising) - 2000
5th C - Create (cameraphone) - 2001
6th C - Community (social networking) - 2003
7th C - Cool (fashion) - 2005
8th C - (Remote) Control - 2007
9th C - Context (status, location etc) - 2008
10th C - Cyber (plants, animals, augmented) - 2009
11th C - Career (employment platform) - 2010
The latest three C's are Context, discovered first by

Olivier 'Cooli' Guyot relating to the GPS abilities and our
network awareness etc. The tenth C is now Cyber as we
start to connect with non-humans like our plants sending
messages to our phones when they need to be watered;
and the various augmented reality and virtual reality
elements to the phone. And the 11th C is Career, the
phone can actually provide a job or employment
platform, an ability discovered by Alan Moore in 2010.
REPLACEMENT CYCLES

The average replacement cycle for mobile phones had

recently been hovering a little below 18 months. It is now
holding steady at 17 months for 2014 for all mobile
phones and 11 months for smartphones. For
comparison average the replacement cycle for personal
computers is about 42 months. When factoring in the
ever increasing portion of multiple subscriptions, and the
related phenomenon of owning and carrying two mobile
phones, if a national replacement cycle is 17 months, for
those with two phones within that market, the effective
replacement cycle is 8.5 months.
INPUT METHOD
Many smartphones and premium featurephones have

advanced input methods of touch screen, QWERTY
keyboard or a combination of both "hybrid". The
QWERTY phones had formed a growing part of
enterprise/business phones with the Nokia
Communicator series and the Blackberry, but the touch
screen and hybrid models were popularized quite
recently after the iPhone was introduced. Today touch-
screen phones are most common form of special input.
For new phones sales in 2013 for the first time the
standard basic keypad input is no longer on majority of
phones sold. It is still the most prevalent input method
with 48%. Touch screens form 42% of new phone sales

and QWERTY forming 8% and hybrid inputs (touch and

keyboard or keypad) form the last 2% in 2013.
New Handset Sales by Type of Input
2000
1800
1600
1400
1200 Standard
Touch Screen
1000
Hybrid
800 QWERTY
600
400
200
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
SMARTPHONES
Smartphones were was launched in 1996 in Finland by

Nokia with the original model 9000 Communicator. Early
smartphones were oriented to business customers and
their needs. The shift from dumbphones to smartphones
has been gradual, as the costs of early smartphones
were far above the costs of basic phones. As that cost
differential has come down, the adoption rate of
smartphones has accelerated and by 2014, the
migration rate of the global handset sales had reached
67% for the installed base of phones, it is 36%.

Smartphones New Sales and Installed Base
2000
1800
1600
1400
1200
Installed Base
1000
New Sales
800
600
400
200
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2014
In 2014 smartphone sales growth was again strong, at

21% annual growth rate but now the growth rate is
slowing down as the transition from dumbphones to
smartphones has passed the midpoint and not much
more conversion market is left to take over. The market
for 2015 is projected to be about 1.5 billion smartphones
sold out of total handset market of 2.0 billion for a 75%
new sales migration rate.
Year 2013 saw the end of Nokia as an independent

handset manufacturer. After its disasterous Windows
Phone experiment failed, Nokia sold its handset division
to Microsoft. As a final insult, weeks before handing over
the handset division to Microsoft, Nokia launched three
smartphones running on Android as the ultimate

acknowledgement that Windows Phone was not

competitive in the market, in February of 2014.
Price Pyramid of Mobile Phones 2014
Premium Smartphones Over $450 20%
Mid-Price Smartphones $150 - $449 12%
Low-Cost Smartphones $40 - $149 33%
Ultra-cheap phones Under $39 36%
Overall the market for smartphones had settled into a

situation of the two giants and the lilliputs. Samsung and
Apple control half of the market. About nine small
players race each other for the temporary honor of
calling themselves the third largest smartphone maker:
Huawei, Lenovo, LG, Sony, ZTE, Coolpad/Yulong, HTC,
Nokia/Microsoft and Blackberry. Meanwhile on the
operating system side Android solidified its position as
the new standard for the IT industry powering 79% of all

new smartphones sold. Apples iOS powered another

15% so there is merely 6% to be split among the restof
the pretenders. 2013 also saw the unexpected delay to
Tizen, the operating system developed by Samsung with
Intel (taking over from Nokia and the terminated MeeGo
project with Intel). Tizen like Android is Linux based and
has dozens of partners including several handset
makers. But the first Tizen devices from Samsung have
been two smart watches. Samsung finally launched its
first Tizen smartphone into a few Asian countries.
Smart Phones out of Installed Base of All Phones
100%
80%
60%
Total phones
40% Smartphones
20%
0%
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
Hong Kong, Singapore and UAE continue to be among

smartphone migration leaders where around 90% of all
new phones sold are smartphones. A few brave
carriers/operators have already announced they will stop
selling dumbphones and only offer smartphones such as
Safaricom in Kenya, following NTT DoCoMo's lead from

Japan, obviously. In the industrialized world roughly

three quarters of new phone sales are smartphones, but
in the Emerging World only about one in three new
phones is. 2013 became the first year when more sales
of new smartphones were to existing smartphone users
than to first-time smartphone users (which are mostly
upgrades from dumbphones).
Smartphone Penetration Per Capita and Migration Rate
80%
70%
60%
50% Smartphone
Penetration
40% Per Capita
Smartphone
30%
Migration Per
Subscription
20%
10%
0%
a t st ed g st a a
ad es in
Ea ric ic
an W Ea nc op Af er
C pe pe dva vel dl
e
Am
& ro ro a de id tin
SA Eu Eu AC ia M
La
U AP As
Nielsen gave a rare national survey of smartphone new

sales percentages across selected major countries in
September 2013. They found Hong Kong and Singapore
in the lead with smartphone sales at 87% of all phones.
Malaysia was at 80%, Australia at 75%, UK at 72%,
France at 64%, Germany at 62% and the USA at 60%.
Of Emerging World markets, China was in the lead with
71% of all phones sold being smartphones, Thailand

49%, Indonesia 23%, India 16% and the Philippines at

15%. These numbers are very consistent with the
reporting in the Almanac.
New Smartphone Market Shares Full Year 2014
Samsung 24%
Apple 15%
Huawei 6%
LG 5%
Lenovo 5%
Xiaomi 5%
ZTE 4%
Others 36%
As there is reporting on the migration rate to

smartphones nationally as well as the penetration rate -
we have added now both metrics to this Almanac from
2014 on. The migration rate is easier to measure but it
distorts the numbers in favor of those regions or
countries that have low overall mobile phone penetratio
rate like North America. The actual adoption rate per
capita is a more relevant metric but it can only be
measured by consumer surveys and its data tends to
lag. For example comparing North America and Western
Europe, North America has a higher rate of migration to

smartphones but Western Europe has a higher

penetration of smartphones per capita.
Samsung is the clear global leader of smartphone sales

with Apple the clear number two. Apple then sells more
than twice what number three, Huawei achieves. The
race behind the three leaders is very tight and quarter-
to-quarter fluctuations in rankings are common. Some
industry experts mistakenly considered Xiaomi to be the
worlds third largest smartphone maker which it has not
been, at least not yet.
OPERATING SYSTEMS
Smartphone OS New Sales 2005-2014
100%
90% All Others
80% Samsung bada
70% Apple iPhone
RIM Blackberry
60%
Google Android
50%
Palm (HP)
40%
Windows Mobile
30%
Windows Phone
20% Symbian
10%
0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
We have seen the end of each of the rivals in the one

plus three race of smartphone operating systems of the

mid 2000s decade where Nokias Symbian was roughly

twice as big as the other three major OS platforms,
Palm, Windows and Blackberry, combined. Apples
iPhone and its iOS took about a one in six share of the
market or roughly the sizes of Palm and Windows
combined. Blackberry has come to the end of its OS, as
the company is shifting to Android powered
smartphones. Windows Phone is Microsofts failing last
play at a rival OS, and has seen nothing but failures in
the market, corresponding with repeated layoffs even
after Microsoft bought Nokias struggling handset
business. Googles Android is nearing 80% of the
market and keeps growing.
Smartphone OS Installed Base End of 2014
Google Android 71%

Apple iPhone 18%
Nokia Symbian 2%
RIM Blackberry 4%
MS Windows Phone 3%
Samsung bada 1%
Others 1%
In very rough terms its fair to say that Apples iPhone

took the market that was mostly North America-based

and used to belong to Palm and Windows. Android took

the rest of the world where Nokias Symbian and
Blackberry were prevalent. The iPhone is incredibly
strong in North America but only of modest strength in
other Industrialized World countries and Android rules
the rest of the world.
For any developers the relevant picture is the installed

base of smartphones in use globally. And the picture is
very clear. Android covers almost two thirds of all
smartphones in use globally. Apples iOS powers one in
six.
Smartphone OS by Region
Installed Base New Sales

Region Leader 2014 Leader 2014
USA & Canada iPhone Android

Europe, West Android Android
Europe, East Android Android
APAC, Advanced Android Android
Asia, Developing Android Android
Middle East Android Android
Africa Symbian Android
Latin America Android Android

Regionally the reasons for Symbians resilience can be

seen that its bases are in the least affluent parts of the
planet: Africa and the countries of Asia that are part of
the Emerging World. However, for ever region in 2013
the bestselling smartphone OS is Android and with time
that will soon also be true of the installed base in every
region.
For more about the handset market including regional

market shares, features, average sales prices, customer
segments etc, please see the companion volume to this
Almanac, the TomiAhonen Phone Book 2014 (note
the Phone Book is released only every two years at the
end of the year, so the next Phone Book will be out for
about Christmas of 2016).

If you need more info about the handset

market, please note the companion volume to
this Almanac, the brand new TomiAhonen
Phone Book 2016. The ebook is in the same
format as this Almanac, but focuses only on
the handset side of the industry including
smartphones, dumbphones, operating
systems, features, app stores and other
devices and accessories. It comes out every
two years but latest edition was published
December 2016, all data in it are current as
of December 2016. The book has 100 charts
and tables including extensive regional tables
of market shares, average sales prices etc. It
costs 9.99 Euros and is avaiable at
www.tomiahonen.com
(this advertising page is not counted in the 212 page length

of this Almanac)

Chapter 5 - Mobile Messaging 64
V
Mobile Messaging
The biggest data application on the planet
SMS Text messaging or "texting" is the single most

widely used data application on the planet totally
dwarfing other data applications. In 2011 SMS overtook
voice calls as the most used service or feature on
mobile phones. Asicion reported in 2013 that the global
user base of SMS texting had reached 6 billion which is
a little bit above what this Almanac had counted for the
same year. But the glory days of the humble 160
character SMS are coming to an end as OTT (Over The
Top) messaging services have seized the heavy users
and most of the traffic. SMS texting has passed its peak
and is now seeing users and total messages sent
roughly flat, while revenues have started their decline.
BRIEF HISTORY
SMS text messaging was invented by then Telecom

Finland (now part of TeliaSonera) executive Matti
Makkonen. The concept was adopted into the GSM
standard and the first machine-generated SMS message
was sent in 1991 in the UK. The first commercial
person-to-person SMS text message from one mobile

phone to another was sent in Finland by Riku Pihkonen

of Nokia, in 1993. Less than ten years later SMS had
become the most widely used data application on the
planet. Today the user count of SMS sits at 5.8 billion,
nearly twice as many people send SMS text messages
than use the internet and as a messaging platform SMS
is used by more than three times more people than
email. SMS reaches a 4 times larger audience than
Facebook. SMS text messaging is worth 139 billion
dollars in annual revenues worldwide which is the first
time it has declined.
SMS Text Messaging Users and Total Mobile Subscribers
8
7
6
5 Subscribers
4 SMS users
3
2
1
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
SMS USERS
As 100% of all mobile phones in use are capable of

sending and receiving SMS text messages, and are on

network connections that provide mobile messaging

functionality (including equivalent short message email
services in the case of Japanese networks), today an
SMS text messages can reach 7.2 billion mobile phone
accounts, and thus has a (nominal) reach of 100% of the
planet's population. 2011 was the year when SMS users
even passed that of users of voice calls on mobile
phones making SMS texting now the most used
communication method on the planet.
SMS Text Messages Sent Globally in Trillions
10
9
8
7
6
5
4
3
2
1
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
Source: TomiAhonen Almanac2015
SMS texting has secured a vital part in social rituals. A

US survey of dating behavior by JDate in 2013 found
that 32% of US dating-age population, both men and
women, feel that a first contact SMS text message is

less intimidating than a phone call. 44% of men and

37% of women felt that SMS made it easier to flirt than a
phone call.
TRAFFIC
Text messaging is an addictive service, it has witnessing

growth rates that seemed to never stop growing. Now as
smartphone penetrations reach mass market scale and
rival 'free' messaging platforms on OTT are proliferating,
SMS text messaging traffic growth is finally slowing
down but overall messaging use is still showing
explosive growth but most of that growth is with OTT
services.
During 2014 a total of 9.2 Trillion (9,200 billion) SMS text

messages were sent worldwide. That amounts to 3.5
SMS sent per day for all mobile subscribers. When
measured against the active user base of SMS texting,
the average is 4.4 SMS text messages sent per day.
Remember this statistic is measured by subscriptions,
so for those consumers with two accounts, the mostly
tend to use SMS on both accounts, so the number
needs to be doubled this is 8.8 SMS per day.
To put it another way, in January 2015 the world

average is 26 billion SMS text messages sent every day,
or 1 Billion per hour, or 17.5 million SMS sent per
minute, or 300,000 SMS text messages sent every

second of every day 365 days of the year. At annual

revenues of 139 million dollars, SMS text messaging
alone generates a fresh million dollars of new revenues
every 4 minutes of every day of the year.
Installed Base of Messaging Capable Phones by Type
100%
80%
Non Messaging
60% SMS Capable
MMS Capable
40% eMail Capable
Smartphones
20%
0%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
VS EMAIL
Since first reported by the Nokia Global Messaging

Study of 2001, the young populations all around the
world prefer using SMS texting to email. Korean youth
say that email is only for communicating with much older
people such as your boss, while American youth say
"Email is, like, so yesterday." A ChaCha survey in 2010
of US youth found that when asked to name their
favorite way to communicate, 0.3% selected email, while
68% selected SMS. SMS out-rated email by 227 to 1 for

the youth. SMS passed email in total users worldwide as

far back as 2002. Gary Schwartz reported in his 2013
book Fast Shopper Slow Store that coupons delivered
via SMS achieved 3 times better response rates than
the same coupons delivered to the same target
audience via email.
SMS Text Messaging Annual Revenues in Billions of Dollars
140
120
100
80
60
40
20
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
MESSAGING HAS TWO INHERENT ADVANTAGES
Text messaging has two absolute advantages over any

other form of electronic communication. First of all, text
messaging is the most private form of communication,
far less obtrusive than a voice call say in a public bus,
airport lounge or waiting room to an important meeting,

messages can carry on communications in silence, with

nobody eavesdropping.
Compared to email, there is no big screen like on a PC,

for bystanders to read messages. In most cases the only
way to read another person's mobile message is to
physically get their phone. Which is why we dont even
share our phones with our spouces.
The Digital Marketing Association of the UK reported in

2012 that SMS text messages are read in 97% of the
cases while emails are only opened 20% of the time.
The Mobile Data Association reported in 2012 that SMS
texts achieve on average 26% response rates when
used by businesses, compared to only 5% of email.
Secondly, mobile messaging, in particular SMS, is the

fastest communication ever - by through-put. This
claimed speed benefit is often perceived on first glance
to be illogical - surely it is faster to hit the redial button,
be connected within seconds, and talk to a person, than
to triple-tap a clumsy message. Yes, under rare
circumstances, a voice call can be slightly faster than
sending an SMS - by a factor of less than one minute.
But by most use cases it is the opposite and SMS is

faster to deliver an intended communication for example
when the other person is not at the phone, does not
answer the phone, cannot talk at that very moment, puts

you on hold, cannot hear you or the call is interrupted

(network coverage problems etc). Today in most cases
of the first attempt of a voice call ends up in voicemail.
SMS sent per month by active user
140
120
100
80
60
40
20
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
Thus in most normal use cases SMS is faster by

minutes, easily half an hour, often many hours faster! As
to the speed? A study by UKs telecoms regulator
Ofcom found that 97% of British SMS text messages are
read within 5 seconds of receipt. Compared to the
average time to read an email at 48 hours, SMS is
17,280 times faster than email. Still, with the advent of
OTT messaging platforms, there is growing evidence we
are at near peak SMS usage.

REVENUES AND PRICE
SMS text messaging is feeling the pressure of OTT

messaging. The heavy users have shifted most of hteir
messaging traffic away from SMS and the mobile
operators/carriers have responded by lowering prices
and adding free minutes to pricing bundles. This has
pushed the revenues down even as traffic still grew.
Average cost of SMS in US Dollar Cents
0.14
0.12
0.1
0.08
0.06
0.04
0.02
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
The average cost of a message sent worldwide is now

1.50 cents per message in 2014, down from 1.57 cents
per message in 2013. Still the most profitable global
business of all time, profit margins in person-to-person
SMS texting are still at over 60% worldwide. In the
Industrialized World countries, in those cases where

individual messages are billed, the prices are around 10

cents per message which means the profit margin
exceeds 99%.
BUSINESS USE OF SMS
Business use of SMS is still expanding globally.

European and Asian business executives first
discovered the business benefits of both the most
discrete (secretive) telecommunication method and most
speedy communications. Their experiences have been
spreading into the rest of the world.
By 2002 already 80% of British business executives

were using SMS for work related communications with
heavy users receiving 40 work related SMS per day
according to the MDA. Not just business: the Singapore
government decided in 2006 that all e-government
initiatives must be made accessible via SMS text
messaging and in 2009 the new US President Barack
Obama changed long-standing tradition where the US
President did not carry a mobile phone. He wanted to be
able to read his messages and a specially secure
Blackberry was made available for his use, by the US
Secret Service. By 2010 various national emergency
services had made SMS the first disaster alert service
for floods, tsunamis, earthquakes, volcano eruptions etc,
from Indonesia to Guatemala.

A 2012 survey of 1,368 consumers by Textmarketing in

the UK found that 89% would like to receive delivery
notices via SMS but only 26% had received any. Same
survey found that 84% would like appointment
reminders via SMS but only 29% had received any and
68% would like SMS based offers or discounts but only
12% had received any. The opportunities in SMS texting
for business use to reach consumers is still vast and
dramatically under-utilized. A 3Seventy study of US
marketing reported at the Mobile Marketing Association
MMA Forum in New York City in May 2013 found that
brands see a 25 dollar return on every one dollar spent
on SMS based marketing. Similarly at the same event
an MMA study found that mobile coupons in the USA
get 10 times the redemption rate compared to traditional
coupons.
PREMIUM SMS
A significant part of the total SMS traffic and revenues

come from various 'premium SMS' services such as
voting for TV shows, paying for content such as a coca
cola can from a vending machine or paying for public
transportation, or sending disaster aid contributions such
as with the disaster in Haiti. 32% of mobile phone user
base have used some kind of premium-SMS service,
such as voting for a TV show, paying for parking or
public transportation, purchasing a ringtone download,
or paying for vending machines.

Mobile Messaging Revenue Breakdown by Type in 2014
Person to Person
SMS
Premium SMS
MMS Picture
Messaging
Mobile eMail
OTT messaging
A study by AFMM of nine major European markets

found premium SMS in those countries alone to be
worth 1.7 billion Euros in 2012. A similar study by Zinnov
of the India mobile VAS market measured it at 5 billion
US dollars in 2012. Most of Indias mobile VAS services
are delivered via premium SMS. While the youth-
oriented early market for SMS has moved onto OTT
services, the premium SMS market is still in dramatic
growth stage.
MMS MULTIMEDIA MESSAGING
MMS or Multimedia Messaging is often misunderstood

and thought of as a failure, because it was early on

promoted as the 'picture messaging' platform to allow

cameraphone users to send pictures from one phone to
another. While person-to-person 'picture messaging' is
certainly one significant opportunity for MMS, a far
bigger use for MMS is as a mass media platform.
Messaging Users by Type of Mobile Messaging
8
7
6 Subscribers
5 SMS users
4 MMS users
3 OTT Users
2
1
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
The MMS messaging platform allows for longer text in

messages than the 160 character limit on SMS; insertion
of a picture or sound file; and even modest-quality video
to be included inside the MMS message. Also various
interactive tools fit perfectly to MMS such as embedding
an internet URL link or a QR code. While many experts
continue to doubt the viability of MMS, they tend to miss
the point that the majority of MMS revenues is coming
as a media platform, not as a person-to-person picture-
sharing service. For example the cosmetics giant Estee

Lauder reported in 2013 that when they compared the

effectiveness of the same campaign on SMS or on MMS
the MMS version achieved 6 times better response
rates.
MMS Multimedia Messages Sent Globally in Billions
500
450
400
350
300
250
200
150
100
50
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
MMS is strongly driven by its popularity in Asia. Asia

became the first region where the value of MMS traffic
exceeded the value of SMS (IDC 2009). 70% of MMS
traffic In China for example is media and information, not
person-to-person traffic (ZTE 2009). In advanced
countries like Norway 84% of the population send MMS
(TNS Gallup 2009) and in China MMS is so common it is
considered a 'mature' messaging platform like SMS
(China Mobile 2009). A Time global survey in 2012

found that 49% of mobile phone owners were users of

MMS messaging worldwide.
MMS Messaging Annual Revenues in Billions of Dollars
50
45
40
35
30
25
20
15
10
5
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
MMS has 3.2 billion users globally in 2014 making it the

second most widely used data application on the planet
behind only SMS text messaging and far ahead of the
internet ranked as third. MMS alone has 50% more
active users than the total installed base of televisions in
use worldwide. MMS is more than twice as big as
Facebook by active users and has five times the reach
of Twitter. But MMS is at its peak where user numbers
no longer grow and usage and revenues have peaked,
as the heavy users are migrating to OTT services like
they did with SMS.

If MMS existed alone and was monitored just on its own

merits it would be seen as a massive global success
story. 3.2 billion users, generating 37 billion dollars of
service revenues annually, at very high profit margins?
This is a huge success. MMS alone is bigger than the
global music industry or all of the cinema industry box
office revenues. In fact MMS alone is bigger than music
and movie box office revenues combined. And MMS is
barely over ten years of age.
MMS Messages vs SMS Text Messages in Messaging Volume
100%
90%
80%
70%
60%
SMS Text Messages
50%
MMS Messages
40%
30%
20%
10%
0%
02
03
04
05
06
07
08
09
10
11
12
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
But MMS is doomed to be seen in the shadow of its far

more successful big brother, SMS. And the industry
continues to think of MMS as a failure for that reason.
As individual MMS messages are far more expensive
than SMS, and MMS is mostly not included in heavy free

messaging bundles, the revenues are dramatically out of

proportion to the usage. MMS usage is still a tiny
fraction of SMS messaging as we see in the above
picture.
Where early projections for the MMS service made

assumptions that the usage pattern of MMS would
mimick SMS, that has proven not to be true. MMS is
more suited as a media and customer service channel,
delivering anything from news and advertisements to
coupons and web links. MMS migration is actually quite
modest in terms of total traffic as we can see in the
graph.
OTT MESSAGING
A new threat to the total messaging industry is what is

called OTT providers (Over The Top) who often provide
highly addictive 'free' messaging services. These include
Whatsapp, Blackberry Messenger (BBM), iMessage etc,
as well as the messaging functions of other social media
services such as Facebook, Twitter and Skype. Please
bear in mind that in terms of total users, SMS has four
times the user base of OTT. It is the heavy users who
are first attracted to OTT because of the savings in
messaging costs. So the heavy users who send most of
the traffic - averaging over 100 messages per day - have
mostly shifted their behavior to OTT.

Migration of Person-to-Person SMS Message Volume to OTT Messages
40
35
30
25
20
OTT Messages
15
10 SMS Text Messages
5
0
00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
The remaining 65% of mobile messaging users who

average only a few messages per day remain on SMS.
That is why the traffic picture is so lopsided and why it
shifted so rapidly. Bear in mind that OTT services make
tiny revenues compared to older messaging platforms.
Even with OTT it should be kept in mind that SMS
continues to grow and even heavily addicted youth
users with smartphones, do continue to use SMS
messages as well, occasionally, especially to connect
with those who are not on their OTT service - quite
typically their parents for example.

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Chapter 4 - Handset Market 82
VI
Mobile Internet
is more than the legacy internet on mobile
The following chapters discuss mobile content. There

are several similar, overlapping and confusing terms to
describe the mobile data industry, including the "mobile
internet", the "wireless internet", "mobile browsing",
"mobile data", "downloading mobile content", "non-
messaging mobile data", "Mobile VAS services",
"premium messaging", etc.
Thus there also are widely varying reports of how

advanced data services are used on mobile phones,
simply based on the differences in definitions used, not
to mention the competence and knowhow of the
research organization and their understanding of this
complex industry. Totally valid claims of 'mobile data'
use can vary from as little as 2 billion people as active
users to as many as 6.2 billion people. These are not
contradictory numbers, they are dependent on which
definition is used. So lets start by defining the common
terminology relating to mobile data services and indicate
what kind of magnitude and scale we talk about if we
use that definition.

DEFINITIONS OF MOBILE DATA
The most broad term is "wireless data" or the "wireless

internet". This includes any wireless technology, such as
cellular telecoms (2G, 3G and beyond); 802.11 W-LAN
i.e. WiFi; Bluetooth; and any other technologies such as
WiMax (802.16), NFC (Near Field Communications) etc.
Wireless data and the wireless internet can include

wireless data services on laptops, netbooks and tablets,
PDAs, even videogaming consoles. This Almanac does
not address the larger wireless data and wireless
internet opportunity. It will focus only on the mobile
telecoms (i.e. cellular telecoms) data opportunity,
excluding WiFi, WiMax, Bluetooth, NFC and other such
methods.
Subscribers, Messaging Users, Data Users
8
7
6
Total subscribers
5
Messaging users
4 Premium data users
3
2
1
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20

The common mobile data definitions are listed in this

accompanying table in diminishing order of magnitude
from left to right. Please remember, in this Almanac,
tablet PC use like the iPad is not counted as 'mobile' use
it is counted as an ultraportable PC. So these charts all
ignore tablet PC use in counting 'mobile data'.
Mobile Data User Numbers in Billions by Using Different Definitions
8
7
6
5
4
3
2
1
0
MMS Active
Total Subs
Real Internet
any kind incl
Mobile Data
Mobile Data
SMS users
Data users
SMS users
Downloading
Smartphone
incl ringtone
Premium
Premium
inactives
incl SMS
subs incl
Browsing
users on
Internet
phone
users
WAP
Definitions to the above graph:
Mobile Data including SMS includes all forms of

mobile access to data services, including SMS, MMS
and email messaging; browsing; data access such as
data modems and dongles; and downloading. This is a
valid measure of the mobile data opportunity and of the
different measures, this is the "most optimistic" measure.
The total user number by this measure is 6.2 billion
(86% of all mobile subscribers).

SMS Users is the active users base of SMS text

messaging (including person-to-person and premium
SMS text messaging). It is somewhat less than Mobile
Data users. The number is 5.8 billion (81%).
Mobile Data Subscriptions Including Inactives, is the

total global subscription count of customers who pay for
premium data, including those with data plan included
with the current subscription. This is typically the
payment plan for all 4G, 3G and most 2.5G subscribers.
This measure over-counts the total user base as it
includes many who pay for the data access as part of
their service package, but are not using premium data
services. The number is 5.3 billion (74%).
Premium Data Users includes all users who consume

any type of premium data when only person-to-person
basic SMS text messaging is excluded. This includes all
users of premium messaging like MMS and premium
SMS (voting on TV etc) as well as any other premium
use of mobile data like downloading mobile content such
as apps, music and ringtones, plus all browsing users
and all who use a data modem or dongle. This is
perhaps the most appropriate measure for users of
mobile internet or non-messaging mobile data or
mobile VAS services. The number of premium data
users on mobile today worldwide is 3.5 billion (49%).

MMS Active Users are those who send at least one

MMS "picture message" per month or subscribe to any
MMS media services. The number is 3.2 billion (44%).
Downloading Including Ringing Tones is the total

number of mobile phone owners, both smartphnone and
dumbphone, who have downloaded content or
applications to a phone in the past month, such as
games, pictures, applications, ringing tones, etc. The
number is 3.0 billion (42%). While the 'featurephone'
users download far less apps or content than
smartphone users, per person, per month, some do
download some content and apps from time to time. As
an addressable market, this is about the same size as
the total internet including mobile and PC.
Browsing Users Including WAP is the most commonly

used definition of a "mobile internet" (as distinct from
'the real internet on a phone' see below) and includes all
who used any type of browser-based service on a
mobile phone, including any internet web browser using
HTML or WAP or i-Mode or other mobile phone browser,
including mobile operator portals. The number is 2.7
billion (38%). (See analysis later in this chapter about
how internet use is split by access method.)
Premium SMS Users includes all premium SMS use,

such as voting for television shows, making premium

SMS payments and downloading basic ringing tones

using premium SMS. The number is 2.6 billion (36%).
Real Internet Access by Phone is any use of a mobile

subscription to access the IP based internet or
Worldwide Web (WWW) or the "real internet" using a
mobile phone or a laptop with data modem or dongle.
The number is 2.4 billion (33%).
Smartphone-only Mobile Internet Access (new

category) is the use of a smartphone to access the
internet or Worldwide Web (WWW). The number is 1.8
billion (25%).
As so many 'experts' now talk of only smartphone use of

internet browsing, I have added the smartphone-only
users as a new category for 2014. This is the smallest
measure and is dramatically misleading as many high-
end premium featurephone users with touch-screen
devices like Nokia Asha series can be as fervent internet
users on their featurephones as a low-end smatphone
user in the same country.
This number could be further inaccurately diminished by

counting only those who had touch-screen based
smartphones, or who are only on all-you-can-eat data
plans or on 3G network connections. The reality is that
while those users may be prone to put a lot of traffic
onto a wireless network, countless hundreds of millions

of featurephones also are used for 'real internet'

browsing, even on less-efficient data connections and
more expensive pricing plans.
I urge readers to use the appropriate terminology and

mobile browser users would be most appropriate
measure to use for counting the full size of WWW type
internet content including Facebook, Twitter, Amazon,
Google, eBay etc users. That minimum level is 2.7
billion active users of the mobile internet at a floor level
at the end of 2013. Any numbers below that are
misleading.
MOBILE BROWSING VS LEGACY INTERNET
Internet Access Type by Device Allowing For Multiple Use
3
2.5
2
1.5 PC incl Tablets
Phone incl WAP
1
0.5
0
00 01 02 03 04 05 06 07 08 09 10 11 12 13 14
20 20 20 20 20 20 20 20 20 20 20 20 20 20 20
TomiAhonen Consulting has tracked the method of

internet access (including all browsing on phones

including WAP and i-Mode) since 2001 and reported on

these trends. The cross-over point happened in 2009,
when for the first time, more people accessed browser-
based content using a mobile phone than with a PC
(laptops, desktops and tablets, combined). The first
graph (above) shows the usage when both types are
included, so the user reports internet usage either
exclusively on that device or including that device. The
PC users include tablets. PC users in the above graph
can also use mobile.
Internet Access Method Globally 2014
Only Phone access 44%
Both PC & Phone 46%
Only PC access 10%
Similarly the mobile users including WAP may also use

PC. The cross-over poin was in 2009 and today more

internet browser users access the internet from mobile

phones than from traditional PCs.
The better measure is to split the usage three ways to

include exclusive users on either method, plus those
who use both devices. This is shown in the pie graph
above. Just under half of all internet users will access
internet content both on a phone and a PC (including
tablets as PCs). The PC-only user base has shrunk to
only 10% of all internet users (it was 100% in 1998). The
mobile-only user number keeps growing and is already
44% of all internet users. So it is accurate to claim that
90% of all internet users access the internet from mobile
phones (at least part of the time). Equally true is that
54% of internet access is by people who use a PC or
tablet (at least part of the time). This may help explain
some of the wildly fluctuating numbers being reported.
A deeper understanding of the shifts in internet browsing

can be seen by allowing multiple use and examing by
type of device.
The 2.9 billion internet users often have more than one
device by which to access the internet, especially in the
Industrialized World (see Digital Divide chapter later in
this Almanac).

Mobile Data User Numbers in Billions by Using Different Definitions
PC any kind incl tablet

PC at home incl tablet
Laptop PC or tablet
Tablet users
PC at work
Internet cafe
Smartphone users
Mobile with HTML
3G users
Mobile HTML & WAP
0 500 1000 1500 2000 2500 3000

However, the shift to mobile is strong. Smartphones

alone now exceed the total population of any type of PC
in use even when tablets are counted on the side of PCs
as ultraportable PCs. And mobile internet use is
significantly larger than just smartphone population as
most mid-range featurephones have HTML browsers
and increasingly even basic phones have WAP
browsers.
Most users who access on both methods, tend to use

more time and put more traffic on the PC based method
of access. Already over a dozen countries report more
mobile phone access to the internet than PC access,
such as Japan, South Korea, Taiwan, Philippines, India,
Pakistan, Kenya, South Africa, etc.

Mobile Data Users by Region: SMS Only vs Any Other Data
100%
80%
60%
40%
20%
0%
ed
ng
da
ica
st
st
t
a
es
ric
Ea
Ea
pi
nc
na
er
W
lo
Af
va
Ca
Am
e
pe
ve
pe
dl
ad
ro
de
&
id
ro
tin
Eu
AC
M
A
Eu
ia
La
US
As
AP
(Note in the above diagram, the light-blue taller bar includes SMS users, the
darker blue bars are 'non-SMS' mobile data users)
In 2013 Ericsson introduced an interesting new metric,

differentiating between the mobile internet as used on
mobile phones, mostly on smartphones but also
featurephone that have HTML browsers; and the
portable internet on laptops and tablets. Many laptops
and tablets, while being used for internet access, are
actually not moved about. So this was a strict measure
of how many actually used their portable PC device in a
portable way, away from the home or the office.
Ericsson counted that 300 million portable internet
devices (laptops and tablets) were in use worldwide
versus 1.9 billion mobile internet devices (smartphone

and featurephones with HTML browsers). Ericsson also

pointed out that the portable internet is not only smaller
but growing much more modestly at only 20% per year
while the mobile internet is 6 times larger and growing
more than twice as fast at 46% per year.
Japan has become the first country to report that the

majority of usage is also from mobile users. This still
does not mean that total usage in terms of traffic even
in Japan has yet shifted from PCs to mobile. However,
Japan became the first country where the usage times
on mobile exceed usage times on PCs in 2007 as
reported by the Japanese regulator. Vietnams regulator
said in 2013 that they expect their usage cross-over to
happen in 2014.
It is important to note that most people who access the

internet (or more precisely, browser-based content and
services) in the world, do so using both a PC and a
mobile phone, with more specialized uses and access
on either platform. When a user has access to both
devices, the PC is more suited for "browsing" and such
services as search. The mobile phone is more suited for
urgent use such as reading email and services such as
alerts. Google reported in 2012 that it is increasingly
common for users to split their web browsing across
different devices so they might start the search for
example on a mobile phone, then later resume that
search on a PC or tablet.

In the Emerging World, however, the vast majority of

internet users do not have access to a personal
computer at home or at work. Some use internet cafe's
or access the internet on personal computers at
university campuses etc., but the significantly larger
opportunity is with browser-equipped feature phones
which still often are on older, slower 2.5G networks. For
more see the chapter on the Digital Divide later in this
Almanac.
Even when such a phone is a considerable investment,

it is far cheaper than a personal computer and a
broadband connection. A further hindrance to PC
access is limited broadband and even narrowband (dial-
up) internet connectivity, in particular to most of Africa.
Even if costly on a per-megabyte basis, a mobile
internet connectivity is often the only viable option to
access any internet services in many parts of the
Developing World. Telenor said in 2009 for example that
in countries like India and Bangladesh, the mobile phone
based internet will be the first experience of the internet
for the majority of the customers in that region.
MOBILE DATA REVENUES
The total mobile data market is worth 525 billion dollars

in 2013 of which 195 billion dollars is from messaging
data services and 330 billion is from non-messaging
data services. 2012 was the first year when non-

messaging revenues grew larger than messaging

revenues in size. The mobile data market now dwarfs
the revenues of the internet, radio, cinema and
recordings. It is approaching the levels of revenues of
print and television as a mass media.
Total Mobile Data Revenues
600
500
400
300
Value-Add Services
200 Mobile Messaging
100
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
AVERAGE REVENUE PER PREMIUM DATA USER
The premium data revenue earned per subscriber

across the total global subscriber base grew slowly in
the early part of the decade when only few countries had
launched meaningful national data services, led by
Japan and South Korea and the Scandinavian countries.
After 2.5G and 3G networks were launched near the
middle of the decade, the average revenue of non-
messaging data use grew strongly and today is at a

global average of 3.82 US dollars per month per

subscriber across the total global subscriber base
(including all non-users). This growth curve reflects
primarily the expansion of mobile data services across a
larger user base and the handset population capable of
consuming those services, not a particular 'explosion' of
actual services consumed by the active use base.
Mobile Premium Data Revenues as Average Per Subscriber
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
The total growth of the ARPU (Average Revenue Per

User) when measured against global mobile subscriber
base shows a strong upward trend. A more pertinent
number, however, is to examine the average monthly
revenues generated against active users of (non-
messaging) mobile VAS data.

When examining the spending of active users of value-

add data in mobile, excluding messaging revenues the
ARPU (Average Revenue Per User) has been growing.
The ARPU of mobile VAS users is now at 8.33 US
dollars per month globally.
Mobile VAS Data ARPU by Active VAS User in US$/Month
10
9
8
7
6
5
4
3
2
1
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
The proportion of advertising as a revenue stream to

premium content providers on mobile has kept growing.
In 2013 mobile advertising revenues reached 44 billion
dollars, accounting for 13% of the VAS data in mobile..
Mobile advertising is particularly strong in newer mobile
service areas such as smartphone apps and mobile
social networking.

Chapter 6 - Mobile Internet 98
Do you need the exact numbers?
The Excel Sheet containing the numbers

behind all the graphics of the Almanac is
available as an optional premium extra for
every edition when released.
The unlocked Excel file is available for 50

Euro cost, please contact Tomi Ahonen at
tomi@tomiahonen.com or via Twitter at
@tomiahonen to arrange payment and
delivery.

Chapter 7 - Seventh Mass Media 98
VII
Seventh Mass Media Channel
The fourth screen for media content
The Mobile Phone has emerged as the 7th Mass Media

channel. It is as different from the internet as TV is from
radio. Mobile also has as much potential beyond the
internet, as TV had over radio. Trying to force concepts
from the internet, TV, or other previous media will
produce disappointing audience experience on mobile.
But understanding the unique power of mobile will
deliver success on the newest mass media.
SEVEN MASS MEDIA
The first four mass media tended to be strongly focused.

The traditional media are well known with established
formats. News and weather work on radio, long-form
stories in books and cinema; videogames work on
recordings etc. Print the oldest, from the 1500s. It
introduced the buy-to-own business model for books
and advertising and subscriptions to newspapers and
magazines. Recordings (late 1890s) introduced
performance media separating the creative element (the
writer/composer) and the performer with the performing
artist, such as Edith Piaff, Elvis, etc. Cinema (1900s)

turned celebrity into superstar with the first global icon,

Charlie Chaplin. Cinema introduced multimedia content
and the pay-per-view business model. Many thought
cinema would kill books but it didn't. Radio (1910s)
brought the broadcast model to media. Radio was the
first pervasive media, received simultaneously by all.
The Seven Mass Media
First Mass Media Channel - Print from the 1500s
Second Mass Media Channel - Recordings from 1900s
Third Mass Media Channel - Cinema from 1910s
Fourth Mass Media Channel - Radio from 1920s
Fifth Mass Media Channel - TV from 1950s
Sixth Mass Media Channel - Internet from 1990s
Seventh Mass Media Channel - Mobile from 2000s
Television is the fifth mass media channel (1950s). TV is

the most influential mass media today globally and was
the first mass media that took elements from previous
legacy mass media and both combined and improved
upon them. Not all legacy mass media, TV did not take

much from print or recordings, but it did "combine" the

best abilities of cinema (multimedia, moving pictures)
and radio (broadcast reach).
Even as TV forced the consumer to purchase a

remarkably expensive home electronics device - early
TV sets were far more expensive than the most
elaborate home record players or radio sets during the
1950s - yet television soon overtook all previous mass
media in its influence.
Where families in the 1930s sat around the radio set to

listen to a soap opera, concert or the news, in the 1960s
those families organized their living rooms to allow good
viewing of TV. TV discovered the power of the celebrity
such as talk shows, game shows and reality TV. After
the advent of MTV Music videos, suddenly MTV - no
longer radio - became the deciding factor to a music
artist's success. TV did not kill radio, it pushed radio to a
niche player still played in the car for example.
So enter the sixth mass media channel, the internet, in

the 1990s. As a mass medium, the internet is the first
"inherent threat media" that is capable of replicating all
of the other five previous media - we can read books,
magazines and newspapers online; view movies; listen
to radio; view TV; download recordings e.g. MP3 files,
computer software, videogames etc.

This was not true of any of the first five mass media, for
example you cannot read a newspaper over radio, or
sell a music record through the silver screen and movie
projector in the cinema (yes, you could sell the
soundtrack in the lobby, but that is part of the recordings
industry, not cinema, and only using the venue of the
movie theater as an alternate sales outlet).
That is why the internet today is such a cannibalizing

threat to the first five media. Furthermore, the internet
introduced three new element that did not exist in legacy
mass media: interactivity, search and social networking.
Capable of copying all that earlier media could do, it is
no surprise the internet cannibalizes existing mass
media today at alarming speeds.
MOBILE REPLICATES INTERNET BENEFITS
Enter the 7th of the mass media: mobile. Mobile

emerged as a mass media from about the year 2000.
Compared with legacy mass media, mobile has wider
reach of a potential audience. Also compared with
legacy mass media channels, mobile is carried more
during the day, and is accessed and looked at more
individual times than we look at any other device, gadget
or media.
Like the internet before it, today the phone can replicate
everything the previous six mass media can do

(including the internet). You can consume newspapers,

read magazine articles, listen to radio and podcasts, buy
MP3 songs, watch TV, even watch whole movies on the
phone. Even printed books see a threat from mobile. In
Japan the value of books, sold to be read on mobile
phones is worth nearly half a billion dollars annually.
Cannibalization Threat by Media Channel
Ability to cannibalize other media content

Print Record'g Cinema Radio TV Internet Mobile
Threat to be
cannibalized
Print Some No No No Yes Yes
Recording No No Some No Yes Yes
Cinema No Yes No Yes Yes Yes
Radio No Yes No Yes Yes Yes
TV No Yes Some No Yes Yes
Internet No No No No No Yes
Mobile No No No No No No
CANNIBALIZATION
Its not just that mobile is a new mass medium and it can
replicate the legacy six mass media. In fact mobile as
the seventh mass media is by far the most powerful. It is

as different to the web as TV is to radio; mobile's

influence will be greater than the internet has achieved;
mobile to internet will become as dominating as TV
became over radio. Like the internet could cannibalize
all first five mass media, now mobile can cannibalize all
six legacy mass media. But the opposite is not true, the
internet cannot cannibalize all of the services on mobile,
for example you cannot do ringtones or ringback tones
on the PC based internet.
The two interactive digital mass media, internet the sixth

and mobile the seventh mass media can potentially
cannibalize any of the five legacy mass media. Note that
mobile can cannibalize internet, but not the other way.
9 UNIQUE BENEFITS OF MOBILE
Mobile has eight elements not available on any of the

previous mass media. The first four were specified by
Tomi Ahonen in 2005 when first discussing the 7th mass
media taxonomy. The fifth benefit was discovered by
author and mobile guru Tony Fish. The sixth benefit was
explained by AMF Ventures. The seventh benefit was
discovered by Alan Moore of SMLXL together with
Xtract. The eighth benefit was discovered by Raimo van
der Klein of Layar in 2009 and the ninth benefit was
discovered by Russell Buckley (ex Google, ex Admob)
in 2011.

(1) The phone is the first personal media. A wired 2006

survey found 63% of the population do not share the
phone even with one's spouse, it is that personal.
(2) The phone is permanently carried. Morgan Stanley

reported in 2007 that 91% keep the mobile within 1
meter (3 feet) range 24 hours a day including when
sleeping.
9 Unique Benefits of 7th Mass Media
1. Mobile is first personal mass media channel

2. Mobile is permanently carried
3. Mobile is always on
4. Mobile has built-in payment channel
5. Mobile is available at point of creative impulse,
enabling user-generated content
6. Mobile has most accurate audience data
7. Mobile captures social context of consumption
8. Mobile enables Augmented Reality
9. Mobile enables digital interface to real world
Adapted from Tomi T Ahonen book Mobile as 7th of the Mass Media, 2008
(3) The phone is first always-on mass media, allowing

fastest news delivery. So fast in fact, that other
broadcast media, TV and radio offer alerts via SMS.

(4) The phone has a built-in payment mechanism. No

other media has a built-in payment mechanism, even on
the internet you have to subscribe to PayPal or provide
a credit card, etc. But already today, older media collect
payments through the phone such as internet service
Habbo Hotel and TV shows like American Idol.
(5) The phone is a creative tool available always at the

point of creative impulse. The cameraphone is in our
pocket, always at the ready to snap images and clips.
User-generated content is radically altering the media
world as seen at YouTube etc, the advent of citizen
journalism, etc.
(6), Mobile has near-perfect audience information. AMF

Ventures measured in 2007 that on TV only 1% of
audience gets measured; on the internet that is better at
10%; but on mobile 90% of the audience is measured.
(7) Only mobile can capture the social context of media

consumption. Not what we consume, but rather with
whom. The CEO of engagement marketing firm SMLXL,
Alan Moore says "Social analytics is the new black gold
for 21st century."
(8) Mobile enables Augmented Reality (AR) mass

media services such as those offered by Layar.
(9) Mobile offers a digital interface to the real world.

The 6 M's Mobile Service Creation Tool
Movement - Escaping the fixed place
Moment - Expanding the concept of time
Me - Expressing myself
Multi-user - Extending my experiences to my friends
Money - Expending financial resources
Machines - Enabling automation and machines
The 6 M's mobile service creation system and management tool was developed
by Tomi T Ahonen with Joe Barrett of Nokia and Paul Golding of Motorola
CREATING SERVICES WITH SIX M'S
The only industry-standard tool for creating

commercially successful mobile services is "The Six
M's" developed by Tomi T Ahonen together with Joe
Barrett of Nokia and Paul Golding of Motorola. The Six
M's are Movement, Moment, Me, Multi-user, Money and
Machines. The Six M's is also used as a management
tool to compare rival service candidates and to evolve
mobile services to become every better. This tool is
referenced in over a dozen books and used by the

leading mobile vendors, operators, developers and

content owners all around the world.
REGIONAL COMPARISON
Mobile Media Markets Regionally by Revenue in USD
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The mobile media market is strongly skewed to Asia.

Advanced Asia-Pacific markets account for 24% of the
global mobile media revenues in 2014. When the
Emerging World countries of Asia are included, Asia
accounts for 44% of the mobile media revenues. The
second largest region is North America where 23% of
the mobile media revenues are generated.

AVERAGE REVENUES PER USER BY REGION
The average revenue per user (ARPU) that is spent on

mobile media content alters the picture of the total
revenues by the relative local price levels of the media
content services.
Mobile Media Average Monthly Revenue by Region in USD
18
16
14
12
10
8
6
4
2
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MOBILE MEDIA REVENUES BY TYPE
Mobile advertising has eclipsed TV & Video, as well as

Social Networking to become the largest category by
service revenues. Advertising on mobile reached 44
billion dollars in value in 2014.

Mobile Content Revenues Globally by Type
Advertising $44
Social networking $39
TV, video, SMS-TV $38

Search $30
Gaming $29
News and alerts $24
Virtual properties $23
Education $19
m-Health $16
Adult $12
Gambling $11
Music $7
Other Mobile VAS $39
0.0 10.0 20.0 30.0 40.0

Social Networking is second largest at 39 billion dollars

and Television-related content is the third largest
category and at 38 billion US dollars. This includes the
various mobile TV, video and movies-related services
for TV from TV-voting to videoclips to TV episode rentals
to premium back-stage pass type exclusive content. It
includes TV related revenues that come from Premium-

SMS based voting services for TV. Search has reached

30 billion dollars in value.
Gaming, News and alerts, and virtual properties have all

passed the 20 billion dollar annual mobile sales level in
revenue. Music was the first major mobile content type,
driven by the ringing tone, but today total mobile music
revenues are in decline and have fallen to 7 billion
dollars in annual revenues.
I need to point out that the above categorization includes

significant 'double-counting'. This is inevitable in this
stage of the industry before we get more formalized and
centralized data collection and reporting. What do I
mean? I mean that for example 'music video' worth
about 1.8 billion dollars - has been counted both in
'Music' and in 'TV, Video and SMS-to-TV' categories.
Why? Because within any one category, it 'belongs'
there, music video sold to phones is both music, and
video. In most cases there is no discrepancy: a ringing
tone is nothing other than music obviously. This method
of accounting means that the individual categories are
the 'total' opportunity within that group, but when added
together, they would result in more than the global total.
That in turn has been 'adjusted' in the Miscellaneous
category which in reality would be dramatically larger.

Tomi Ahonen's sixth book is the highly

acclaimed 322 page hardcover volume
entitled Mobile as 7th of the Mass Media.
The book explains all media formats for

mobile, and what opportunities traditional
media like news, games, music, advertising
etc will have in mobile.
Considered a must-read by media leaders,

the book includes 16 case studies of mobile
media excellence from around the world.

of this Almanac)

Chapter 8 - Mobile Music 111
VIII
Music on Mobile
The first type of mobile content
Music is the oldest form of mobile media content. It is

also the first form of mobile media which has peaked in
revenues and user numbers and is now in its decline
phase.
Mobile Music Consumers
4000
3500
3000
2500
2000
1500
1000
500
01 002 003 004 005 006 007 008 009 010 011 012 013 014
20 2 2 2 2 2 2 2 2 2 2 2 2 2
The first mobile content was the ringing tone, launched

by Saunalahti (now part of Elisa) onto only five models

of only Nokia branded phones, that had that peculiar

feature, that they accepted "user-installed" ringing tones.
Ringing tone success followed. For much of the 2000s
decade, the ringing tone download industry was worth
more than all of Apple iTunes global sales.
A significant music industry (not just mobile music but

global music industry) milestone was recently passed,
when Francisco Tarrega's classic guitar tune Gran Vals
became the most sold song of all time, selling more
copies in its lifetime than Elvis, the Beatles, Abba or
Michael Jackson had achieved in their recording
careers. When I say Gran Vals, you might not recognize
the tune, but if I say 'The Nokia Tune' then you know
exactly what song I mean. As part of over 4 billion
phones sold by Nokia that have had that song pre-
installed, forming a tiny portion of the 'bundle' of the
Nokia phone and the Gran Vals, it has indeed sold over
4 billion copies. It is also the most recognized song on
the planet, more so than Love Me Tender or White
Christmas or Happy Birthday.
RINGBACK TONES
More advenced mobile music appeared from ringback

(or waiting tone) music, which was launched in South
Korea by WiderThan on the SK Telecom network. Then
in 2003, the first real songs, as MP3 music downloads
were introduced by Sony Music also in South Korea.

Installed Base of Music Capable Phones
100%
80%
Non-Music phones
60% Ringtone phones
40% Media-player
FM Radio
20%
0%
01 03 05 07 09 11 13
20 20 20 20 20 20 20
Since that time, more advanced mobile music concepts

have been developed including mobile karaoke in South
Korea and Japan, while India introduced the background
song. Also music videos were soon popular as a form of
music consumed on phones. Other even more esoteric
mobile music services launched such as Shazam the
"song identification" service which has passed 100
million paying users all around the world.
MUSIC CONSUMERS
The first mobile music customer was the youth and they
enjoyed the early ringing tones. Then as the youth
noticed that their parents also started to download
ringing tones of "their music", the youth started to feel

that ringing tones were no longer cool, and a shift

started away from ringing tones to more advanced forms
of mobile music, such as MP3 full-track downloads,
ringback tones, music videos, mobile karaoke etc.
Mobile Music Revenues
16
14
12
10
8
6
4
2
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
Revenues for all mobile music stopped growing in 2010

when global mobile music industry revenues turned to
decline. Today mobile music is worth 7 Billion dollars.
MOBILE MUSIC BY TYPE
Basic monophonic ringing tones have almost

disappeared. Ringback tones have grown to be the

biggest part of mobile music. MP3 full-track music

downloads are now the second biggest category. Music
streaming has passed music videos in value.
Mobile Music by Type in 2014
Ringones-basic
Ringtones-Truetone
Ringback Tones
MP3
Music video
Music stream
Other
I would note that mohile music can serve as a good

forerunner when examining the mobile data services
industry. Its likely that the growth, evolution, peak and
decline phases for mobile will be replicated with other
mobile services. Probably similar to mobile, in other
content and service categories the first peak will be the
revenue peak, before the user peak will be reached. We
are now seeing this pattern repeat with SMS text
messaging and with MMS multimedia messaging.

Want Tomi at Your Event?
Tomi Ahonen will love to join your event.
Tomi will be delighted to join your event wherever you

hold it in the world. He has been seen speaking at
public conferences held in over 100 cities in over 60
countries, which is more than most music rockstars or
Formula 1 race drivers or pro tennis or golf stars get
to travel in their careers.
Tomi will need to have his travel costs covered and

be paid a reasonable speaking fee depending on the
type of event. Contact him at tomi@tomiahonen.com


Chapter 9 - Mobile TV and Video 116
IX
Mobile TV, Video and SMS-to-TV
Small screen teevee
The mobile TV and video category has three major

elements, actual TV shows and movies seen on mobile
including digital TV broadcasts direct to mobile phones;
video seen on mobile including video-sharing services
such as YouTube and Periscope; and various mobile-TV
service concepts for broadcast TV, epitomized by SMS-
to-TV voting. This major category of television and video
related mobile services is growing very strong on all
three legs.
Traditional broadcast type of TV is expanding and

starting to make money, while not yet profits, on mobile.
Video clips such as YouTube and video streaming are
gaining great popularity with better screens on modern
phones and higher data transmission speeds. And the
broadcast industry is jumping on the SMS voting
bandwagon with seemingly new reality TV shows
introduced continuously.
Television-interactivity includes SMS televoting and

various games that use interactivity on TV. It also
includes TV chat boards run on premium SMS and

uploads of pictures and video to television shows, such

as i-Report to CNN. In India 44% of mobile phone
owners have voted on TV shows via SMS (Vital
Analytics 2009)
Mobile TV/Video and SMS-TV Users
3500
3000
2500
2000
1500
1000
500
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
The second category is broadcast television content

shown on TV. There are various ways to do this, from
actual digital broadcast TV tuners built into high-end
premium phones. These are still mostly limited to
phones in South Korea and Japan. Simpler phones with
analog tuners also exist and are popular for example in
China. The television content is also offered on various
less sophisticated delivery means ranging from

"streaming" TV on 3G and slower networks, to video clip

downloads of TV clips.
Installed Base of Videoclip-Capable Phones
100%
90%
80%
70%
Basic phones
60%
Color Screen
50%
MMS Capable
40%
3G phones
30%
20%
10%
0%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
The third related concept is video sharing such as

YouTube. This chapter includes all three forms, and
when counted together, they generated 38 billion dollars
of revenues in 2014. Mobile video accounts for roughly
9% of the total worldwide television industry income.
HANDSETS AND NETWORKS
The installed base of television and video capable

phones worldwide consists still mostly of phones of
modest capability with color screens. They phones and

their usually "2.5G" network generation are not suited for

real time streaming television viewing. Even 3G
networks are only moderately well suited for television
type of content, but 3G networks do support video
sharing well.
TV, VIDEO AND MOBILE
Video clip download, streaming and broadcast TV

content are now all available on mobile phones. This
industry is at its infancy. Mobile TV is something far
more than putting current TV content onto phones much
like current TV content and programming is more than
just movies from cinema.
The world's first broadcast TV content viewable on a

mobile phone was launched by broadcast TV channel
MainosTV3 in Finland in 2001, by which short clips from
TV news were made available for download to phones.
TV-mobile convergence appeared from the direction of
broadcast TV with experiments in interactivity via the
mobile phone, as in 2001 MTV in the UK introduced the
world's first interactive TV show, Videoclash which
offered viewers the novelty of voting for the next music
video by SMS text messaging. The American Idol type
of reality TV voting interactivity is the direct descendant
of that innovation.

Mobile TV, Video and TV-interactive Revenues
40
35
30
25
20
15
10
5
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Streaming services were launched by Eurotel in

Slovakia in 2002 on the GPRS 2.5G network
technology. Today streaming TV is widely available
around the world on various 3G networks and offer a
selection of TV channels similar to the broadcast TV
network feeds. But being constrained by cellular
technology, there are congestion issues where heavy
usage of live TV streaming services will crowd out other
cellular telecoms services such as voice calls, text
messaging and web browsing.
The newest form of mobile TV is digital broadcast

television directly to mobile phones and other portable
and hand-held devices ranging from laptop PCs to
automobiles. The first network went live in 2005 in South

Korea on the DMB technology and since then similar but

incompatible broadcasts have launched such as 1Seg in
Japan. In other regions the digital TV offering has
floundered. DVB-H was seen as not commercially viable
for Spain and the early MediaFlo based digital mobile
TV has suffered in America.
Similar to broadcast TV, this technology allows unlimited

number of viewers of a given TV channel, without
congestion problems associated with cellular data
transmissions, as long as the audience is within reach of
a broadcast signal. Pricing on digital broadcast mobile
TV is usually either a subscription model or funded by
advertising.
TV INTERACTIVITY
SMS text messaging based voting uses premium cost

SMS text messaging for interactivity. It is best known for
a wide multitude of TV voting shows from American Idol
to the Eurovision song contest. The ability to monetize
TV audiences capitalizes on the trend that most TV
viewers have their phones within reach when watching
TV which only grows with smartphone adoption rates. A
2012 survey of US smartphone owners found 86% using
their phones while watching TV, and 76% doing so in
the UK. Many TV programming producers such as
Endemol and Fremantle Media make significant
revenues out of SMS participation.

Mobile TV, Videoclips and SMS-to-TV Revenues in 2014
Video clips
SMS-to-TV
TV on mobile
A major provider of SMS-to-TV gaming is Hong Kong

based Artificial Life creating also some of the most
advanced TV-interctive formats for example for Japan
where consumers create personal avatars and join TV
audiences live.
SMS-to-TV chat is yet another variant of viewer

interactivity and all-night chat boards spread rapidly after
first launched in Finland. Now variants such as SMS-to-
TV dating exist for example in Italy. Some cable TV
channels specializing on SMS interactivity earn 80% or
more of their revenues this way. Not surprisingly Finland
became the first country where SMS related revenues
exceeded those of advertising or subscription revenues.

MOBISODES
Many industry experts feel that full-length TV viewing is

not viable on the small screen of the mobile phone. So
many TV producers have been developing custom
content aimed solely at the "Fourth Screen" (Cinema, TV
and PC screens being the first three). The short, mobile
-optimized episodes are designed to be very short in
duration, typically 5 minutes in length, and are often
produced with the small screen in mind, meaning more
close-up scenes, not heavy action and movement of the
camera, etc. A major key to mobisode adoption is, that
short mobisodes can be delivered via MMS which
supports short video clips.
Actual viewer preferences indicate that many viewers

were comfortable averaging easily 30 minutes or more
per viewing session. Korean mobile TV broadcaster Tu
Media reported in January 2007 that their average
viewing across over 1.5 million viewers was over 60
minutes per day while on Japanese 1Seg technology
digital mobile TV broadcasts the average viewing is
about 47 minutes per day in 2007. Similarly MTV
reported in 2008 about viewing habits and found that its
audiences were happy to consume half-hour episodes of
MTV shows like Jackass on their phones, as long as the
mobile-phone variants of the shows were produced to
optimize small-screen viewing situations.

As broadcast TV learns to use mobile, it also quickly

discovers the video capabilities for example with MMS
video clips. The US hit TV show Pretty Little Liars on
ABC TV saw 12% of its audience sign up to receive
MMS based episode previews in 2010. This bonus
content was free and sponsored by advertising.
Mobile TV has different viewing habits. The evening

"prime time" viewing is changed, and mobile TV gains a
new peak in viewing around lunch time. Research based
on actual mobile TV viewing in South Korea, Japan,
Finland and the UK show that between 40% - 50% of all
viewing is indoors at the home or the office. In the home
mobile TV is watched as the second TV. Motorolas
global survey in 2013 found that while conventional TV
is viewed by 39% of consumers in the bedroom, mobile
phone TV is viewed by 44% in the bedroom. While in the
living room the large plasma screen TV rules, mobile
has already captured the bedroom TV experience.
USER-GENERATED VIDEO
News TV shows now ask viewers to send in pictures

and videos such as CNN's iReport. Talk shows and
morning TV can send further information back to viewers
such as cooking recipes.
The mobile phone can offer the viewer the chance to

buy the episode. Interactive advertising is being rolled

out where viewers can pause a live TV show and get

marketing information as well as coupons, testers, web
links via the phone. Video sharing services were
popularized by YouTube. The first major mobile-specific
video sharing service was SeeMeTV, launched by the
Three/Hutchison 3G mobile operators in the UK, Italy,
etc. In 2007 Orange France reported that 40% of all 3G
data traffic on their network was related to user-
generated videos and blogs.

In February Only:
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of this Almanac)

Chapter 10 - Mobile Gaming 126
X
Mobile Gaming
Interactive, immersive, immediate, impulsive
Gaming became the third major category of mobile

content by revenues to pass 10 billion dollars in annual
revenues. In gaming imuch of the money is generated
from among a small subsegment of the total population.
These heavy gaming users tend to download many
games per year. More casual gaming is gradually
gaining acceptance led by Angry Birds which had
passed one billion downloads by 2012. The recent
innovation of advergaming is now expanding the reach
of mobile gaming to new audiences. This chapter
ignores default time-killer games that come pre-installed
to phones.
MOBILE GAMING
While some premium phones optimized for gameplay

have been launched, such as the now defunct Nokia N-
Gage series, a mobile gaming phone category has
remained elusive. As modern smartphones now tend to
be touch-screen devices, the user experience on mobile
phones is far more limited than what for example the
Playstation controller allows for gameplay.

Total Mobile Gamers Globally
1800
1600
1400
1200
1000
800
600
400
200
0
01 02 003 004 005 006 007 008 009 010 011 012 013 014
20 20 2 2 2 2 2 2 2 2 2 2 2 2
Some of the major videogaming houses have found

large opportunities in mobile gaming, such as the mobile
arm of EA Electronic Arts, which earned 200 million
dollars of m-gaming revenues in 2009. ComScore found
in 2011 found that 24% of the French play mobile
games. This is in line with the CWTA 2011 survey of
Canadians (24%). The Japanese continue to be among
leaders as seen in the 2010 CIAJ survey of Japanese
mobile owners which found that 35% play mobile
games. Worldwide 1.7 billion people play games on their
phones that did not come pre-installed. It is 24% of the
total mobile user base. Gamer numbers are nearing a
plateau level suggesting gamer saturation is near.

The downloadable mobile games market is mostly

geared to heavy users of mobile gaming, and serves
phones that have good graphics, fast processors and
suitable game development and download environment.
The Apple iPhone App Store and Google Play Store are
now the primary gaming market surpassing Java and
Brew based gaming apps. Gaming can feature sudden
successes such as Angry Birds by Rovio of Finland
which achieved over 75 million game downloads in its
first year.
Popular games often related to popular culture hits from

TV and the movies such as the mobile quiz around Who
Wants to be a Millionaire and the massively multiplayer
games such as Disney's Pirates of the Caribbean on
mobile phones. A recent milestone was with the mobile
version of Tetris, which at 100 million downloads by the
end of 2009 had sold nearly three times as many copies
on mobile as it had achieved on the Nintendo console
version.
GAMING HANDSETS
Gaming capable phones came into the market first in

Japan on very basic browser phones on the i-Mode
service on NTT DoCoMo's network. Next came 2.5G
networks but the real gaming opportunities emerged
when consumers could install games onto their phones
and play them regardless of the network connection.

Gaming-Capable Phone Installed Base
100%
80%
Non browser
WAP browser
60%
2.5G
Java/Brew
40%
Smartphone
20%
0%
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
(Note this table item has been changed from previous editions. Consumer
smartphone is no longer a meaningful distinction with BYOD Bring Your Own
Device policies at working places and pure business-oriented smartphones
like the Blackberry and Nokia E-Series are exinct. Thus the Almanac will from
now on show all smartphones rather than consumer-oriented smartphones)
GAMING REVENUES
Total mobile gaming revenues have kept growing

even as the total gaming user base has stayed modest
as a percentage of all mobile phone subscribers. The
steady growth in gaming revenues reflects partly a
steady growth in total gaming users, but also the growth
in gaming titles and more powerful phones that are
capable of more advanced mobile games. The value of
gaming revenues on mobile was $29 billion in 2014.

Mobile Gaming Revenues
35
30
25
20
15
10
0
01 02 03 004 005 006 007 008 009 010 011 012 013 014
20 20 20 2 2 2 2 2 2 2 2 2 2 2
The mobile gaming revenue number as reported in the

Almanac in 2013 of 24.3 billion dollars for 2012 as a
number was very similar to the published number by
Digi-Capital Gaming Report 2012. Digi-Capital found
direct mobile gaming revenues at $10 Billion but related
gaming revenues, like advertising and virtual properties,
when added proportionally to mobile, brings the total
mobile related gaming revenues to $22 Billion by their
count in 2012.
ASIA FOCUS

Early on most mobile gaming revenues came from

Japan and South Korea. Now some other advanced
Asian "Tiger Economy" countries are delivering
significant mobile gaming revenues as well, lead by
Taiwan. European and US mobile gaming also grows in
relevance, but the biggest rival to Japan's and South
Korea's dominance in mobile gaming is China.
Gaming Revenues Regionally
10
9
8
7
6
5
4
3
2
1
0
a
es
t st ed ng st a ica
nad Ea nc pi Ea ric er
Ca
W e a lo e Af
& pe op ad
v
ev
e
ddl Am
ro r d i tin
A Eu Eu AC ia M
La
US AP As
The majority of gaming consumption tends to be

centered around high-user gamers, who buy many
games per year and tend to play many games on
consoles, personal computers and over the internet.
This heavy user gamer segment is not very large but
they are willing to pay a lot to feed their gaming habits.

The vast majority of mobile gaming is built on the

freemium business model where the basic game is free
but various shortcuts, extra features, additional layers
and premium goods are sold to heavy gamers. The
general rule of thumb is that one in ten freemium player
is willing to pay to buy extra content or services.
Advertising also exists in mobile gaming but forms a
modest revenue stream.

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Chapter 11 - Mobile Social Networking 133
XI
Mobile Social Networking
Digital communities on mobile
Social networking on mobile, also often called digital

mobile communities or mobile web 2.0 and closely
related terms such as wireless user-generated Content,
citizen journalism and moblogging (mobile blogging) are
new forms of digital community collaboration, using
mobile phones either exclusively on mobile networks, or
in conjunction with another media such as online
broadband internet, TV, videogaming etc.
Most known of social networks is Facebook with over

1.3 billion users of whom nearly 9 in 10 will access the
service on a mobile phone at least part of the time. Most
pure mobile social networks are not well known, and
include QQ of China's TenCent, mig33 of Singapore,
Frenclub of Malaysia, Mixi of Japan, Itsmy of Germany,
Funbook of Indonesia etc.
Mobile Social Networking became the fastest-ever

billion-dollar-business, passing that level of annual sales
in just two years. In 2009 it became the fastest-ever ten
billion dollar industry earning 10.3 billion dollars.

Mobile Social Networking Users
2500
2000
1500
1000
500
0
00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
The growth in mobile social networking was very strong

superceding the growth rates of smartphones or of high
speed 3G networks, arriving to a slowdown in growth
because slower networks and modest handsets are not
well suited for social networking behavior. Today 2.1
billion people worldwide use social networking services
on mobile phones which is 29% of all mobile users. Note
that the slowdown in the growth rate does not mean that
mobile social networking is reaching maturity or
saturation; rather than that as its growth rate is now
constrained by the handsets and networks, its likely to
follow the more modest growth rate of smartphone
installed base. Note that already today, mobile social
networking users number 100 million more than total

smartphone installed base (where featurephone users

also can access social networks).
The ability to charge has even been used by online

(internet) digital communities as the mechanism to
generate user revenues which was pioneered by Habbo
Hotel, the teenager virtual world ("Second Life for
children") from Finland which had spread already to over
30 countries. Habbo customers - teenagers without
credit - buy Habbo virtual currency with their phones
using premium SMS. Habbo Hotel (and its owner Sulake
of Finland) earned 50 million dollars annually, making a
10% gross profit before Finlands Elisa Group bought
the service and no longer releases quarterly
performance data.
Other mobile social networking services from Cyworld in

South Korea to Flirtomatic in the UK to Funbook in
Indonesia have adopted this payment mechanism to use
mobile to take payments on a converged service on both
mobile and web. Similar features are on many other
online social networks from Itsmy out of Germany to the
MTV related mobile social networks ranging from Italy to
Japan.
REVENUES
The mobile social networking industry has recently been

the most lucrative part of mobile, combining the rapidly

growing social networking frenzy, with the innovative

new business models around virtual properties and
virtual gifting, powered by virtual currencies. These have
already superceded traditional income streams of
subscription and advertising revenues.
Mobile Social Networking Revenues
45
40
35
30
25
20
15
10
5
0
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
In Japan recently the three mobile social networks, Mixi,

Mobagetown and Gree earn between 200 and 400
million dollars annually, and are not only reporting profits
- all three are listed on the Tokyo Stock Exchange. Each
makes its money primarily on the virtual goods, gifts and
personalization, where subscriptions and advertising
form a minority income level.

Asia now accounts for almost half (47%) of all mobile

social networking revenues worldwide reflected by rapid
growth outside the early wealthy countries of South
Korea and Japan. China, Indonesia, India, Pakistan etc
are the strong growth markets where often even modest
mobile social networks are thriving.
Mobile Social Networking by Regional Revenues
10
9
8
7
6
5
4
3
2
1
0
ed
ng
da
ica
st
st
t
a
es
ric
Ea
Ea
pi
nc
na
er
W
lo
Af
va
Ca
Am
e
pe
ve
pe
dl
ad
ro
de
&
id
ro
tin
Eu
AC
M
A
Eu
ia
La
US
As
AP
Much technical innovation is seen there such as

Pakistans SMSall which has built a Facebook and
Twitter clone running on SMS text messaging and
working on all phones. Service concept innovation is
also rampant such as Nepals Ritirivaj which uses
mobile to let Nepals over 50 separate cultural groups

and language groups store videos, cooking recipes etc

of their rituals and also offer a trading hub where say a
local seamstress can create the appropriate wedding
gown for a couple marrying abroad say working in
Dubai.
Meanwhile in the advanced markets, many innovations

are now coming from the content owners, led by pop
culture. Britney Spears allowed fans to insert
themselves into her video to dance with her; UK trio
Sugababes invited fans to send dance moves via video,
while rappers Seeda of Japan and Jay-Z in the USA
sent their fans onto mobile phone-driven treasure-hunts.
Meanwhile sports oriented fan clubs are equally a
lucrative opportunity, as Real Madrid reported in
January 2010 that their 100,000 mobile fan club
members generate 18 million dollars of annual revenues
on fan services on their phones. American professional
sports from NFL football to NBA basketball to NHL ice
hockey are cashing in on mobile social networking. For
example the hockey team Pittsburgh Penguins
innovated with live streams of cameras mounted on key
hockey players or above the goal, as well as
microphones on coaches, so fans sitting in the hockey
rink watching the live game, could get a more exciting
experience. Half of the Penguins season ticket holders
subscribed to this premium mobile video and audio
streaming service in its first year.

In Japan Mobagetown allows users to create mobile

stories, a kind of half-way-house between blogs on
mobile, and actual mobile phone based books. Very
simple SMS based multiplayer games are even
possible, as illustrated by the innovative football (soccer)
game developed by Voxline of Romania in 2010 using
SMS interactivity to create a real time multiplayer multi-
team game around soccer/football.


best examples of mobile social
networking.

Mobile Social Networking."

covers all major areas of digital communities, mobile
web 2.0, user-generated content as are currently
counted to include in mobile social networking. The
eBook includes major global innovators such as
Habbo Hotel, Flirtomatic, Cyworld, Mogi, Mobage
Town and Mixi. It has a Foreword by Flirtomatic CEO
Mark Curtis.
The cost for eBook is only 9.99 Euros. See sample

pages including several of the case studies at
www.tomiahonen.com
(this advertisement is not counted in the 212 pages...)

Chapter 12 - Other Mobile Content 140
XII
Other Mobile Content Types
News, Jokes, Adult, Location-Based, etc
There are many other areas of mobile content and

services. This is a brief look into several of the other
media content types.
MOBILE NEWS
The first mobile news service on SMS was launched by

Finnish newspaper Aamulehti in 1996. Browser-based
mobile phone news services were introduced on NTT
DoCoMo's i-Mode service in 1999 where CNN was the
first global news brand to launch a mobile news service
as a subscription service.
The first free news headlines on mobile were by

MainosTV3 in Finland with advertising-sponsored news
headline service on SMS in 2000. By 2001 WAP based
news services became possible in Europe. For example,
the Financial Times launched their mobile news in 2001
on WAP. In 2011 the first WAP based news sites are
starting to be extinguished, where the BBC is among the
first to end its WAP based simple browsing services, in
favor of 'real' HTML internet on mobile.

Basic mobile news services were mostly basic web page

(WAP) and SMS text messaging based offers at the
start. As video capable phones appeared in 2001, first
mobile video clips, as excerpts from the nightly news
were introduced, with Finnish MainosTV3 offering the
first video clip highlights form their nightly news in the
late spring of 2001.
Consumers of Mobile News
3000
2500
2000
1500
1000
500
01 02 03 04 05 06 07 08 09 10 11 12 13 14
20 20 20 20 20 20 20 20 20 20 20 20 20 20
Today it may come as a shock to many newsmedia

executives to find that there are six times as many
people who subscribe to mobile phone based news - 2.7
billion people (37% of all mobile subcriptions) - than the
total circulation of all daily newspapers at 425 million

worldwide. The global news consumer count in the

TomiAhonen Almanac has been one of the higher
numbers reported in recent years, yet very recent
consumer surveys suggest it may still be too low. Just in
China, SMS and MMS based branded headline news
services are used by 79% of consumers (Time Mobility
Poll 2012). In the Middle East 46% of mobile phone
owners receive news (Plus 7 survey 2012). In Japan
58% do so (ComScore 2011) while 47% do so in the
USA (MMA 2011).
Mobile News Revenues
30
25
20
15
10
0
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
Most major global news services have mobile variants

and services. CNN reports that its i-Report service has
had over half a million videos and pictures submitted to
it from all over the world. More advanced services are

being introduced such as NTT DoCoMo's i-Channel,

launched in 2005. It uses the idle screen of the phone to
deliver "24 hour news ticker" style news. These are
more useful to end-users being able to be personalized,
something that cable/satellite 24 hour news TV cannot
do. The service has since been launched in other NTT
DoCoMo markets from Guam to India.
JOKES, CARTOONS, BOOKS
Jokes are a popular category of basic SMS based

services in most markets, as a minor content category
and worth about two billion dollars in annual revenues.
Cartoons have mostly not been a big success outside of
Japan where the Manga comic book styles seem to fit
the local culture and the strong mobile books publishing
industry. Cartoons are an industry sector that many
expect will grow strong, once cartoonists discover the
opportunity.
Meanwhile mobile books - eBooks formated for mobile

phone screens and sold and downloaded directly to
phones have exploded in Japan to becoming nearly a
half billion dollar industry already (Impress R&D 2009)
and a quarter of Japanese phone users read m-books,
m-dictionaries or manga comics (Japan Mobile
Marketing Laboratory 2009). A Beijing University study
in 2012 found that 25 million Chinese read mobile
books.

LOCATION-BASED SERVICES
The single most spectacular failure in the group of

mobile services and applications is the category of
Location-Based Services (LBS). The category is as old
as mobile content, conceptually, and commercial
launches have been seen in advanced markets from
Japan to Italy to Finland to Germany since 2000.
Inspite of almost every conceivable LBS type of service

having launched, the mass-market success of LBS is
elusive. Some niche-target services have succeeded,
mostly in the enterprise/business sector, and in parcels
delivery, vehicles fleet management and such
movement-control related industries. Mapping and
guidance such as TomTom and automobile vehicle
control, security, tracking and safety services like
OnStar have been successful, but no mass market
success of LBS has been achieved. After the iPhone
added GPS to its abilities, LBS has experienced a new
revival of passion but so far success has not been seen.
The reality of LBS is, however, that while consumers are

quite happy to use free maps, the paying user base of
LBS is miniscule. Gartner reported in 2009 that the total
worldwide user base of all LBS services was only 96
million subscribers (2% of the mobile subscriber base)
ABI Research counted the value of all LBS services in
2010 to be worth $560 million dollars (which was only

0.4% of all mobile VAS premium-data service revenues

that year, and about 0.1% of all mobile data revenues).
This from a mobile service category that has been in
existence for ten years! Quite literally, out of all mobile
data service opportunities, Location-Based Services are
dead-last as the least successful opportunity of this
enormous industry. It is not that LBS can make 'no'
money, but it is by far the worst opportunity in mobile.
Today LBS revenues globally are between 1 and 2
billion dollars, far too little to be separately analyzed for
this Almanac.
ADULT ENTERTAINMENT
The first content category for essentially every mass

media ever invented, tends to be adult entertainment.
Mobile is a rare exception, that ringing tones actually
invented the media opportunity, but within months of that
launch, the first adult premium content services
emerged on mobile.
This sector is a significant niche market worth 10.9

billion dollars in 2013 but one that is usually under the
radar of most analysis and reports of the mobile
industry. While representing only 3% of the mobile
content revenues today, the best indication of the role of
adult entertainment on mobile, is to look at the
proportion of its contribution over time. Generally media
analysts suggest that the higher the role of adult

entertainment out of the total media opportunity, the less

mature that mass media industry is.
Adult Entertainment, as percent of all mobile content
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
On mobile currently, adult entertainment is only the tenth

largest content category group worth 12 billion dollars. It
has seen a gradually declining contribution to the total
mobile content industry, suggesting that mobile is
maturing far more rapidly than for example the legacy
PC based internet where adult entertainment still
delivers a large slice of content revenues. Note also that
3% adult content is in very rough terms on the same
scale as adult entertainments contribution to the
magazine print industry and the cinema industry which
suggests it is likely to stabilize to this level.

Gambling and betting is also available on mobile

phones. A steadily growing content category, gambling
and betting deliver 11 billion dollars of annual revenues.
The users of gambling and betting tend to be a small
niche group of users, who then generate a lot of
transactions and revenues.
OTHER SERVICES
Early popular content type was picture downloads as

first logos then screen savers. This early staple of
mobile content which once delivered 25% of the content
industry for mobile, is now disappering and worth under
1% of the industry.
Search services also are on mobile and growing strongly

from a small base. Search on mobile was worth 30
billion dollars in 2014, led by Google obviously, but
including many of the more exotic mobile search,
identification and information services such as Shazam
the music recognition service and answer services like
ChaCha and AQA.
Education services are growing very popular in many

Asian markets, such as South Korea, Japan, China etc,
where the mobile phone is proving a powerful tool to
help with language training, and other services such as
mathematics tutorials etc. For example Bangladesh
found 400,000 paying users within a month of a new

mobile phone based English language course being

launched (Financial Times 13 Nov 2009). The total value
of mobile education services is 19 billion dollars.
Mobile healthcare is another strongly-growing sector. Its

appeal is particularly strong in areas where overall
healthcare services are not well available. A lot of
mobile healthcare innovation comes from Africa where
mobile payments have also enabled the commercial
uses of m-health services. The global market for m-
health services is 16 billion dollars annually.
A multitude of ever smaller niche services and concepts

also exist relating to mobile content, too many to
mention from the mobile books and movies, to sports
services, virtual reality services, augmented reality
services, etc. Again to understand how miniscule these
tend to be, the first global survey of the Augmented
Reality market size was published by Markets and
Markets and found the global market of AR services to
be worth 496 million dollars in 2013, yes less than half of
one billion dollars. This Almanac starts to get interested
in services when they mature enough to near 10 billion
dollars in annual revenues.

WANT LATEST NUMBERS?
The TomiAhonen Almanac 2017
You are reading the free edition of an

older version of the TomiAhonen
Almanac. If you want the latest
numbers, the new TomiAhonen
Almanac is out annually in February.
The paid edition of the TomiAhonen

Almanac costs only 9.99 Euro
($13.99 US dollars, $8.99 UK Pounds)
It has exactly the same format and series of tables as

this free edition, but the data is all current.
The only place to buy the TomiAhonen Almanac or

its sister ebooks, the TomiAhonen Phone Book, the
TomiAhonen Mobile Forecast, and the Pearls
series of ebooks is directly from the publisher, via the
website www.tomiahonen.com
To buy Tomi Ahonen ebooks, see:

www.tomiahonen.com

Chapter 13 - Smartphone Apps` 149
XIII
Smartphone Apps
Rapidly growing, yet tiny slice of pie
A long-nascent niche category of mobile apps has

suddenly reached fever-pitch hysteria as the Apple
iPhone App Store reported ever more billions of
downloads. However, the promised nirvana of vast
fortunes has proven a mirage. Most who report on the
apps economy now concur with my early prognostication
that it was a fools errand.
Smartphone Application Market Revenues by Type
30
25
20
15 Consumer apps
Business apps
10
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
A 2013 survey of 5,000 US consumers found that 66%

of Americans preferred going to a mobile website of any

random brand than downloading their app onto the

smartphone. The apps opportunity continues to be
primarily a gaming opportunity and to a lesser extent a
business tool (for employees) but not a mass market
service platform.
Distribution of Mobile Data Revenue by Type
100%
80%
Mobile Messaging
60%
VAS Services
Applications
40%
20%
0%
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
Mobile phone app sales were not actually invented by

Apple. NTT DoCoMo was the first mobile company to
offer apps to download and purchase, as part of their i-
Appli store from 2001. Nokia set up the first dedicated
smartphone apps store for the N-Gage phone platform,
which was later closed with the termination of the N-
Gage line of gaming phones. But even before 'Apps
Stores', smartphone applications were sold in particular
for business-oriented phones like the Blackberry, until
Apple's iPhone App Store re-invigorated the market.

Consumer App (App Store) Revenues by Type 2014
App Store Owners

(Apple & Google) 25%
Developer Income:
Direct Payments 12%
Developer Income:
Advertising 17%
Developer Income:
Virtual Goods 46%
While Apple App Store download statistics have gained

enormous media attention, there is still plenty of hype
and even hysteria. At the Apple iPhone App Store, most
downloads are free apps. Out of paid apps, the majority
are games.
The total revenues generated by all smartphone apps,

not just app-store apps, is about 29 billion dollars
globally. The consumer apps accounted for 72% and the
business/enterprise -oriented applications accounted for
28% of the revenues. Apple's highly popular iPhone App
Store was still the biggest app store in terms of total
revenues generated but Googles Play store is now
closing the gap and will soon overtake Apples store.

App Store Key Metrics 2014

Cumulative Apps Published: 3.6 Million
Live Apps Still Maintained: 1.0 Million
App Downloads: 144 Billion
Smartphone Population (mid year) 1.8 Billion
Downloads Per live App: 144,000
Downloads Per Smartphone: 80
Developer Revenues (all sources): 15.8 Billion
Average Revenues Per Download: 0.11 US Dollars
Annual Revenues Per Live App: 15,800 US Dollars
Average Downloads Per Live App: 144,000
Median Revenue Per App To Develper: 400 US Dollars
Developers Who Turn Profit 1.6%
Developers Who Lose Money 98.4%
Meanwhile the proportion of total apps revenues has

remained consistent as a tiny sliver of the total mobile
data market. Mobile messaging and increasingly mobile
VAS non-messaging data services are a far bigger
economic opportunity than all apps of any kind for
smartphones. The mix of revenues in the consumer app
market is shifting radically. It started as a paid app
business model, and very soon added advertising and
sponsored apps (adver-apps) as an alternate revenue
model. During 2010 many app developers discovered
the opportunity in various virtual properties, similar to

how the majority of all revenues are generated in mobile

social networking.
App Developer Average Annual Income 2014
Rich App Developers $432,700 1%
Middle Class Developers $ 40,500 2%
Laborers $ 9,400 8%
Slaves $ 421 49%
Paupers $ 0 40%
ONE PERCENT MAKE ALL THE MONEY
The app economy has famous success stories that are

often quoted suggesting that there is a realistic
economic opportunity. In reality, a few popular games
make millions of dollars, and the vast majority of apps
that are still being maintained, do not come close to
breaking even. While the average income earned per
app seems attractive at 15,800 dollars, the reality is that

the median developer only earns 400 dollars. Yes,

exactly half of all developers with live apps, earn less
than 400 dollars. Most app developers cannot recoup
even the costs related to the app development software
licences, far less the costs of the hardware such as a
laptop PC.
Because of a few very rich developers with hit titles like

Candy Crush or Clash of Clans or Angry Birds, the
mathematical average skews totally off the scale. Its like
if in a small town there lives two billionaires, then the
average income of the town could be about a million
dollars per year. But the several thounsand others living
in the small town would in reality only be of normal
wages. That is why the median number is the most
important.
Also one should note that to achieve even to reach the

average income levels of about 14,000 US dollars, an
app would need well over 100,000 downloads, on
normal monetization methods including advertising and
virtual goods (also known as in app purchases). Apps
can be a good business for games, and in some cases
for enterprise apps. The consumer space is nearly
hopeless for an app to generate any actual income for
its developer unless the app is developed for and sold to
an corporation or other such entity which pays for the
development costs, for example for customer service
uses.

If you need more info about the handset

market, please note the companion volume to
this Almanac, the brand new TomiAhonen
Phone Book 2016. The ebook is in the same
format as this Almanac, but focuses only on
the handset side of the industry including
smartphones, dumbphones, operating
systems, features, app stores and other
devices and accessories. It comes out every
two years but latest edition was published
December 2016, all data in it are current as
of December 2016. The book has 100 charts
and tables including extensive regional tables
of market shares, average sales prices etc. It
costs 9.99 Euros and is avaiable at
www.tomiahonen.com
(this advertising page is not counted in the 212 page length of this
Almanac)

Chapter 14 - Mobile Advertising and Marketing 155
XIV
Mobile Advertising and Marketing
Natural medium for engagement marketing
Admob became an instant mobile news story in 2009

when Google bought it. Admob was the biggest of the
mobile ad platforms and was delivering over 11 billion
ads to mobile phones every month worldwide. Bear in
mind, that while largest, Admob is only one of the
suppliers of advertising on mobile and they only operate
in a small portion of all countries of the world. A survey
of major mobile ad networks by Mobile Marketing
Magazine in July 2010, found that 14 mobile ad
networks delivered more than a billion ad impressions
per month, each. And that is just the most commonly
referenced metric of banner ads which are perhaps
easiest to measure. Mobile Marketing Watch reported
that SMS based ads alone accounted for 4 Billion US
dollars in advertising expenditures in 2013.
Please note, that many who report on mobile advertising

revenues, count only smartphone-oriented ads such as
banner ads and preroll video etc, often explicitly ignoring
messaging-based mobile ads. This severely
undercounts the total market as messaging (primarily
SMS and MMS) still delivers 27% of all mobile ad

revenues globally and in the Emerging World markets,

messaging accounts for almost all mobile ad revenue.
Mobile Advertisements Delivered Annually (Billions)
1600
1400
1200
1000
800
600
400
200
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
The first mobile advertising was an ad-sponsored news

headline service in Finland, based on SMS text
messaging in 2000. The first conference to discuss
mobile marketing and advertising was held in London in
February 2001, that I chaired and the first book to
feature mobile advertising was my second book M-
Profits in 2002.
The early mobile ad traffic was very modest until the

model exploded with Admob and its close rivals like
Jumptap, InMobi, Adsmobi, Amobee, Smaato, Admoda
and Buzz City. The above graph best illustrates the
recent and very dramatic growth in mobile ad
impressions delivered globally. Note that the first ads

were delivered a decade earlier in the year 2000, but the

traffic did not even register in the illustration until after
year 2009.
People Receiving Mobile Advertising
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
CONSUMERS OF ADS
The early assumption of the mobile marketing industry

was that advertising on mobile would be seen as a
novelty at first, and would find exceptionally high
acceptance early on but over time people would prefer
not to receice ads as their numbers on mobile would
grow. The US based annual Harris tracking poll of
consumer preferences has found the opposite to be
true. Every year since they first asked the question in
2009 the acceptance of mobile ads has been increasing
in the USA, not decreasing. The latest survey result by

Harris in August 2013 found that 45% of US mobile

phone owners would like to receive ads on their phones.
By audience reach, mobile became the largest
advertising media passing FM radio in 2013. Today
mobile ads reach nearly twice the audience of the
internet, 2.5 times the number of TV sets and 20% more
than radio. Compared to newspapers, mobile ads have
a reach 12 times larger.
Advertising-Capable Mobile Phone Installed Base
100%
90%
80%
70% SMS capable
60% Any Browser/WAP
50% MMS capable
40% HTML browser
30% Smartphones
20%
10%
0%
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
`
Mobile advertising is more accurate and more effective.
AMF Ventures found in 2007 that on TV only 1% of total
audience data is collected. On the internet about 10% of
total audience is known. As the marketing professionals
learn to use mobile they also are reporting astonishingly
strong performance with the medium. ePrize reported in

2013 that when they introduced mobile offers to sell

tickets to the Broadway show Spiderman, they achieved
59% conversion rates on the offers. Mondelez found in
2013 that when mobile offers were introduced at retail
points of sale they increased impulse purchases by
18%. The MMA reported in 2013 that 49% of American
smartphone owners had changed their mind inside a
store based on something they found on their phone.
Meanwhile Google reported in 2012 that 28% of
searches on mobile result in a conversion to sale.
Mobile Advertising Revenues Globally
50
45
40
35
30
25
20
15
10
5
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
The revenues of mobile advertising are growing at far

faster speeds than the overall mobile data industry.
From 2013 to 2014 the mobile advertising revenues
grew by 43% and reached 44 billion dollars in value.

The average revenue earned by the mobile industry per

subscriber from advertising has been growing and is
now at 51 US cents per month as a global average
across all subscribers.
Mobile Advertising Revenues Monthly as Average Per Subscriber
0.60
0.50
0.40
0.30
0.20
0.10
0.00
00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
This number is far below all early expectations of the

role of advertising to the overall mobile media
opportunity as suggested by the industry forecasters a
decade ago.
When the number is adjusted for only those who receive

advertising on their phones, the number is somewhat
higher but still less than one dollar per month per mobile
phone owner receiving ads. It was 73 US cents per
month as a global average in 2014.

Mobile Advertising ARPU by Audience Receiving Ads per Month
0.8
0.6
0.4
0.2
0
00
01
02
03
04
05
06
07
08
09
10
11
12
13
14
20
20
20
20
20
20
20
20
20
20
20
20
20
20
20
One should keep in mind the relevance of mobile

advertising to overall revenues of the mobile media
industry.
Role of Advertising as Part of Mobile Media Revenues
350
300
250
200
150
100 Mobile Media

Advertising Contribution
50
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

In some industries like radio and the internet, advertising

forms most of the opportunity to generate income and is
thus a critical element to the survival of the industry
itself. In other media such as cinema and books, the role
of advertising is trivial and only seen as an optional
revenue source. In mobile media the role of advertising
as a revenue source has been growing but still accounts
only for 12% of the total mobile content income.
TYPES OF MOBILE ADVERTISING
Early mobile ads were copies of legacy media. WAP

banner ads are adaptations of web banner ads which
are copies of newspaper and magazine ads; spam SMS
grew from junk mail and internet email. Pre-roll video is
a linear interruptive format similar to the ad breaks on
television.
A Forrester survey in December 2012 found that

interruptive banner ads, in-app advertising and pre-roll
video ads are more annoying to mobile users than
traditional TV advertising. But the same survey found
that messaging based ads on SMS and MMS are less
intrusive and annoying, and found to be even more
useful, interesting and engaging, when based on opt-in.
The Mobile Marketing Association and other marketing
bodies have been educating the advertising and
marketing industry of the importance of opt-in, as well as

the power of mobile messaging in marketing uses, which

is still severely under-utilized.
Revenues of Mobile Advertising by Type in 2014
SMS text messaging 13%
MMS picture messaging 14%
Banner ads 54%
Other mobile ads 19%
Advergaming is the merger of advertising with

videogaming. One of the world's first such campaigns
was simple puzzle game in India in 2005 to promote the
launch of the Bollywood movie Jurm. More modern
advergaming concepts include the Puma sponsored
multiplayer Formula One racing game at the Shanghai
2008 F1 race which allowed four friends to race each
other in real time on phones.
POWER OF VIRAL
The power of viral marketing is illustrated by the findings

by Forrester in 2006 that 64% of consumers are willing

to try something, that was recommended by a friend;

and 69% of consumers will forward something to a
friend that they like. In fact on mobile, they will typically
forward it to between 2 and 6 people. Mike Beeston
former CEO of UK based Fjord says mobile campaigns
should be "sufficiently contageous."
USER CO-CREATED ADVERTISING
UK based Blyk brought the "web 2.0" innovation of user-

generated content (blogs, Flickr pictures, YouTube
videos etc, citizen journalism) to advertising. How does it
work? The young consumer is encouraged to respond to
ads and tell the brand more about personal preferences.
The system automatically rewards the youth for being
truthful. So a brand may ask which supermodel is
favored by a teen. After answering honestly, that girl will
then receive her advertising from that brand,
personalized so that it features her favorite supermodel.
Same can be done with her colors, her music, her
fashion styles, etc. Every time she gives more
information to the advertiser, the advertiser learns more
to personalize the offering.
This creates a transition in the content, where the

content is no longer seen as intrusive advertising, but as
valuable content. The concept is so powerful, that the
biggest complaint by members of Blyk was that they
wanted more of the ads. Major brands such as Coca

Cola, Adidas and L'Oreal were running dozens of

engagement marketing campaigns on Blyk and raving
about this innovation of user co-created advertising.
Forum Oxford reported in 2010 that the Japanese youth
fashion mobile magazine, Girlswalker, is now sustaining
45% conversion rates on its highly targeted fashion ads.


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Chapter 15 - Voice Calls 166
XV
Voice calls
Still the elephant in the room
This chapter is deliberately towards the back of the

Almanac, even though voice calls form 41% of all mobile
telecoms industry revenues and 56% of all mobile
service revenues. Voice calls are a well established,
relatively stable part of the mobile opportunity.
Global Mobile Voice Revenues Annually
1000
800
600
400
200
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Voice calls generate about 671 billion dollars of

revenues annually. The revenues of mobile voice have
finally peaked and are now in gradual decline at 1%
annually. The big threat to traditional mobile phone voice

calls is Skype and its clone services that offer internet

telephone calls often for no cost at all to the caller.
These VOIP (Voice Over Internet Protocol) services like
Skype are often used together with WiFi connectivity to
avoid any mobile operator/carrier data charges.
HOW LONG WILL VOICE DOMINATE?
The mobile phone or the cellular phone, incorporates the

abbreviation of an older word, the telephone. Telephone
comes from the Greek and means "distance" (tele) and
"sound" (phone). The original telephone was a long
distance voice system, a talking device for long
distance. It is quite normal for most to think, that the
"natural" ability of any phone, including any mobile
phone, is voice communiciation. It has been, after all,
that way for more than one hundred years with the fixed
landline telephone service.
That is now changing, and a clear-cut distinction of "real

experts" in mobile telephony in contrast with any claimed
expert who may come from the fixed landline side, or the
internet side, or any laggard mobile market like the USA,
is how they answer the question, what is the primary use
of a mobile phone. If they say, "but of course, it is voice
calls" then that person does not understand mobile.
As I showed in the SMS text messaging chapter, today
the primary use of a mobile phone has now shifted to
messaging on mobile, away from voice calls.

Active Users of Outbound Voice Calls Out of All Subscriptions
100
80
60
40
20
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
The more startling evidence is how many mobile phone

subscribers never initiate voice calls on their phone. In
most cases these are poor people who cannot afford to
place voice calls, who are willing to accept calls from
wealthier relatives, a very common phenomenon in the
Developing World. In India 30% of all mobile phone
subscribers do not initiate voice calls at all. Globally 73%
of all active mobile accounts are not used to initiate
traditional cellular/mobile calls. Some dont use the
service at all, others use VOIP calls, and some only
respond to phone calls but do not make them. Also the
total subscriber count includes data dongles and
telematics subscriptions which do not use voice calls.
In South Africa a new free service has been introduced

to capitalize on this human need. The 'Call Me' service

is sponsored by advertising and allows anyone with a

valid phone to send a free SMS text message to a friend
or relative asking them to call. The advertiser pays for
the message, the person receiving the message usually
is close to the sender and is willing to pay for the call,
resulting in more traffic. In 2014 the MMA South Africa
reported that every South African mobile phone user
had either sent or received at least one Call Me
message. Everyone wins.
In India in 2013 several of the winning mobile service

innovations have been built around missed call
marketing services, where a consumer is asked to place
a missed call (call the number but hang up before it
answers) to a number and then receive a message from
the advertiser, such as coupons and offers sent via
MMS for example. The advertiser of course pays a
nominal fee per missed call attempt made to the
carriers/operators who are happy with this arrangement.
Three relevant factors contribute to the trend away from

voice calls trend. Some users, mostly young "Generation
C" for Community Generation, under 30 year old users
in developed mobile markets, prefer SMS text
messaging so much, they have stopped placing voice
calls altogether. This is a small minority of all
subscribers, but a growing part. Their preference for all
outbound and inbound communications is to use text
messaging based communication. For them a phone

with a broken microphone or speaker, is not broken, as

long as the display and text entry still function on the
device.
A second new development is the data-only mobile

subscription. Most typically this is the data card modem
or dongle, used to connect a laptop PC to the internet
via mobile broadband speeds. These customers will not
place traditional voice calls at all onto the network.
There are also many who have a smartphone or 3G
phone that is configured to work this way, as only a data
access device, in effect a moving modem for the laptop
or PDA or other data device.
The third development is an effect of multiple phone

ownership. If a user has two phones, on two networks,
and one network offers a great bargain on voice calls
(free minutes to all networks, etc) and the other has a
great data package, this one user can optimize the
traffic so, that one mobile phone is used for voice, and
one is used for data. This produces subscribers who do
use a mobile phone (on one network) for data-only,
while using the alternate phone on another network for
voice calls (and usually also other data like SMS text
messaging as well).
TomiAhonen Consulting has been tracking this

development of users who have abandoned outbound
voice calls and finds that globally the level has now

passed 23% of all mobile subscriptions. As we passed

the point where mobile messaging is used more than
voice, it has become a valid point then to consider what
to call the device, if it is no longer primarily even used to
place voice calls.
A 2012 survey by O2 in the UK found that in Britain the

camera function has now also passed voice calls as
more used on the mobile. As the clock/alarm functionon
the mobile phone now also has more users than voice
calls, voice has fallen to fourth most used feature of a
mobile phone.


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Chapter 16 - Business/Enterprise 172
XVI
Business/Enterprise Services
Not a vanishing segment
At the start of mobile telecoms the cellular phone was

seen as a productivity tool for busy businessmen in
cities, often used as a carphone. The perception lasted
well into this decade with many business and enterprise
oriented services developed, most obviously the
Blackberry wireless email system for business/
enterprise use, and the push-to-talk service that
propelled Nextel to its success in the USA.
The overall balance of customers shifted during the

1990s and now the vast majority of all mobile phone
customers are residential customers. The total industry
revenues, and the various service and application
opportunities, as well as handset types etc, are now
predominantly sold to consumers.
This does not mean that there is not a market for the
business/enterprise segment. It is vast, counted in the
hundreds of millions of subscribers worldwide, who also
deliver a disproportionately large amount of traffic and
revenue per business/enterprise phone subscription.
Still, the balance of the industry has shifted so much,

that business customers reflect a tiny fraction of the total

customer base.
Enterprise Customers out of All Unique Subscribers

5
4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2013 2014
There are significant revenue sources out of

corporate/enterprise/business applications. The vast
majority of enterprise/business mobile telecoms
revenues comes out of voice calls, as phone users who
have employer-provided phones, and whose employers
pay for the voice calls, will tend to put far longer duration
voice calls to the network. They also produce a
disproportionately large amount of the total international
roaming voice calls on mobile networks. Roughly
speaking the 10% of enterprise/corporate business
customers generate about 20% of the total industry
income, and on many networks in Industrialized World

markets the business customer segment can deliver

40% of total revenues. This rule of thumb was once
again verified by a 2012 survey by UK telecoms
regulator Ofcom which found that 11% of UK mobile
phone subscriptions are 'employee phones'.
There is also a growth opportunity in new data services

for business/enterprise customers, in particular modem
data cards and dongles for laptop internet access;
automation and telematics systems; CRM systems, etc.
Services in the enterprise/business segment tend to be

highly specialized and industry-specific. So for example
a service might be tightly tailored for the healthcare
industry or for fleet management or for utilities
employees field work. In Finland with a major lumber
industry, there are tree management systems that log
every individual tree electronically, with GPS and GSM
modules, to enable intelligent forestry management.

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(This advertisement is not counted in the 212 pages)

Chapter 17 - Other Mobile Data 175
XVII
Other Mobile Data
Mobile commerce, telematics etc
There are still several other areas of services on mobile.

This is a quick look at mobile commerce, banking and
credit cards; telematics; accessories; and miscellaneous
other categories.
MOBILE PAYMENTS
A strongly-growing 'hype' sector in mobile is mobile

payments and mobile money. In some countries this has
truly exploded, with everyone looking at M-Pesa in
Kenya. Launched only 6 years ago, today 48% of the
total Kenya economy transits mobile phones, according
to the Central Bank of Kenya statistics in 2012. But only
9 countries in Africa have passed the point where more
than 10% of adults use mobile payments, and even in
countries where NFC technology is widely installed in
the phone base - such as Japan where 58% of all
phones have NFC enabled mobile wallet capability
(Celent 2013), most users are not actively using mobile
payments.

In 2011 Visa became the first major international

financial institution to state that they believe mobile is
the future of payments. In 2010 Sweden started
deliberations of when to end the manufacturing of coins
and banknotes - the very literal end of cash. In 2011,
Turkey became the first country to issue a target date of
when they expect to stop issuing cash. Their target year
is 2025, only 12 years from today.
Globally, only 13% of the mobile phone user base have

used any kind of mobile payments including coupons.
The mobile coupons industry was worth only $5 Billion in
2012 (Juniper 2013). The MMA reported in 2013 that
mobile coupons deliver 10 times better redemption rates
than printed paper coupons such as in newspaper
inserts. This sector is interesting to monitor, but is still
too small and does not yet warrant its own section in the
Almanac in 2015.
Telematics is another area that has tight niche

opportunities in remote control and remote metering as
well as various systems for cars and fleet management.
This is a small niche market but for their respected
industries, an important evolving opportunity. In some
countries like Sweden 20% of all mobile subscriptions
are already used for such telematics applications.
Systems and Systems Telecoms reported in 2013 that
the total global value of mobile telematics industry
globally is 48 Billion dollars. This number includes

hardware sales in addition to the service revenues.

TomiAhonen Consulting measures the service revenues
part of the telematics industry to be well under 5 Billion
dollars still in 2015. But it is a well growing part and like
much of mobile industry innovation the hardware part
emerges first before the software and services business
can become viable.
Accessories and customization of mobile phones is

another significant niche market. Phone faceplates,
phone carrying pouches and transparent plastic covers
to protect the phones are a billion dollar industry by
themselves. In Asia it is popular for the youth to hang
little teddybears and small toys to the phones, and these
form a little industry. In Japan it is common to decorate
phones with custom stickers. All these are valid
opportunities but disappear in the rounding off error in
the scale of the total industry. The total value of the
accessories after-market is about 75 billion dollars in
2015 including bluetooth earphones, spare batteries,
carrying cases, memory expansion cards etc.

Do you need the exact numbers?
The Excel Sheet containing the numbers

behind all the graphics of the Almanac is
available as an optional premium extra for
every edition when released.
The unlocked Excel file is available for 50

Euro cost, please contact Tomi Ahonen at
tomi@tomiahonen.com or via Twitter at
@tomiahonen to arrange payment and
delivery.

Chapter 18 - Infrastructure 178
XVIII
Infrastructure
Networks
The infrastructure sector of the mobile industry is worth

about 45 billion dollars annually. It is mostly hidden
when analysts look at the industry, yet hidden in the
numbers is the world's largest infrastructure investment
of all time, when 3G networks were rolled out in this
decade at the cost of 300 billion dollars worldwide.
About 100 billion of that was license fees for 3G licenses
and nearly 200 billion were network installation and
upgrade costs.
The big 3G investment opportunity has now passed with

most major Industrialized World countries having well
deployed 3G networks but still some have not deployed,
such as Turkey. Many parts of the Developing World
have not yet deployed 3G, such as parts of Africa and
the Middle East. These will still support major
expenditures in the 3G evolution of mobile network
deployments.
A new opportunity is emerging with 4G. That is not to be

confused with the hype around WiMax where many
WiMax providers now call their technology 4G. That is

not what is consistent with international standardization,

and is self-serving. After years of complaining about the
specific misuse of the term, the ITU finally accepted the
common usage in 2010 and today WiMax networks can
also be called 4G, as well as the 'evolution' systems to
3G celluar networks, such as LTE.
Mobile Subscribers by Network Generation
100%
90%
80%
70% 3G +
60% 2.5G
50% 2G
40% 1G
30%
20%
10%
0%
03 04 05 06 07 08 09 10 11 12 13 14
20 20 20 20 20 20 20 20 20 20 20 20
As a comment, currently the big network providers in the

cellular telecoms space are LM Ericsson and Nokia and
Huawei, with Alcatel-Lucent and ZTE also significant
suppliers. Many supporting players offer elements to the
infrastructure ranging from Gemalto which makes SIM
cards, to Cisco making internet routers to Amdocs
making billing systems to Comverse making messaging

platforms and Buongiorno making mobile service

applications etc.
Note that at the back of this Almanac in the Tables

section, there is a listing of the 25 most advanced
countries by 3G penetration rate.

Want Tomi at Your Event?
Tomi Ahonen will love to join your event.
Tomi will be delighted to join your event wherever you

hold it in the world. He has been seen speaking at
public conferences held in over 100 cities in over 60
countries, which is more than most music rockstars or
Formula 1 race drivers or pro tennis or golf stars get
to travel in their careers.
Tomi will need to have his travel costs covered and

be paid a reasonable speaking fee depending on the
type of event. Contact him at tomi@tomiahonen.com


Chapter 19 - Digital Divide 181
XIX
The Digital Divide
Emerging World not like Industrialized World
This chapter examines the Digital Divide briefly relating

to major mass media technologies, and then in further
detail at some major categories of mobile statistics from
the angle of the Digital Divide.
Mobile phones (cellular phones) were conceived as

business tools used by wealthy bankers, executives and
government officials in the richest cities of the
Industrialized World, and launched first commercially in
Tokyo Japan in 1979. Gradually phones spread to all
sectors of the public, beyond the cities, even the youth
adopted mobile phones. But most of the Emerging
World did not benefit from mobile phones for the first two
decades of the industry in the 1980s and 1990s.
During the past decade of the 2000s, however, the

Emerging World has rapidly taken to phones. At the start
of 2010, three out of every four mobile phone
subscriptions were in the Developing World and today
most of the industry growth is in Africa, Latin America
and Asia. India alone adds 20 million new subscribers

every month, which is about the size of the total

population of Portugal or Taiwan or the State of Texas.
TECHNOLOGY PENETRATION RATES
Digital Divide - per capita

Industrialized World Emerging World
Population 1.2 Billion 6.0 Billion
Households 480 million 1.4 Billion
Mobile subscriptions 2.1 Billion (175%) 5.1 Billion (85%)
FM radio receivers 2.8 Billion (233%) 1.7 Billion (28%)
Banking account holders 1.0 Billion (83%) 1.5 Billion (25%)
Televisions 675 million (56%) 1.4 Billion (23%)
PCs incl laptops&tablets 750 million (63%) 950 million (16%)
PC web users home/office 650 million (54%) 850 million (14%)
Internet cafe users 30 million (3%) 290 million (5%)
Mobile Internet users 750 million (63%) 1.95 Billion (33%)
Landline phones 300 million (25%) 700 million (12%)
Automobiles 650 million (54%) 450 million (8%)
Let start with the big picture in the Industrialized World.

The planet has a population of 7.1 billion people. Only
about 1.2 billion live in the Industrialized World of
Europe, USA and Canada, Japan, Australia and New
Zealand, and a few advanced smaller Asian countries
like Singapore, Hong Kong and South Korea. When
considering these markets from a technology viewpoint,

they are typified by ubiquitous overlapping networks - all

households have access to fixed landline phones and
mobile phones. The penetration of radios and mobile
phones far exceeds the total human penetration in these
advanced countries.
Essentially all households have televisions and most

have computers. By now, essentially all homes have
internet access, which mostly tends to be broadband.
The telecoms and media infrastructure technologies are
also ubiquitous and reliable, from access to reliable
electricity to banking services. Finland became the first
country to guarantee broadband internet access as a
legal right to its citizens.
The Emerging World has none of that. There are not TV

sets in every home, it is a 'wealthy' home that has a
television. In poorer parts of Africa for example, many
homes do no have even basic FM radio receivers.
Telephones are not landline-based, landline phones are
few, expensive and unreliable. If a citizen has a phone,
in 8 times out of 10, it will be a mobile phone.
The penetration rate of personal computers is modest,

the availability of the internet is patchy in dial-up, and
almost non-existent in fixed broadband. The ratio of
internet access from mobile exceeds landline internet
access in South Africa by 5 to 1 (Vodacom 2009). The
poorer the nation, the greater the proportion is of mobile

access, in countries like Sri Lanka and Bangladesh, the

ratio of mobile access to basic web services, using WAP
technologies, compared to PC based access to the web,
is 10 to 1. Similarly there is a lack of banking services
for the masses, and in many countries, even basic
electricity is not available on a reliable basis.
MOBILE PENETRATION RATES.
While in the West the penetration rate of mobile phones

far exceeds the human population - in Europe there are
1.75 mobile phone subscriptions for every man woman
and child alive - the recent dramatic growth has been in
the Developing World. Russia is past 180%. Even Brazil,
South Africa and Indonesia are already past 100%.
Currently the Industrialized World average penetration

rate (by total subscriptions, including multiple
subscriptions) is 175%, the total World average has just
hit 100%, and the Developing World average is 85%.
Still, that means that every economically viable person
in the Developing World has a mobile phone. If they can
afford a cup of coffee or a newspaper, they will have a
phone, on average.
The differences are very stark also when considering the

types of phones in use. In the Industrialized World,
already 95% of all unique mobile phone subscribers
have been migrated to 3G. There is a 3G subscription

for 88% of the total population. In the Emerging World

only 56% of all phone owners have a 3G subscription,
and only 32% of the total population in the Emerging
World has 3G connectivity.
Digital Divide - Handsets

Unique subscribers 1.1 Billion (92%) 3.4 Billion (57%)
Total mobile phones 1.6 Billion (133%) 3.9 Billion (65%)
Cameraphones 1.55 Billion (129%) 3.3 Billion (49%)
is pct of all phones 97% are camphones 76% camphones
3G subscriptions 1.05 Billion (88%) 1.9 Billion (32%)
is pct of unique owners 95% migrated to 3G 56% migrated 3G
Smartphones 1.2 Billion (100%) 800 million (13%)
is pct of all phones 75% are smartphones 21% smartphones
Second-hand phones 40 million (3%) 800 million (13%)
is pct of all phones 3% are second-hand 21% are 2nd-hand
Similarly with smartphones, in the Industrialized World

already 80% of all phones in use are smartphones and
there are as many smartphones in use and connected
than the total population. In the Emerging World only
21% of all phones in use are smartphones - and a part
of these are second-hand smartphones - and of the total
population, only 13% have a smartphone.

As to second-hand phones, in the Industrialized World,

used phones tend to be only used with children and
young teenagers. 3% of all phones in use, and 3% of the
population use second-hand phones. In the Emerging
World 21% of all phones, one in seven, is a second-
hand phone, and 13% of the total population - one in
nine people - makes do with a used mobile phone.
Whereas in the West mobile is thought of as the 7th

mass medium in chronological sequence, in the
Developing World, mobile is often called the first mass
media, as it is by far the one with the widest reach.
Families that do not own TV sets, have internet access,
or even FM radios, have mobile phones. In India for
example, MyToday, an SMS text messaging based daily
news service, has 3.1 million paid users. In fact, 21% of
India's mobile phone owners consume news services or
sports on their phones, which is more than the combined
circulations of all of India's newspapers.
Even basic features can be of immense value. Nokia

has found that the FM radio in many of its low-cost
phones, is often the first FM radio that some customers
have ever owned. Similarly the light of a phone can be
used where villages and towns have no night-time street
lights, and crime and wild animals offer real threats.
Where the banking industry is weak, mobile phone
based money systems and m-banking can rapidly
become popular, as seen from the Philippines to South

Africa. In Kenya after six years from launch, mobile

banking, led by M-Pesa of Safaricom, today handle an
astonishing 48% of the total national GDP of Kenya.
Digital Divide - Economics

Unique subscribers 1.1 Billion (92%) 3.4 Billion (57%)
2014 Service Revenue $590 Billion $605 Billion

Messaging Revenues $ 40 Billion $155 Billion
VAS Data Revenues $230 Billion $100 Billion
ARPU (per Subscription) $23.41 $9.89

Data ARPU $10.71 $4.17
Percent on Postpaid 39% 11%

Percent on Prepaid 61% 89%
POVERTY
The income levels for the Developing World are far

below the levels known at the headquarters of most
industry giants. Even a mid-priced smartphone costs
more than a year's income for low-paid full-time jobs in
parts of Africa like The Ghana. When a 'good job' pays a

dollar a day, then there is no market for downloadable

applications that cost 'only 99 cents'. The phone
services are usually offered on 'prepaid' basis by which
there is no contract of monthly fees. This precludes
offers of bundled services of a free or low cost phone,
in return for a 18 month or 24 month contract.
This sets different expectation levels for viable phones,

that have to cost less than 20 dollars to the end-user - in
markets with no handset subsidies. It also means that
the market will see an influx of second hand premium
phones on the GSM standard, such as European and
Middle-Eastern phones flooding into Africa. These will
be an eclectic mix of what were the most popular
premium phones a few years ago, Nokias, Samsungs,
SonyEricssons. The proportion of second hand phones
in many poorer African nations is from a third to up to
half of all phones in use.
Even in the poorest countries there is a wealthy class.

What also has emerged is the economics of connecting
the poor, through their wealthier relatives. While the
parents may be poor farmers in a village that on first
glance cannot support mobile network connectivity,
some of their adult-age children now work in a city and
can give the parents their old hand-me-down phones,
and then these employed children can carry the full cost
of the phone calls.

In South Africa there is a free 'Call Me' service on SMS,

that anyone can use to send the free message to a
relative or friend, who then typically calls back and thus
carries the cost of the call. In India 30% of all mobile
phone owners do not originate any voice calls.
ECONOMICS
2014 is the year when the Emerging World total mobile

industry revenues caught up with the Industrialized
World, while having 2.5 times more subscribers. In the
area of data services, the messaging data type of
revenues are strongly skewed to the Emerging World
markets, whereas more advanced mobile data revenues
come predominatly from the Industrialized World
countries.
The Average Revenue per Subscription in the

Industrialized World is at $23.41 per individual
subscription. Please note that when most Westerners
have two subscriptions, for those consumers their
monthly spending needs to be doubled of course. About
four in ten of the subscribers are on postpaid (contract)
and six in ten are on prepaid billing accounts in mobile.
In the Emerging World the Average Revenue per
Subscription is only $9.89 and nearly nine in ten of
subscribers are on prepaid billing plans.

ILLITERACY
The UN estimates that of reading age population on the

planet, 800 million are illiterate. An illiterate user finds no
utility in a printed user's manual to a phone. The phone
makers and service providers are now adding symbols
based guides, with hand gestures, and using simple
videos pre-loaded onto the phones, to help illiterate
people use functions of a phone. It also means severe
problems in particular for mobile banking uses. That also
introduces opportunities of 'micro-employment' for
example if a teenager is the first in his family to learn to
read and write in school, he can then make some money
by reading and writing messages for parents, uncles and
aunts, etc.
LACK OF ELECTRICITY, ADDRESS
Another major problem throughout the Developing World

is a lack of reliable electricity. Vodafone reported in 2013
that 600 million people live beyond the reach of the
electrical grid. That means that phones will place a big
premium on battery life. And mobile phone operator
stores often offer free recharging services, where
customers who do not have electricity at home, can
come to the store to get their phones recharged. Some
walk for miles to get such free benefits in countries such
as war-torn Afghanistan.

Migrationary workers from the Philippines find well-paid

jobs in Hong Kong; workers from Pakistan in Dubai;
from Algeria in France; and from Mexico in the US.
Migrants have particular needs in their communications,
and often send money back home. Often migrants can
be a lucrative market segment when telecoms services
are tailored in their own language, etc. Another common
aspect is 'addresslessness', for those living a nomadic
life; or often where family members can visit for months
or even years; and to the millions of refugees from wars,
famine, and natural disasters. All still have
communication needs and can be served by mobile.


Forecast 2015-2018

Phone Book, the Mobile Forecast
industry and projects them into
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Shares, Mobile Data, Smartphone Apps, and
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Forecast 2015-2018 is an excellent value compared
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Chapter 20 - Brief History 192
XX
Brief History and Milestones
Looking back to understand the future
Here is a short review of mobile telecoms history and

major milestones, with selected comparisons with other
major technology developments.
First a comment. Dr Martin Cooper of Motorola is often

said to have "invented the mobile phone" as he did use
a prototype cellular hand-held phone to call Dr Joel
Engle of AT&T, while walking in New York City in 1973.
While perhaps interesting from a prototype testing angle
to a new technology, it was however quite a minor point
in the development and commercial launch of mobile
and cellular telecoms, as early cellular telecoms had
already been commercially launched prior to this point
and various prototype devices and services would be
littering the industry milestones for decades.
This historical timeline will examine the actual

commercial launches of the significant technologies and
services of mobile. Motorola's handheld was
commercially launched in 1983 by Ameritel in Chicago
and is given proper credit at that point in this timeline.

1971 The first commercial nationwide cellular mobile

network is launched in Finland on the ARP technology
as a car phone service. This, often called "zero
generation" is the first commercial national cellular
telecoms service.
1979 first commercial cellular telecoms network with cell

handover, is launched by NTT in Japan. The service is
what now is called a "first generation" (1G) analogue
network, offering only voice services. Generally this is
seen as the birth of modern mobile telecoms.
1981 the first internationally roaming mobile network,

NMT, is launched in the four Nordic countries of
Denmark, Finland, Norway and Sweden. NMT was the
first internationally standardized mobile technology.
1981 IBM launches PC with Charlie Chaplin ads
1983 Motorola launches world's first handheld mobile

phone which costs 3,995 dollars on Ameritel network.
1984 Apple Macintosh launched
1985 first laptop by Toshiba in Japan
1989 WWW invented by Sir Tim Berners-Lee
1990 first digital camera by Dycam/Logitech

1991 the first digital mobile network and "modern"

mobile telecoms is launched by Radiolinja (now Elisa) of
Finland on GSM. This is also the introduction of
competitive mobile telecoms.
1991 Linux launched by Linus Torvalds
1993 the first person-to-person SMS text message from

one phone to another is sent by Riku Pihkonen of Nokia
in Finland.
1994 Nokia installs music ringing tone to its 2100 phone

model, makes Francisco Tarrega's guitar tune Gran Vals
("Nokia Tune") most recognized song on the planet
1994 Internet is on covers of Newsweek and Time
1994 Sony launches PlayStation
1995 first mobile banking services offered by Merita

Bank in Finland via SMS text messaging
1995 Yahoo! launches
1995 pre-paid mobile phone accounts for GSM are

launched in Portugal
1997 first smartphone is launched by Nokia in Finland

with the Communicator 9000 model offering full PDA

functionality, speakerphone, fax, internet, email and

GSM mobile phone services including SMS
1998 first downloadable content: Saunalahti (now part of

Elisa) launches ringing tones in Finland
1998 Google launches
1998 first mobile payment launched by Coca Cola on

vending machines accepting SMS payment in Finland
1998 the first installed videogame is introduced as part

of the phone, when Nokia introduces the Snake
1999 more mobile phones than personal computers
1999 first mobile internet service is launched by NTT

DoCoMo in Japan on its i-Mode system
1999 first commercial mobile parking system is launched

in Norway using SMS text messaging
2000 first national mobile banking and mobile cash

systems launched in the Philippines by Smart as Smart
Money and by Globe as G-Cash.
2000 first mobile advertising launched by TV

broadcaster MTV3 as part of free news headline service
in Finland

2001 first commercial launch of a 3G network by NTT

DoCoMo in Japan
2001 first mass-market cameraphones launched by

Sharp and J-Phone (now Softbank) in Japan
2001 More DVD players sold than VCRs
2001 first picture messaging service (Sha Mail)

launched by J-Phone (now Softbank) in Japan
2001 Apple launches iPod
2001 RIM launches Blackberry in Canada
2002 more mobile phones than fixed landlines
2002 more SMS text messaging users than email users
2002 more smartphones sold than PDAs
2002 More digital cameras sold than film cameras
2002 first ringback tones launched in South Korea by SK

Telecom and WiderThan
2003 more mobile phones than TV sets
2003 More digital camcorders sold than analogue

2003 more cameraphones sold than digital cameras
2003 More internet users than personal computers
2003 Cyworld is first mobile social networking service

launched in South Korea by SK Telecom
2003 first full-track MP3 music downloads offered in

South Korea. Sony sells of tracks of Ricky Martin MP3s
2004 more mobile phone subscriptions than unique

holders of credit cards
2005 more musicphones sold than MP3 players

including iPod
2005 first television phones launch in South Korea by Tu

Media with inbuilt digital TV tuners on the DMB standard
2006 More DVD players in use than VCRs
2007 Apple launches iPhone
2007 More internet users than landline phones
2007 at 3.3 billion mobile phone subscriptions, there is

an active mobile phone subscription for half of the
planet's total population of any age

2007 more cameraphones are in use than total

cumulative sales of all film-based and stand-alone digital
cameras ever manufactured
2007 mobile phone become first gadget to sell 1 billion

units per year
2008 total mobile phone cumulative shipments exceed

human population
2008 More laptops are sold than desktop PCs
2008 more users access mobile internet than internet

access on all types of PCs combined
2008 Mobile Telecoms becomes a Trillion Dollar

Industry
2008 more smartphones sold than all portable PCs,

laptops, notebooks and netbooks combined
2009 total number of unique mobile phone owners

reaches 3.4 billion so even eliminating multiple
subscriptions, there is literally at least one mobile phone
for half of the planet
2009 Mobile data revenues exceed total internet

revenues

2009 the number of MMS picture messaging users

exceeds the number of eMail users globally
2009 by using newly accepted definition of smartphone

being computer, Nokia becomes the world's biggest
computer maker by unit sales volume, passing HP
2010 Apple launches iPad
2010 the value of smartphones sold exceeded the value

of dumbphones for the first time
2010 the installed base of cameraphones in use

matches the population of half of the planet
2010 Samsung launches world's first handset with

embedded pico projector
2010 Sharp launches first smartphone in Japan with 3D

display that does not require special 3D glasses
2011 World passes point where SMS messaging is used

more on mobile phones than voice calls
2011 First year smartphones outsell globally all forms of

personal computers added together including tablet PCs
2011 mobile services alone excluding hardware sales
pass 1 Trillion US dollars in annual revenues

2012 Non-messaging mobile data revenues grow past

mobile messaging revenues
2012 Samsung passes Nokia to become worlds largest

handset manufacturer
2012 OTT messaging traffic grows past SMS text

messaging traffic
2013 More smartphones sold annually than non-smart

dumb phones for the first time
2013 Samsung launches the first smartphone-watch

devices as the Galaxy Gear
2014 More tablets sold than laptops
2014 World passes point when there are more mobile

phone subscriptions in use than human alive on planet
2014 Smartphone sales pass 1 billion units per year

Tables 201
Tables
Index of Mobile Market Leadership
TomiAhonen Consulting tracks the world's mobile

telecoms markets and produces an index that includes
the penetration level of mobile phones, the migration to
next generation networks, the adoption of mobile data
services and the availability of advanced handsets. The
top 30 countries from the index are included here in this
table, with also the ranking from the previous year.
Rank Index Rank in Index

2014 Country 2014 2013 2013
1 Japan 93% 1 92%

2 Singapore 90% 2 88%
3 South Korea 88% 3 87%
4 Sweden 85% 4 85%
5 tie Finland 83% 5 84%
5 tie Taiwan 83% 6 83%
7 Hong Kong 81% 7 81%
8 UK 80% 9 tie 79%
9 Denmark 79% 11 78%
10 Italy 78% 8 80%
11 tie Austria 77% 9 tie 79%

Tables 202
11 tie Norway 77% 12 77%

13 tie USA 75% 14 tie 74%
13 tie Norway 75% 12 77%
15 Australia 74% 13 76%
16 tie Israel 73% 14 tie 74%
16 tie Netherlands 73% 17 72%
17 UAE 72% 16 73%
18 Switzerland 71% 18 71%
19 Ireland 69% 20 tie 69%
20 Spain 70% 19 70%
21 tie Estonia 69% 24 65%
21 tie France 69% 20 tie 69%
23 Germany 68% 22 67%
24 Malaysia 67% 25 64%
25 tie Portugal 66% 23 66%
25 tie New Zealand 62% 27 tie 62%
27 tie Czech Rep. 63% 26 63%
27 tie Belgium 63% 27 tie 62%
29 Saudi Arabia 62% 29 61%
30 South Africa 60% 30 60%
The index has a rough rule-of-thumb that ten index

points equals about one year of market maturity
leadership. So currently Hong Kong leads Saudi Arabia
by two years and Hong Kong leads Switzerland by one
year, etc.

Tables 203
60 Major Countries
A comparison of the 60 most significant countries for
mobile telecoms, including all the most populous
countries (with populations over 50 million people) and
all markets where the mobile telecoms industry earns
more than a billion dollars in annual revenues.
Practically that means for the Industrialized World

markets all countries with more than 4 million people
and most Developing World countries with over 10
million mobile phone subscribers. All data is effective
December 31, 2013.
The table includes country, population (in millions),

subscription total (in millions), penetration rate (in
percent), unique mobile phone owners (in millions),
network technologies deployed in the country and
additional information about 3G deployments and MVNO
availability. See below for specifics on the abbreviations
for data in the last two columns.
Note that after the 60 country table are two summary

tables of the leading 25 countries by subscriptions and
penetration rate.

Tables 204
Country Pop Sub Pen Uni Netwk Other
Argentina 41 59 143% 35 G, i 3, M
Australia 23 30 133% 19 G 3, M
Austria 8 15 187% 7 G 3, M
Bangladesh 165 115 69% 83 G, C 3, M
Belgium 10 12 120% 9 G 3, M
Brazil 201 277 137% 178 G, C, i 3. M
Canada 34 27 79% 24 G, C, i 3, M
Chile 17 22 131% 15 G, C 3, M
China 1350 1237 91% 944 G,C,T 3
Colombia 47 49 104% 39 G, C 3, M
Congo D.R. 68 37 54% 29 G 3
Croatia 4 5 127% 4 G 3, M
Czech Rep 11 13 124% 9 G 3, M
Denmark 6 8 133% 5 G 3, M
Ecuador 14 16 114% 11 G, C 3
Egypt 82 98 114% 65 G 3
Ethiopia 85 22 21% 16 G
Finland 5 9 180% 5 G 3, M
France 64 73 114% 56 G 3, M
Germany 82 109 132% 76 G 3, M
Greece 11 12 109% 9 G 3, M
Hong Kong 7 15 219% 7 G, C 3, M
Hungary 10 12 120% 9 G 3, M
India 1221 983 80% 721 G, C 3, M
Indonesia 237 244 103% 193 G, C 3, M
Iran 74 97 131% 57 G 3
Ireland 5 5 114% 4 G 3, M

Tables 205
Israel 7 9 129% 6 G, C, i 3, M
Italy 60 90 150% 54 G 3, M
Japan 126 132 105% 110 U,C,P 3, M
Kenya 42 32 76% 22 G 3, M
Malaysia 28 39 139% 23 G 3, M
Mexico 112 112 100% 89 G, C, i 3, M
Morocco 31 38 123% 27 G, C 3
Netherlands 17 20 121% 14 G 3, M
New Zeal. 4 5 125% 4 G, C 3, M
Nigeria 165 126 76% 94 G, C 3
Norway 5 6 121% 4 G 3, M
Pakistan 179 122 68% 102 G, C 3
Peru 30 34 113% 22 G, C, i 3
Philippines 94 110 117% 79 G, i 3, M
Poland 38 48 126% 33 G 3, M
Portugal 11 13 124% 8 G 3, M
Romania 21 23 109% 14 G, C 3, M
Russia 143 263 184% 138 G, C 3, M
Saudi Arab. 27 50 185% 22 G, i 3, M
Singapore 5 8 160% 4 G 3, M
South Afr. 51 61 119% 46 G 3, M
South Kor. 49 53 109% 43 U, C 3, M
Spain 47 57 121% 42 G 3, M
Sweden 9 11 123% 8 G 3, M
Switzerland 8 10 133% 7 G 3, M
Taiwan 23 29 126% 20 G, C 3, M
Thailand 65 74 114% 58 G, C 3, M

Tables 206
Turkey 75 72 96% 58 G 3, M
UAE 8 12 150% 6 G 3, M
UK 62 82 132% 57 G 3, M
Ukraine 46 59 128% 39 G, C 3, M
USA 318 342 107% 281 G, C, i 3, M
Vietnam 90 88 97% 57 G, C 3, M
Notes on the table
The Sub column with number in bold indicates total

subscriptions in the market including owners with
multiple subscriptions. The Uni column reflects the
unique mobile phone owners in that market, removing
multiple subscriptions. Note, compared to the 2014
Almanac, some subscriber total counts have declined, at
times significantly. This reflects the national industry and
regulators eliminating inactive SIM cards/subscriptions
which operators/carriers used to count to try to boost
their total customer base reported numbers. These
above numbers have been meticulously contrasted with
the latest ITU reported numbers and adjusted, including
downwards where necessary.
On the networks column, G means GSM, C means

CDMA, i means iDen, P means PDC, T means TD-
SCDMA, and U means non-GSM but compatible
UMTS/WCDMA 3G networks. PDC is exclusive to Japan

Tables 207
and UMTS indicates only South Korea and Japan,

where the countries decided not to deploy "old" GSM
technology and only the compatible 3G variant of
UMTS/WCDMA.
On the last column, on other info, two further details. 3

means that 3G networks have been deployed. For GSM
networks this usually means UMTS/WCDMA but can
also mean HSPA. For CDMA networks it means
CDMA2000 EV-DO. The last detail is M, where it is
indicated, the country has allowed MVNO's (Mobile
Virtual Network Operators) into its market - these may
include countries that for MVNOs have "come and gone"
like in Singapore or "announced but not deployed" as in
South Korea.
All numbers have been rounded off to the nearest even

million to keep the table reasonable for this eBook and
still practical to view on handheld devices. Due to the
rounding off, the mathematics may not equal the exact
percentages, in particular for countries with smaller
populations. The penetration percentage number is
more accurate than the subscription count in millions,
due to this rounding-off error.

Tables 208
25 Leading Countries by Subscribers, Penetration
Country Subscriptions Country Penetr
China 1,227,000,000 Hong Kong 219%

India 923,000,000 Russia 179%
USA 334,000,000 Austria 177%
Brazil 271,000,000 Finland 175%
Russia 256,000,000 Saudi Arab. 170%
Indonesia 240,000,000 Singapore 151%
Japan 132,000,000 Denmark 147%
Pakistan 118,000,000 UAE 142%
Nigeria 114,000,000 Argentina 141%
Bangladesh 112,000,000 Malaysia 136%
Mexico 112,000,000 Brazil 135%
Germany 107,000,000 Australia 133%
Philippines 107,000,000 Chile 131%
Iran 96,000,000 Germany 131%
Egypt 93,000,000 UK 131%
Italy 89,000,000 Iran 130%
UK 81,000,000 Croatia 128%
Vietnam 74,000,000 Ukraine 128%
France 72,000,000 Czech Rep. 127%
Thailand 69,000,000 Israel 127%
Turkey 69,000,000 Portugal 127%
South Africa 59,000,000 Poland 123%
Argentina 58,000,000 Sweden 123%
Ukraine 58,000,000 Taiwan 123%
Spain 56,000,000 Morocco 122%

Tables 209
25 Leading Countries by 3G Penetration Rate
Rank 3G Penetr 3G migrat.

2014 Country per capita of subscr.
1 Singapore 139% 86%

2 Sweden 112% 88%
3 S Korea 107% 99%
4 Japan 105% 100%
5 Denmark 102% 83%
6 Taiwan 99% 90%
7 tie Finland 96% 71%
7 tie Hong Kong 96% 48%
9 Australia 94% 81%
10 Norway 89% 81%
11 UK 88% 75%
12 Netherlands 87% 74%
13 Austria 85% 60%
14 Italy 83% 54%
15 tie USA 82% 73%
15 tie N Zealand 81% 72%
17 Saudi Arabia 79% 49%
18 Ireland 78% 66%
19 Israel 77% 67%
20 Spain 74% 66%
21 tie Switzerland 73% 60%
21 tie Germany 72% 59%

Tables 210
23 tie Poland 70% 54%

23 tie France 70% 66%
25 Russia 68% 44%
The primary sorting criterion is 3G penetration rate per

capita.
Note the more common way to list national 3G rate is

the migration rate as a percentage out of all mobile
subscribers. This measure is less valid as an
international comparison which 'punishes' high-
penetration markets like Hong Kong and 'rewards' low-
penetration markets like the USA. Both rates are
included in the above table.

Tables 211
20 Biggest Mobile Operator Groups

Operator Home Subs Footprint
Group
China Mobile China 775 As
Vodafone UK 420 Eu, As, Af, ME,
NA, Oc
China Unicom China 285 As
Bharti Airtel India 275 As
America Movil Mexico 270 NA, LA, Eu
Telefonica Spain 255 Eu, LA
Axiata Malaysia 240 As
Orange France 230 Eu, Af, ME, LA
Vimpelcom Russia 210 Eu, As, ME, Af
MTN Group South Afr. 185 Af, ME, Eu
Etisalat UAE 175 ME, Af, As
Telenor Norway 165 Eu, As
TeliaSonera Sweden 160 Eu, As
Saudi Telec. Saudi Ar. 155 ME, Af, As
Reliance India 150 As
China Telec. China 135 As
T-Mobile Germany 140 Eu, NA
MTS Russia 125 Eu, As
Idea India 115 As
AT&T Mobility USA 110 NA
Code for regional footprint: Af Africa, As Asia, Eu

Europe, LA Latin America, ME Middle East, NA North
America, Oc Oceania

Tables 212
Footprint regions are in order of significance for that

carrier group
Note the subscriber numbers are 'proportional'

subscriber counts, i.e. when an operator owns only part
of a subsidiary, the number of subscribers from that
subsidiary are allocated in the same proportion as the
ownership.
All subscriber numbers rounded off to nearest 5 million

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Index 213
About the Author
Tomi T Ahonen is a bestselling author who was rated

the world's most influential expert in mobile by Forbes.
His thirteen books are already referenced in more than
170 books by his peers. Seen in over 100 cities in over
60 countries on all six inhabited continents, Tomi
Ahonen's cumulative live audience has passed 150,000.
His highly rated blogsite has had over 5 million visitors
and on Twitter has has over 15,000 followers. Tomi
Ahonen has delivered mobile, media and tech
consultancy for ten percent of the Global 500 companies
all around the world and sixteen of the 20 largest
telecoms operator/carrier groups have used his
consulting services.
Tomi is the father of several significant theories and

concepts for the industry including the Six M's (originally
Five M's) the mobile industry service development tool
used by all leading companies in the industry; the
Hockey Sticks mobile industry revenues and costs
equation; the Connected Age paradigm; Generation C
for Community, and the 7 Mass Media taxonomy, all of
which have been referenced in published books by other

Index 214
experts. Tomi holds co-inventor status on several

patents in the mobile telecoms space.
Tomi is known as an evangelist for new technologies

who has discussed over 1,400 of his "Pearls" in the
public domain. Tomi has delivered keynotes at over 300
conferences on six continents and has been quoted in
over 500 press articles in leading press such as Wall
Street Journal, Economist, Business Week, Financial
Times, etc. and is often seen on TV. His columns have
appeared in New Media Knowledge, Mobile Handset
Analyst, Asia-Pacific Connect World, European
Communications, IEE Communications Engineer,
Telecommunications, Mobile Communications, Total
Telecom, etc.
Serving as co-editor of the Forum Oxford Journal, Tomi

sits the Editorial Board of the Journal of
Telecommunications Management and on the Advisory
Board of Mobile Monday. A founding member of
Wireless Watch, Carnival of Mobilists, Engagement
Alliance and Every Single One Of Us, Tomi co-chairs
Forum Oxford. His blog at CommunitiesDominate.com is
syndicated widely including at CNBC, Business Week
and the New York Times. His Klout Score on Twitter is
over 67 signalling a very influential thought-leader.
Tomis consulting reference client list reads like the

whos who of high tech, including Axiata, BT,

Index 215
Buongiorno, China Mobile, Ericsson, Google, Hewlett-

Packard, IBM, Intel, LG, Motorola, Nokia, NTT DoCoMo,
Orange, RIM, Siemens, SK Telecom, Symbian, T-
Mobile, Telenor, TeliaSonera, TiGo and Vodafone. Tomi
has consulted many non-technology customers
including Aller, Bank of America, Bank of Finland, BBC,
DHL, Economist, Emap, HSBC, MadHouse, Merrill
Lynch, MTV, Ogilvy, Otava, Royal Bank of Scotland,
Saatchi, Sanoma, Telegraaf and the United Nations
Security Council. Tomi serves on the Boards of several
start-ups, and advises industry bodies such as the
Singapore Infocomm Development Agency, Canadian
Wireless Telecoms Association, Irish Marketing
Association and Communications Industry Association
of Japan.
Tomi set up his own telecoms and media consultancy in

2001. Before that he was employed by Nokia as Global
Head of 3G Consulting where Tomi oversaw Nokia's 3G
Research Centre. Earlier at Nokia he was Nokia's first
Segmentation Manager and started his Nokia career
working with internet gateways authoring Nokia's first
white paper to discuss how the internet could be
deployed on mobile telecoms networks.
Prior to that he worked with two telecoms operators,

Elisa and the Finnet Group in Finland where his
accomplishments include creating the worlds first fixed-
mobile service bundle, the world's largest multi-operator

Index 216
billing system; and setting the world record for taking

market share from the incumbent. Prior to that Tomi was
Head of Marketing for New York's first internet service
provider, OCSNY where he placed one of the first
advertisements onto the brand-new WWW based
internet. He started his career on Wall Street. Tomi
holds an International Finance MBA (with hons) from St
Johns University NY and a bachelors in International
Marketing from Clarion University (with hons).
Tomi Ahonen's previous books are The Insider's Guide

to Mobile (2010), Mobile as 7th of the Mass Media
(2008), Digital Korea (2007) with Jim O'Reilly,
Communities Dominate Brands (2005) with Alan
Moore, 3G Marketing (2004) with Timo Kasper and
Sara Melkko, m-Profits (2002) and Services for UMTS
(2002) with Joe Barrett. Each of his books has been
certified a technology bestseller. The world's largest
publisher of engineering and technology books, John
Wiley & Sons said at the 3GSM World Congress in 2005
that Ahonen's 3G Marketing had become the fastest-
selling telecoms book of all time. So far Tomi has had
books translated into Chinese and Spanish; and one of
his books, Digital Korea has been serialized.
In 2009 Tomi released his eBook series focusing on his

Pearls, with Tomi Ahonen's Pearls Volume 1: Mobile
Advertising featuring 50 real mobile services and
concepts in the mobile advertising and marketing area

Index 217
and Tomi Ahonen's Pearls Volume 2: Mobile Social

Networking with 50 examples from the digital mobile
communities space. The third edition in the series was
Pearls Vol 3: Mobile Money. He also released an
annual review of the mobile industry as another eBook
entitled the Tomi Ahonen Almanac: Mobile Telecoms
Industry Review. To reward his loyal readers, Tomi
released his tenth book, the Insider's Guide to Mobile
as a free eBook edition.
Tomi T Ahonen is a verified celebrity on Twitter as

@tomiahonen with over 15,000 followers. His CV with
references is on Linked-In and Tomi Ahonen has a
Facebook page, all link to each other. His main blog is
www.communities-dominate.blogs where Tomi blogs on
a weekly basis and which has had over five million visits
and maintains a vigorous comments section by loyal
readers.

About the Author 218
Follow the CDB Blog:

Best statistics about mobile & tech for
free. 6M page views and still no ads
Tomi Ahonens digital home is his blog,
www.communities-dominate.blogs.com
Tomi blogs approximately weekly and
comments on all major tech developments
and gives his guidance.
The CDB blog has passed 6 million
lifetime views in its 12 year life. It has over
2,500 total articles posted which have 60,000
comments contributed by an enthusiastic and
knowledgable readership who treat CDB as a
tech Forum rather than just a blog. It still has
no registration, serves no ads and never
harvests any reader data. Freel free to follow.

Tomi T Ahonen in the

press over the years
Ahonen referred to the unexpected success of Japan's i-mode service.

Total Telecom 12 October 2000
"The biggest service to disappear off the 3G radar screen is video telephony,' Tomi Ahonen said.
Global Mobile Daily 26 February 2001
"The information sent to the phone can be personalised," said Ahonen.

Economist October 13, 2001
"By the end of this year mobile phones will overtake TVs," Ahonen said.
Mobile Wireless News June 19, 2002
Tomi Ahonen predicted that some people will happily carry two phones.
Cambridge Network News July 8, 2003
"Mobile web surfing today is not like fixed internet web surfing," says Tomi Ahonen
Business Week Oct 13, 2003
Tomi Ahonen is predicting rapid dramatic growth for SMS over

the next five years, in Americas as well as in Europe and Asia.
Wireless Asia December 15, 2003
Ahonen predicts that in the future, the phone will replace music players.
ITWeb November 10, 2004
"The mobile phone is the only device that 30% of the world's population carries," says Tomi Ahonen.
Financial Times 31 August 2005
Tomi Ahonen told Wireless Asia that Cellphones were replacing wristwatches.
Wireless Asia 1 Sept 2006
Tomi T Ahonen believes that even media business should be very very worried about iPhone.
Santa Fe New Mexican 13 June 2007
Tomi Ahonen calls Mobile the 7th Mass Media and he believes
that it will be more important to advertisers than the fixed web.
Tomi Ahonen Almanac 2015
Brand Republic March 25, 2008
Copyright Tomi T Ahonen 2015
Previous Famous Forecasts on Mobile

by Tomi T Ahonen
Tomi T Ahonen significant public forecasts, where his

view has been controversial at the time, and often been
the first in the industry to voice that view; that can now
be determined for accuracy. Please consider the timing
of the forecasts as made (very often that timig was the
worlds first forecast made of that given aspect):
1998: Mobile phone penetrations will exceed landline

penetrations (correct)
1999: Ringing tones will be international success
(correct)
1999-2005: Saturation ceiling is a myth (widely held
myth that mobile penetrations cannot exceed x
percent, where the percent shifted gradually up
from 60%-100%) (correct)
2000: Mobile phone penetration rates will exceed human
population in industrialized countries (correct)
2000: Majority of US citizens will become active users of
SMS text messaging (correct)
2000: Videocalls will become a significant revenue
source in 3G (wrong, changed mind in 2001)
2000: Location-based services will become major
source of revenues (wrong, changed mind in
2002)

2001: MVNOs will take up to 20% of national subscriber

numbers (correct)
2001: Concept of location-based push "spam" ads is not
going to succeed (correct)
2001: It will become commonplace that people will carry
two phones (correct)
2001: Stand-alone PDAs will lose their market to
smartphones (correct)
2001: SMS text messaging is addictive (correct)
2001: MMS picture messaging usage will follow pattern
of SMS usage (wrong, changed mind in 2004)
2001: Videocalls will not form significant revenue source
in 3G (correct, note this is change from 2000)
2002: Ringback tones will become billion dollar industry
(correct)
2002: MVNOs will be short-lived phenomenon in most
markets (correct)
2002: Mobile telecoms revenues will exceed fixed
telecoms revenues (correct)
2002: Mobile content revenues will exceed internet
content revenues (correct)
2002: More people will access internet on mobile
phones than personal computers (correct)
2002: Location-based services will not become major
mass-market success (correct, change from 2000)
2002: Inspite of bad reputation of early WAP launches,
WAP not crap, will become success (correct)
2002: Inspite of the success of Blackberry, more US
users will use SMS than wireless email (correct)

2003: Inspite of the telco bubble burst and 100 billion

dollar 3G licences, 3G will become commercial
success (correct)
2003: Stand-alone cameras will lose market to
cameraphones (correct)
2003: Of new services, ringback tones will produce
bigger revenues than MMS in 2003 (correct)
2004: MMS picture messaging not follow SMS, yet will
become success (correct, note is change from
2001)
2004: iPods will lose musicplayer market to
musicphones (correct)
2005: Mobile social networking is first killer application
for 3G (correct)
2005: Engagement marketing on mobile phones will
produce satisfied customers (correct)
2005: Long-form content like movies and whole TV
show episodes will be viewed on mobile phone
screens; the popular screen-size limitation, limiting
viewing to snacking short content, is a myth
(correct)
2006: Apple will have to release an 'iPod Phone' (which
became iPhone) to combat loss of market of iPod
to musicphones (correct, confirmed by Apple that
this was reason for iPhone)
2007: iPhone will ignite US based giants of the media
industries, the PC makers and the advertising
industry to enter mobile (correct)

2008: Virtual goods (aka in-app purchases) will become

primary way to make money with apps (correct)
2008: Smartphone apps will only be a viable mobile
service business for gaming and social media, not
the rest of mobile media, even as Apples App
Store was hailed as revolutionary (correct)
2010: iPhone reaching market share peak (correct)
2010: Google will sell the handset part of its Motorola
acquisition (correct)
2011: Nokia will fail with Windows strategy (correct)
2011: Microsoft purchase of Skype will anger the global
carrier community and result in a sales boycott
against all Windows smartphones (correct)
2011: Samsung will become the largest smartphone
maker, not Apple or Blackberry, which where then
larger than Samsung (correct)
2011: Nokias handset failure will result in Microsoft
having to purchase Nokias handset business
(correct)
2012: Augmented Reality (AR) will reach mass market
media status (correct)
2013: Microsoft will fail with its Nokia acquisition
(correct)
(note more recent Tomi T Ahonen forecasts cannot yet

be determined for their accuracy)

Tomi T Ahonen workshops
Tomi T Ahonen provides his invaluable insights and the

latest of his "Pearls" in workshops, seminars and
briefings to the industry. His workshops and seminars
have been run on all six inhabited continents and are
regularly booked by the leading global players in the
seventh mass media space. He runs a university short
course on emerging mobile media at Oxford University.
Global giant companies from Google to Ericsson to

Vodafone to Saatchi to IBM to Sanoma to Bank of
America to Nokia to Siemens to Telenor have used Tomi
Ahonen to run workshops and seminars to their clients
at their events as a keynote highlight speaker or
workshop leader. Topics run from traditional telecoms
topics to digital convergence to mobile media to mobile
marketing, mobile payments, mobile social media and
emerging areas such as Augmented Reality (AR).

Typical 7th Mass Media seminars and workshops

include the primary tool for creating compelling content
for mobile, The Ahonen-Barrett-Goldberg tool of the Six
M's (referenced in a dozen books and used by all major
industry players from Nokia and Motorola to Vodafone
and NTT DoCoMo)
7th Mass Media workshops and seminars will feature

latest commercially launched services and innovations
(ie Pearls). The major content categories will be
covered, and focus areas can be provided for specific
content areas such as mobile advertising, mobile social
networking, mobile commerce, mobile TV and video,
etc.
MANY OTHER WORKSHOPS - Tomi can do

workshops on how the industry makes money including
business models, value chains and eco-systems; on
various service and application types from music to
gaming to social networking; on industry players;
strategies; marketing and pricing; customer insights etc.
Write to tomi@tomiahonen.com to request a proposal

and book a seminar or workshop.

Other books by Tomi T Ahonen:
TomiAhonen Mobile Forecast

2015-2018, an eBook format Report
85 pages
Published by TomiAhonen Consulting

in March 2015, only as eBook edition
Covers the 110 most relevant data points of the mobile

industry, forecasted for the four-year period. Available
only at www.tomiahonen.com
for download at cost of 99 Euro
TomiAhonen Phone Book 2016

an eBook
184 pages

in December 2016, only as eBook edition
Covers all mobile handset-related statistics and data

points in over 80 tables. Available only at
www.tomiahonen.com
for download at cost of 9.99 Euro

Pearls Vol 3: Mobile Money

an eBook
171 pages

in April 2011, only as eBook edition
Covers 50 case studies of mobile payments, m-money &

m-banking available only at www.tomiahonen.com
Pearls Vol 2: Mobile Social

Networking, an eBook
171 pages

in April 2009, only as eBook edition
Covers 50 case studies of mobile social networking

available only at www.tomiahonen.com

Pearls Vol 1: Mobile Advertising

an eBook
with foreword by Russell Buckley,
Chairman Mobile Marketing Association
and Managing Director, Admob Europe
171 pages

in January 2009, only as eBook edition
Covers 50 case studies of mobile advertising

available only at www.tomiahonen.com
for immediate download at cost of 9.99 Euro
Mobile as 7th of the Mass Media

Cellphone, cameraphone, iPhone,
smartphone
foreword by Pekka Ala-Pietila Chairman
Blyk, past President Nokia
(published by futuretext)
2008 hardcover 322 pages
ISBN 978-0-9556069-5-3

Digital Korea:
Convergence of Broadband Internet,
3G Cellphones, Multi-player Gaming,
Digital TV, Virtual Reality, Electronic
Cash, Telematics, Robotics,
E-Government and the Intelligent Home
by Tomi T Ahonen & Jim O'Reilly
foreword by Dr Hyun-oh Yoo President and CEO SK
Communications
284 pages hardcover, futuretext 2007
ISBN 978-0-9556069-0-8
A lot of what we in the UK, think of as futurology is

actually already happening in Korea.
Peter Miles, CEO, SubTV, UK
Communities Dominate Brands:

Business & Marketing Challenges
for the 21st Century
by Tomi T Ahonen & Alan Moore
foreword by Stephen C Jones Chief
Marketing Officer Coca Cola
280 pages, hardcover, futuretext, 2005
ISBN 0-9544327-3-8
"Invaluable in how power will reside far more with

ordinary people than with companies."
Rory Sutherland, Vice Chairman, OgilvyOne UK

M-Profits
Making Money from 3G Services
By Tomi T Ahonen
(360 pages, hardcover, Wiley 2002)
Foreword by Teppo Turkki Strategy
Director Elisa Corporation
ISBN 0-470-84775-1
Good read for industry professionals, operators,

bankers and analysts.
Voytek Siewierski NTT DoCoMo Japan
3G Marketing
Communities and Strategic
Partnerships
By Tomi T Ahonen, Timo Kasper and
Sara Melkko
(333 pages, hardcover, John Wiley & Sons, 2004)
Forewords by Mike Short VP O2 and Chairman MDA;
and Jouko Ahvenainen Chairman Xtract Ltd
ISBN 0-470 -85100-7
second printing 2004 also translated into Chinese
"Insightful look into capitalising on customer data and

developing targetted marketing propositions."
Jan-Anders Dalenstam, Ericsson

Services for UMTS

Creating Killer Applications in 3G
Edited by Tomi Ahonen and Joe Barrett
373 pages, hardcover John Wiley 2002
Forword by Alan Hadden Chairman
GSM Suppliers Association
ISBN 0471 485500
also translated into Chinese
Explains some of the compelling services.

Jeff Lawrence Intel

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Published opinions of previous editions of the Tomi

Ahonen Almanac & Phone Book statistical volumes:

Tomis Almanac is the definitive collection of stats on the Mobile

"Whenever I need a stat, Tomi seems to have it, so I'd highly

"Speaking of statistics, Tomi Ahonen has put together the Tomi

""Tomi Ahonen is the king of mobile statistics and knows more

"If you're interested in mobile statistics, you really need to pick up

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

Copyright 2015 TomiAhonen Consulting

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

You are allowed to distribute this document or copies of it as

Copyright 2015, 2017 TomiAhonen Consulting

All rights reserved. No part of this publication may be reproduced,

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

Certain statements in this document are forward-looking. Although

All third party brands and trademarks belong to their respective

This is an eBook edition only

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

This reprint edition in 2017 is a totally free eBook and made

The file size of this ebook is 231 numbered pages when

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

Chapter 2 - Size of Industry . . . . . . . . . . . . . . . . . . . 6

Chapter 5 - Mobile Messaging . . . . . . . . . . . . . . . 62

Chapter 6 - Mobile Internet . . . . . . . . . . . . . . . . . . . 80

Chapter 7 - Seventh Mass Media Channel . . . . . . 96

Chapter 8 - Music on Mobile . . . . . . . . . . . . . . . . . 109

Chapter 9 - Mobile TV and Video . . . . . . . . . . . . . 114

Chapter 10 - Mobile Gaming . . . . . . . . . . . . . . . . . 124

Chapter 11 - Mobile Social Networking . . . . . . . . 131

Chapter 12 - Other Mobile Content . . . . . . . . . . . 138

Chapter 13 - Smartphone Apps . . . . . . . . . . . . . . 147

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

Chapter 14 - Mobile Advertising and Marketing . 153

Chapter 15 - Voice Calls . . . . . . . . . . . . . . . . . . . 164

Chapter 16 - Business/Enterprise Services . . . . 170

Chapter 17 - Other Mobile Data . . . . . . . . . . . . . . . 173

Chapter 18 - Network Infrastructure . . . . . . . . . . 176

Chapter 19 - Digital Divide . . . . . . . . . . . . . . . . . . 177

Chapter 20 - History and Milestones . . . . . . . . . . 190

About the Author . . . . . . . . . . . . . . . . . . . . . . . . . . 211

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

Preface to Tomi Ahonen Almanac 2015

The TomiAhonen Almanac has become an annual

The normal TomiAhonen Almanac comes out around

The price of the Almanac is only 9.99 Euros, and for a

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

example a student or retired person or charity, etc. I

If you like this Almanac, pleased do share it with your

If you need more updated data, please visit

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

Welcome to the 2015 edition of the TomiAhonen

I had been giving annual reviews of the state of the

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

have memorized every conceivable industry statistic - I

I want to comment on the big number. The data in the

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

they can optimize their traffic on the networks, by

When I examine the growth rates of the largest countries

I also report on all numbers released into the public

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015

dominate.blogs.com and my Twitter feed is at

All data in this Almanac, that is not explicitly attributed to

My digital home is of course www.tomiahonen.com

Tomi Ahonen Almanac 2015 Copyright Tomi T Ahonen 2015