The world is flat

If you havent read the amazing book by Thomas Friedmann - The World is Flat, go read it. It even has a chinese version printed for the chinese market in China. It really conveys just how much the world has changed through the disruptive nature of technology.

And we were struck by how the world of marketing seems to believe itself immune to these trends, despite the clear evidence of how every other facet of business has been changed.

If you doubt the scale of the changes, look at these two charts from a Morgan Stanley presentation :

Just as the future of business is driven by digital opportunities, the future of marketing is going to be driven by digital opportunities.

Mobile Fashion

Love it or hate it - do or don’t - but many of us Personalise and Customise our phones - whether it be internalised modification - wallpapers, ringtones, screensavers, or through external modification - stickers, express-clip on covers, to one of the most prevalent forms of individualisation - the strap attached to the phone.

In today’s global village whether you are on the fashionable streets of East Nanjing - Shanghai, Sibuya - Tokyo, or Sloane Street - London the mobile phone has become the most personalised gadget ever and has become the defacto device we use to show off our style and cultural identity.

Mobile design is advancing further into style and trends - and many of the mobile phone brands have spotted the trend of consumers personalising and customising the designs with an array of styles from urban street to the luxury sector - we have the fashion phones from Vertu, Apple, Nokia, LG and Samsung - and at the top end of the mass market we have the Samsung/Bang&Olufsen phone - followed by LGs Chocolate range and their ultimate trend setting latest creation to hit the urban catwalks with the LG Prada - mobile has become style ubiquitous and with it comes the desire to use it as a social device not only in communication but as a symbol - a symbol of who I am - a signal to the culture around…

“I like modern design aesthetics” - the Samsung/Bang&Olufsen Serene
“I am a Fashion whore” - The Devil carries an LG Prada
“I am a Design guru” - Apple iPhone
“I am affluent and super rich” - Vertu’s “signature Cobra”
“I am all bling bling” - Motorola D&G V3i - also now with Fashion icon - Kate Moss as their new “role model” for the Razr range. Hellooooooo Moto

What are you all doing with your mobiles to personalise and customise it into something intimate, individual or tribal? What are you???

Apple’s three screens opportunity

Of course the three screens idea is nothing new. The importance of TV and mobile phone screens joining into the computer screen fun is something that’s been anticipated, discussed, and written about in mobile circles for years. What is interesting to me is that, perhaps for the first time, there is a company in place that has a reasonable chance to simultaneously capitalize on all three screens: Apple.

Mac sales are doing well. Apple TV has launched. And iPhone has already generated more than 1 million customer inquiries to AT&T three months before it even launches.

If done right, the elegant and simple Apple way, these products taken together represent a tremendous “three screens” opportunity. With iTunes as the digital hub, content can be consumed on any of a consumer’s three screens, when and how they want, at work, at home, and on the move.

One could argue that Microsoft has a similar chance with Windows, XBox 360, and Windows Mobile. The interoperability between the three, however, is not as streamlined and therefore not as consumer friendly as the Apple solutions, which are cleanly tied together through iTunes. And according to news reports, Xbox Live has something like 6 million users versus more than 100 million iTunes users, giving Apple a very significant advantage in the number of eyeballs potentially leveragable across all three screens.

The opportunity is tremendous. I hope Apple fully realizes it by providing developers with the access they need to all three screens.

Free is the natural online way to move forward

Hot or Not, the online dating and rating site, is about to end its main revenue stream — subscriptions — and focus instead on online ads and transactions, like selling virtual flowers. Hot or Not founder James Hong, who has gotten rich off of the subscriptions of his cash-cow, will be making its US$6 a month "meeting" services a free subscription.

Why? James says that free is the future.

Free sites are destroying pay sites (at least the ones that do not have extremely powerful network effects.. which dating sites generally do not because users can (and often do) join multiple services.). . . Sites like Match.com, Yahoo Personals, etc.. are going to be in a lot of trouble. In china almost all the dating sites are free and almost all are ad supported.

James explains it as when the company started out in 2000, subscriptions were the only way for a tiny site like theirs to survive. But as ad-targeting improved, and ad dollars moved online, ad pricing has reached the level where an individual or a streamlined small company can make a significant profit.

James says the online dating industry is reaching a “strategic inflection point” as the growth of the amount of paying subscribers for these sites becomes saturated and are forced to generate more revenue from existing subscribers. Over the long run, the result is fewer new subscribers, and a disappearing userbase.

With online advertising growing exponential each year and in the UK, the online advertising had just surpassed newspapers advertising for the first time in 2006, its clear that with improved and targeted online advertising, many similar services will be free.

China Netcom profits down 6.7% for the first time

(Associated Press via NewsEdge) China Netcom, China's second-biggest phone company, said its 2006 profits dropped 6.7% amid falling subscriber numbers as potential customers opted for mobile service.

Netcom's earnings were 12.96 billion yuan ($1.7 billion), down from 13.89 billion yuan ($1.79 billion), the Beijing-based fixed-line provider said. Revenues rose just over 1% to 86.9 billion yuan ($11.2 billion).

The number of subscribers stood at 114.9 million, representing the first decline in Netcom's history from 119.4 million subscribers at that time.

China has the world's biggest telephone market, but traditional fixed-line carriers have seen growth slow sharply as potential customers opt increasingly for mobile service.

Netcom and its bigger rival, China Telecom, are promoting Internet, Web-based television and other new services in hopes of reviving revenue growth.

iPhone & LG KE850-based Prada : twins separated at birth?

Two sparsely-buttoned large, touchscreen phones: the Apple iPhone, and the LG KE850-based Prada (which already won the International Forum Design Product Design Award for 2007). Separated at birth, or possible lawsuit number two for Apple? You decide.

Is this the end of Digital Rights Management (DRM)?

EMI Group PLC on Monday announced a deal that will allow computer company Apple Inc. to sell the record company's songs online without copy protection software.

The agreement means that customers of Apple's iTunes store will soon be able to play downloaded songs by the Rolling Stones, Norah Jones, Coldplay and other top-selling artists without the copying restrictions once imposed by their label.

The software, known as DRM (Digital Rights Management), is designed to combat piracy by preventing unauthorized copying, but can make downloading music difficult for consumers. Labels like DRM because users can’t easily copy songs to give to friends. Users hate DRM because they are locked in to one device or service.

Apple's Stranglehold on Digital Music

So what does this news mean for the Online Music industry? Well firstly it emphasizes the stranglehold that Apple has over the online/digital music market. You have to hand it to Steve Jobs, his February open letter to record companies can now be seen as a masterstroke of strategy - positioning Apple as 'the good guys' in the digital music industry and giving EMI Music a golden opportunity to take the DRM-free initiative, with Apple holding its hand. It's win-win of course for both companies - Apple reinforces its dominance and gets DRM-free music, while EMI (which had been publicly struggling to compete with the other big record companies) gets to be seen as a leader in the digital music business.

The End of DRM? Nearly...

Is it the end of DRM? Well not quite... as it's noted near the end of the EMI press release:

"EMI Music will continue to employ DRM as appropriate to enable innovative digital models such as subscription services (where users pay a monthly fee for unlimited access to music), super-distribution (allowing fans to share music with their friends) and time-limited downloads (such as those offered by ad-supported services)."

So DRM is still being seen as a competitive tool. But this move by EMI and Apple is a great first step for DRM-free music from big record companies. EMI was struggling, so really they were pushed into it (with a helping shove from Apple), but it's a brave move nonetheless.

With EMI making the announcement, this would be a huge milestone for the music industry. Some analysts suggest that lifting the software restrictions could boost sales of online music, which currently account for around 10 percent of global music sales. This will send a strong message to Universal and Sony who has yet to take a definitive position on DRM.

China Unicom posts 24.3% profit increase

China Unicom, the second largest Chinese mobile group listed in Hong Kong, announced that its annual profits last year reached 6.13 billion yuan ($780 million), up 24.3% from earnings posted in 2005.

The total revenue of the year is 94.29 billion yuan ($12.2 billion), up 8.3% from last year.
China Unicom said its mobile subscribers in 2005 increased 14.57 million to 140 million with message volume increased 38.8% to 75.6 billion messages.

Source : © 2007 Xinhua News Agency