Global Mobile Vision 2012

How to enter the European Mobile Market

CEO & Founder Rumble Media

David An

Executive MBA HSG, M.Sc.

November 2012

Online Gaming

Rumble Media GmbHCEO: David An Foundation: 2007Major Shareholder: HoltzbrinckHQ in Karlsruhe, Germany Number of employees: 11

Mobile Gaming

About Rumble Media

Portal Business

Mobile SaaS Reseller

Mobile PublishingSolutions

Agenda

- European Mobile Market- Current Challenges - Potential Growth Strategies- Solution - Conclusion

3

European MobileMarket

4

Largest 6 European Countries

Population

Population

3G

3G

(Mio)

%

Subscriber

%

(Mio)

Germany

82

23%

38

18%

France

61

17%

30

14%

Great

62

18%

42

20%

Britain

Italy

61

17%

44

20%

Poland

39

11%

28

13%

Spain

47

13%

33

15%

Total

351

215

The top 6 countries make up 350 million inhabitants which is about ~50%

of total Europe and 70% of EU (500 M).

Source: Morgan Stanley, Wikipedia

5

How big is the market

82 Million total

38 Million Mobile 3GSubscriber

26 Million SmartphoneUsers

Germany has a ~ 68% smartphone penetration.

Source: Bitcom

6

Statistics German Market

Incumbent App Stores

In Germany, Android has become market leader. There are only 3 significant appstores

Source: Madvertise

7

OS Penetration Germany

Symbian

5%

RIM

6%

iOS

14%

Windows

5%

Android

68%

Bada

2%

Other

0%

Currently, in the top 6 European countries 2/3 of every newly sold

smartphone is an Android phone.

Source: Kantar worldpanel

8

New Smartphone Sales

0.6%

13%

19%

46%

Android apps are more advertising driven with only 0.6% pure paid apps and 13% in-

app-purchase apps.

Apple iOS paid apps still have 20% share.

Source: xyologic

9

Revenue Models Germany

Current

Challenges

1

A game on Android will make only 24% of the iOS version. Amazon is ~ 89%Lower payment conversion for Android in Europe is due to the lack of GoogleWallet accounts which Google is working on of course.

Source: Madvertise

11

New Smartphone Sales

$2.50

$2.00

$2.00

$1.50

$1.00

$0.75

$0.50

$0.00

According to Pocketgamer user acquisition costs have recently jumped

from 0.75$ to 2

$.

This is due to incumbent players currently buying themselves at a loss intothe future ( Zynga, Gree, DeNA)

12

Current Challenge: Customer Acquisition Costs

Cost per User (Cost per install)

$2

$1.86

$0.75

$0.75

Conversion Rate

5%

5%

5%

5%

Break-Even

$40

$37

$15

$15

Target Margin

30%

30%

30%

50%

Life-Time Value (LTV) Target

$57

$53

$21

$30

Buying users at 2$ equals to burning money.

Assuming a low target margin of 30%, 0.75$ CPI seems feasible. But the question is: Can you get the right audience ?

13

Current CPI Levels are not sustainable

Potential GrowthStrategies

1

Overview of Growth Strategies

1.Viral

Out of product itself (Kakaotalk, Anipang)Social media (Social graph)

2. Organic

SEO (Google)

PR (Public Relations)

Appstore Relations (Have good relations)

3. Advertising Networks

CPM (Cost per Mille)CPC (Cost per Click)CPI (Cost per Install)

4. Special Paid Networks

Incentivized (Tapjoy, Sponsorpay)Free App a Day (FAAD)

Chart Booster

5. M&A

6. Partnerships

Channelling (LTV)

Free

Pay

Share

15

Some real numbers!

Clickrate 2.5%

CPC 20cents

1 Million BannerImpressions

1 Million x 2.5% x .2= 5,000 Euro

25,000 Clicks

16

Paid Advertising - CPC

Advertise in the timeline

- high CTR

- good targeting

- however high costs

- ~1$ CPI

In addition:

- use social graph

features like requests,challenges, invitations,score API, open graph

17

Paid Advertising Facebook Ads CPI

Most deals were bought at a high premium:

- Zynga bought OMGPOP for $ 180 - 210 Million 6$ / user

- Gree bought Pokelabo ($7m revenues $2m profit 2011)for $170m by Gree 25 Price/Sales and 85 Price/Earningsmultiple

18

M&A

In addition, build your own distribution eco-system

Eco-system approach (channeling) forces you to build a good monetizinggame right from from scratch and build long-term partnerships.

You need an external solution to manage all the tracking and analytics.

19

Solution

2

TinyCo shares up to 75% of realized revenues (at least 30%needed)

Incremental revenues for app publishers Drawbacks:

Limited to apps

SDK for app publishers needed

No detailed reporting

21

First step into the right direction

Mobile PS is a solution that supports your eco-system

Game Publishers

Build a longterm global network of affiliate partners Don't waste marketing dollars & ad network fees Flexibility to mix different revenue models

22

23

Mobile PS SaaS Technology

Conclusion

2

- Don't inflate your business plan on Android

- Control your conversion funnel at any time

- Public Relations builds awareness & word-of-mouth

- Don't outspend your competition

- Hire Managers with cultural empathy

- Build a long-term distribution network & ecosystem

- Outsource solutions which are not a core competence

- Use Mobile PS as Software-as-a-service

25

Conclusion

Please visit our website forfurther information

david_an@rumblemedia.de

26

Any questions?www.mobile-ps.com

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