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Saturday, January 19, 2008

Mobile vs Fixed Internet Users #2... it's all about the browser

Let's play word association.

How about the word "Browser"?.....................

............ I bet you said "web", or "Internet" in response.

But that's not the full story, and this is why I think that Tomi Ahonen & I have been disagreeing so strongly over some analysis of the numbers of mobile & fixed Internet users. He asserted that 30% of global Internet users were using mobile access only, based on some top-down analysis of total Internet & PC users, and assorted survey data reporting mobile users' Internet behaviour preferences. I responded that that seemed completely at odds with bottom-up statistics that I could find, plus I have my doubts about any survey that purports to accurately the sample the whole global mobile user base, especially if it's sponsored by a vendor for PR purposes.

(In general, I don't trust survey data unless I know exactly the wording of questions asked, who's been asking them, how the sample was selected, what the purpose the study was - and ideally if I have the entire raw output rather than a carefully-selected summary of findings. My default belief is that 90% of respondents don't know what they're talking about or have the questions poorly-defined - and the other 10% lie. I'm open to evidence to the contrary, but it needs to be robust. I trust Government stats & surveys a bit more than others)

But the disparities in some of Tomi's data against my own, plus the fact that some survey responses have a high WTF? quotient, made me think about what's underlying data vs. measured reality.

I think the answer is this:

On a PC, browsers are almost (but not entirely) used to access the Internet, specifically the WWW. Yes, there are some other applications such as corporate intranets, accessing embedded standalone web servers in bits of computing gear for configuration, kiosks linked to local government private networks and so on. But basically on a PC, it's quite easy to write & distribute "native" applications as there's one OS platform that's 90% of the market, plus Macs if you want full coverage, and Linux if you're really enthusiastic. The only reason (historically at least) you'd use a browser was to access the web. This is changing a bit with the rollout of widgets, web services and the like, but for now it's a fairly reasonable assertion. (Main exception is the enterprise, where a much higher % of browsers are used for non-Internet tasks).

On a phone though, as any mobile developer or operator knows, platform fragmentation is hideous. Unless you're an operator able to tell your handset manufacturers exactly what platform to deploy (eg Verizon/Brew, or DoCoMo/Symbian or /Linux), most apps will struggle to go beyond 10-20% of addressable handsets. Maybe a few more if you're prepared to put up with Java's limitations and fragmentation as well.

In other words, on a phone, there's a big argument to use the browser as the only (relatively) standard data access platform. This means that mobile browsers get pushed into service for a lot more non-Internet access purposes than is the case on PCs - especially access to operators' walled-garden portals and content download facilities. (Yes, alternatives like "on device portals" also exist, but they've had comparatively low traction).

Now don't start telling me that Operator Portals are "the Mobile Internet" or any of that nonsense. They're not. Internet is short for "internetwork", which means the connection of two or more separate networks. Accessing an operator's portal from that same operator's customer's phone is no more an internetwork than a set-top box talking to a cable operator's head end, or my switching on the electricity at the wall for my toaster. It's one network, not several. There's no "inter".

If the term "The Internet" had been trademarked, any operator daring to call a walled garden by a derivative of the name would have been receiving nasty letters from lawyers quicker than they could say "per megabyte charging".

Now in some cases the walled garden does offer a narrow path to the Real Internet, or perhaps even a Google search box. Increasingly, operators in developed countries are offering "real" Internet access (albeit perhaps filtered/proxied in some way) and/or Internet email interconnection. (Separately, although email is clearly an Internet application, I suspect that most people tend to think Internet = WWW. But there are probably too few email-only mobile-Internet users to make a difference to the stats). It's worth noting that prepay services often don't permit web access, or else it's prohibitively expensive (especially on GPRS because of the inherent cost of data transport).

Although are grey areas, I think that in most cases it's possible to classify Operator Portal use as Internet/non-Internet. Roughly speaking, any content/resource that's accessible from any other Internet access = Internet, while any proprietary/operator-only content is not. So, for example:

- Google via a portal-embedded API = Internet
-Accessing news headlines prepared & edited especially for the portal = Not Internet
- Downloading ringtone from WAP menu = Not Internet
- Using browser to initiate POP3 access to ISP email box = Internet
- Pressing operator portal icon on phone menu & visiting home page = Not Internet

Over time, more grey areas will undoubtedly emerge - mildly operator-customised versions of Amazon & eBay, specific partnerships with Yahoo and so forth. Is initiating a Skype call from a 3 Skypephone, terminating on a PC, mobile Internet access? That's where it starts getting vague, but most of today's users aren't there yet.

With all this in mind, I've decided to have a bash at revisiting my Mobile/fixed Internet segmentation table, but this time I've done it twice. Once for "All Browser Users", and once for "access to the Real Internet". Again, there's some health warnings to go with these - I'm aiming for order of magnitude data, so don't read too much into 1m there, or 300m in another. Could well be 400k or 350m in reality - I don't have all the source data to hand. (And if I did, I probably wouldn't give it away for free on my blog....). Once again, I've aimed to make it all add up to the 1.3bn Internet users figure, which seems (fairly) robust, but which is also perhaps worth revisiting another time.

[Separately, it's also worth noting that total # of PCs in use is now >1bn, rather than the earlier 900m estimate. Interestingly, Forrester is forecasting 2bn in use by 2015 which would essentially give PC-Internet accessibility to pretty much anyone with a phone. I suspect we'll end up with more or less the entire planet having access to the Internet via multiple platforms]

But in addition, I've recalculated it if you include ALL browser access. So this includes operator portal access, and drastically increases the total number of mobile "Internet" users to more than 800m, which fits in with some of Tomi's cited stats. It also slightly bumps up the number of PC-based users, as there are a small proportion of extra non-Internet browser use cases (eg information kiosks, corporate applications, access to secure government private 'internets' etc)

The addition of non-Internet browser usage definitely skews the results more towards mobile. I estimate that 52% of "Browser users" use mobile handsets at least some of the time, and that 27% are mobile-only or mostly-mobile browsers. On the other hand, I reckon that 93% of "Real Internet" users have access to a PC at least some of the time, and that 82% of users are "PC-primary".

Using this approach, it's possible to view the world through different lenses - you can either pitch it as a mobile-growth story, or one that says that PC are still central to Internet access.

Thoughts & feedback very welcome. And if this type of analysis is of further interest, please contact me via information AT disruptive-analysis.com


Anonymous said...

Thanks for these distinctions, they are an important contribution to the "Internet over mobile phones" (IOMP) discussion.

That said, I wonder if Google's Android on cheaper Chinese dual-mode (GPRS/WiFi) handsets will really start ramping up IOMP numbers, at least in emerging countries. Operators *may* be incentivised to set-up WiFi hot-spots and hot-zones, with Google involved in monetising the WiFi-IOMP deployments.

With operators still getting their SIMs for pre-paid GPRS (voice and SMS), such a GPRS+WiFi Google-monetised scenario may also put a new twist on 3G rollout economics - 3G used "exclusively" for voice calls?

Then, Ahonen's missives on the "7th Media" might get to be realised.

Anonymous said...

A couple of other exceptions. MVNO portals are generally connected through the "Internet" since they are generally just using the MNO for the data connection. Not a huge deal in Europe, perhaps where most MVNOs are no-frills voice and SMS providers, but a big deal in the US with folks like VMU, Helio, Movida that have extensive Internet portals and CMS infrastructures hosted in carrier hotels, Akamai etc... Also, roaming is an interesting gray area, what if I am in Japan connecting to Verizon's portal page through a WAP browser. Lastly, carriers in Korea may also have their own WAP portals, but also have commercial relationships with ten of thousands of 'ASP' content providers that are all hosting their content on the Internet somewhere.