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Yoshiaki Maeda on how Docomo plans to tackle Japan’s smartphone app market

Takeshi Hirano 2013.04.23

This is a part of our coverage of B Dash Camp Fukuoka 2013.

You can’t discuss the history of the Japanese mobile business without talking about i-mode. This is the featurephone content platform from NTT Docomo, which many content providers used to achieve significant growth and revenue.

Of course in recent years, the market need has shifted to smartphones, especially the iPhone, and not many people have their their eyes on i-mode these days. But many of the ideas developed in i-mode live on. For example, Docomo’s competitor KDDI has had much success with SmartPass, a flat rate app subscription program similar to i-mode in terms of its subscription model.

How exactly will Docomo respond to KDDI’s smartphone success so far? At B Dash Camp 2013 in Fukuoka yesterday, Yoshiaki Maeda, the managing director of smart communication services at NTT Docomo, explained a little about the company’s upcoming strategy, revealing a few interesting figures in the process.

Docomo’s smartphone content sales generates $180 million a month

To date, Docomo has acquired 18 million smartphone users. The figure is expected to reach 40 million by the end of 2014. Their smartphone content sales grew to a market worth of $180 million, and that’s continuously on the rise each month.

Conversely, the i-mode content market is shrinking.

20130423-083256 — The growth of Docomo’s smartphone subscribers

20130423-083303 — The growth of revenue from smartphone content sales

On-the-spot purchase needs surpasses that of monthly subscription model

In the era of featurephones, monthly subscription models were very strong but it’s shifted to an ‘on-the-spot’ purchase model as our more subscribers move to smartphone users.

20130423-083310 — Monthly subscription sales vs. on-the-spot purchase sales
in the last three years

For us, by bringing the subscription user base from the featurephone market (i-mode) to the smartphone content market, we expect monthly revenue to increase to $300 million.

Partnering with new content providers

Some content providers brought conventional (featurephone optimized) content to the smartphone app marketplace, and that will never attract our subscribers.

We value our providers though, but we further expect to get new providers involved to cultivate the market. We also have our Docomo Innovation Ventures as a touch point for new companies or startups. We’ve exploring ways to work with brand new people.

When will Docomo start ‘Sugotoku’, its monthly flat-rate subscription program for smartphone apps?

We’re preparing for it to be launched very soon. It would be similar to our competitor KDDI’s strategy, but we’re still in talks with partner content providers (and/or app developers). We aspire to make it comfortable enough so that our customers will be happy to use it.

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B Dash Camp panel: Trends in the Japanese online ad business

Takeshi Hirano 2013.04.22

See the original story in Japanese. This is a part of our coverage of B Dash Camp Fukuoka 2013. Along with the evolution of web services, online advertising platforms have drastically evolved. In the past, we used to place simple banner ads on our websites, and subsequently search advertising emerged. Now we’ve adopted impression-based ads using ad tools like DSP (demand-side platform). But the further ad solutions evolve, the more issues we face. Here’s a quick rundown on the panel discussing issues facing the online advertising space in Japan. The panelists for the session include: Osamu Aranami, Corporate Office, Head of Marketing Solutions Company, Yahoo Japan Kenichi Sugawara, CMO, ScaleOut Koki Sato, President and CEO, Septeni Holdings Moderator: Toru Kawarazuka, Senior Manager, Sales Management Dept., Sony Bank Does social media have much of an impact on the conventional ad business? Aranami: I can’t disclose our figures because we’re heading towards the announcement of our financial statements in the week ahead. In terms of browsing devices, it’s changing. The share of smartphone and tablets is on the rise. Sato: Social media allows users to create a sort of user pool as well as owning their official website. The engagement helps acquire…

See the original story in Japanese.

This is a part of our coverage of B Dash Camp Fukuoka 2013.

Along with the evolution of web services, online advertising platforms have drastically evolved. In the past, we used to place simple banner ads on our websites, and subsequently search advertising emerged. Now we’ve adopted impression-based ads using ad tools like DSP (demand-side platform).

But the further ad solutions evolve, the more issues we face. Here’s a quick rundown on the panel discussing issues facing the online advertising space in Japan. The panelists for the session include:

Osamu Aranami, Corporate Office, Head of Marketing Solutions Company, Yahoo Japan
Kenichi Sugawara, CMO, ScaleOut
Koki Sato, President and CEO, Septeni Holdings
Moderator: Toru Kawarazuka, Senior Manager, Sales Management Dept., Sony Bank

Does social media have much of an impact on the conventional ad business?

Aranami: I can’t disclose our figures because we’re heading towards the announcement of our financial statements in the week ahead. In terms of browsing devices, it’s changing. The share of smartphone and tablets is on the rise.

Sato: Social media allows users to create a sort of user pool as well as owning their official website. The engagement helps acquire high-profile users, and may work well for global business expansions. But it’s still in the stage of trial and error.

Using personal profiles for advertising

Sugawara: DSPs allow you a specific ad space on an impression-basis. In terms of placing ads using this platform, you can specify a target audience segment or ad spaces. The audience segments requires personal profiles. For example, when you visit a motor comparison site (overseas), they will use your profile and propose target vehicles for you.

Aranami: Yahoo Japan has users’ purchase histories on our shopping site and auction site. We’re considering to use that data for our ad delivery. But at the same time, we have to be careful on how we should handle such data.

20130422-185321 — Septeni Holdings CEO Koki Sato speaking on the panel

What’s ahead for rich media ads?

Aranami: To help with promotional activities for the Olympic bid in Tokyo, we’ve created an ad where athletes move when you mouse over them. It generated a lot of buzz, but we’re still preparing for movie ads.

Sato: At my company, the demands of rich media ads account for a lesser share of our business, especially compared to English-speaking countries. There are two key points here: How much can premium (rich media) ads bring value compared to conventional TV ads? And how many users are shifting from desktop browsing to smartphone devices.

Sugawara: There are rights management issues as well. Some TV ads cannot be reproduced for online advertising because of rights issues.

Aranami: Yahoo Japan is working on finding out how we can create a safe and secure ad networks for our clients, as well as deploy further extensive developments on YDN, our Yahoo Display-ad Network. We can take minor requests from our clients, such as which domain they would like to place ads on. We proudly think ourselves as Japan’s largest DSP operator.

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Kakao CEO Sirgoo Lee: Creating a mobile social platform

Rick Martin 2013.04.22

This is a part of our coverage of B Dash Camp Fukuoka 2013. At B Dash Camp 2013 in Fukuoka today, Kakao CEO Sirgoo Lee, explained a little about the rise of the KakaoTalk mobile chat application in Korea and around Asia. Sirgoo was joined on stage by Gen Miyazawa, the head of search at Yahoo Japan, Kakao’s partner in Japan. To date the KakaoTalk app has seen over 86 million downloads, including 10 million here in Japan. Sirgoo explained that Kakao has over 29 million daily unique views, and more than 4.8 billion messages are exchanged each day. Perhaps more important than those metrics are the revenue figures that Sigoo mentioned. He says that in 2012 the company hit $42 million in total revenue, turning a profit of $6.5 million. Most of that revenue comes from their platform business, specifically games and social commerce, as well as ads. But he noted that this is just the beginning and that this social layer can stimulate growth in spaces like e-commerce, for example, showing friends what you want to buy. Line Corporation CEO Akira Morikawa was sitting in the front row (having spoken in a session earlier in the day) and…

This is a part of our coverage of B Dash Camp Fukuoka 2013.

At B Dash Camp 2013 in Fukuoka today, Kakao CEO Sirgoo Lee, explained a little about the rise of the KakaoTalk mobile chat application in Korea and around Asia. Sirgoo was joined on stage by Gen Miyazawa, the head of search at Yahoo Japan, Kakao’s partner in Japan.

To date the KakaoTalk app has seen over 86 million downloads, including 10 million here in Japan. Sirgoo explained that Kakao has over 29 million daily unique views, and more than 4.8 billion messages are exchanged each day.

Perhaps more important than those metrics are the revenue figures that Sigoo mentioned. He says that in 2012 the company hit $42 million in total revenue, turning a profit of $6.5 million. Most of that revenue comes from their platform business, specifically games and social commerce, as well as ads.

But he noted that this is just the beginning and that this social layer can stimulate growth in spaces like e-commerce, for example, showing friends what you want to buy.

Line Corporation CEO Akira Morikawa was sitting in the front row (having spoken in a session earlier in the day) and Sirgoo acknowledged that they have a few things that Kakao could take away from watching how Line operates:

We have to learn more from Morikawa-san in terms of global business. We are very local in that 70% of our users are in Korea. It’s difficult to expand beyond Korea. We at Kakao are taking a different approach. […] We’re partnering with Yahoo Japan here, and we’d like to partner with local partners in other regions who know those regions.

This is an interesting contrast with Line, who expands in a different manner, observing where they do well and then flying in to do business there.

The paths of these two mobile chat giants have largely mirrored each other to date, with each one dominating their respective local markets. But with their somewhat differing philosophies on expansion, it will be interesting to see which strategy works best.

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B Dash Camp panel: Social gaming principles can also be applied to e-learning

B Dash Camp Fukuoka 2013

Takeshi Hirano 2013.04.22

See the original story in Japanese. This is a part of our coverage of B Dash Camp Fukuoka 2013. The e-learning industry is changing drastically with new technologies like cloud technology or social media. One of notable startups in this space is Schoo, which provides real-time online lecture services on many topics. We had a chance to check out a panel on online e-learning services at B Dash Camp 2013 today in Fukuoka. In the fist, Dylan Arena, the chief learning scientist of the e-learning solution provider Kidaptive, introduced four keywords to describe the latest trends in the US e-learning market. Access: Giving access to online lecture services anywhere at anytime. Attention: Giving teachers an efficient way to pay an attention to what their students are doing in their classrooms. Assessment: An advanced e-learning system gives teachers a way to assess their students far better than before. Personalization: Using the three points stated above, explore a way to personalize lecture content to individual students. For the people who have less learning opportunities for economic reasons, Kidaptive’s solution allows teachers reach students by providing a combination of an online e-learning environment as well as private tuition opportunities. Subsequently teachers can check…

See the original story in Japanese.

This is a part of our coverage of B Dash Camp Fukuoka 2013.

The e-learning industry is changing drastically with new technologies like cloud technology or social media. One of notable startups in this space is Schoo, which provides real-time online lecture services on many topics.

We had a chance to check out a panel on online e-learning services at B Dash Camp 2013 today in Fukuoka. In the fist, Dylan Arena, the chief learning scientist of the e-learning solution provider Kidaptive, introduced four keywords to describe the latest trends in the US e-learning market.

Access: Giving access to online lecture services anywhere at anytime.
Attention: Giving teachers an efficient way to pay an attention to what their students are doing in their classrooms.
Assessment: An advanced e-learning system gives teachers a way to assess their students far better than before.
Personalization: Using the three points stated above, explore a way to personalize lecture content to individual students.

For the people who have less learning opportunities for economic reasons, Kidaptive’s solution allows teachers reach students by providing a combination of an online e-learning environment as well as private tuition opportunities. Subsequently teachers can check up on how students are doing in a more systematic manner.

20130422-160324 — From the left: Drecom’s Yuki Naito and Quipper’s Akifumi Yokoi

Interestingly, social gaming players are showing an interest in the e-learning area. On this panel, Drecom‘s CEO Yuki Naito and Quipper‘s Akifumi Yokoi discussed what’s ahead for the intersection of gaming and education services. Naito explained a bit about their e-learning platform, adding:

The know-how for improving user retention rate in the social gaming areas can also work in managing e-learning services.

While it’s doubtful that social gaming developers will sidetrack their businesses into this space, it will interesting to see them occasionally deploying their ideas to different business spaces such as this one.

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B Dash Camp panel: New tides in social B2B

Rick Martin 2013.04.22

This is a part of our coverage of B Dash Camp Fukuoka 2013. The afternoon session of B Dash Camp Fukuoka 2013 included a panel on the changes in B2B business brought about by the social web. Participants in the discussion included: Akira Kurabayashi, senior director, corporate development Koki Uchiyama, CEO, Hottolink Inc. Masahide Nakamura, President and CEO, Allied Architects Inc. Moderator: Yasuhisa Tsubata, Reservation service unit manager, media services, Yahoo Japan 16:05 – Kurabayashi: “In the US, social networks exist in business, not just in the consumers space. There are so many players in the business social area.” He explains a little about Marketing Cloud, their leading social marketing platform. 16:08 – Nakamura: About 3000 companies in Japan using social B2B, but we figure the number of companies that will use social for business will increase. […] We think this is like 15 years ago in the consumer space, where things are only just starting to take off. 16:12 – Tsubata notes that maybe if more people use Line for B2B then maybe it can boom. He observes Line CEO Morikawa taking notes in the front row. Mr. Uchiyama says jokingly that he’d like to partner with them! 16:15…

This is a part of our coverage of B Dash Camp Fukuoka 2013.

The afternoon session of B Dash Camp Fukuoka 2013 included a panel on the changes in B2B business brought about by the social web. Participants in the discussion included:

Akira Kurabayashi, senior director, corporate development
Koki Uchiyama, CEO, Hottolink Inc.
Masahide Nakamura, President and CEO, Allied Architects Inc.
Moderator: Yasuhisa Tsubata, Reservation service unit manager, media services, Yahoo Japan

16:05 – Kurabayashi: “In the US, social networks exist in business, not just in the consumers space. There are so many players in the business social area.” He explains a little about Marketing Cloud, their leading social marketing platform.

16:08 – Nakamura: About 3000 companies in Japan using social B2B, but we figure the number of companies that will use social for business will increase. […] We think this is like 15 years ago in the consumer space, where things are only just starting to take off.

16:12 – Tsubata notes that maybe if more people use Line for B2B then maybe it can boom. He observes Line CEO Morikawa taking notes in the front row. Mr. Uchiyama says jokingly that he’d like to partner with them!

16:15 – Nakamura: There’s lots of information moving about these days, and for example, if you eat at a restaurant you may recommend it online, and this sort of social data is abundant online — and search might not be the most efficient to sort though it. I think the volume of data will only get larger, and we’re still in the early stages of sorting though it.

16:23 – Uchiyama: In 2010 there was a stock forecast system using social media, so I think with things like that there’s not a big gap between the US and Japan. […] On Japanese companies not yet being aggressive: Japanese companies are often thinking about past cases, rather than new ideas. […] The literacy level of the customers is very different as well.

16:27 – Nakamura: Asia’s GDP is projected to soon account for 52% of the world, so I don’t think it’s merely about exporting US services to these regions, but you also have to localize of course.

16:31 – Tsubata: B2B is a good sector to invest in, and there are lots of companies looking to market on the web and in the social world, and I think there’s lots of potential there.

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Line Corporation’s CEO Morikawa on fast and furious global expansion

Rick Martin 2013.04.22

This is a part of our coverage of B Dash Camp Fukuoka 2013. In the opening session of B Dash Camp Fukuoka 2013, we had a chance to hear from the CEO of Line Corporation, Akira Morikawa. The company’s popular Line chat app now boasts over 140 million users around the world, and over 45 million in its home market of Japan. The moderator, Ryuichi Nishida, tried to ask if they have a next target goal in terms of users, but Morikawa-san declined to bite on that one. Morikawa explained a little about the recent rebranding of the company from NHN Japan to Line Corporation, explaining that this decision was largely based on creating a brand intended for global expansion. Mr. Nishida asked about what the company’s localizing strategy is, and whether they plan to establish regional subsidiaries in all the countries or regions where they operate. Interestingly, Morikawa-san explained that they do not, noting that they prefer to operate in a more flexible manner, as a sort of borderless company. He says that when they find some success in a certain region, they do fly there and do business – but they don’t need to be there perpetually. He…

This is a part of our coverage of B Dash Camp Fukuoka 2013.

In the opening session of B Dash Camp Fukuoka 2013, we had a chance to hear from the CEO of Line Corporation, Akira Morikawa. The company’s popular Line chat app now boasts over 140 million users around the world, and over 45 million in its home market of Japan. The moderator, Ryuichi Nishida, tried to ask if they have a next target goal in terms of users, but Morikawa-san declined to bite on that one.

Morikawa explained a little about the recent rebranding of the company from NHN Japan to Line Corporation, explaining that this decision was largely based on creating a brand intended for global expansion.

Mr. Nishida asked about what the company’s localizing strategy is, and whether they plan to establish regional subsidiaries in all the countries or regions where they operate. Interestingly, Morikawa-san explained that they do not, noting that they prefer to operate in a more flexible manner, as a sort of borderless company. He says that when they find some success in a certain region, they do fly there and do business – but they don’t need to be there perpetually. He added:

Maybe we were lucky to succeed in each market, but we didn’t think very deeply about [each one]. Japanese companies think too much. They devise a way to do the best [thing] from the start, and then you can’t really go anywhere.

This somewhat echoes his sentiments from last week at the Japan New Economic Summit, with more of an emphasis on speed and agility. This is pretty unique for a company in Japan, and it’s likely the characteristic that contributed to their unique success thus far.

For more information on the growth of Line, please check out our interactive Line Timeline which chronicles its growth from its launch back in 2011 up until the present day.

Docomo’s smartphone content sales generates $180 million a month

On-the-spot purchase needs surpasses that of monthly subscription model

Partnering with new content providers

When will Docomo start ‘Sugotoku’, its monthly flat-rate subscription program for smartphone apps?

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