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On-Device Portals: Beyond WAP
ARCchart, January 2006, Pages: 145
The industry is witnessing the adoption of On-Device Portals (ODPs), a new generation of products which deliver content on the mobile phone through the use of a client application. This report classifies these products into three categories: offline portals, on-device store-fronts and home-screen replacement products. On-device portals are an evolution of WAP, as they leverage the handset's capabilities to deliver a more compelling user experience, increase service awareness and streamline content purchasing.
This report provides an extensive analysis of the on-device portal market: the players, the market movements and the trends which are emerging. Topics of coverage include:
- Analysis of the disappointing data revenues most operators are currently generating
- The failures of the data services user experience, from awareness and accessibility to communication and education
- A comparative landscape of ODP vendors currently in the market
- In-depth reviews of the ODP vendors: Abaxia, Action Engine, Cibenix, Handmark (Pocket Express), Macromedia (FlashCast), MSX, Nellymoser, Onskreen, Opera Platform, Openwave, Qualcomm (uiOne), RefreshMobile, Silk and SurfKitchen
- ODP market perspective, from early adoption, to mass market and commoditisation
- Movements of the mobile operators in the ODP market, including case studies for ONE Smile, O2, Telefónica Móviles and TIM Imagine
- Strategies of the handset manufacturers, content providers and standards bodies
- #Key challenges for ODP vendors, including their to-market strategy and technology considerations
- Ten trends that will impact the market of mobile content between 2006-2008
- Case studies for Access, Obigo, Macromedia Flash Lite, Ikivo, July Systems, Zi Qix, Leiki, Digital Airways, TAT and a yet-unnamed heavyweight infrastructure vendor who is entering the ODP market in the first half of 2006.
- Recommendations for ODP vendors as well as operators, manufacturers and content providers
Answers and opinions are provided with respect to the following essential questions:
- Why are On-Device Portals the next step beyond WAP?
- What kind of ROI are European operators currently seeing from network and content investments?
- What defines the 'user experience' and how has the usability of mobile data services failed?
- How do ODP vendors compare in terms of their positioning, customers, technology and strategy?
- What are the worldwide deployments of ODP products and which deployments are on mass-market handsets?
- What is the role of phone manufacturers in the ODP market and what are the most innovative approaches?
- What is the role of content providers and why do they stand to surpass operators as the largest deployers of ODP products in 2009?
- What are the operators' attitudes towards on-device portals?
- What are the key market challenges for ODP vendors going forward?
- Which handset application platforms are moving to provide a route to market for on-device services?
- How is ODP technology moving towards commoditisation and what are the forthcoming opportunities and high-value areas?
- How should ODP vendors, operators, manufacturers and content providers adapt their strategy to take into account the threats and opportunities in the ODP market?
List of Figures
Chapter A. Introduction
What Are On-Device Portals?
Organisation of the Report
Chapter B. Data Service Monetisation
B.1 The Industry Experience
The Numbers game
- Data ARPU growing, but on a downwards trend
- Non-SMS revenues still weak
- Reading into the numbers
Beyond the Numbers
- Marketing challenges.
- Operational challenges
B.2 The User Experience
The User Experience Disappoints
- Ease of use
B.3 Handset, The Final Frontier
A Flashback in History
A Change of Scene
B.4 On-Device Portals
The Vendor Landscape
The Market Today
- A nascent market
- The second wave
- Content providers
B.5 Reading On
Chapter C. Vendor Reviews
C.1 Introduction Definitions
The Make Up of an ODP Vendor
- The customers
- The products
- The technology
- The devices
- The route to market
C.2 Vendor landscape
Side By Side
C.3 Vendor Reviews
(history, positioning, products, customers, technology, strategy, viewpoint)
Handmark Pocket Express
Chapter D. The Market Today
D.1 Market Overview
From Early Adoption to Mass Market
- 2001: the trigger
- 2002: The first wave
- 2005: Gaining acceptance
- 2006: The second wave
- 2007: On-device services
D.2 Market Movements
- Worldwide deployments
- T-Mobile NewsExpress
- Orange Downloads
- Vodafone Live Cast
- Operators in Japan
- Manufacturers taking on a key role
- Nokia Active Idle
- Nokia Preminet Purchasing Client
- Nokia operator menu and visual radio
- Moving forward
- Mobile, the third screen
- Advertising to play a key role
- Case study: Handango InHand
- Impact on ODP vendors
D.3 Case Studies
O2 On-Device Portals
Telefónica Móviles España
Chapter E. Strategic Outlook
E.1 Global Market Growth Forecast
Market Forecast 2005-2009
E.2 Market Challenges Today
- Channel spaghetti
- Java, a point solution
- Beyond Java
E.3 | Market Trends 2006-2008
Trend #1: Software Platforms: The Route To Market
- And the winner is
- Case study: Access
- Case study: Obigo
- Case study: Macromedia Flash Lite
- Case study: Ikivo
Trend #2: The Server: A Core Part Of The Value Proposition
- Case study: July Systems
Trend #3: The Second Wave of ODP Vendors
- Case study: An Emerging ODP Player
Trend #4: The Content Providers Strike Back
Trend #5: Synchronisation: The Missing Link
Trend #6: Service Discovery and Search
- Case study: Zi Qix
Trend #7: Personalisation: The End-Goal of Customisation
- Case study: Leiki
Trend #8: The SIM is Back
Trend #9: ODP Technology: Commoditisation And New Opportunities
- Rendering technology: consolidation
- TAT: adding the wow factor
- New opportunities for ODP technology investments
Trend #10: Unique, Mass-Produced Experiences
- From theory to market practice
- Case study: Digital Airways
- Customised design manufacturers
- Homogeneous user experiences
Chapter F. Recommendations
F.1 ODP vendors: Prepare for Commoditisation
F.2 Operators: Migrate WAP investments into ODP products.
F.3 Content Providers: Exploit Distribution Power and Impact
F.4 Manufacturers: Position ODP software as a Value-Add
List of Figures
Figure 1. Data as a proportion of revenue, for leading operators
Figure 2. Growth of non-messaging data revenues for Vodafone operations
Figure 3. Conceptual definitions of usability, user experience and customer experience
Figure 4. Typical user journey to browse, select, purchase and install a ringtone
Figure 5. Typical advertisement for a content subscription service in the UK
Figure 6. On-device portal vendor deployments by geographic region
Figure 7. Customer mix of on-device portal vendors
Figure 8. Comparative landscape of ODP vendors (customers, products, and technology)
Figure 9. Abaxia screenshots
Figure 10. Sprint phone w/ Action Info
Figure 11. Cibenix screenshots
Figure 12. Pocket Express screenshots
Figure 13. FlashCast screenshots
Figure 14. MSX screenshots
Figure 15. Nellymoser screenshots
Figure 16. Onskreen screenshots
Figure 17. Opera Platform screenshots
Figure 18. Openwave screenshots
Figure 19. uiOne screenshots
Figure 20. RefreshMobile screenshots On-Device Portals
Figure 21. Silk screenshots
Figure 22. SurfKitchen screenshots
Figure 23. Pictorial representation of on-device portal history and future trends
Figure 24. Screenshots of T-Mobile's NewsExpress client
Figure 25. Orange Downloads service
Figure 26. Vodafone Live Cast screenshots
Figure 27. Motorola Screen3 screenshot
Figure 28. Nokia Preminet diagrammatic overview
Figure 29. ONE's television advertising for its Smile service
Figure 30. Screenshots of O2 Active menu (access to premium content shown in yellow)
Figure 31. On-device portal client deployments (estimated)
Figure 32. Market share for ODP deployments in 2005 and 2009 (estimated)
Figure 33. Total value of global on-device portal market in 2005 – 2009 (estimated)
Figure 34. Zi's Qix product screenshots
Figure 35. Customisation as the opposite of personalisation
Figure 36. Example of a rotating CD music player UI delivered by TAT's Kastor
The mobile phone industry is witnessing the adoption of On-Device Portals (ODPs), a new generation of products which deliver content on the mobile phone through the use of a client application. We segment ODPs into three classes of products - offline portals, on-device store fronts and home-screen replacements. Ondevice portals are an evolution of WAP, as they leverage the handset's capabilities to deliver a more appealing user experience, increase service awareness and streamline content purchasing.
On-device portals have emerged to address the poor take-up of mobile data services. Operators have spent tens of billions of dollars on 3G licenses and infrastructure, and are now investing in HSDPA network upgrades and in sourcing content from media brands. However, we find that non-messaging data revenue is still very low: for a successful operator like Vodafone UK, the increase in pure data revenue generated between 2004 and 2005 is estimated at just $88 million.
Clearly, the answer is not in bigger pipes or more content - content may be king, but the user experience is queen. While operators have made substantial investments in their content strategies, the user experience has been neglected. It can be said that we are at the stage of the 'abandoned shopping cart' syndrome that was prevalent in the early days of the web.
ODPs cater directly to the needs of the major industry players involved in the distribution of content to mobile handsets – namely the operators, handset manufacturers and media companies. For mobile operators, ODPs have the potential to drive data ARPU uplift and service usability by delivering content to the device in an easily discoverable, instantly accessible and personalised manner, and by providing the 'wow' factor through the use of rich graphics and smarter content. For content providers, ODPs are able to deliver an immersive user experience beyond the traditional off-portal channels. Finally, ODPs cater to handset manufacturers who want to reduce their time-to-market for customised handsets.
This report analyses 14 vendors in the on-device portal space, namely Abaxia, Action Engine, Cibenix, Handmark (Pocket Express), Macromedia (FlashCast), MSX, Nellymoser, Onskreen, Openwave, Opera Platform, Qualcomm (uiOne), RefreshMobile, Silk and SurfKitchen. An in-depth overview is provided for each vendor covering the vendor's history, positioning, products, customers, technology and strategy, in addition to presenting our viewpoint on the company. The report also draws a comparative landscape of ODP vendors in terms of their positioning, customers, products and technology.
An extensive discussion of the current ODP market is presented. Following the technology trigger in 2001 and the first wave of ODP vendors arriving in 2002, on-device portals have gained traction in 2005. In 2006, we expect to witness a second wave of heavyweight vendors enter the market, while in 2007 we see the wide acceptance of on-device services by the key industry players. Ultimately, however, we see the core technology of current ODP solutions commoditising from 2008.
With more than one RFP for ODP products being announced each month globally, the market for on-device portals is starting to boom. Spearheaded by European operators, ODP product deployments are expanding to the major US operators and content providers, as well as seeing the first commercial deployments in the Middle East, Asia and Australia. The report profiles the movements of the major operators within the ODP space, such as Orange Download and Vodafone Live Cast, and presents case studies on product deployments from O2, ONE, Telefónica and TIM. Efforts by device manufacturers to incorporate ODP features into their handsets, such as Motorola's Screen3 and Nokia's Active Idle and Preminet Client, are examined and an insight into ODP deployments by content providers is provided. The report also investigates developments within the various standards bodies – namely the OMA, the OMTP and the W3C – and their likely impact to the ODP market and on the evolution of ODP technology.
Having completed the initial phase of product innovation, the challenge for ODP vendors is now on execution and partnering in order to establish market share and develop a fuller product specification.
Based on interviews with 35 ODP vendors, operators and other players, the report identifies 10 trends which we see unfolding within the ODP market from 2006 onwards. We see third-party software platforms becoming an important route to market: not necessarily platforms like Java or super-browsers, but application environments, such as those from Openwave, Access, Obigo and Macromedia (Flash Lite), all of which are profiled in detail. We see the server becoming a core part of the ODP value proposition, offering features such as content and, client and user management. Other market trends discussed include the increasing importance of synchronisation, service discovery and search, personalisation (both implicit and explicit) and the SIM as high-value areas in on-device portal services. The report also casts an eye on the future of unique, mass-produced experiences, where we see ODP functionality combine more intimately with the handset user interface.
The report presents a forecast for growth in the ODP market over the next four years, up until 2009. We estimate that the ODP market in 2005 stood at $30 million, but will grow aggressively over time to reach $1.4 billion by 2009, corresponding to 1.1 billion ODP licenses sold for that period. We believe that tier-1 and tier-2 mobile operators will initially lead the way in ODP client deployments but, by 2009, content providers will be responsible for most client deployments. We believe that a second wave of heavyweight ODP vendors will arrive over the next 12 months and the report profiles an anonymous server infrastructure vendor that is planning an entrance in 1H06.
The report concludes with actionable recommendations for ODP vendors, as well as forward-looking operators, manufacturers and content providers.