2014 Feb How Changing Mobile Technology Is Changing The Way We Do Business When the first mobile phones came out in sizes such as shoeboxes, people thought it was convenient, but not practical. Car phones came around the same time but weren't quite life changing yet. Then the phones got small enough for pockets and people in all walks of life started using mobile phones in various places. Undoubtedly, mobile phones have changed people lives. In Feb, the C8 CEO Insights luncheon is pleased to welcome Dr. Minoru (Mick) Etoh. Mick is the Managing Director of R&D and strategy in Japan, as well as CEO of Docomo Capital based in Palo Alto, California. He will be sharing with us on how he sees the business and technology landscape is changing due to advances in telecommunications and mobility. How companies are prospering in this next generation, and how some firms are actually missing the boat. This is a wonderful opportunity to hear from one of Japan's leaders from a flagship firm.

1. How Changing Mobile Technology
Is Changing The Way We Do
Business
Mick Etoh (@mickbean)
Feb. 13th, 2014
© 2013 NTT DOCOMO, INC. All rights reserved.
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2. Who am I?
•
Mick Etoh, SVP, NTT DOCOMO
•
Role: R&D Strategy
•
Expertise:
Pattern Recognition & Machine Learning,
Signal Processing & Multimedia,
Mobile Networks
Fun:
Bike Riding, Fly Fishing, and Wine Tasting
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© 2013 NTT DOCOMO, INC. All rights reserved.

3. Who is DOCOMO?
•
61 million subscribers in Japan
•
$45 billion revenue (2013)
Next to China Mobile, Verizon, and
AT&T
•
“i-mode” innovator (1999)
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© 2013 NTT DOCOMO, INC. All rights reserved.

4. Revenue Structure (FY2012)
Feature Phone Era
Data Stage
Voice Stage
Smart Phone
Service
Cloud
Service $5.5 Billion
Packet
Data: $19 Billion
Voice
Voice: $13 Billion
Device
4
© 2013 NTT DOCOMO, INC. All rights reserved.

5. Two Distinct Operation Structures
Operator-Own-Everything Model
Communication-Service-Provider &
Customer-Relation-Management Model
Customers
Customers
Services
Payments
Services
Payments
CRM
CSP
System Integration/Operation
Operator-Defined Interface
Vendor1
Vendor2
Vendor3
CSP
CRM
Solution Vendor
Proprietary Vendor Interface
Sub Vendor1
© 2013 NTT DOCOMO, INC. All rights reserved.
Sub Vendor2
Sub Vendor3
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6. © 2013 NTT DOCOMO, INC. All rights reserved.
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7. Experiencing a Big Challenge
DOCOMO as
Wireless Carrier,
Network Vendor,
and
Service Provider
© 2013 NTT DOCOMO, INC. All rights reserved.
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8. Unbundling the corporation
by John Hagel III and Marc Singer (1999)
• Customer Relationship Management
–Battle for Scope: Identify, attract, and build relationships with
customers
• Infra Structure Management
–Battle for Scale: Build and manage facilities for high-volume,
repetitive operation tasks
• Product Innovation
–Battle for talent: conceive of attractive new products and services
and commercialize them
© 2013 NTT DOCOMO, INC. All rights reserved.
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9. What is Innovation?
Joseph Schumpeter‘s
“neuer Kombinationen”
(Theorie der wirtschaftlichen Entwicklung)
© 2013 NTT DOCOMO, INC. All rights reserved.
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10. Innovation Example
2.5G Internet connectivity,
DOCOMO
1998
Serendipity
Micro Browser,
Access Co.
1995
© 2013 NTT DOCOMO, INC. All rights reserved.
i-mode,
DOCOMO
1999
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11. Wireless Technologies, the Enablers
+Big data synchronization
+Flat Rate + Cloud
+CODEC
+micro browser
Personal Storage
SNS/Comm. Tools
3.9G LTE:∼75Mbps2010
Smartphone Platform
as Application Market
3.5G: ∼14Mbps 2006
Mobile Multimedia
3G: 64-384Kbps 2001
i-mode
2G:9.6KbpsX3 1998
© 2013 NTT DOCOMO, INC. All rights reserved.
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12. Very Simplified Formula as Our Old Strategy
Wireless
Broadband
?
Innovation X
© 2013 NTT DOCOMO, INC. All rights reserved.
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13. Very Simplified Formula with Smartphone
Wireless
Broadband
Smart
Phone
Dumb Pipe
?
Innovation X
© 2013 NTT DOCOMO, INC. All rights reserved.
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14. Control Points, those who have gone...
Operator
Portal
Operator
Portal
Applications
Applications
Middleware
Middleware
OS
OS
Radio Interface
Radio Interface
AAA
LINE
Facebook
i-tunes
Search Engines
AAA
Feature Phone Smart Phone
© 2013 NTT DOCOMO, INC. All rights reserved.
No Operator’s
Control Points
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15. Battle for the place where people visit
in the cyber space
© 2013 NTT DOCOMO, INC. All rights reserved.
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16. © 2013 NTT DOCOMO, INC. All rights reserved.
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17. Technology Trend 1:
Personal Assistant Agent (i.e., very
thin client) with
a killer new functionality
Copyright: Microsoft's "Cortana" Personal Assistant App
© 2013 NTT DOCOMO, INC. All rights reserved.
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18. Technology Trend 2:
Very Fat & Robust Pipe
and Machine Communication
© 2013 NTT DOCOMO, INC. All rights reserved.
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19. Those who have gone.
© 2013 NTT DOCOMO, INC. All rights reserved.
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20. LTE-Advanced Network （２０１６？）
Macro Cell Base Station
Small Cell Base Station
Centeraized Radio Access
Network
© 2013 NTT DOCOMO, INC. All rights reserved.
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21. The Next Enablers
+Large Scale Data Synchronization
Personal Agent
4G
+Big data synchronization
+Flat Rate + Cloud
+CODEC
Personal Storage
SNS/Comm. Tools
new B2B Biz
M2M/eSIM
3.9G LTE:∼75Mbps2010
Smartphone Platform
as Application Market
3.5G: ∼14Mbps 2006
Mobile Multimedia
3G: 64-384Kbps 2001
© 2013 NTT DOCOMO, INC. All rights reserved.
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22. New Formula as Our Strategy
Machine-Connected
Large Scale
Wireless Network
?
© 2013 NTT DOCOMO, INC. All rights reserved.
Innovation X
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23. Technology Trend 3:
Asset-Oriented (i.e., Core-Biz Focused)
and API-Centric
© 2013 NTT DOCOMO, INC. All rights reserved.
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24. Application Programing Interface (API)
I PA
API as Alternative
pps
artners
ncome
Adam DuVander,
© 2013 NTT DOCOMO, INC. All rights reserved.
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25. APIs mean a lot of exposure for web giants
API Billionaires Club
(Programmable Web)
13B Calls / Day (2011.05)
API Growth Rate
(Programmable Web)
9,000
8,000
5B Calls / Day (2010.04)
5B Calls / Day (2009.10)
1.4B Calls / Day (2012.05)
7,000
6,000
5,000
4,000
1.1B Calls / Day (2011.04)
1B Calls / Day (2012.05)
3,000
2,000
1,000
1B Calls / Day (2012.03)
1B Calls / Day (2010.01)
API is a key success driver for these businesses
0
2005
2006
2007
2009
2010
2011
2012
Annual growth in number of APIs: 100%
© 2013 NTT DOCOMO, INC. All rights reserved.
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26. Why API matters
Traditional Web business model
APIs help you grow your business
V.S.
Disadvantages
•Limited user reach
•Limited brand awareness
Advantages
•Unlock distribution channels
•Expand user reach through the
© 2013 NTT DOCOMO, INC. All rights reserved.
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27. APIs enable business to create “ Revenue Ecosystem”
Amazon.com
Mobile Apps
+ API
Affiliate Sites
Supplemental Services
Internal Developers
© 2013 NTT DOCOMO, INC. All rights reserved.
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28. Change of API Offering Models
Consumer oriented API Offering
Cloud oriented API Offering
End Users
End Users
Consumer Product
(e.g.)
Developers
API
API
API
Cloud API
Developers
(e.g.)
© 2013 NTT DOCOMO, INC. All rights reserved.
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29. Rise of Cloud API Startups
Location
Banking
Billing
Shipment
Communication
Analytics
Authentication
Print
Healthcare
© 2013 NTT DOCOMO, INC. All rights reserved.
Translation
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30. Whey are they focusing on the APIs ?
Traditional B2C Business Process
API oriented business process
Consumer
Product
1
Consumer
Product
2
User Acquisition
3
User Acquisition
1
User Data
2
4
APIs
APIs
5
3rd Party
Integration
These processes has become harder
User Data
3
3rd Party
Integration
© 2013 NTT DOCOMO, INC. All rights reserved.
These
processes has
been covered
by 3rd parties
That’s why API
startups only
focusing on
APIs and data
acquisition
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31. Yet Another New Formula
Your Asset
API
Design
?
© 2013 NTT DOCOMO, INC. All rights reserved.
Innovation X
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32. Let’s see what will happen soon.
© 2013 NTT DOCOMO, INC. All rights reserved.
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