Activating Idle Screen Paper

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ACTIVATING THE IDLE SCREEN: UNCHARTED TERRITORY

WHITE PAPER

Activating the Idle Screen: Uncharted Territory

About the authors:

George Voulgaris, ITM Analyst Partner. George is an Associate with VisionMobile Ltd., a telecomsmarket know-how firm. George has a multidisciplinary background in academic research, wirelesstechnology due diligence and product management positions. He specialises in handset software, IPTelephony and Wireless LAN technology. George holds an MSc in Communications Systems & SignalProcessing from the University of Bristol, UK.

Andreas Constantinou PhD, ITM Analyst Partner. Andreas is Director of VisionMobile Ltd, a marketknow-how firm offering telecoms industry research and strategy advisory services. He has 8 years

experience in research and consulting, specialising in handsets, mobile software and UI technologies,device management, operator strategy, SIM cards and open source. Andreas has worked on numerousprojects with operators France Telecom, T-Mobile and OMTP, equipment and software companies,system integrators and analyst houses. Andreas holds a PhD in Image & Video Compression from theUniversity of Bristol, UK.

Freda Benlamlih, Editor/Co-ordinator. Freda is Director of Consulting at Informa Telecoms & Media. Shehas lengthy, broad ranging expertise in mobile and fixed communications markets, and has written andcontributed to strategic reports and projects on mobile and wireless devices, wireless automation,telematics & M2M, handsets and interfaces, networks and infrastructure.

For further information please contact Freda Benlamlih on +44 20 70175558 or email: [email protected]

This white paper contains the findings of independent research and analysis carried out by

Informa Telecoms & Media in March and April 2007.

Table of Contents

Section A Market Overview . 3Section B Vendor Reviews ..8

In-depth reviews of Abaxia Mobile Desktop, Aditon U-Daily, Adobe Flash Home, Celltick LiveScreen

Media, IntroMobile IntroPad, Nokia Ad Connector, Onskreen Fusion, Openwave Mobile Widgets,

Qualcomm uiOne, Tegic T9 Discovery Tool, Webwag Mobifindit/Mobidgets, and Zi Qix

Section C Deployment Case Studies ....19

Featuring Alltel Celltop, Motorola SCREEN3, Orange Homescreen, S60 Active Idle, SKT 1mm, T-Mobile

MyFaves and Vodafone Live! Cast.

Section D Market Trends 25

Conclusions ..27
mailto:[email protected]:[email protected]


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ABOUT INFORMA TELECOMS & MEDIA

Informa Telecoms & Media is the leading provider of business intelligence and strategic marketing

solutions to global telecoms and media markets.

Driven by constant first-hand contact with the industry our 90 analysts and researchers produce a range

of intelligence services including news and analytical products, in-depth market reports and datasets

focused on technology, strategy and content.

Informa Telecoms & Media Head Office

Mortimer House, 37-41 Mortimer Street

London W1T 3JH, UK

Website: www.informatm.com

Acknowledgements

For this research, ITM conducted 19 individual interviews with representatives from Abaxia, Acrodea,

Aditon, Adobe, Amobee, Celltick, Ikivo, IntroMobile, Motorola, Nokia, Onskreen, Openwave, Orange,

Qualcomm, Tegic, Webwag, and Zi Corp.

Peer reviews were carried out by:

Dave McQueen, Principal Analyst with Informa Telecoms & Media. David focuses on mobile handset

developments and vendor strategies worldwide. He has 12 years experience in telecoms research andconsulting and has gained first hand experience in the handset markets' needs and requirements.

Nick Lane, Principal Analyst with Informa Telecoms & Media. Nick manages ITMs mobile content &applications products. He has been following the mobile data industry since 2001 including mobile dataapplications and services, mobile-data players' strategies and business models, mobile content, and 3Gwireless technology.

Informa UK Limited 2007.All rights reserved.The contents of this publication are protected by international copyright laws, database rights and other intellectual property rights. The owner of these rights isInforma UK Limited, our affiliates or other third party licensors. All product and company names and logos contained within or appearing on thispublication are the trade marks, service marks or trading names of their respective owners, including Informa UK Limited. This publication may not be:-(a) copied or reproduced; or(b) lent, resold, hired out or otherwise circulated in any way or form without the prior permission of Informa UK Limited.Whilst reasonable efforts have been made to ensure that the information and content of this publication was correct as at the date of first publication, neitherInforma UK Limited nor any person engaged or employed by Informa UK Limited accepts any liability for any errors, omissions or other inaccuracies.Readers should independently verify any facts and figures as no liability can be accepted in this regard - readers assume full responsibility and risk accordingly fortheir use of such information and content.Any views and/or opinions expressed in this publication by individual authors or contributors are their personal views and/or opinions and do not necessarily reflect the viewsand/or opinions of Informa UK Limited.

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Section A Market Overview

Introduction

Since the beginning of the decade, operator investments have focused mostly on one thing: building

bigger, better, faster networks. Investments in 2.5G, 3G and now 3.5G networks across the globe have

been made in the hope that the value-added services delivered through these networks will secure

higher data average revenue per user (ARPU).

By 2007, the outcome of operator strategies has taken a rather different course than had been hoped.

Informa Telecoms and Media research indicates that voice ARPU fell from a global average of $19.38 in

2005 to $17.65 in 2006 and is expected to drop by a further $1.34 (7.6%) in 2007. At the same time, the

much-awaited boost in data service revenues has fallen somewhat short of expectations. From a global

average of $2.84 in 2005 data service ARPU dropped to $2.81 in 2006 and is forecast to climb by just

$0.07 in 2007. These results indicate that building bigger networks alone is not enough to secure

meaningful increases in data ARPU.

Recognising that the handset is central to service discovery and delivery, mobile operators have been

customising handsets since 2002 to provide branding and shortcuts to mobile services. A more concerted

effort on the part of operators has begun since 2006, creating customised handset applications that will

improve the accessibility, discoverability and the delivery of data services in the form of on-device

portals (ODPs). Operators have been reporting positive results, most notably with Orange announcing in

March 2007 that its Orange Downloads branded ODP application has increased download data ARPU bynearly 100%.

As ODP products move towards mass adoption, a new, uncharted territory is emerging, the handset idle

screen (also known as phonetop, mobile desktop, or home screen). Informa Telecoms and Media believes

that the idle screen is the foremost piece of real-estate from which accessibility, discoverability and

the delivery of mobile services can be improved. The idle screen lies by definition at the start and end of

each user journey, in other words, at a click-distance of zero.

In 2007, the idle screen is becoming the epicentre of commercial efforts to facilitate the access,

discovery, search and advertising of mobile services. A dozen or more commercial products in this

technology domain, from Abaxias Mobile Desktop to Zis Qix, are making their presence felt. This paper

adopts the term Active idle screen (AIS) solutions to refer to this class of products (a term also used by

Openwave and Nokia in their product marketing).

Moreover Alltel, Vodafone Germany, Orange UK, SKT, T-Mobile US and TMN Portugal have all deployed

some form of AIS products, while at least three more European operators have issued commercial

tenders (RFPs) for AIS solutions. For mobile operators, AIS products have the potential to improve not

only data revenues, but also voice and advertising revenues, while at the same time making complex

handsets easier to use. A similar trend is also taking place in the PC market; Windows Vista Instant

Search bar, Google Desktop and Apples OSX Dashboard are examples where the PC desktop (the PC idle

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screen equivalent) is utilised to facilitate content access, discovery and search of applications and user

data.

This white paper analyses the nascent market for active idle screen solutions, reviews the commercial

products available today, provides several case studies of AIS deployments and concludes with a review

of market trends in mobile service discovery.

Challenges with mobile services and the idle screen opportunity

As already emphasised, the idle screen is the starting and finishing point for all tasks associated with a

mobile phone; whether making a call, sending a text, checking to see if a voicemail has arrived or

downloading a ringtone, the idle screen precedes and concludes the user journey involved in performing

each task. As a result, the idle screen has two important properties. Firstly, it is the application within

the handset that is visible most often or that is active for the vast majority of the handsets lifetime.

Secondly, the idle screen is the least intrusive medium on the handset for presenting informational or

promotional messages. As a result, the idle screen has been widely used by mobile operators and handset

manufacturers to provide branding elements and static links to mobile services, such as a WAP portal.

However, the idle screen need not necessarily be static; In fact, adding interactivity elements into idle

screen makes it anything but idle. Indeed, active idle screen solutions can address three real challenges

that mobile services and handsets are currently facing, namely:

Handset complexity andfeaturitis which impacts the ease of use of handsets

Poor access and discovery of mobile services, due to the long click-distances associated with the

location of these services.

Inadequate means for service promotion and advertisement

Handset complexity

Mobile handsets today are highly complex pieces of technology. Feature phones arriving in 2007 are full

of features like MMS, alarm clock, camera, photo album, mp3 player, radio, video recorder, Bluetooth,

games, email and video calling. An intricate sequence of menus is used to provide access to these

features, compensating for the lack of dedicated hardware keys for each function. User interface (UI)

navigation paradigms like the icon grid in Nokia S60 handsets that were heralded with enthusiasm five

years ago can no longer accommodate the sheer multitude of features and options available in handsets

today. Furthermore, menu hierarchies are still a point of differentiation across handset manufacturers,

so a user has to learn anew with every change of handset how to use basic features like SMS camera,

photo album and music player.

A number of AIS solutions have surfaced in early 2007 to address the needs for accessing features on the

handset. Vendors Abaxia, Tegic, Webwag and Zi offer predictive search functionality from the idle

screen that allows the user to quickly and intuitively access handset features. For example, typing the

sequence A L A on the keypad would bring up a text menu highlighting the alarm clock feature, while

typing G A would similarly list the games installed on the handset. More importantly, this navigation

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paradigm can provide consistent and repeatable access to common handset features, across

manufacturers.

Predictive search can solve another downside of handset sophistication. As users are able to store

hundreds of contacts, ringtones and videos on their handset, locating a particular item means scrolling

through long lists, a frustrating but necessary evil for the vast majority of phones today. Predictive

search can again come to the rescue, for example by matching the keys typed from the idle screen with

the name or surname of a contact.

Access and discovery of mobile services

Handset features are only the tip of the iceberg. While handsets contain tens of features, mobile

network operators (MNOs) offer hundreds of mobile data services (from ringtone downloads to cinema

listings), usually accessible through their WAP or web portal. Given the small screen, the entry point into

individual data services is located within a complex menu hierarchy. Even when operator portals are

accessible through a dedicated key on the handset, the user still has to trawl (often unsuccessfully)

through long sequences of menus before locating a particular service.

The challenge is twofold. Firstly there are far too many data services for the user to be aware of them

and secondly there are several (typically a minimum of 10) clicks that a user has to go through before

locating the service they are after. Such high click counts undoubtedly discourage potentially interested

users from persevering to reach their preferred services.

A number of AIS products also present a solution to the challenge of service access and discovery.Predictive search can be used from the idle screen to list the most likely service available in response to

a user query, similar to predictive search for handset features.

Service promotion and advertisement

The idle screen is clearly of value for promoting operator services; WAP portal shortcuts, news tickers

and service announcements have been inserted into handset applications and on-device portals in tens of

operator deployments to date. The idle screen is a logical evolution as a medium for hosting operator

service promotion that lies at a zero click distance from the start of each user journey. Informa

Telecoms & Media believes that a bigger opportunity is emerging for exploitation of the idle screen by

advertising publishers and agencies.

The mobile handset has already been called the fourth screen for media promotion and advertising

(cinema, TV and computer screens being first, second and third). Across the handset real-estate, the idle

screen is the most sought-after property or the most prized inventory to borrow an advertising term,

due to its close proximity to the user. Multiplying this inventory by the one-billion-a-year shipments of

handsets, puts a completely new perspective on the value of idle screen for ad publishers and agencies.

Added to this is the fact that handsets, like watches and clothes, are personal items that users always

carry with them. Advertising on mobile can also target users with precision, based on their location.

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Yet until 2006, the idle screen was largely unexploited as an advertising medium. In 2007, a string a

product announcements such as Nokias Advertising Connector, Amobees SDK, Aditon and Webwag have

joined Cellticks LiveScreen Media and Motorolas SCREEN3 in the league of commercial solutions for

service promotion on the idle screen. These solutions promise to turn the idle screen into an interactive

medium through which to channel live content, ranging from pure-news feeds collected from third

party web sites and sponsored content, to infomercials (e.g. Yellow Pages listings) and hard promotions.

Active idle screen as a handset customisation technology

AIS solutions form part of the handset customisation technology cookbook. Yet, as with all technology,

AIS solutions should not be seen as a recipe for all tastes, budgets and requirements. Handset user

interface customisation technology today comprises a landscape of dissonant vendor marketing efforts,

where being different is better and unclear positioning is the norm.

Table 1: Common technologies for handset customisation, their defining and distinguishingcharacteristics

Themes & Skins On-Device Portals Active idle screen

Usages Branding Branding, discovery anddelivery of content

Branding, zero-clickaccess and discovery ofservices and handsetfeatures, advertising.

PC equivalent Windows styling andappearance

iTunes application Google desktop, AppleOSX dashboard

Revenue source Increased brandawareness

Store-front downloads Content impressions orclick-through to content

Present during Idle screen, menus andsome apps

1-2% of user journey (onlywhen launched)

Majority of the user journey

Access Not applicable 3-6 clicks (min. 5 seconds) Zero-click (0 seconds)

Technical medium Skins Dedicated application Idle screen replacementapplication

Client platform Skin framework Java or Open OS application Native applications (OpenOS or RTOS)

Technicaldependencies

Handset-specific Standalone applicationconnecting to content serverand to an offline cache on thehandset

Integration with 10s ofhandset features, e.g.email, address-book,battery level, GPS

Addressablemarket

Most handsets (buthandset-specific)

Java and Open OS handsets Open OS* and some real-time OS handsets

Vendor examples Nokia Carbide UI themeedition, uiOne

SurfKitchen, mPortalNellymoser, Streamezzo,uiOne

Abaxia Mobile Portal to ZisQix (see section B)

Note: * While it is possible to replace the idle screen on Open OS (S60, UIQ and Windows Mobile) handsets,doing so often requires manufacturer consent. Very few J2ME handsets today allow Java applications to takeover the handset idle screen, although this functionality will become more widely available in 2008 with theadoption of MIDP3.

SIM-based active idle screen applications can project text messages on the idle screen and present a trade-off between a very large target addressable market against the limited range of use cases (typically contentpromotions comprising of text and basic graphics for use in developing markets).

Source: Informa Telecoms & Media

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In this environment it is important to understand the boundaries of the AIS solution space, i.e. which

purposes it is best suited for and which it does not address. To accomplish this, it is important to

establish a frame of reference across other customisation solutions, namely on-device portals, AIS and

skinning solutions, and ascertain what are the defining traits and distinguishing characteristics of each

solution space, and last but not least, the points of parity between them. Table 1 above summarises

these for themes, on-device portals and active idle screen solutions.

Very few software vendors cover more than one solution space. For example, uiOne can be used to

implement deep skinning, on-device store-fronts or idle screen-based promotion solutions. A few on-

device portal vendors offer idle screen replacement capabilities, most notably mPortal, whose

Springboard ODP client sits on the idle screen of Disney Mobile handsets and Cibenix who had launched

an idle screen-based dashboard on some handsets launched by operator ONE in Austria.

The active idle screen market: past, present and future

The active idle screen market has come a long way in the last few years. The market has been led by

Abaxia in 2002 and IntroMobile in 2004 who deployed handset-based AIS with operators Orange and SKT

respectively. Zis Qix and Qualcomms uiOne products were announced in 2005, but only achieved

customer wins with idle screen products in 2007. In early 2006, SCREEN3 was first shipped as part of

Motorola handsets and later in the year Onskreen secured a deployment with operator Airtel in India. In

the SIM-based active idle screen market, Celltick first launched its LiveScreen Media solution with Hutch

India in 2002.

2007 is clearly the year when a wave of vendor announcements have hallmarked the establishment ofthe active idle screen market. Aditon U-Daily, Adobe Flash Home, Nokia Advertising Connector,

MobiComps ActiveTicker, Openwave Mobile Widgets, Tegic T9 Discovery Tool and Webwags Mobifindit

and Mobidgets were all announced in early 2007.

Challenges

Despite this flurry of announcements AIS products are still part of a nascent market, both in terms of

technology maturity and the commercial route to market. There are four fundamental challenges all AIS

products will have to address:

Idle screen replacement requires integration of the AIS software with tens of relatively inaccessibleAPIs (application programming interfaces) which are only available to third parties subject to

manufacturer approval. This implies that the AIS technology is mostly accessible to companies with

strong relationships with handset and operating system vendors.

Deployment remains a challenge for all handset applications. As such AIS solutions will rely on

operator backing or manufacturer consent in order to secure distribution volumes.

Any form of pre-sales handset customisation can easily impact the time-to-market. Since active idle

screen products imply significant modifications to handset software, AIS solutions have to constantly

trade-off the scope of customisation against the time-to-customise.

The idle screen represents the cardinal touch point of the end user with the handset manufacturer

brand. As such, handset OEMs are particularly wary of the risk of brand dilution and third partycontrol points that can devalue their business proposition.

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Opportunities

As for the future, there is no doubt that the idle screen represents the primary real-estate for servicesearch and promotion. It lies at the confluence of mobile operators, handset manufacturers and media

publishers. Within such highly prized territory, it is clear that plenty of opportunities exist, but execution

will be challenged by many turf wars. The commercial solutions that will be most successful will be those

that reconcile manufacturer interests with those of operators and extend into service providers and

media publishers for lucrative revenue share agreements. Moreover, unlike on-device portals, the idle

screen will also be used to increase voice ARPU, rather than pure data or advertising revenue.

Section B - Vendor reviews

There are nearly 15 software vendors today who specialise in active idle screen solutions. Informa

Telecoms & Media interviewed 19 software vendors, handset manufacturers and mobile operators to

compile reviews and comparative analysis on the nascent AIS market. This section presents detailed

reviews for Abaxia Mobile Desktop, Aditon U-Daily, Adobe Flash Home, Celltick LiveScreen Media,

IntroMobile IntroPad, Nokia Ad Connector, Onskreen Fusion, Openwave Mobile Widgets, Qualcomm uiOne

(on idle screen), Tegic T9 Discovery Tool, Webwag Mobifindit / Mobidgets and Zi Qix. Access Netfront

Dynamic Menu and MobiComps Active Ticker are further AIS solutions. Last but not least, Amobee

produces the Handset API (HAPI) SDK for insertion of interstitial and banner advertisements into handset

applications, including the idle screen.

Comparative analysis

The following tables compare and contrast AIS products in terms of their market track record and

features.

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Table 2: Comparative analysis of AIS solutions product launches, handset deployments andfeatures

Handsets Platform Access Promotion

Vendor name LaunchedLicenseesModels Base CLNT TOOLOPERPUBLPREDUGC HSET FEEDWIDGADVR

Abaxia MobileDesktop Suite

2001 9 30 >12M

Aditon U-Daily 2H07 n/l n/l n/l

Adobe FlashHome

2H07 n/l n/l n/l

CelltickLiveScreenMedia

2000 - >100 >45M SIM

IntroMobile

IntroPad 2004 3 6

approx

20K MotorolaSCREEN3

2005 1 >15 >3M

Nokia AdConnector

2H07 n/l n/l n/l

OnskreenFusion

2006 1 n/a n/a

OpenwaveMobile Widgets

1H07 0 0 0

QualcommuiOne (on idlescreen)

2004 3 n/a n/a

Tegic T9

Discovery Tool1H07 0 0 0

WebwagMobifindit /Mobidgets

1H07 1 n/a n/a

Zi Qix 2005 1 2approx

50K

Source: Vendor data, ITM

Chart legend

n/a = Information not available PRED: Predictive search

n/l = Product not launched UGC: Access to user generated content(eg contacts or music files)

CLNT : Handset client (SIM = SIMapplication

HSET: Access to handset functionality

TOOL : Vendor offers tools for idle screenUI customisation

FEED: News feeds (eg RSS)

OPER : Operator Platform WIDG: Widgets

PUBL: Publisher Platform ADVR: Advertisements

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Table 3: Comparative analysis of AIS solutions - manufacturers handsets shipped with the product(client software) embedded in ROM

Vendor > Amoi BenQ HTC LGMoto-rola

Nokia PalmPana-sonic

Pan-tech

SagemSam-sung

SharpSony

Ericsson

Abaxia MobileDesktop

Aditon U-Daily

Adobe Flash Home

Celltick LiveScreenMedia

S S S S S S S S S S S SIntroMobile IntroPad Motorola SCREEN3 Nokia AdvertisingConnector

Onskreen Fusion L

Openwave MobileWidgets

Qualcomm uiOne (onidle screen) Tegic T9 DiscoveryTool

WebwagMobifindit/Mobidgets

Zi Qix L

Source: Vendor data, ITM

Chart legend

Client embedded on handset

L Client installed post-launch

S Client embedded in SIM

The remainder of this section reviews individual vendors of active idle screen solutions from Abaxias

Mobile Desktop to Zis Qix.

Abaxia Mobile Desktop

Based in France, Abaxia develops active idle screen products for mobile operators. The company was

founded in 2001 with offices in France, Belarus and Korea and employs 31 staff. Abaxia started as a

privately funded company and has been profitable since its inception.

Mobile Desktop is a suite of access, discovery and search applications replacing the handset idle screen.

Abaxia sells Mobile Desktop as a white-label solution direct to mobile operators and major OEMs. The

Mobile Desktop suite consists of:

Mobile Portal, a dashboard for branding and access to handset features and operator services and

Mobile Finder, a search application which enables predictive text queries for operator services,

handset functions and on-device data (e.g. PIM information, logs, multimedia files, SMS/MMS and

email).

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A third component of Mobile Desktop integrates with the SIM card for SIM-based idle screen

customisation and service distribution. The revenue model is a per-device fee as well as NRE fees for

software development, integration and maintenance.

The Mobile Desktop suite is a client-side solution that is integrated deeply into the handset. The client

suite supports standardised protocols (OMA DM, WAP Push, SMS and USSD) to communicate with 3rd

party servers. Abaxia reports that its client suite has been ported on 30 handset models across S60, UIQ,

Windows Mobile 5 and PalmOS platforms.

According to Abaxia, Mobile Portal has been deployed with operators Orange (since 2002, in a total of 8

country operations), Evodial (2006), and is also working with Telefonica Spain. Abaxia reports it has

secured licensing deals with Nokia, HTC, AMOI, BenQ and Samsung, and that two more manufacturer

agreements are expected in the second half of 2007. In total, Abaxia reports over 12m handsets have

been deployed with Mobile Portal to date.

Thanks primarily to the Orange account, Abaxia leads the active idle screen solutions market for service

access and discovery, followed by Access NFDM product, IntroMobile IntroPad and Zis Qix. Abaxias

position has helped it ink global distribution agreements with major handset OEMs. Beyond its OEM

relationships, Abaxia boasts know-how of in-depth handset integration and operator requirements, which

helps it reduce its time-to-market for customised handsets.

Among the companys plans in 2007 is a client port to Linux-based operating systems and other RTOSs

and expansion into discovery of voice services, advertising content and user subscription management.

Aditon

Founded in June 2006, Aditon, is a technology company which offers a platform for channelling

advertising content into the handset idle screen. The company was spun off from PA Consulting in June

2006 and employs 17 people with offices in the UK. Aditon received its first round of funding by PA

Ventures in October 2006.

Launched at 3GSM 2007, Aditons U-Daily is a client-server platform that pushes advertising content onto

the handset idle screen. Aditon works directly with advertisers and charges them on a cost per action

(CPA) model. The companys route to market is through operators who receive a share of advertising

revenue. U-Daily operates on a hosted (ASP) model, therefore no operator-resident infrastructure is

required. Aditons route to market relies on operators who then require OEMs to embed the U-Daily

client on their handsets.

Aditons client-side technology serves advertising to the idle screen based on a pre-determined schedule

or in response to handset events (e.g. when an SMS is sent or a conversation is terminated). The U-Daily

client technology has been implemented for selected Symbian and Java handsets, while the company

reports it is working on Windows Mobile and BREW ports. Usage behaviour is collected by an Aditon

personalisation server which automatically tailors the content served to the user profile. Aditons

technology is designed to allow the user to select which categories of ad content they would like to

receive, which Aditon claims makes for a less intrusive user experience.

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A UK trial involving a few hundred users is currently in progress and is expected to finish in mid 2007. The

company is hoping to conduct a 5,000-user trial in Germany starting in May 2007, for which it is seeking

advertising partners. No commercial deployments have been announced yet although according to the

company, negotiations with four operators are under way, including two likely deployments in the

second half of 2007.

Aditon competes with Amobee and Nokia Ad Connector, although it differs from them in terms of the

client technology (idle screen application instead of an SDK), its route to market (via operators and not

via OEMs) and the confines of its solution (Aditons solution does not extend all the way to advertisers).

Adobe Flash Home

A $2.5 billion-a-year company, Adobe is best known in the mobile industry for its Flash Lite application

environment which is inherited from the acquisition of Macromedia in late 2005. Flash Lite is becoming a

de-facto standard environment for graphically-rich applications; its 220 million cumulative deployments

across mobile and embedded devices place it second only to Java in terms of market penetration.

Unveiled in February 2007, Flash Home is an idle screen-based client-server solution for push-based

discovery of operator content, handset functionality (e.g. missed calls, battery levels) and user content.

Banner ads are also supported, although the product does not offer usage tracking and analytics. Flash

Home leverages the same platform as Flash Cast, a client-server offline portal solution, based on Flash

Lite. Flash Home differs in terms of the depth of integration into the handset, as the client has to access

native handset functionality and features. Over-the-air content updates are communicated via a

proprietary protocol. Development of Flash Home modules is supported via Adobes latest Creative Suite3 tool.

Much like Flash Cast, Flash Home is available as a white-label solution for mobile operators with licensing

based on a per-device technology fee, a per-user activation fee and revenue share on content services.

Adobe plans to launch Flash Home during the second half of 2007, with the first handsets with Flash

Home expected in the first half of 2008. Flash Home will be the first Adobe product to use the

technology acquired from Actimagine in October 2006 which allows Flash Lite content to be played on

feature phones due to its lower processor and memory requirements (even low end features as claimed

by Adobe). Flash Homes footprint is expected to be around 300KB, whereas the current version of Flash

Lite is around 400KB.

Flash Home competes most closely with Motorolas SCREEN3 and Qualcomms uiOne. Key points of

differentiation are the established base of Flash developers (claimed to be 3 million), the richness of

interactive graphics and the advanced Creative Suite tool which should lead the market of mobile

content development tools.

Celltick LiveScreen Media

Founded in 2000, Celltick is a vendor of SIM-based active idle screen applications. The company is

headquartered in the UK and employs 70 staff with offices in Israel, Russia, Singapore, Thailand and

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Brazil. Celltick is privately held and funded by VCs led by Amadeus Capital and Jerusalem Venture

Partners.

Cellticks LiveScreen Media is an application resident on the SIM card that pushes content and advertising

teasers on the handset idle screen, combined with a server for delivering content over cell broadcast and

IP channels. The SIM application periodically displays text and images including live news, sports,

weather updates, gossip or games that can be adjusted based on the users location. Once a user reacts

to a teaser message, they are taken to a WAP page or connected to a customer service representative.

Celltick offers LiveScreen Media as a white label solution to mobile operators and increasingly to media

providers. The product is available as a hosted or operator-resident service and licensed either on a per-

active-user or revenue share basis.

Celltick uses a SIM toolkit application that offers an impressive target addressable market, but

rudimentary graphical capabilities and slight variations in the way that the content teasers are presented

across handset models. To transmit teasers to the handsets in the installed base, LiveScreen Media

utilises Cell Broadcast, a GSM network technology that allows small packets of information to be pushed

to handsets with minimal network impact and adapted on a cell-by-cell basis. The LiveScreen Media

client can be updated through SMS messages or using GPRS or 3G channels.

Celltick boasts high-volume deployments with VimpelCom Russia (18m enabled subscribers), AIS

Thailand, Hutchison Essar India, Globe Philipines, KievStar Ukraine and Dialog in SriLanka, accounting in

total for more than 45m active enabled subscribers worldwide. LiveScreen Media has been deployed

mostly in Asia and the Middle East due to a number of factors, including rapid SIM replacement rates

(30%), shorter sales cycles to operators and better support for Cell Broadcast technology. Celltick reports

that 8 out of 10 users continue using (i.e. do not opt out of) the LiveScreen Media service, due the

carefully orchestrated mix of pure content, infomercials and promotions that are channelled to the idle

screen.

Due to the SIM and cell broadcast technology, LiveScreen Media is unique among idle screen service

promotion solutions. However, while the product may have an enviable target addressable handset

market and the largest deployment base compared to other AIS vendors, its use is limited to developing

markets and content promotions based on text and basic graphics.

IntroMobile IntroPad

Founded in July 2000, IntroMobile is a vendor of multimedia client-server solutions for mobile operators.

Based in Seoul, the company employs 150 staff, with offices in North America and China. IntroMobile is

privately held, funded by the Korean government and regional private investors. The company reports

that its multimedia messaging platforms have been used by 20 operators, 9 handset manufacturers and

14 service providers worldwide.

IntroPad, an idle screen service discovery tool was developed in 2004 as a by-product of an active idle

screen client deployment for SKT. Intropad is complemented by Smartpath, an idle screen-based,

widget-like platform for delivery of internet services.

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IntroPad functions as a tool for discovering user-generated content (SMS, contacts, email), handset

functions (e.g. Bluetooth), as well as operator and third party content. Content is pushed via a set of

channels, which can be personalised by the end user.

IntroPad is available for WIPI (Korea-specific), Symbian and Windows Mobile platforms as well as Java

(with limited functionality). The IntroPad client can be updated over the air (OTA) using a proprietary

OTA technology, while the company is planning to move to Open Mobile Alliance Device Management

(OMA DM) standardardised protocols.

IntroMobile is offered as a white-label client-server product for mobile operators. The revenue model

varies between pay-per-channel, pay-per-use and pay-per-download, although the majority of the

revenue comes from licensing to MNOs and software integration.

IntroMobile reports deployments of IntroPad with SKT (2004), KT (two deployments in 2005 and 2006)

and a commercial pilot with Telecom Italia Mobile during the Torino 2006 Winter Olympic Games.

According to the company, IntroPad has been embedded in approximately 20,000 devices shipped to

date by Korean manufacturers Samsung, LG and Pantech.

IntroMobiles IntroPad competes with Abaxias Mobile Portal, Qualcomms uiOne and Motorolas SCREEN3

as well as browser vendors such as Openwave and Opera who are moving into idle screen service

discovery. Despite the products low handset shipments, its proximity to the Korean operators puts it in

touch with much know-how on delivering advanced multimedia services across fixed and mobile

networks, such as a recently-launched video upload and sharing service.

Nokia Advertising Connector

Announced in March 2007, Nokia Ad Connector is an end-to-end platform that enables delivery of

targeted ads to mobile devices. Advertisements can be inserted not only within the handset idle screen,

but also within any application such as MobileTV, music player, on-device portal and map applications.

The service is expected in launch in 4Q07 and is completely independent of the Nokia Ad Service

announced concurrently, but which focuses on browser-based ad delivery.

Ad Connector is a white-label client-server platform. On the client side, an SDK allows the integration of

the ad stream into any handset application, based on customer requirements. Nokia has announced plans

to integrate the SDK within its own applications, although plans to integrate with 3rd party applications

are not yet clear. Browser-based ads are within the future plans for Ad Connector, so as to accommodate

non-Nokia devices and feature phones. On the server side, the platform provides ad publishing,

management and analytics for ad publishers as well as operators and allows users to opt in or out of ad

channels. The Ad Connector is positioned as a white label, ad delivery platform, targeted at mobile

operators and media publishers. Product revenues are to be based on the CPA (cost per action) model.

The Ad Connector technology allows ad targeting based on decision mechanisms at both the client and

server. The Ad Connector SDK caches ad media, profiles usage and manages ad relevancy in terms of

content and its placement within handset applications. The server logic determines which ad will reach

which subscriber, at which point in time.

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Nokia reports that it has already completed a trial of Ad Connector on N-series S60 3rd edition devices

and is scheduling a product launch in November 2007. The Finnish OEM believes that it is uniquely

positioned within the value chain to offer a mobile ad publishing platform, due its global reach and the

uniqueness of an integrated solution that can bridge the gap between operators, media companies,

publishers and handsets.

Onskreen Fusion

Founded in September 2004, Onskreen is a software vendor of idle screen promotion solutions. The

company is privately funded, employing 8 staff with offices in Seattle and an engineering base in

Mumbai.

Fusion is Onskreens client-only platform for the discovery of content and services through the handset

idle screen. The product offers direct access to the operator content catalogue (downloads, special

offers and services), internet content feeds and third part content sources (e.g. Google mail or

advertisements). Fusion is a white label solution targeting operators primarily, and is charged on a per-

active user basis, plus customisation and maintenance fees.

Fusions technology caches content locally on the handset to reduce latency when accessing content. It

is a client-only platform which relies on SMS push and XML-based content pull to refresh the content

presented to the user. This latter characteristic makes the product attractive to tier-2 and tier-3

operators. Fusion is available on Symbian handsets with Windows Mobile and J2ME versions in the

pipeline.

Onskreen has realised one commercial deployment of Fusion with Airtel, India since March 2006, on

Symbian handsets. The company is also implementing support for the client-server protocol used with

Motorolas SCREEN3, so that operators can target handsets from multiple manufacturers using a

combination of SCREEN3 and Fusion clients. Onskreen reports that Fusion is used by the majority (65%) of

the enabled user base, with most churn occurring one month after product activation.

Fusion competes with Qualcomms uiOne and Adobes Flash Home. The product is differentiated by an

easy-to-deploy client-only solution that does not require a dedicated server. Onskreen is facing

increasing competition in the AIS market and will find it challenging to secure deals outside its local

Indian market.

Openwave Mobile Widgets

Founded in 2000, Openwave is a vendor of browsers and mobile software solutions. The company is

headquartered in California, and employs 1300 staff in 12 countries. Openwave is publicly traded and

listed in the NASDAQ National Market.

The companys key product is the Openwave web browser with a market share of over 50%. In parallel

Opewave has re-productised their browser components into a Mobile AJAX application platform called

MIDAS. MIDAS is offered

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to operators as a choice of white label products (including the Mobile Widgets, Musiwave music

application and MediaCast on-device portal) and

to handset OEMs as a platform to reduce time-to-market for customised handsets.

Announced in November 2005, MIDAS has not so far achieved any operator deployments; however, the

company reported it was doubling internal product resources in March 2007.

Building on the MIDAS platform, Mobile Widgets is a content discovery and delivery product that fully

integrates with or replaces the handset idle screen. Mobile Widgets offer a customisable range of news

tickers and widgets that act as a graphical front-end to operator services and third party content.

Openwave offers an AJAX SDK to operators who can create exclusive widgets for their subscribers. The

revenue model for Mobile Widgets is typically a per-handset fee. Opewave is considering alternative

licensing schemes such as per-widget licensing and sponsored, premium widgets. The company reportsthat Mobile Widgets are available on Windows Mobile, Symbian, BREW, Linux and on OEM proprietary

platforms.

Mobile Widgets is a client-only product that can use standardised OMA DM protocols for connection to

mobile device management (MDM) operator infrastructure. Openwaves Profiling and Personalization

System (OPPS) can also be combined with Mobile Widgets.

Openwave expects to announce two commercial deployments of Mobile Widgets in 2007 in Asia & North

America. Mobile Widgets competes with IntroMobiles SmartPath, Webwags Mobidgets and Nokias

WidSets (although the latter is not resident on the idle screen). Openwave faces continuing challenges in

the commercial deployment of MIDAS, but the repositioning of the application platform to value-added

products should help the company strike deals with operators in 2007.

Qualcomm uiOne

Founded in 1985, Qualcomm is a heavyweight $7B per year vendor of chipsets and software solutions,

and an intellectual property licensor. Qualcomm is headquarted in San Diego and employs more than

9,000 staff in 26 countries.

uiOne is Qualcomms handset software technology that delivers handset theming, idle screen discovery

and on-device portal functionality. uiOne technology was inherited from the Trigenix acquisition in 2004

and is developed within Qualcomms Internet Services business unit (QIS). Through the handset idle

screen, uiOne allows promotion of operator teasers and services, as well as discovery of handset

features. uiOne offers extensive UI customisation features for operators and UI personalisation options

for end users. The product is offered to mobile operators as a white-label product on a revenue share or

per-active-user basis.

uiOne technology offers flexible customisation of the idle screen layout and contents, albeit at the cost

of complex development, based on the TrigML language (a hybrid combination of Java and XML). uiOne

idle screen implementations exist only for Qualcoms BREW application environment (version 3.1 or

greater). BREW is mainly available on ODM handsets equipped with Qualcomm MSM chipsets. uiOne

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clients can be managed through Qualcomm Delivery One server infrastructure which is available on a

hosted or operator-resident basis.

uiOnes most notable deployment is with US operator Alltel which, in January 2007, launched Celltop, an

idle screen service promotion solution (see case study in section C). In Europe, the uiOne client is

available on the O2 ICE handset and the TIM Onda handset. Note that TIMs uiOne deployment leverages

a Qualcomm-hosted Delivery One system. The company hopes to secure two more operator deals for

uiOne in Europe during 2007.

uiOne competes with Abaxia, Adobe, IntroMobile and Openwave and boasts native integration to the

BREW platform (but is dependent on BREW), as well as extensive customisation and personalisation

options. uiOne is focusing on two challenges: luring mobile UI developers to its platform and developing a

web-based personalisation portal for end users.

Tegic T9 Discovery Tool

A wholly owned subsidiary of AOL LLC since 1999, Tegic is an established vendor of text input technology

for handheld devices and the developer of the T9 Text Input product. Based in Seattle, Tegic employs

170 people (60% engineers) in Brazil, London, Paris, New Delhi, Beijing, Hong Kong, Seoul, Tokyo and

Singapore. Tegics T9 has been shipped on 2.4 billion embedded and mobile devices units and is available

in 64 languages

T9 Discovery Tool was announced in February 2007 as a predictive search tool invoked through the

handset idle screen. The product allows the user to discover own content (contacts, email), handsetfeatures (e.g. Bluetooth) and operator services (e.g. maps), much like the functionality offered by Zis

Qix. Tegics Discovery Tool is offered as a white label product that helps

a) operators to increase data ARPU due to easier service and content discovery and

b) manufacturers to offer a direct and logical way to access features, applications and content on the

handset.

Tegics Discovery Tool is a client product that indexes all data structures on the device (e.g. menus,

functions, PIM data, call logs, application data). When the user presses keys from the idle screen, Tegics

software produces a list of the most likely keyword matches to the keys. Since the product can be

adaptively scaled to varying memory/processor handset capabilities, it is suitable for high end torelatively low end phones (although the indexing process can be processor-intensive). The technology

will initially be integrated on Windows Mobile and S60 platforms.

Tegic reports that it is close to announcing its first operator and handset OEM customers for its first

deployment of T9 Discovery Tool. According to the company, preliminary feedback from operator trials is

encouraging, highlighting the advantage of using existing operator infrastructure, the ability to reach

mass-market phones and the easy accessibility of operator defined content (e.g. access to remaining free

minutes under the service plan).

Tegics Discovery Tool competes closely with Zis Qix, Abaxias Mobile Finder and Webwags Mobifindit,

but differs in that, being a pure textual interface with minimal branding, it does not impose major

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modifications to the UI. Tegic further boasts a global base of manufacturer customers, a technology

advantage in terms of data indexing know-how and significant R&D investments behind the product.

Webwag Mobilefindit / Mobidgets

Founded in 2006 by ex-Google France managing director Franck Poisson, Webwag offers a Web 2.0

widget-based personalised start-page. In March 2007, Webwag announced the acquisition of Mobease,

another young company that develops active idle screen solutions Mobifindit and Mobidgets. Webwag is

VC funded and employs 10 staff with offices in France.

Launched in September 2006, Mobifindit is an idle screen based tool for predictive search, much like Zis

Qix. Mobifindit predictively matches key presses against of user-generated content, eg SMS, contacts,

handset features such as Bluetooth and infrared, and third party content (including content retrieved

through Webwag partner Yahoo). Mobifindit is available for S60 and Windows Mobile handsets.

Mobidgets is an idle screen widget platform for service access and discovery, expected to be released in

May 2007. Webwag provides a downloadable SDK for the development of Mobidgets by 3rd parties. The

widget platform is offered as a Symbian S60 and a Windows Mobile version, with a limited-functionality

J2ME version also available. Mobidgets operates a direct-to-consumer (D2C) model which is monetised

through advertising revenue share.

Webwag reports that Mobifindit underwent a commercial pilot in February 2007 with SFR (Vodafone

France) on Symbian S60 2nd edition handsets. Webwag hopes to develop a converged web and mobile

widget platform providing access to content, across consistent user experiences and personalisationoptions.

Zi Qix

Founded in 1996, Zi Corp is an established vendor of text input solutions. Zi employs 75 staff with offices

in North America, Europe and Asia. The company is publicly traded and listed in the NASDAQ National

Market and the Toronto Stock Exchange. Thanks to its predictive text-input product, Zi reports licensing

agreements with over 100 OEMs & ODMs of mobile and embedded devices and that its software is

embedded in more than 860 device models.

Launched in February 2005, Zis Qix is an idle screen-based application for predictive search anddiscovery of user-generated content (e.g. contacts, email), handset features and operator services.

Whenever a user presses a key from the idle screen, Qix brings up a matching list of contacts, features

and service links. For example, typing a key sequence of 62 (MA) brings up a shortlist of contacts like

Mary, Mark or Martin. Switching to a different view of Qix brings up a list of ringtones from Madonna or

Massive Attack. Typing 252 (ALA) brings the user directly to the handsets alarm clock function. The

product is available for S60, UIQ and Windows Mobile platforms. Qix also offers a lightweight server

component to manage service keywords which Zi plans to enhance with analytics and campaign

management functionality.

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Qix targets tier-1 operators in Europe and North America as a white-label service discovery solution -

operators can customise the product user interface, as well as service keywords, shortcuts (QixLinks) and

banners (QixLinks Ads) presented by Qix. The revenue model for Qix is a combination of NREs and per-

device fees, while Zi also hopes to move into the per-click revenue model. Moreover, Zi positions Qix as

a complement to idle screen-based service promotion applications such as tickers and advertisements.

In trials of Qix with Virgin Mobile UK in early 2005 involving several hundreds of participants, results

indicated a 33% increase in voice and data ARPU. Qixs first commercial deployment is planned for the

second half of 2007 with T-Mobile UK, across 25,000 Nokia N70 handsets. A second deployment will

follow with N73 handsets, and a second phase will take place with N73 throughout the course of 2007 at

similar volumes.

Although it appeared in the market in early 2005 with a unique proposition, Qix has been slow to

leverage its market lead and secure customer deals. In early 2007, three competing products from Tegic,

Abaxia and Webwag appeared offering similar functionality. One of Zis challenges has been to clearly

communicate Qixs value proposition, not as an on-device portal, but as a service discovery solution.

Miscellaneous vendors

Finally, although not an active idle screen vendor, Amobee is developing the Handset API (HAPI) SDK for

insertion of interstitial and banner advertisements into handset applications. Amobees solution presents

an end-to-end platform to ad publishers that delivers ad content to a variety of mobile channels,

including SMS, MMS, WAP, in-game, in-application channels and the idle screen. The companys revenue

is based on a cost per thousand impressions (CPM) model.

Amobee reports that the HAPI has been integrated in 12 applications to date on 15 handset models

deployed in 4 markets (in Europe, US and the Middle East) across 5 mobile operators. In total, the

company claims it is serving over 100,000 ad impressions to 20,000 unique customers using 20 advertiser

brands (including Harry Potter, Lenovo, Sonic the Hedgehog, Jetix, News of the World, UEFA and

McAfee). The company has not deployed ads through the idle screen yet, although this is technically

possible through its HAPI SDK.

Section C - Deployment Case Studies

This section presents seven case studies of active idle screen product deployments, namely Alltel

Celltop, Motorola SCREEN3, Orange Homescreen, S60 Active Idle, SKT 1mm, T-Mobile MyFaves and

Vodafone Live! Cast. These case studies cover both manufacturer and operatorled AIS deployments,

spanning North American, European and Korean markets.

To date, Alltel, Vodafone Germany, Orange UK, SKT, T-Mobile US, TMN Portugal and Vimpelcom have

deployed some form of AIS products. Of these deployments, it is worth crediting Orange with the highest

number of handset shipments with embedded clients, Vimpelcom with the highest number of deployed

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on-SIM clients, Alltel with the most personalisable active idle screen product and T-Mobile US with the

first AIS product designed to boost voice ARPU.

Alltel Celltop

Alltel is a major North America mobile operator with over 11M users. Launched in January 2007, Celltop

is Alltels active idle screen product which enables direct access to external content and handset

functionality.

In order to design and develop Celltop, Alltel contracted frog design, a US-based creative consulting

firm. Alltel opted to use Qualcomms uiOne solution, a natural choice given that the operator has been

using BREW-powered handsets since 2002. A number of parties were involved in creating Celltop, namely

OEMs (primarily Motorola, LG and Samsung), telecoms software house Aricent (responsible for design,

development and testing of Celltop), content provider Motricity (providing content aggregation and

repurposing) and content publishers such as Associated Press (news), STATS (sports information) and

AccuWeather (weather forecasts). frog design was also responsible for the user research, the UI design of

Celltop and the project management. frog design reports that the project went from design to delivery

within twelve months.

Celltop displays information on the idle screen using a vertically split screen arrangement. Each half-

screen vertical strip is called a cell. Each cell is a gateway to a different service component. The

colour, order, and content of the Cells can be changed by the user. Celltop keeps a record of a users

location and preferences and delivers targeted content to each cell. There are ten cells currently made

available by Alltel: call log, messaging inbox, ringtones, stocks, news, weather, baseball, football,basketball and pro rodeo.

Celltop is currently available on LG AX8600 and Samsung u520 handsets, while the motoRAZR V3m,

motoKRZR and the LG AX245 are planned for launch within 2Q07. The operator hopes to have all

handsets equipped with Celltop by the end of the year. No information is currently available regarding

service usage and adoption by the end users although Qualcomm reports that early results indicate a rise

in conversion rates (users that switch to Celltop-enabled devices). Alltel is also planning to open up the

Celltop SDK to 3rd party developers to enable the development of a greater variety of available cells.

Motorola SCREEN3

Launched in 2005, SCREEN3 is Motorolas idle screen-based service discovery platform. The product is

integrated as a feature within Motorolas handset software platforms. In its latest iteration, SCREEN3

can deliver operator or 3rd party advertisements on the idle screen.

SCREEN3 is a client-server based solution capable of delivering XHTML-formatted content on the handset

idle screen. The software supports access to handset features and user data, but does not support

scripting. Content is fetched from content delivery systems serving XHTML or RSS 2.0 formats. SCREEN3

is also capable of pushing dynamic video links directly to the idle screen, a feature which Motorola hopes

will resonate with mobile operators keen to see a return on their 3G investments.

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SCREEN3 is managed by the xProducts and Experiences team, a multidisciplinary group within Motorolas

Motorola Devices business supporting design, development, pre-sales, deployment and operational

aspects of the product. SCREEN3 is tightly integrated into Motorolas product management cycle and is

treated as a feature which operators choose to switch on/off when procuring the handset. The product

forms part of Motorolas proprietary (P2K) platform, as well as its Linux-based (EZX and L-J) platforms.

Motorolas primary aim with SCREEN3 is to increase handset sales and differentiate, by marketing

SCREEN3 as a feature to operators. According to the company the revenue generated by server-based

service fees is low compared to the perceived profit gain by driving incremental device sales.

Since 2005, SCREEN3 has been embedded in a wide range of 2.5G handsets shipped (approximately 13

different handsets based on Motorolas proprietary software platform and one Linux-based model) and

the entirety of 3G handset products. In total, SCREEN3 has launched with 13 operators around the globe -

including Cingular, Telefonica and CMCC. The solution is currently enabled on millions of Motorola 2.5G

and 3G handsets worldwide (estimated at over 3m).

As a Motorola product, SCREEN3 has not been licensed by other handset OEMs. This creates challenges

for operators who would need to deploy a consistent promotional campaign across their subscribers. To

overcome these challenges, Motorola is one of the main contributors behind the OMA DCD (Direct

Content Delivery) work group which aims to standardise content delivery protocols across handset idle

screen solutions.

Orange Homescreen

Orange Homescreen is the mobile operators idle screen product offering branding and access to

operator services. The Orange Homescreen was introduced in 2002 as part of Signature handsets

portfolio and has since been featured on every Signature handset. Abaxias Mobile Desktop product has

provided the idle screen client technology for most Signature Open OS handsets to date. On proprietary

devices the Homescreen is primarily implemented by manufacturers in-house development teams.

According to Orange, 13 million handsets with the Orange Homescreen have been shipped to date.

During 2006, approximately 70 Signature devices were shipped with the Homescreen product,

representing an increase of approximately 100% over 2005.

The Orange Homescreen client resides on the idle screen and offers a familiar one-click access to the

most commonly used handset functions (e.g. contacts, call history, messaging, calendar, camera) as well

as operator specific services and content (e.g. bookmarks to the operators WAP portal).

The Homescreens primary functionality is to reduce the number of clicks required to reach an

application, function or service as well as to provide preferred discovery into specific applications

serving branding or promotional goals. In addition, Homescreen provides a user interface with consistent

look-and-feel across Signature devices. For Orange, the benefits of the Homescreen are threefold:

Increased usage of services (voice and data);

ARPU increase (voice and data), by facilitating access to revenue generating functions and services

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Increased customer satisfaction and loyalty, through a common customer experience across the

handset portfolio

Although no specific data has been publicised regarding the ARPU or usage increase achieved through the

Homescreen, Orange has released data for its store-front application, Orange Downloads, powered by

Surfkitchen, which is accessible via the Homescreen. According to the operator, the Orange Downloads

application has increased download data ARPU by nearly 100%, while WAP (OrangeWorld) revenues went

up by 30% through deep linking. Repeat visitors have gone up by 30% for both Orange Downloads and

OrangeWorld. Orange also announced that its Orange Photography service powered by Newbays Pixota

client has achieved over 1 million mobile phone uploads in the first 5 months of service. Although these

results cannot be attributed directly to the Homescreen alone, it is likely that users are encouraged to

use such services when it is easier to discover them through a familiar interface.

Oranges Homescreen provides the operator with a significant advantage over competing operators, in

terms of a customised idle screen product available across more than 100 models, 13m handsets and 9

handset manufacturers. This compares favourably to similar solutions of other operators that are

available on only a few models in the range. The operator attributes its competitive advantage to

leading edge technology, process know-how and commercial relationships.

Orange plans to extend the functionality of Homescreen product with additional features that ease

contact management, provide access to customer information, and content feeds. Furthermore, user

personalisation features are being developed including customised Homescreen plug-ins.

Direct advertising via the idle screen is being evaluated, but is not within the companys immediateplans. Orange believes that mobile advertising must mitigate all risk of negative impact to the user

experience, before becoming widely adopted.

S60 Active Idle

S60 Active Idle is Nokias framework for idle screen application development and deployment. The

product delivers branding and service shortcuts through the idle screen with the aim of increasing device

usage and handset sales.

The framework has been designed to allow two scenarios: firstly S60 licensee-branded idle screens

including manufacturer shortcuts, and secondly idle screen customisation by mobile operators.

Active Idle is typically used to display shortcuts to handset features and operator premium content. More

importantly, the product can host plug-ins such as a mini-dashboard to the media player, an enterprise

email notifier, or an RSS news reader. Nokia has restricted access to the plug-in SDK to Nokia partners

and thus only a few tens of plug-ins are currently available. There is no provision of over-the-air update

of the product at this stage.

Since its launch on the Nokia 6680 in 2005, Active Idle has been embedded on the S60 2nd and 3rd

edition platforms across over 30 different handsets (mostly from Nokia). Active Idle functionality can be

disabled by end users on Nokia handsets.

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The manufacturer admits that the capabilities of Active Idle have not been used to their full potential by

network operators. Moreover, innovative applications like the Flash Lite-based idle screens and Zis Qix

for S60 are not based on Active Idle, possibly hinting at the limited use cases for the current architecture

of this S60 feature.

The manufacturer does plan to release the Active Idle SDK to the public with a future product version.

Opening up the products plug-in SDK should see significantly higher levels of innovation in plug-in

development and as a consequence greater operator interest in exploiting the Active Idle platform for

service search and promotion.

SKT 1 mm

Launched in April 2005 by SKT, Koreas largest mobile operator, 1 millimeter (1 mm) is an active idle

screen product. 1 mm comprises an animated avatar that offers personalised recommendations for SKT

content. The avatar sitting on the idle screen communicates with the user using a natural language, text

chat-like interface. The 1 mm avatar can analyse the subscribers usage patterns and automatically

adjust its content recommendations for example by suggesting when new songs are available for a

particular artist based on the users music download history.

SKTs rationale for 1 mm was to increase mobile data usage by providing a close-proximity (hence the 1

mm name), highly interactive, personalised and tailored user experience. However, 1 mm achieved

limited success and was discontinued after only 90 days of operation, having attracting less than 40,000

subscribers. The 1 mm service appears to have suffered from poor execution focusing on the user

interface rather than on the value and service proposition for end-users.

SKT launched an evolution of 1 mm in 1Q07, in the form of T-interactive, an active idle screen client for

service access and discovery. Alongside T-plan and T-login, the T-interactive service falls under SKTs

T product family, an umbrella brand for the operators HSDPA-based services.

Compared to 1 mm, T-Interactive forms a more pragmatic service proposition. T-Interactive provides

access to a few easy-to-understand services, such as stock ticker, finance news, sports news, music store

and e-books. A key difference with T-Interactive is that the services offered are predefined rather than

dynamically discovered and selected, as in the case of 1 mm. A T-Interactive subscription is offered for

the equivalent of 2-4 US$ per month and is currently available on 45 handset models.

T-Mobile MyFaves

Launched in October 2006, T-Mobiles MyFaves is a calling plan supplemented by a customised, active

idle screen client. The MyFaves client shows a carousel of five pictures, corresponding to five contacts to

which the subscriber may place calls with just one click. T-Mobiles service/client bundle builds on T-

mobiles own research results which indicated that most subscribers tend to make 65% of their calls to

only five numbers. A similar study of usage patterns by Nokia in 2006 concluded that the top five

contacts of a subscriber receive over 50% of voice calls and over 70% of SMSs.

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The calling plan includes unlimited free calls to five numbers nationwide, regardless of their network.

The basic calling plan does not include free SMS/MMS/IM messages although it can be combined with an

unlimited messages plan for an additional cost. Subscribers select the five contacts of their preference

when initially registering for the service. Each of the five contacts can be changed once a month either

through the idle screen client or via T-Mobiles personalised on-line portal (myt-mobile.com).

The idle screen client is the key differentiator of MyFaves in comparison to similar offerings by other

operators. The service is designed is to have easy, one-touch communication (voice, messaging or photo

sharing) with the five most important contacts, which are always available on the front of idle screen.

The client replaces the idle screen with a carousel of five pictures, each representing one of the five

contacts. The pictures can be either selected out of an icon collection which is bundled with the product

or any photo that is stored in the handset. After selecting the desired contact, the user is presented with

a set of actions namely call, send message, share picture and send voice note.

The client comes pre-installed and activated on a selection of MyFaves branded handsets and can also be

installed on compatible handsets post-sales through firmware over-the-air (FOTA). As of April 2007 there

are 35 handsets supporting MyFaves from manufacturers Nokia, Samsung, Motorola, RIM and T-Mobile

branded HTC phones.

The MyFaves service/client bundle is designed to increase voice and data usage as well as attract new

customers. T-Mobiles MyFaves is similar to Alltels MyCircle, an unlimited calling plan for 10 contacts,

but differentiated by its attractive eye-catching user interface that sits on the handset idle screen. No

performance results have yet been released regarding MyFaves.

Vodafone Live! Cast

Vodafone Live! Cast is an active idle screen service for content promotion. The service was launched by

Vodafone Germany in 4Q05, as a commercial pilot to 50,000 participants on a free trial basis until March

2006. The service was eventually discontinued due to technical challenges.

Live! Cast was a pioneering service that delivered headlines from politics, economics and sport to the

handset idle screen, via an animated pop-up window appearing in the lower half of the screen. Upon

clicking on a news headline, the user would be taken to the Vodafone WAP portal to directly access the

full article. The Live Cast client was embedded in the Panasonic VS3, Sagem myV-76 and Sony Ericsson

K750i handset models launched by Vodafone Germany.

The Live! Cast solution was designed and developed by an internal Vodafone team using an SVG-Tiny 1.1

player by Ikivo and XHTML browsers by Openwave and Opera. Cell broadcast technology was used to

efficiently transmit content updates to handsets in the installed base, while an OSGi-compliant protocol

was used for management of the clients. However, the Live! Cast project was not fully commercialised

due to technical issues with cell broadcast incompatibilities across telecom infrastructure providers.

As a pre-cursor to Live! Cast, Ikivo co-led the standardisation of SVG-T 1.1 Plus in 2004 with Vodafone, a

standard which introduced transparency elements in SVG-T and was later incorporated into SVG 1.2. In

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February 2007, the Vodafone-Ikivo collaboration further led to the development of an on-device portal

and mobile TV application with content branded for the Bundesliga, the German football league.

Section D - Market Trends

This white paper has so far discussed the active idle screen solutions market, reviewed a dozen AIS

vendors and presented a number of case studies of AIS deployments. This final section outlines three key

trends that will be affecting the market of idle screen solutions.

UIs as ringtone downloads

Japan, the worlds most advanced market for mobile operator services, offers a glimpse of the future of

not only idle screen customisation, but also complete UI customisation.

Acrodeas Vivid UI technology has gradually become the de facto UI customisation solution for the

Japanese market. The two leading mobile operators, DoCoMo and KDDI have chosen Acrodeas

technology as the UI platform that will be embedded in all their phones by the end of 2007, according to

the Japanese software vendor.

Japanese operators use Vivid UI in a fashion similar to a content platform; a user can purchase and

download a branded user interface in the same way they can download a ringtone; the downloaded UI,

based on Acrodeas technology platform can transform the user interface radically, for example by going

from a BMW-branded to a Barbie-branded UI. Acrodea works with 16 content providers in Japan who

create customised UIs for handsets sold by Japanese operators.

Upon installation of a new UI, not only the handset theme changes but effectively most of the interface

from the idle screen, to the soft keys and the built-in email and dialler applications. The changes are not

simply superficial, as they affect the content layout on the built-in applications as well as the cross-

application journeys.

Technology-wise, Vivid UI publishes an API specification that is then used by manufacturers to integrate

their applications into the platform. The whole process is specified and mandated by the network

operators, which makes this commercial feat both unique and nigh impossible to replicate in any othermarket.

In GSM markets, three elements will be leading to this UI-as-a-ringtone reality by 2010, starting with idle

screen widgets. Firstly, the Dynamic Content Discovery (DCD) specification currently being drafted by the

OMA standards body, which defines how UI customisations are specified and communicated in a way that

is consistent across handset models and manufacturers. Secondly, the wide availability of UI

customisation solutions, not only in the form of AIS offerings, but more importantly in the form of tools

for rapid, end-to-end handset UI redesign, such as those on offer by Digital Airways, Nucleus (Inflexion),

and TAT (Cascades). Thirdly, the trend for software vendors to move away from per-device royalties into

per-activation and further into download revenue share models, as handset software margins are

continually squeezed.

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Idle screen advertising will fail before it succeeds

In 2007 mobile advertising is undergoing a period of major hype. Advertising is seen as a third source ofARPU for mobile operators, following voice and data ARPU and therefore a major untapped opportunity

of a magnitude of a billion units per year. As discussed in section A, the idle screen is the most sought-

after inventory in the mobile handset, due to its proximity to the user, its near-always-on presence and

its relative lack of intrusiveness. However, the hype surrounding mobile advertising will lead players

keen on advertising dollars to ignore the domain-specific challenges that the mobile domain entails, at

their own peril.

Firstly, mobile advertising can easily turn from a casual reminder of promotional items to an intrusive

and unwanted nuisance that mars the user experience. Carefully managing the mix of pure news,

sponsored news, infomercials (i.e. product placements) and hard promotions will be instrumental to the

success of this new medium. According to Celltick, the ideal mix of these elements involves 5-10% hard

promotions, 35%-40% infomercials, 40% pure news, and 10% sponsored news.

Secondly, mobile ad placement requires determining the best context and time for inserting an ad. This

implies an intimate knowledge of handset technology, so as to ascertain where, when and how an ad will

appear within the user journey. For example, the effect and efficiency of the ad impression will be

significantly different if it appears on the idle screen, or when a user is typing a calendar entry or is in

the middle of a phone conversation. Another example is that idle screen advertisements are far more

effective if the software can ensure that the mobile handset is in front of the user and not in their

pocket. Naturally, monitoring ad impressions and click-through will be instrumental in determining the

most appropriate context and time for ad insertion.

Thirdly, mobile handset technology is highly fragmented. Expanding a client ad platform across a critical

mass of handset models and volumes will be one of the hardest challenges to overcome.

Fourthly, handsets come with a variety of screen sizes. Repurposing the ad media for different screen

sizes will be important to ensure that the ad reaches the consumer in the format and style intended,

rather than cropped. Mobile-specific tools for ad publishers will be essential to overcome this challenge.

Last, and certainly not least, consumer acceptance of mobile advertising is still untested and uncharted

territory. Besides a carefully balanced mix of news, infomercials and hard promotion, mobile advertisers

must include easily accessible opt-in and opt-out mechanisms for end-user management of ad channels

received.

There is no doubt that over-enthusiastic efforts to place ads in mobile handsets before the technology

and commercial agreements mature, will be faced with failure.

Voice, the next killer data application

Mobile operators have continually tried to seize every opportunity to grow their data revenues. Yet, most

efforts, from 3G and MMS to HSDPA and Mobile TV are failing to achieve widespread adoption and

therefore fall short of their initial expectations. At the same time, voice ARPU has not only reached a

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plateau, but is on a declining trajectory. Informa Telecoms and Media research indicates that voice ARPU

fell from a global average of $19.38 in 2005 to $17.65 in 2006 and is expected to drop further by $1.34

(7.6%) in 2007. Yet mobile data ARPU has far from compensated for this shortfall. From a global average

of $2.84 in 2005 data service ARPU dropped to $2.81 in 2006 and is forecast to climb by just $0.07 in

2007.

Informa Telecoms & Media believes that operators should refocus their strategy to not only achieve

increases in data ARPU, but also reverse the trend of declining voice ARPU. In other words, mobile

operators should reconsider voice as a possible new killer data application.

There are already a number of services which encourage users to increase their voice calling. T-Mobiles

MyFaves is perhaps the leading example of this new generation of services which combine a tariff plan, a

data service and handset customisation to deliver a truly unique experience that encourages users to

make more calls. Another example is Comverses Visual Voicemail which encourages more interaction

(voice and text) with the voicemail callers. Moreover, Qixs Zi (alongside Abaxias Mobile Finder and

Tegics T9 Discovery Tool) facilitate looking up an address book contact and calling them up, which again

has been shown to increase voice calling. Yet another example is SoloMios (now Openwave) In-Call

handset client which offers phone users more choices for taking calls when otherwise occupied.

As operators are coming under increasing pressure to sustain their ARPU, they will be reconsidering the

long-ignored voice services and refocusing some of their efforts on building more value-added voice

services combining not only voice, but data services and handset or SIM customisation. As they do this,

the T-Mobile MyFaves service will undoubtedly serve as a role model for operators throughout developed

markets.

Conclusions

2007 is clearly the year when a wave of vendor announcements has hallmarked the establishment of the

active idle screen market. Some 15 vendors are now offering AIS solutions, deployed by over 10 mobile

operators to date, with Alltel, Orange, T-Mobile US and Vimpelcom being behind the most innovative and

aggressive deployments.

As the market crosses the early adopter chasm, a number of challenges remain, namely technology

know-how, building lasting handset manufacturer relationships and reducing the impact of time-to-

market.

There are plenty of opportunities, as the several billion handset idle screens in the market represent

uncharted territory for operators, manufacturers, content providers and advertisers. The idle screen is

clearly the prime real-estate for providing access, search, discovery and advertising of mobile services.

Informa Telecoms & Media believes that exploitation of this territory will proceed rapidly with a

significant increase in regional deployments of AIS in 2007, before active idle screen solutions become a

standard feature of most mass-market handsets by around 2009.

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