Mobile:
Juniper Research
Market Study October 2004
Mobile Java™ has generated much industry and media excitement since the first MIDP (Mobile Information Device Profile) specification was released in 2000. Java™ technology has been widely embraced by the mobile industry as the de facto standard for developing and delivering mass market mobile applications. New mobile Java™ download services open up many fresh business opportunities for network operators, application developers, content owners, content aggregators and handset manufacturers.
This report serves as a timely guide and reality check on the emerging market for new mobile Java™ services at a time when industry expectations are high and new services in Europe and North America are starting to take off. In presenting the findings of this report we have drawn on the experience of mobile industry pioneers including our survey of senior managers such as CEOs, Marketing Directors, CIOs etc. This helped us formulate our unique market sizing and growth model for the sector.
Table of Contents
Executive Summary
1. Mobile Applications Market Landscape
2. Mobile Java™ Technology
3. Business Models
4. On-Line Java™ Survey
5. Mobile Java™ Downloads Revenue Forecasts
6. Mobile Infrastructure Providers
(174 pages)
List of Figures
List of Tables
List of Forecasts
Glossary
Executive Summary
Introduction
Technology
Compelling Content
The Opportunity
Market Projections
On-line Java™ Survey Findings
Conclusions Summary
CHAPTER 1: Mobile Applications Market Landscape
Introduction
Java™ Currently Has the Strongest Industry Support
The Big Picture
Mobile Industry Trends Paving the Way for Mobile Applications and Java™
Customer Trends
Industry & Technology Trends
The Mobile Handset Mega Trend
The Best Way to Win a Fight is to Get Your Retaliation in First
More Parallels with the PC Industry
Open Standards Accelerate Commoditisation
Mobile Phones – Even More Suspiciously Like PCs on the Inside
Java™ Unites Them All
The Big Question
Market Effects
Moulding the Market into Niches
Race to Discover New Niches – Only the Most Innovative Need Apply
Designer Quality
Haute Couture Phones for Fashion Victims?
The New Breed of Competition
Clones Arise
Attack of The Clones
Operators Flex Their Muscle
Who Else Wants to Roll Their Own Clones?
New Designer Clones – Coming Soon?
Application Opportunities
Niche Applications
Business Ecosystems of Related Service Providers
Vertical Markets
Brand Owners
Games/Entertainment
Business Applications
Clone Customisation
CHAPTER 2: Mobile Java™ Technology
What Exactly is Java™?
What Makes Java Different?
Industry Backing Through The Java™ Community Process
Java 2 Micro Edition (J2ME)
J2ME Receives Widespread Industry Endorsement
Profiles
Mobile Information Device Profile (MIDP)
OTA Support
Improved Security Features
JSR 185 - Java Technology for the Wireless Industry
JSR 185 - Road Map for the Wireless Industry
In the Pipe Line
Business
Other Standards Bodies
Java Challenges
Platform Independence – Portability vs Performance
Speeding Java™ Performance
Benefits of Java™
Client-Server Functionality
Ubiquity
Developer Appeal
Development Tools
Operator Appeal
Content Aggregator/Provider Appeal
Handset Manufacturer Appeal
Customer Appeal
Rival & Alternative Technologies
CHAPTER 3: Business Models
Show Me The Money
Revenue Generating Opportunities
Ecosystem or Symbiosis ?
Network Operator Centric Model
Content Services Provider Centric Model
Vertical Market Model
Manufacturer Centric Model
Summary
Case Studies
i mode®
i-appli
Operator Benefits of Adopting i-mode
i mode – A Prodigious Success Story
Customer Appeal
Content Based Marketing
Content Provider’s Appeal
Business Model - A Benevolent Patriarch
A Simplified Value Chain
Close Co-ordination of Content, Devices and Marketing Effort
Will i-mode Succeed in Europe ?
BREW
The BREW Distribution System
Deployments
Operator Experiences
KT Freetel (KTF)
Verizon Wireless
Implications
BREW Challenges
Conclusions
CHAPTER 4: On-Line Java™ Survey
Results, Analysis and Comment
Survey Objectives and Respondents
Demographics
Greatest Benefit Expected from Selling OTA Applications
Greatest Current Barriers to Selling OTA Applications
Top Revenue Earning Content
Java’s™ Perceived Advantages Over Alternative Technologies
Technology Most Used for Providing OTA Applications
Where Developers Expect to Earn Most Revenue
Where Most Development Activity Will be Concentrated
Types of OTA Applications Being Developed
Developers’ Preferred Sales Channels
Developers’ Preferred Revenue Sharing Options
How Much Revenue to Share with Partners
Content Aggregators’ Biggest Customers
Aggregators’ Content Delivery Services
Aggregators’ Content Format
Revenue Share – Content Aggregators
Handset Manufacturers Strategic OTA Platform
Handset Sales Growth
European Network Operators - Do All The Operators Surveyed Have a Java™
OTA Application Platform in Place?
European Network Operators- ARPU Expectations
European Network Operators - % of Users Expected to Have a Java™ Phone by 2007
European Network Operators - Maximum Percentage of Revenue an Operator
would Share with an Application Developer
Summary of Key Findings
CHAPTER 5: Mobile Java™ Downloads Revenue Forecasts
Methodology
The Scenario
Business Applications
Global Forecasts
Asia Pacific (APAC)
Technology Migration
APAC Java™ Revenues
Handsets
Europe
Technology migration
European Java™ Revenues
European Java™ Handset Shipments
North America
Technology Migration
NAM Download Java™ Revenues
North American Java™ Handset Shipment Forecasts
Latin America
Latin American Java™ Download Revenues
Latin America Handsets Shipment Forecasts
Rest of World (ROW)
Technology Migration
Rest of World Java™ Download Revenues
Rest of World Java™ Handset Forecasts
Conclusions
Important Lessons
CHAPTER 6: Player Profiles
Mobile Infrastructure Providers
Openwave Systems
Company Type
Company Overview
Java™ Strategy
Progress
Developers Programme
MX Telecom
Company Type
Company Overview
Java™ Strategy
Progress
Developers Programme
Publishers
Tira Wireless
Company Type
Company Overview
Java™ Strategy
Progress
Developers Programme
Network Operators
mmO2
Company Type
Company Overview
Java™ Strategy
Progress
Developers Programme
Handset/Handset Platform Provider
Savaje
Company Type
Company Overview
Java™ Strategy
Progress
Developers Programme
PalmSource
Company Type
Company Overview
Java™ Strategy
Developers Programme
AlphaCell Wireless
Company Type
Company Overview
Java™ Strategy
Developers Programme
Content Providers
WES (Wireless Entertainment Services Finland Ltd.)
Company Type
Company Overview
Developers
ROK
Company Type
Company Overview
Java™ Strategy
Developers Programme
Xpherix
Company Type
Company Overview
Java™ Strategy
Developers Programme
Smartner
Company Type
Company Overview
Java™ Strategy
Progress
Mediation & Billing
Mobileway
Company Type
Company Overview
Java™ Strategy
Progress
Highdeal
Company Type
Company Overview
Java™ Strategy
Others
Motorola
Company Type
Company Overview
Java™ Strategy
Progress
Developer Programme
Handango
Company Type
Company Overview
Java™ Strategy
Progress
Developers Programme
End2End
Company Type
Company Overview
Java™ Strategy
Progress
IN-FUSIO
Company Type
Company Overview
Java™ Strategy
Progress
Developer Programme
Esmertec
Company Type
Company Overview
Java™ Strategy
Progress
Developer Programme
Aplix
Company Type
Company Overview
Java™ Strategy
Progress
Developer Programme
Insignia
Company Type
Company Overview
Java™ Strategy
Progress
Developer Programme
Sun Microsystems
Company Type
Company Overview
Java™ Strategy
Progress
Developer Programme
Symbian
Company Type
Company Overview
Java™ Strategy
Progress
Developer Programme
All forecasts cover 2004 – 2009 and are split five key regions: North America (NAM), South America (LAM), Europe, Asia Pacific, ROW except where stated.
Global Forecasts
Global Revenues by Region from Java™ Download Services (m)
Global Shipment Forecast – Total Handsets, Java Handsets (m)
Global Handset Shipment Forecast – Java/Non-Java (%)
Java™ Handset Shipment Forecast (m) by Region
Non-Java™ Handset Shipment Forecast by Region (m)
Asia Pacific Forecasts
Java™ Download Revenues ($m) by Technology - 2G, 2.5G, 3G, Total
Handset Shipments (m) – Non Java/Java/Total
Java™ Handsets by Technology (m) – 2G, 2.5G & 3G
European Forecasts
Java™ Download Revenues ($m) by Technology – 2G, 2.5G & 3G
Handset Shipments (m) – Java/Non-Java/Total
Java™ Handsets by Technology (m) – 2G, 2.5G & 3G
North American Forecasts
Java™ Download Revenues ($m) by Technology – 2G, 2.5G & 3G
Handset Shipments (m) – Java/Non-Java/Total
Java™ Handsets by Technology (m) – 2G, 2.5G, 3G
Latin American Forecasts
Java™ Download Revenues ($m) by Technology – 2G, 2.5G, 3G
Java™ Handset Shipments (m) – Java/Non-Java/Total
Java™ Handsets by Technology – 2G, 2.5G, 3G
Rest of World Forecasts
Java™ Download Revenues ($m) by Technology – 2G, 2.5G, 3G
Java™ Handset Shipments (m) – Java/Non-Java/Total
Java™ Handsets (m) by Technology – 2G, 2.5G, 3G
List of Figures
All forecasts cover 2004 – 2009 and are split five key regions: North America (NAM), South America (LAM), Europe, Asia Pacific, ROW except where stated.
Figure ES1: Global Handset Shipment Percentages Split by: Non-Java; Java™; Total.
Figure ES2: Total Global Revenues from Java™ Downloads ($m),
Figure ES3: Java Survey: Expected Benefits (ranked) from Selling OTA Applications
Figure ES4: Java Survey: Strongest Barriers (ranked) to Selling OTA Applications
Figure 1: Greatest Benefits Expected from Selling Downloadable OTA Applications
Figure 2: OMA Positioning
Figure 3: Smart Phone Infrastructure
Figure 4: The Nokia N-Gage
Figure 5: The Nokia Vertu and Siemens Xelibri4
Figure 6: The Orange Smartphone
Figure 7: The Vodafone/Sharp GX10
Figure 8: SavaJe Operating System
Figure 9: The Harley-Davidson/Motorola V60i
Figure 10: The Java™ 2 Platforms
Figure 11: The J2ME Platform
Figure 12: The Java™ 2 MIDP
Figure 13: Network Elements and Process for a Java™ OTA Download
Figure 14: Mobile Handset Platform Architecture
Figure 15: Jazelle™ Runtime Architecture
Figure 16: Sales Forecast (m) – All Handsets & All Java™ Handsets,
Figure 17: Mobile Services Value Chain
Figure 18: Value Chain Partners – Network Operator Perspective
Figure 19: Value Chain Partners – Content Service Provider
Figure 20: Value Chain Partners – Manufacturer’s Perspective
Figure 21: Panasonic mova® P505i
Figure 22: DoCoMo Percentage of ARPU from Voice and i-mode
Figure 23: DoCoMo ARPU from Voice and i-mode (Yen)
Figure 24: DoCoMo Customer Fees
Figure 25: DoCoMo Controls the i-mode Value Chain
Figure 26: Evolution of i-mode Services
Figure 27: The Key Steps in the BDS Process Flow
Figure 28: BREW Developer Payment Flow
Figure 29: Distribution of Respondents by Regional
Figure 30: Distribution of Correspondents by Industry: Network Operators; Handset Platform Providers; Application developers; Content Provider/Aggregators; Others
Figure 31: Survey Response to – ‘What do you expect will be the greatest benefits of selling downloadable OTA applications?
Figure 32: Survey Response to – ‘What do you think are the top five barriers to selling downloadable applications?’
Figure 33: Survey Response to ‘Which types of mobile content do you expect to be among the top five revenue earners in the following years?’2003; 2005; 2007; 2009
Figure 34: Survey response to - ‘What advantages do you think Java 2 Micro Edition (J2ME) currently has over rival technologies for running downloadable OTA applications on mobile phones?’
Figure 35: Most Used OTA Technologies in 2003: Java; BREW; MS.NET; Other
Figure 36: Survey Response - Most Used OTA Technologies in 2005: Java; BREW; MS.NET; Others
Figure 37: Survey Response - Most Used OTA Technologies in 2007: Java; BREW; MS.NET; Others
Figure 38: Survey Response - Most Used OTA Technologies in 2009: Java; BREW; MS.NET; Others
Figure 39: Survey Response - ‘Which mobile technologies (SMS; MMS; WAP/WML; Java; BREW; MS.NET CF) do you expect to generate most revenue through data services in the following years - 2003, 2005, 2007, 2009?’
Figure 40: Survey Response - ‘Which of the following mobile technologies will you be developing data services (SMS; MMS; WAP/WML; Java; BREW; MS.NET CF) for in the following years - 2003, 2005, 2007, 2009
Figure 41: Survey response to - ‘What kinds of downloadable applications does your company focus most of its effort developing
Figure 42: Survey Response to – ‘What is your preferred sales channel for mobile applications you have developed (to Developers)?
Figure 43: Survey Response to - ‘What is your preferred revenue sharing model with sales channel partners such as network operators, where they do all the marketing (to Developers)?
Figure 44: Survey Response to - ‘What is the maximum percentage of revenue that you would share with an application sales/distribution partner such as a network operator who also does all the marketing (to Developers)?’
Figure 45: Survey Response from Mobile Content Providers/Aggregators - Who are your main Customers?
Figure 46: Survey Response from Content Providers/Aggregators’ ‘What services does your company provide now and in the future?’ 2003, 2005, 2007, 2009
Figure 47: Survey Response from Content Providers/Aggregators: ‘Which of the following forms of mobile content does your company provide now and in the future?’ 2003, 2005, 2007, 2009
Figure 48: Survey Response from Content Providers/Aggregators - ‘What is the maximum percentage of revenue that you would share with an application developer where the network operator does all the marketing?’
Figure 49: Survey Response from Handset Manufacturers – ‘What is your currently preferred strategic platform (Java, BREW, MS.NET CF, Other) for running downloadable OTA applications on handsets for the following network technologies (PDC, TDMA, CDMA2000, CDMA One, UMTS, EDGE, GPRS, GSM)?’
Figure 50: Survey Response - ‘What do you estimate the average yearly percentage increase in sales will be from the end of 2003 through to 2007?
Figure 51 Survey Response from Network Operators - ‘When do you expect your OTA application delivery platform to be fully operational?
Figure 52: Survey response from Network Operators – 2003 Expected OTA Application Revenue as a Percentage of Overall ARPU
Figure 53: Survey response from Network Operators – 2005 Expected OTA Application Revenue as a Percentage of Overall ARPU
Figure 54: Survey response from Network Operators – 2007 Expected OTA Application revenue as a percentage of overall ARPU
Figure 55: Survey response from Network Operators – 2009 Expected OTA Application revenue as a percentage of overall ARPU
Figure 56: Survey response from Network Operators – ‘What percentage of your subscribers do you estimate have a handset that allows applications to be downloaded OTA?’ 2003
Figure 57: Survey response from Network Operators – ‘What percentage of your subscribers do you estimate have a handset that allows applications to be downloaded OTA?’ 2005
Figure 58: Survey response from Network Operators – ‘What percentage of your subscribers do you estimate have a handset that allows applications to be downloaded OTA?’ 2007
Figure 59: Survey response from Network Operators – ‘What is the maximum percentage of revenue that you would share with an application developer where the network operator also does all the marketing?’
Figure 60: Global Revenues by Region from Java™ Download Services (m),
Figure 61: Global Shipment Forecast – Total Handsets, Java Handsets (m),
Figure 62: Global Handset Shipment Forecast – Java / Non-Java (%)
Figure 63: Java™ Handset Shipment Forecast (m) by Region,
Figure 64: Non-Java™ Handset Shipment Forecast by Region (m),
Figure 65: Asia Pacific Java™ Download Revenues ($m) by Technology - 2G, 2.5G, 3G, Total,
Figure 66: Asia Pacific Handset Shipments (m) – Non Java / Java / Total,
Figure 67: Asia Pacific Java™ Handsets by Technology (m) – 2G, 2.5G & 3G,
Figure 68: European Java™ Download Revenues ($m) by Technology – 2G, 2.5G & 3G,
Figure 69: Europe Handset Shipments
Figure 70: European Java™ Handsets by Technology (m) – 2G, 2.5G & 3G,
Figure 71: North American Java™ Download Revenues ($m) by Technology – 2G, 2.5G & 3G,
Figure 72: North American Handset Shipments (m) – Java/Non-Java/Total,
Figure 73: North American Java™ Handsets by Technology (m) – 2G, 2.5G, 3G,
Figure 74: Latin American Java™ Download Revenues ($m) by Technology – 2G, 2.5G, 3G,
Figure 75: Latin American Java™ Handset Shipments (m) – Java/Non-Java/Total,
Figure 76: Latin American Java™ Handsets by Technology – 2G, 2.5G, 3G,
Figure 77: Rest of World Java™ Download Revenues ($m) by Technology – 2G, 2.5G, 3G,
Figure 78: Rest of World Java™ Handset Shipments (m) – Java/Non-Java/Total,
Figure 79: Rest of World Java™ Handsets (m) by Technology – 2G, 2.5G, 3G,
List of Tables
Table ES1: Regional Revenues from Java™ Download Services/ $m
Table 1: Games Genres Currently, and Soon to be Available in Mobile Format
Table 2: Key Mobile Java™ JSRs
Table 3: JSR 185 key specifications
Table 4: Terminal Features History and Forecast
Table 5: Manufacturers with Java™ Enabled Mobile Phones
Table 6: J2ME Development Tools
Table 7: The Cost of Recalling Handsets for Bug Fixes
Table 8: JVM Technology Suppliers
Table 9: Content Revenue Sharing in Europe (Premium SMS)
Table 10: i-mode Licensees Outside Japan
Table 11: BREW – Application Pricing Options
Table 12: Data Transmission Speeds
Table 13: Technology Definitions Adopted in This Report
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