China's Mobile Advertising Market Grows in 2010, Big Brands Take Action
This report is an update to a previous In-Stat report, China's Mobile Advertising Market: Sales-Oriented Ads First, Brand Ads Second, #IN0804237CWW, published June 2008. The Chinese mobile advertising market has changed considerably since Chinese operators launched 3G services in May 2009. This report analyzes the impact of these changes.
China's Mobile Advertising Market Grows in 2010, Big Brands Take Action first gives an overview of China's mobile advertising market, including changes in the mobile network and mobile advertising evolution. Then the report introduces several new types of mobile advertising, including MMS, LBS, widgets, SNS, and search. With results from interviews and market research, the report presents an analysis of changes in business models and value chain, and finally, this update forecasts market revenue through 2013 based on driver/barrier analysis.
China’s Mobile Online Game Industry—The Turning Point
The mobile online gaming industry has seen a turning point in 2009. Due largely to the reduction of GPRS fees early this year that led to a significant increase in subscribers, many industry players, including game developers and game publishers have reported profits.
China Mobile introduced a new payment channel that greatly impacted other industry players. Further, China Mobile launched a new mobile gaming platform in 2009—the first such platform among the three telecom operators in China. In-Stat believes that although all of the operators were rewarded full-service licenses in 2009, China Mobile will continue to lead the pack.
China Mobile Will Promote Profitable Digital Publishing
More than 100 million Chinese consumers use mobile phones as e-readers. Active e-reader users, however, number less than 200,000. China's e-reader market is clearly at a very early stage, although device manufacturers including Hanwang, Founder, and Datang have been actively promoting their e-reader products.
In this report, In-Stat examines China's e-reader market in order to better understand its development path. What are the differences between reading using an e-reader and using a mobile phone? What are the main barriers to the development of China's e-reader market? What are the market drivers that will ensure the eventual success of the e-reader market, and how will this success likely happen?
This report includes: -An overview of China's e-reader market -An in-depth analysis of China's e-reader market value chain, including: -E-reader manufacturers -Content platform operators -Mobile carriers -Content providers
Mobile Widgets in China: Standard in the Next Three to Five Years
Mobile widgets were launched in China early in 2007 by Nokia Widget but only became popular in mid-2009 with the launch of application stores and mobile widget engines by telecom operators.
Currently, most Chinese application store operators (telecom operators, foreign brand handset vendors, and OS vendors) are actively promoting mobile widgets in their stores. Most mobile widget engines in China are designed for high-end smartphones, although there are also some independent providers focused on the lower-end feature phone market. In-Stat believes that mobile widgets will become a standard function of smartphones in the near future in China. However, although mobile widgets are an effective means of delivering Internet services on a mobile device, we do not believe it will become the primary technology employed by mobile Internet devices.
This report defines the concept of widgets and mobile widgets, provides a deep analysis of China's mobile widget engine market, and examines drivers and barriers and market trends. It also gives forecasts on mobile widget units, users, downloads, and download revenue in China.
More Effort Needed to Develop Application Stores in China
This report provides an overview of the application store market, its value chain, business models, and key drivers and barriers. Through analysis of the value chain, it also describes the principal types of application store and discusses important market issues.
The App Store model has generated a new industry and created a new business model that allows third-party developers to share revenue with platform providers. The success of an application store depends on many factors, including platform development and management capability, payment system and payment method, licensing, and application localization. For non-local providers operating in China, such as Apple, Nokia, and Google, licensing and application localization are the most crucial issues. As both a local provider and a mobile carrier, China Mobile has formidable competitive advantages over other providers.
Overall, the application store market is in a state of rapid development and faces many challenges, especially in China. The booming smartphone market and huge promotional efforts by mobile carriers are driving the market, but licensing, application localization, and smartphone and application fees remain barriers to be overcome.
Lower Barriers to Entry Will Drive China's Smartphone Market
Smartphone shipments in China grew 30% to 23.6 million in 2008 despite China's uncertain economy and overall stagnation in handset shipment growth. Mobile Internet applications, GPS, and multimedia functionality have been the most important drivers of this growth.
In-Stat estimates that the compound annual growth rate of China's smartphone market will be 25% throughout the period 2009 to 2013 and that the next wave of smartphone market growth will be driven by lowered barriers-to-entry on both the OS and chipset platform solution sides. This report examines the changing dynamics of China's smartphone OS and chipset platform markets and analyzes how these will drive the smartphone market in coming years. Details of other significant drivers are also provided.
China's blue-ocean netbook market offers the kind of high margins that no PC or CE vendor wants to miss.
The result, however, is intense competition between every player in the netbook value chain. Already, the x86-based platform is being threatened by ARM-based platforms.
To better understand China's netbook market, In-Stat interviewed specialists from several parts of the industry, including operators, netbook vendors, chipset vendors, OEM vendors, and national agencies. Based on this research, the report first outlines the current status of the Chinese netbook market. It also discusses the development of the 3G market and operator plans for 3G services, and analyzes each part of the netbook value chain and its key players. Finally, it provides netbook shipment forecasts based on an analysis of the current market drivers and barriers.
Remote Payment Will Lead China's Mobile Payment Market, Local Payment Will Follow
Payment functions in mobile phones have already become a kind of fundamental technology. Using payment functions, a mobile phone can become a digital wallet containing various forms of money, including debit card, credit card, rechargeable card, coupon, and discount card.
Mobile payment services in China are generally in the initial phase, with usage limited to mobile phone charges and mobile application purchases. Other types of mobile payment, such as NFC mobile phone payment and online payments of the kind used in mobile e-commerce, remain in the trial phase. However, drivers from both the supply side and the demand side are strong enough to drive growth. In addition, industry players in China have recognized the potential growth of the mobile payment market and are beginning to get more actively involved.
To provide these players with a deeper understanding of the mobile payment market, In-Stat generated this report, which clarifies the various kinds of mobile payment services and the ways in which they are used, analyzes business models and potential market structures, and provides forecasts for the market sizes of the different types of mobile payment services in China.
In 2008, the mobile Internet device (MID), became a new member of the UMD family, and the development of the entire UMD market has been positively impacted by its arrival.
In addition to MIDs, ultra mobile PCs (UMPCs), another member of the UMD family, are rapidly evolving. And high-end smartphones, the last member of the UMD family, also can provide the same level of Internet experience as UMPCs or MIDs, such as Apple's iPhone and RIM's BlackBerry.
More and more notebook and cellphone makers are recognizing the huge potential of the UMD market. Meanwhile, many popular Internet applications can run on UMDs and an improved wireless environment can provide a faster mobile Internet access. All these initiatives support the belief that UMD is on its way.
This report provides the following: - An overview of China's UMD market, including UMPCs, MIDs, and high-end smartphones - Profiles of the main players, including processor and chipset vendors, OEM vendors - An outline of the elements of the UMD ecosystem and value chain - Discussion of x86-based UMDs and ARM-based UMDs - Shipment forecasts for UMPCs and MIDs in China from 2008 to 2012
Cellular Network Indoor Coverage in China: 3G Drives the Market
In-Stat's research shows that more than 60% of mobile voice/data traffic takes place in indoor locations, including offices, houses, and public transportation stations.
In 2008, China’s mobile market entered its transition from 2G to 3G. The incoming 3G market, with huge market potential, becomes the new arena for the three mobile operators in China: China Mobile, China Unicom, and China Telecom. In-Stat research shows that more than 80% of data traffic in 3G networks will occur indoors. Therefore, indoor coverage becomes the key in winning the 3G market competition.
This report outlines the current deployment of indoor coverage in China, details the popular 2G and 3G indoor coverage technologies, analyzes the future market demand of indoor coverage systems, and discusses the relationship and attitude of every link in the industry chain. In addition, the report provides indoor coverage equipment revenue and overall revenue forecasts.
The GPS Phone and Smartphone—Key to Future of Mobile LBS in China
Mobile LBS is still in the emerging stages in China. Awareness among non-users is still very low. In-Stat's consumer survey, however, found that GPS phones and smartphones are very important in encouraging the use of mobile location-based services. GPS phone or smartphone users have more opportunity to use mobile LBS and are also in general quite prepared to buy a GPS phone; potential users, on the other hand, generally have more moderate interest in mobile LBS.
We think that the growth of the GPS phone market in China will be driven by the supply side rather than the demand side, as handset makers plan to make their products more attractive by adding a GPS function. In-Stat estimates that shipments of GPS phones reached 800,000 by the end of 2007. We forecast that by 2012 this figure will reach 18 million.
Navigation, local search, and map display are popular mobile location-based services in China. But mobile navigation faces challenges from in-car navigation and the PND. Finally, the new trend in mobile LBS is integrating it with other services such as social networking services (SNS) and gaming.
This report provides an overview of China's mobile LBS market and forecasts for GPS phone shipments in China. It also provides the results of a survey of over 550 current and potential users of mobile LBS in order to better understand their attitudes toward the technology.
Mobile Online Gaming in China: A Booming and Promising Market
Mobile online games are played on a mobile phone, smartphone, PDA, or a handheld computer. Usually, a wireless network is required to download the game, exchange data between server and client, or interact with other players. Mobile online gaming uses various technologies including short messaging service (SMS), multimedia messaging (MMS), and WAP.
Mobile online gaming has a more complex value chain than PC online gaming. In addition to developers, operators, and carriers, the chain includes game publishers, handset vendors, operating system vendors, and application platform vendors. In 2008, each party in the value chain has begun to experience significant growth.
As of May 2008, there were 592 million mobile users in China, indicating that there is room for enormous growth in the mobile online gaming industry. This report presents the following: -An overview of China's mobile online gaming market -Profiles of the main game companies -An analysis of the mobile online gaming market value chain -An analysis of the business models used, including time-based, item-billing, and IGA -A behavior analysis of current and potential users -Revenue and subscriber forecasts
Mobile SNS in China: Online Extensions Provide an Edge
In China, social networking services began in 2002 and have been an Internet phenomenon since 2005. It is estimated that China had over 100 million online SNS subscribers, or over 50% of total Internet users, at the end of 2007. China’s mobile SNS market began in 2004, a few years later than the web-based networks. This is still a small market, with about 40 million users at the end of 2007.
This report discusses SNS trends and discusses market structure, services, and business models. It also includes the results of a consumer survey that explores the attitudes and preferences of Chinese mobile Internet users with regard to mobile social networking. Finally, the report cross-checks survey results with other consumer research, e.g., Chinese Internet user profiles provided by CNNIC and the results of an online SNS survey conducted by In-Stat.
Revolutionary UI/UE Will Drive Smartphone Growth in China
Smartphones experienced rapid development in 2007. Mobile Internet and GPS are the most important functions attracting users. Yet what are the trends driving the smartphone market from 2007 through 2008?
Apple’s iPhone has had a significant impact on the smartphone world with its user interface (UI), user experience (UE), and business model. At the same time, it made an impact on the China smartphone market too. The iPhone has set a standard for users’ expectation of entertainment smartphones, resulting in iPhone-like models appearing in the marketplace. In-Stat predicts that this type of revolutionary UI/UE, enabled by a touchscreen, with acceleration and proximity sensors technologies will be a distinct trend in China’s entertainment smartphone market over the next two years.
To help industry players learn more about Chinese consumer attitudes toward smartphones (including the iPhone), In-Stat conducted a web survey in May 2008. The study focused on Chinese customer interests, usage patterns, and emerging trends in smartphones. With a review of the survey results, this report provides an analysis of current/potential customers and user segments in China’s smartphone market, with particular emphasis on patterns of usage and consumer concerns. It also presents an overview of the OS market.
Finally, based on this analysis, this report provides drivers and barriers for the Chinese smartphone market and smartphone shipment forecasts from 2008 to 2012.
Online Gaming in China: Web Games Lead the Next Wave
It is estimated that the revenue of the Chinese online gaming market reached US$ 1.65 million in 2007. The top ten game companies contributed 90% of the total revenue. SNDA sustained the number one spot with 20.4% market share, followed by Netease.
Compared to the MMOG market, web gaming is still in its infancy. However, with continued technical improvements and increased promotion, it is growing rapidly. The number of web gamers was estimated at over three million in 2007. Revenue was US$8 million, or 0.5% of total online gaming revenue; however, many gaming giants are paying more and more attention to this segment owing to its huge potential for growth.
This report discusses the trends of online and web gaming and presents details, including value chain, business models, drivers and barriers, primary gaming companies, and the most popular online games. It also includes In-Stat's forecasts of the revenue and subscribers for both online and web gaming from 2008 to 2012.
Multimedia + Wi-Fi: China's Next Wave of Converged Consumer Electronics
It’s only been in recent years that consumers are demanding converged functionality in consumer electronics devices, and now the prices of those devices have fallen to levels that are affordable to the mass market.
Portable media players (PMPs), which are primarily audio and video playback devices, now integrate games; game consoles and personal navigation devices (PNDs) integrate audio and video playback. We call these products converged consumer electronics (converged CE). To help industry players learn more about consumer attitudes toward converged CE, In-Stat conducted a web-based survey in May 2008. The study focuses on customer interest, usage patterns, and emerging trends in converged CE.
In-Stat believes that the convergence trend in CE is gathering strength. With this in mind, the survey sought to answer the following questions:
What are the attitudes of current users to converged CE? What are the usage patterns of current users? What kind of consumer is potentially interested in converged CE? Which applications are the most interesting to potential customers? What do potential consumers want in converged CE devices, and how much are they willing to pay for them? What is the next wave in converged CE?
China's Mobile Advertising Market: Sales-Oriented Ads First, Brand Ads Second
In 2007, China’s mobile advertising market grew 97% over the previous year. Currently, SMS advertising is the type of mobile advertising most widely used and represented an estimated 40%–50% of China’s mobile advertising revenue in 2007. However, SMS is widely considered spam and is, therefore, likely to decline significantly during the next few years. WAP advertising, especially sales-oriented advertising, will grow rapidly in the same period. Interactive marketing is also gaining interest from brand advertisers, providing the next area of growth.
Consumer acceptance of mobile advertising is lower than with other advertising methods; however, ads that are related to topics of interest to consumers are likely to be very successful. Spam and traffic costs are the primary barriers for consumer acceptance of mobile advertising.
Most mobile Internet users in China are young and tech-savvy, with low- to mid-level personal income but high purchasing power. As such, we think that fashionable, interesting, leading-edge products or advertising campaigns may appeal to them more.
This report covers China’s mobile advertising market with an analysis of features, market size, types of mobile advertising, value chain structures, business models, pricing models, market drivers and barriers, and forecasts. It also includes the results of a survey of Chinese mobile Internet users that sheds light on the attitudes of Chinese consumers with regard to mobile advertising.
Mobile Linux in China Will Find Its Way in TD-SCDMA
In contrast with the leadership of Symbian and the strong growth of Windows Mobile, mobile Linux witnessed a decline in 2007, which contributed to Motorola’s poor market performance. With low non-recurring engineering (NRE) and royalty fees, mobile Linux has been adopted by some Chinese handset vendors like ZTE, Hair, and TCL. However, the lack of applicable third-party applications and the immaturity of its ecosystem negatively impact growth. In addition, our consumer survey shows that Chinese consumers attach high importance to the OS when purchasing smartphones, and when compared with Symbian and Windows Mobile, mobile Linux has the least name recognition in China, which further impacts growth.
On the flip side, Google’s Linux-based Android, TD-SCDMA, and mobile Linux's open-source features will be big drivers to mobile Linux in China.
In-Stat forecasts that in 2012 total shipments of mobile Linux smartphones in China will reach 8.4 million.
This report first analyzes China’s smartphone market, including market size, players, and market share by vendor and by OS. Then it describes the entire value chain of mobile Linux including structure, business model, and profile of key players. This report includes the advantages/disadvantages of mobile Linux and market drivers and barriers. Finally, it presents a forecast of shipments for the mobile Linux smartphone in China from 2008 to 2012.
China's Global Position on GPS Handsets: The Market is Booming!
China’s GPS phone market grew rapidly in 2007, and GPS phones, along with music and camera phones, are one of the brightest spots in the mobile phone market overall. A number of the major handset manufacturers have entered the GPS phone market, although cautiously and with a limited number of high-end models. The GPS phone market is still small and has low penetration, but its high growth rate is a clear signal of its development, as is the fact that it is starting to have an impact on the growth of the personal navigation device (PND) market.
To identify consumer demand for GPS phones, this report provides an analysis of current and potential customers in China’s GPS phone market, with particular emphasis on patterns of use and consumer concerns. It also presents an overview of the GPS phone value chain, compares the online model with the offline model, introduces major players, and analyzes new market trends.
In addition to evaluating the growth potential of the GPS phone market, this report introduces the key location technology and provides a breakdown of the cost of adding GPS to a phone. Finally, based on our analysis, this report provides drivers and barriers for the GPS phone market and GPS phone shipment forecasts from 2008 to 2012.
TD-SCDMA in China: Two Years Away From Ten Million Users
The development of TD-SCDMA will remain in its infancy throughout 2008, with the total number of subscribers reaching 600,000. In 2009, following a possible network expansion to tier-two and tier-three cities, the number of TD-SCDMA subscribers will explode to 4.3 million and in 2010 to 15.7 million. By then, China Mobile will be focusing on HSDPA/EDGE instead of just on TD/GSM dual-mode. The capex on TD-SCDMA is estimated to peak at US$5.3 billion by late 2008 or the beginning of 2009.
In-Stat believes that the market will move in TD-SCDMA's favor in 2009, and that 2009 will be the turning point for TD-SCDMA's growth rate, which will reach 617%. However, the number of subscribers will not pass 10 million until 2010.
Increase in Family Cars Drives PND Growth in China
In 2007, portable navigation device (PND) shipments in China exceeded one million for first time, a 90.9% increase over the 550,000 shipped in 2006. This high growth was primarily driven by price declines.
To identify consumer demand for PNDs, this report provides an analysis of the development of China’s automobile market, especially the family car market. It also provides an overview of the PND market value chain and introduces the major players in the PND market.
To evaluate the growth potential of the PND market, this report also presents a comparison between PNDs and in-car navigation systems and then between PNDs and mobile handset navigation devices. Based on this analysis, the report identifies drivers and barriers for the PND market and PND shipment forecasts from 2008 to 2012.
Mobile Internet and GPS Change the Future of Smartphones in China
The year 2007 was a milestone for the smartphone, with a series of events impacting the future of the device. These events include the introduction of the Apple iPhone, Nokia's announcement of its Ovi Internet service portal, and Google's announcement of its Google Android Linux OS platform.
In-Stat believes that there are three key factors that will have the greatest impact on the Smartphone market.
- Mobile Internet. Riding a wave that is bringing mobile Internet to handsets, the smartphone is evolving to become a mobile Internet device, with cellular voice communication just one function of the converged appliance. - Revolutionary UI and UE. Touchscreen UI and 3D sensor technologies are being integrated into smartphone operating systems to enable a more creative user experience. - Built-in GPS function. The GPS function enables the smartphone to be a mobile navigation device and provide location-based service to mobile users.
Referencing our Chinese consumer survey on smartphones, we clarify the difference between the Chinese and the US smartphone markets and outline the primary purposes for which Chinese consumers purchase smartphones. Next, we provide an extended analysis of the trends mentioned above, and answer the following questions:
- How will the trend toward mobile Internet impact the smartphone market? - What are the trends in mobile OS for next-generation smartphones? - What impact will the GPS function have on the smartphone market?
