MAVAM México 3rd Edition - Messaging - English version - May 09,2012

64
Grupo Convergencia | Convergencialatina | Convergencia Research Avenida Belgrano 680 – Piso 9 (C1092AAT) - Buenos Aires, Argentina T. + 54 11 4345-3036 [email protected] | wwww.convergencialatina.com | [email protected] MAVAM Mexico 3 rd Edition

description

Acision's MAVAM México, 3rd Edition, was released on May 2012, bringing new data about the mobile value added services (VAS) in the market. Some key findings: - Mexico has the largest SMS market in Latin America and the Caribbean - Messaging service sales (SMS and MMS) in Mexico show year-on-year growth rate of 32% in US Dollars (26% in Mexican Pesos), generating $601 million USD in Q3 2011 - Over Q3 2011, revenues from value added services (VAS) in Mexico represented $1,047 million USD - 38% above the figure for the same period the previous year. - VAS represents 31% of sales from the services rendered by operators during the same period – on average 6% higher than other Latin America and Caribbean regions. - 57% of value added services (VAS) sales are generated from SMS and MMS alone - 98% of mobile subscribers used SMS services over Q4 2011 - 25% of users consider that SMS services will be more important in the future.

Transcript of MAVAM México 3rd Edition - Messaging - English version - May 09,2012

Page 1: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

Grupo Convergencia | Convergencialatina | Convergencia Research

Avenida Belgrano 680 – Piso 9 (C1092AAT) - Buenos Aires, Argentina

T. + 54 11 4345-3036

[email protected] | wwww.convergencialatina.com | [email protected]

MAVAM Mexico 3rd Edition

Page 2: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

Editorial

Oliveira Vancrei

Acision

VP regional Latin America

As the global leader in mobile messaging with more than oneSMS infrastructure market (as calculated by Informa Telecoms & Media in 2011), Acision¨Messaging”. This edition continues to demonstrate Acision’s commitment to providing a tool that analysis the trends associated with the consumption of mobile VAS and messaging across the Mand how this impacts operators.

Net sales of SMS and MMS during the third quarter of 2011 reached $601 million USD, representing 57% of VAS sales for Mobile Operators. Although SMS and messaging stands for a MAVAM research to better understand the reasons that motivate or inhibit the use of messaging, with the results represented in this report.

We also demonstrate that opportunities based on SMS go beyonservice as we know it today with valuean enriched user experience through services such as group messaging, autoreply / auto

We also expect IP Messaging services to be a priority for operators in 2012, as they seek to deliver new innovative services to compete wservices. IP Messaging, such as is RCSthe same user experience, reach and reliability that users have become accustomed to with SMS, while leveraging the capabilities of broadband IP network asharing. Operators will also begin to adopt cloudbecome a prominent delivery model in 2012, also means that these innovations will be brought to market faste

With this in mind, this edition of MAVAM has researched the potential demand for new messaging services that enrich and expand the use of messaging, how users use messaging services and looks at business models for paying for each service and driving

We hope you enjoy reading!

| 2 |

As the global leader in mobile messaging with more than oneSMS infrastructure market (as calculated by Informa Telecoms & Media in 2011), Acision launches the third edition of MAVAM Mexico with the special theme ¨Messaging”. This edition continues to demonstrate Acision’s commitment to providing a tool that analysis the trends associated with the consumption of mobile VAS and messaging across the Mexican mobile market during and how this impacts operators.

Net sales of SMS and MMS during the third quarter of 2011 reached $601 million USD, representing 57% of VAS sales for Mobile Operators. Although SMS and messaging stands for a major proportion of mobile VAS today, we have used this MAVAM research to better understand the reasons that motivate or inhibit the use of messaging, with the results represented in this report.

We also demonstrate that opportunities based on SMS go beyonservice as we know it today with value-added, personalized messaging providing an enriched user experience through services such as group messaging, autoreply / auto-signature and parental control.

We also expect IP Messaging services to be a priority for operators in 2012, as they seek to deliver new innovative services to compete wservices. IP Messaging, such as is RCS-e, is key to delivering services that have the same user experience, reach and reliability that users have become accustomed to with SMS, while leveraging the capabilities of broadband IP network and delivering services such as IM, group chat, file transfer and video sharing. Operators will also begin to adopt cloud-based services, which will become a prominent delivery model in 2012, also means that these innovations will be brought to market faster.

With this in mind, this edition of MAVAM has researched the potential demand for new messaging services that enrich and expand the use of messaging, how users use messaging services and looks at business models for paying for each service and driving up operator revenue.

We hope you enjoy reading!

As the global leader in mobile messaging with more than one-third of the global SMS infrastructure market (as calculated by Informa Telecoms & Media in 2011),

launches the third edition of MAVAM Mexico with the special theme ¨Messaging”. This edition continues to demonstrate Acision’s commitment to providing a tool that analysis the trends associated with the consumption of mobile

exican mobile market during Quarter 4 of 2011

Net sales of SMS and MMS during the third quarter of 2011 reached $601 million USD, representing 57% of VAS sales for Mobile Operators. Although SMS and

major proportion of mobile VAS today, we have used this MAVAM research to better understand the reasons that motivate or inhibit the use of messaging, with the results represented in this report.

We also demonstrate that opportunities based on SMS go beyond the basic added, personalized messaging providing

an enriched user experience through services such as group messaging, auto-

We also expect IP Messaging services to be a priority for operators in 2012, as they seek to deliver new innovative services to compete with ‘OTT’ messaging

e, is key to delivering services that have the same user experience, reach and reliability that users have become accustomed to with SMS, while leveraging the capabilities of broadband IP

nd delivering services such as IM, group chat, file transfer and video based services, which will

become a prominent delivery model in 2012, also means that these innovations

With this in mind, this edition of MAVAM has researched the potential demand for new messaging services that enrich and expand the use of messaging, how users use messaging services and looks at business models for paying for each service

Page 3: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 3 |

Index

1. Introduction ....................................................................................................................................................................................................... 4

1.1. Value Added Services worldwide ............................................................................................................................................................... 5

1.2. Value Added services in Latin America ...................................................................................................................................................... 9

1.3. Value Added Services (VAS) in Mexico ................................................................................................................................................... 12

2. MAVAM (Acision Monitor for Mobile VAS) ...................................................................................................................................................... 16

3. Messaging Services (Special Issue) ............................................................................................................................................................... 17

3.1. SMS ........................................................................................................................................................................................................ 18

3.1.1. Future importance of SMS ................................................................................................................................................................ 19

3.1.2. Deterrents to broader SMS use ......................................................................................................................................................... 20

3.1.3. New SMS– and MMS– based products ............................................................................................................................................. 21

3.2. MMS ........................................................................................................................................................................................................ 27

3.2.1. MMS Scenarios ................................................................................................................................................................................ 29

3.2.2. Deterrents and incentives to broader MMS use ................................................................................................................................. 30

3.3. Instant Messaging .................................................................................................................................................................................... 32

3.3.1. Opportunities and deterrents for wider IM use ................................................................................................................................... 33

3.4. Advantages of SMS service over instant messaging ................................................................................................................................ 37

3.5. Advantages of IM services over SMS....................................................................................................................................................... 38

3.5.1. Service preference per recipient........................................................................................................................................................ 39

3.5.2. Preference of service depending on the circumstances ..................................................................................................................... 40

3.5.3. Service Reliability and Speed ............................................................................................................................................................ 42

3.6. Use of messaging services to send Christmas and New Year’s greetings ................................................................................................ 43

3.7. Advertising messages via SMS for discounts and purchases ................................................................................................................... 45

4. MAVAM Mexico .............................................................................................................................................................................................. 47

4.1. Entertainment .......................................................................................................................................................................................... 47

4.1.1. Types of Files (Images, Music, Games, Ringtones and Videos) ........................................................................................................ 47

4.1.2. Mobile TV and Video ......................................................................................................................................................................... 47

4.2. E-mail ...................................................................................................................................................................................................... 48

4.3. Mobile Internet ......................................................................................................................................................................................... 48

4.3.1. Deterrents to the Use of Mobile Internet ............................................................................................................................................ 51

4.4. Social Networks ....................................................................................................................................................................................... 52

4.5. Mobile Marketing ..................................................................................................................................................................................... 55

4.6. Mobile Banking and Money ...................................................................................................................................................................... 56

4.7. GPS and Maps ........................................................................................................................................................................................ 57

5. Conclusions .................................................................................................................................................................................................... 58

6. Glossary ......................................................................................................................................................................................................... 59

7. Technical File ................................................................................................................................................................................................. 63

8. Team .............................................................................................................................................................................................................. 64

Page 4: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 4 |

1. Introduction

Mobile phone penetration in Latin America exceeded 100% in the third quarter of 2011, although there are still

some countries like Mexico, Bolivia, Nicaragua, Cuba, and Peru –among others– which have not yet reached that

figure. The fact that there is more than one line per person is the consequence of some users owning two phone

devices, M2M lines, mobile broadband access (USB modem), and lines which are hardly used or which are not

used at all but are registered as active lines.

Smartphones and the expansion of Mobile Internet have caused the market to grow and has driven an increase in

the postpaid customer base. Social networks are the top applications for this stage of Mobile Internet.

In addition, number portability will be introduced in the leading markets in 2012 and the mobile virtual network

operators (MVNOs) business will be developed. Colombia is the country with the highest number of operating

MVNOs, generally focused on broadband services. The entry of mobile virtual network operators in Brazil,

Argentina, Mexico and Chile, among other countries, is expected by 2012. These operators are targeted at specific

niches, and it is assessed that their potential is about 2% of the market. The highest expectations are in Virgin

Mobile, which aims at becoming the first regional mobile virtual network operator focused on the 14-to-34-year-old

target.

New spectrum assignments in several countries, meant to foster the entry of new players to increase competition,

are encouraging the entry of mobile virtual network operators.

Said factors make it possible to forecast higher competition in 2012, focused on mobile broadband, driving massive

use of social networks among prepaid customers, and on creating new applications and businesses.

Page 5: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 5 |

1.1. Value Added Services worldwide

To understand the value added services (VAS) business worldwide, we analyzed VAS evolution for the world’s

biggest mobile carriers in various regions of the world. We compared the 3Q values for 2010 and 2011, except for

China Mobile, whose data only allows us to compare changes between 1H 2010 and 1H 2011.

The companies evaluated are:

� AT&T - United States

� China Mobile – China*

� Orange - France

� NTT Docomo - Japan

� Verizon – United States

� Vodafone

� Vodafone United Kingdom

� Vodafone Germany

� Vodafone India

* China Mobile 1H 2010 x 1H 2011

Chart 1

Operators analyzed

Page 6: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 6 |

Chart 2

Change in share of voice service revenue vs. value added service (VAS) revenue. Between the

second and third quarter 2011. Except China Mobile, comparing 1H 2010 with 1H 2011

Source: Convergencia Research based on carriers’ published financial reports.

VAS continues to grow its share of total revenue among the carriers surveyed, independent of country. Positive

changes in voice service revenue contributions are normally explained by specific events, such as regulatory

measures (reduced interconnection fees – See MAVAM Brazil 9th Edition2) competition or seasonal effect.

In more advanced countries, the increase in VAS uptake is mainly based on Mobile Internet revenues driven by the

increasing number of smartphones. In countries where there is still room to grow the number of connections, SMS

still plays a major role in VAS growth.

2 http://www.acision.com/News-and-Events/Press-Releases/Brazil/2011/MAVAM-9th-Edition.aspx

-3%

2%

-3%

2%

-3%

3%4%

3%

-4%

3%

-1%

5%

0%

6%

-1%

16%

-10%

-5%

0%

5%

10%

15%

20%Voice Service VAS Service

AT&T United States France Telecom France NTT Docomo

Vodafone United Kingdom Telecom Italy Verizon

Vodafone Germany Vodafone India

Page 7: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 7 |

Chart 3

VAS share of total ARPU. 3Q 2011. Except China Mobile, comparing 1H 2010 with 1H 2011

Source: Convergencia Research based on carriers’ corresponding financial reports – 3Q 2011

It is interesting to compare the operations of Vodafone UK, Germany and India.

In the UK, Vodafone’s VAS represents 46% of service sales and this share is almost identical to its main

competitor.

In the UK, which has a significant number of smartphones, Vodafone’s Mobile Internet service sales have grown

around 3% quarterly/per quarter, while messaging (SMS and MMS) growth is around 2%. However, in Germany

messaging revenues are also growing at 2%, while mobile Internet revenues are growing at 6%.

In contrast, India, which has mobile penetration of around 70% of the population, SMS grows at around 43% and

mobile Internet at just 2%, mainly because 3G networks were only recently launched (See MAVAM Brazil 9th

Edition).

In the US, both Verizon and AT&T present similar figures to Vodafone, with VAS growth of no more than 5% per

quarter and voice revenues declining by 1 to 3%, depending on the carrier - although in this market VAS

contribution (40%) is lower that the European countries where Vodafone operates. In Japan, voice and data growth

rates for NTT Docomo are similar to the USA, but the main difference is that VAS (contributing 54% of revenues) is

NTT Docomo’s main source of income, instead of voice revenues, on which other carriers depend.

54

%

46

%

43

%

40

%

39

%

35

%

32

%

30

%

16

%

0%

20%

40%

60%

80%

100%

VA

S %

ov

er

tota

l A

RP

U

Page 8: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 8 |

At China Mobile, whose figures only allow for a six-monthly comparison, the number of subscribers grew 11.3%

annually between the first semester of 2010 and 2011 to 617 million lines, in a country where 75% penetration still

offers room for post-paid plan growth. As new users are usually “low usage clients” and the “one client with several

chips” is becoming more commonplace, total ARPU dropped 3% in the first half of 2011, year on year.

China Mobile has 35 million 3G subscribers (5% of its customer base). At the end of the first half of 2011, VAS

represented 32.2% of carrier revenues, up 18% year-on-year compared with 5% for voice services, in local

currency. Of the VAS, the contribution made by SMS has dropped almost 1 percentage point, while revenue for

voice services, Mobile Internet and “other VAS” rose between 0.5 and 1 percentage point.

Chart 4

Mobile penetration vs. VAS contribution to ARPU. 3Q 2011. China Mobile 1H 2010 x 1H 2011

Source: Convergencia Research based on carriers’ corresponding financial reports and penetration data from various sources.

0%

20%

40%

60%

80%

100%

120%

140%

160%VAS % 3Q 11

Penetration / 100 inhabitants

Page 9: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 9 |

1.2. Value Added services in Latin America

The third quarter of 2011 ended with 607 million mobile telephone lines (including 10.5 million trunking3 lines) in

Latin America and the Caribbean1. The number of lines brings regional penetration up to 104% –taking into account

trunking lines and 102% without them – although some countries4 have yet to achieve this level of mobile

subscriptions. South America5 and Mexico represent 89% of these lines (540.4 million). The remainder are in

Central America6 (41.7 million) and the Caribbean7 (24.6 million).

During the quarter through September 30, 2011, total sales for mobile operators in the countries researched were

23,397 billion dollars (without trunking services revenues), up 17% year on year. Convergencia Research

estimates that 2011 should end with sales 14% up on 2010 to 91,500 billion dollars.

89% of regional revenues are generated in South America and Mexico (17,138 million US dollars and 3,753 million

US dollars respectively) and the remaining 11% is split between Central America (1,446 million US dollars) and the

Caribbean (1,061 million US dollars).

Voice revenues were up 11% between 3Q 2010 and 3Q 2011 to 15,967 billion dollars.

Revenues from device sales rose to 2,052 billion dollars, 20% up on the 1,716 billion dollars registered last year.

Value Added Services (VAS) continue to show the most robust growth. During the third quarter of 2011 they

generated 5,378 billion dollars, 40% up year on year. This means that VAS now represent 25% of service revenues

(voice + VAS), compared with 21% previously.

3 Trunking or Specialized Mobile Service (SME for its initials in Portuguese) is a service of terrestrial mobile telecommunications of collective

interest that uses the radio system, mainly, to perform delivery operations or other forms of telecommunications. Sourse: Annex to resolution

No. 404 of May 5, 2005 (Anatel).

4 Bolivia, Paraguay, Perú, Venezuela, Guyana y Guyana Francesa, México, Belice, Costa Rica, Guatemala, Honduras y Nicaragua, Antillas

Francesas, Bonaire, Cuba, Curazao, Haití, Islas Turcas y Caicos, Montserrat, Puerto Rico, República Dominicana y Santa Lucía.

5 Argentina, Bolivia, Brazil, Chile, Columbia, Ecuador, Guiana, French Guiana, Paraguay, Peru, Suriname, Uruguay and Venezuela.

6 Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama.

7 Anguilla, Antigua and Barbados, French Antilles, Aruba, Bahamas, Barbados, Bermuda, Bonaire, Cuba, Curacao, Dominica, Granada, Haiti,

Cayman Islands, Turks and Caicos Islands, British Virgin Islands, Jamaica, Montserrat, Porto Rico, Dominican Republic, Saint Kitts and Neves,

Saint Vicente and the Grenadines, Santa Lucia, Trinidad and Tobago.

Page 10: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 10 |

Chart 5

Mobile telephony revenue growth in Latin America by service type. 3Q 2010 x 3Q 2011

Chart 6

Mobile telephony sales by revenue source. 3Q 2010 x 3Q 2011

Of the value added services, SMS and MMS have a 51% market share, with Mobile Internet at 38% and other VAS

representing 11%. Other VAS revenue flows include, for example, mobile marketing, revenue sharing for content

and application downloads and mobile banking solutions.

US

D 2

0,0

06

US

D 1

4,4

39

US

D 3

,85

1

US

D 1

,71

6

US

D 2

3,3

97

US

D 1

5,9

67

US

D 5

,37

8

US

D 2

,05

2

17%

11%

40%

20%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

USD 0

USD 5,000

USD 10,000

USD 15,000

USD 20,000

USD 25,000

Total Mobile Phone Service

Voice Service VAS Terminals

Re

ve

nu

es

in U

SD

Millio

n

3Q 10 3Q 11 Variation

USD 20,006

USD 23,397

USD 1,527 USD 337USD 840 USD 543 USD 144

USD 0

USD 5,000

USD 10,000

USD 15,000

USD 20,000

USD 25,000

3Q10 Voice Serv. Terminals Internet Messaging Other VAS 3Q11

Re

ve

nu

es

in U

SD

Millio

n

Voice Serv. Terminals Internet Messaging Other VAS

Page 11: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 11 |

Mobile Internet revenues have risen 69%, driven by the growth of smartphones, which now represent around 10%

of all cell phones in Latin America.

Brazil is the biggest Mobile Internet market by revenue and users, although Central America and countries with low

levels of fixed line broadband penetration also drive significant volumes.

Text and multimedia messaging services have seen sales rise by 25%, mainly because there are still countries with

very low usage levels and there are still opportunities to increase usage through devices and other commercial

tactics, such as changing pricing plans.

The other VAS’s have seen revenues rise by 31%, based on new mobile businesses like mobile payments, mobile

marketing and application downloads, among others.

Chart 7

VAS Revenue Shares. Through 3Q 2011.

USD 15,96775%

USD 2,714 51%

USD 2,052 38%

USD 613 11%

USD 5,37825%

Voice Serv. VAS SMS + MMS Internet Other VAS

Page 12: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 12 |

1.3. Value Added Services (VAS) in Mexico

As of the end of the third quarter of 2011, there were 97,062 million mobile phone lines in Mexico (including

trunking operator Nextel’s 3.6 million lines), which represent an 88.7% penetration over population8.

Mobile subscribers in Mexico grew by 9.9% from the third quarter of 2010 to the third quarter of 2011. Mobile

service customers in Latin America and the Caribbean increased by 11.4% over the same period, mainly as a

consequence of an increase in the number of users in Brazil and Peru; both markets grew by 19% and 14%,

respectively.

Mexico is the second largest mobile market in Latin America and the Caribbean as to number of customers,

representing a 16% share in the region. Nevertheless, while Latin America exceeded 100% penetration by the end

of 2011, Convergencia Research believes that Mexico will reach that figure by the first quarter of 2013, providing

that the growth rate remains constant.

Chart 8

Evolution of the total mobile phone lines in Mexico (without trunking). 2008 vs. 2012 (estimate).

Irrespective of Nextel’s trunking, the market share is split among Telcel (72.8%), Movistar (22.0%), and Iusacell

(5.3%). As compared to 2010, Iusacell’s market share grew by almost one percentage point.

8 Source: Convergencia Research based on the information disclosed in Telcel, Movistar and Nextel’s balance sheets, the number of mobile

phone lines reported by COFETEL (Federal Telecommunications Committee) and the population published by the INEGI (National Bureau of

Statistics and Geography)

74,42579,555

88,001 90,266 92,222 93,463 94,704

103,227

0

20,000

40,000

60,000

80,000

100,000

120,000

2008 2009 2010 1Q11 2Q11 3Q11 4Q11e 4Q12e

Nu

mb

er

of

mo

bile

lin

es

-in

millio

ns

Page 13: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 13 |

Chart 9

Subscribers per operator. 3Q 2011 (in thousands of lines)

Telcel has an ARPU equal to USD $ 13 ($MEX 154), which is 65% above its competitors’ ARPUs. Movistar has an

ARPU equal to USD 8 ($MEX 93), while Iusacell just reached USD 11 ($MEX 140). The three operators’ ARPUs

dropped in respect of 2010. Movistar was the operator with the highest ARPU drop (-17% in US Dollars and -21%

in Mexican Pesos); Iusacell suffered a 5% drop in US Dollars and 9% in Mexican Pesos; Telcel reported a 2%

ARPU drop in US Dollars and 6% drop in Mexican Pesos.

Chart 10

Total ARPU per operator. 3Q 2011

Telcel68,002

73%

Movistar20,516

22%

Iusacell4,9455%

USD 13

USD 8

USD 11$154

$93

$140

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

USD 0

USD 2

USD 4

USD 6

USD 8

USD 10

USD 12

USD 14

Telcel Movistar Iusacell

AR

PU

in $

Me

x

AR

PU

in U

SD

ARPU in USD ARPU in $ Mex

Page 14: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 14 |

The mobile industry sales from July to September 2011 reached USD 3,753 million dollars (mdd9) ($ 46,008 million

pesos - mdp10), which is 5% higher than the figure for the same quarter of 2010. The revenues from Voice and VAS

services reached USD 3,382 mdd ($ 41,458 mdp) in the period, which is 4% higher than it was in the third quarter

of 2010 in US Dollars and 1% lower in $MEX, as figures are affected by exchange rates11. The remaining USD 371

mdd ($ 4,549 mdp) pertain to the sale of devices.

Chart 11

Mobile Phone Service. Variation per type of income. 3Q 2010 vs. 3Q 2011

(in US Dollars) (in Mexican Pesos)

The growth of services is the consequence of the increase in sales of Value Added Services (VAS), which grew by

38% in US Dollars (+32% in $MEX), while the revenues from voice services dropped by 7% in US Dollars (-11% in

$MEX). This variation derives from the drop in the termination rate implemented in May 2011.

The revenues from the sale of terminals (handsets) grew by 18% in USD and by 13% in $MEX, as compared to the

third quarter of 2010.

VAS generated sales for USD $1,047 mdd ($ 12,839 mdp) in the third quarter of 2011, representing 31% of the

revenues from services.

Within the VAS category, the messaging service sales (SMS and MMS) represent 57% (USD $601 mdd and $

7,367 mdp), below the record set at 60% in the third quarter of 2010. In spite of the drop in the total market share,

the messaging services sales show a year-over-year growth rate of 32% in US Dollars and 26% in Mexican Pesos.

9 Million US Dollars.

10 Million Mexican Pesos.

11 The average US Dollar value was equal to $MEX 12.8 in 3Q 2010 and to $MEX 12.3 in 3Q 2011, with a slight revaluation of $MEX as

compared between these two periods.

US

D 3

,57

3

US

D 2

,49

9

US

D 7

58

US

D 3

16

US

D 3

,75

3

US

D 2

,33

4

US

D 1

,04

7

US

D 3

71

5%

-7%

38%

18%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

USD 0

USD 500

USD 1,000

USD 1,500

USD 2,000

USD 2,500

USD 3,000

USD 3,500

USD 4,000

Total Mobile Phone Service

Voice Service

VAS Terminals

Re

ve

nu

es

in

Mil

lio

n U

SD

3Q 10 3Q 11 Variation

$4

5,7

70

$3

2,0

14

$9

,71

3

$4

,04

3

$4

6,0

08

$2

8,6

20

$1

2,8

39

$4

,54

9

1%

-11%

32%

13%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

30%

35%

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

$50,000

Total Mobile Phone Service

Voice Service

VAS Terminals

Re

ve

nu

es

in

Mil

lio

n $

Me

x

3Q 10 3Q 11 Variation

Page 15: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 15 |

Mobile Internet sales grew by 70% in USD (63% in Mexican Pesos), and they reached a volume of USD 257 mdd

in the quarter, representing 25% of the revenues from VAS.

The other revenues from VAS12 were USD 189 mdd ($ 2,316 mdp), which grew by 25% in US Dollars (20% in

$MEX). Their contribution to the total VAS dropped from 20% to 18% between the third quarter of 2011 and the

same period of 2010.

Chart 12

Income Distribution per Type. 3Q 2011 (in million USD)

Vivo retains top spot in VAS as a percentage contribution to total revenues (23%). VAS represents 18% of service

sales to both TIM and Oi.

12 The other VAS comprise revenues from mobile marketing, the revenue share of contents and application downloading, and mobile banking

solutions, among others.

USD 2,33469% USD 601

57%

USD 257 25%

USD 189 18%

USD 1,04731%

Voice Serv. VAS SMS + MMS Internet Other VAS

Page 16: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 16 |

2. MAVAM (Acision Monitor for Mobile VAS)

The MAVAM Acision study aims to analyze the evolution of value added services in Latin America. It has been

carried out in Brazil since 2009. The study was then carried out in Mexico in 2010 and Argentina in 2011.

This edition of MAVAM Mexico has been prepared on the basis of the following methodological characteristics:

a) 800 interviews were made to people contacted on the Web (Computer Aided Web Interviewing –CAWI-).

b) The geographic area covered by the sample comprises all of Mexico’s regions. The sample considers the

number of inhabitants, the economic status and Internet penetration by geographic region (it is a Web-based

interview), in order to improve local representativeness.

c) The survey was made on the Web (CAWI), pursuant to the rates applicable to the socio-economic level, age and

gender, which preserve the proportions of Mexican population.

Since the number of Internet users (about 41.3 million) is lower than the number of mobile users (about 98

million), and given the fact that the sample represents people who are more familiar with technology, the values

obtained in some cases may not be extrapolated to the market aggregate; instead, such values are considered

for reference and orientation purposes. These cases are explained throughout the study.

d) The services analyzed in this edition include:

� Messaging

• SMS

• MMS

• E-mail

• Instant messaging

� Entertainment

• Music

• Pictures

• Games

• Ringtones

• TV

• Video

� Mobile Internet

• Social Networks

• Location services (GPS)

• Payments and mobile banking

• Mobile Marketing

This MAVAM Mexico edition was performed by

Convergencia Research, in March 2012.

Sampling participation pursuant to the geographic residence in Mexico:

Residence %

Mexico City 48%

Rest of the country 52%

Page 17: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 17 |

3. Messaging Services (Special Issue)

The globalization of mobile phone services is also means the globalization of SMS services. It can be

acknowledged that almost every mobile phone in the world is SMS-enabled. However, as evidenced in other

editions of MAVAM, the frequency of use of SMS differs from one country to another.

The expansion of the range of smartphones and instant messaging solutions on mobile phones pose a challenge to

the traditional use of text messages for communicating among people. Therefore, new solutions and products are

analyzed in this edition of MAVAM so as to understand how users engage with mobile messaging services and

services can be adopted to enrich the traditional SMS experience and generate new revenues for operators.

The SMS services features researched in this edition are:

1. Auto-signature: this function makes it possible to set up a signature or a greeting at the end of the drafted

messages (for instance: “I am on holiday”, “I am busy right now / I am not at the office.”)

2. White lists / black lists personalization: it enables the creation of contact lists so as to define who may and who

may not send messages to the user.

3. Automatic forwarding to another phone: it makes it possible to automatically forward the messages received to

another telephone number (for example, to your personal / professional telephone number)

4. Automatic forwarding to an e-mail account: this function makes it possible to automatically forward the messages

received to an e-mail account to have a back-up copy or read them on a desktop PC.

5. Groups Messaging (Distribution lists): provides for the possibility of exchanging messages with a group of

contacts whose recipients may also answer to the entire group.

6. Receipt notification: to receive a confirmation of receipt of the messages sent.

7. Searches: possibility to search through saved messages.

8. Reminders: to receive scheduled appointment reminders.

9. Receiving party pays: possibility of sending messages paid for by recipients.

10. Storage services: being able to store every message at a cloud storage service provided by the operator.

11. Multiple SIM cards: possibility to send messages from any other device (tablets, dongles, USB modems, etc.)

12. Alias: configuration of names or nicknames in a user’s origin number.

13. SMS Beeper (Nick Name alias): possibility to receive text messages or calls without revealing the phone

number, but through a nickname: people send their SMS to a call center (for instance: 12345) starting with the

nickname and following with the message.

Page 18: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 18 |

A comparison is also made between the features that users regard as being the most important in instant

messaging and in an SMS service, as well as the occasions in which users prefer one form of communication over

the other.

Although the analysis is focused on the messaging habits among people, it is important to mention that, in the

future of SMS, communications among machines and the usage models play an essential role as a new B2C

(Business to consumer) communication channel, such as for instance, inquiries via SMS for banking services,

governmental procedures, etc.

3.1. SMS

Over the fourth quarter of 2011, 98% of the users questioned for MAVAM used the SMS short messages services,

almost three percentage points over the previous edition of MAVAM (with data pertaining to the first quarter of

2011).

Chart 13

SMS use Basis: total sample (1Q 2011: 798 cases; 4Q 2011: 800 cases)

SMS use is global, not only because it reaches a penetration higher than 90%, but also because its use does not

depend on gender, age, social class or type of payment schedule. It is noted that, irrespective of the particular

features, use exceeds 95% in all cases. 59%13 of users send more than one SMS a day.

13 Figures are not comparable to the previous edition of MAVAM, due to the fact that the question has been asked in a different way.

95.5%

2.5% 2.0%

98.3%

1.1% 0.6%0%

20%

40%

60%

80%

100%

I sent text messages overthe last 3 months

I have not sent any SMSover the last 3 months

I do not make useof the service

Perc

en

tag

e o

f cases

1Q 2011

4Q 2011

Page 19: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 19 |

Chart 14

SMS sending frequency (Only users who send SMS: 786 cases)

3.1.1. Future importance of SMS

54% of the users questioned consider that, in the future, SMS will be as important for their communications as they

are today; 25% consider that SMS will be more important than today.

Chart 15

How important do you think SMS will be in the future compared to the present time? (Total sample:

800 cases)

18%

23%

59%

0% 10% 20% 30% 40% 50% 60% 70%

Very few, I hardly use it

I send one per day in average

More than one

Percentage of cases

3%

18%

54%

25%

0%

10%

20%

30%

40%

50%

60%

I don't knowLess importantEqually importantMore important

Perc

en

tag

e o

f cases

Page 20: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 20 |

3.1.2. Deterrents to broader SMS use

It is worth analyzing the deterrents to broader SMS use, or why users do not use SMS more frequently. The main

reason for not using SMS is the user’s preference for voice communications. 77.5% of the users questioned state

that talking on the phone is easier and simpler and 45.4% states that voice is faster.

Chart 16

What stops you from using SMS on the mobile phone you use most or from using SMS more frequently? (Total sample: 800 cases) – Multiple choice

ABC+ sectors comprise the highest percentage of respondents who prefer voice communication over SMS.

Deterrents to SMS use

Socio-Economic Level

D+ C ABC+ Total

Talking on the phone is easier and simpler 25.6% 32.9% 41.5% 100%

Talking on the phone is more practical 24.1% 32.0% 43.9% 100%

14%

1%

1%

7%

10%

10%

12%

20%

45%

78%

0% 20% 40% 60% 80% 100%

Others

My phone doesn't supportsending SMS

I don't know how to do it

I don't like to send SMS

I'm not able to chat in group

I don't need to send SMS

SMS is expensive compared to calling-comparing the price of the minute-

I don't know if the recipientreceived the message

Talking by phone is faster

Talking by phone is easier/it is more practical/simple

Percentage of cases

Page 21: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 21 |

3.1.3. New SMS– and MMS– based products

The solutions and products mostly preferred by users

Users were asked about their willingness to use new products which make it possible to enhance SMS-based

communications and when referencing the list mentioned at the beginning of this chapter. The users questioned

were allowed to choose more than one option.

Acceptance of all the options was above 50%. The three options most required by users were: being able to send

text messages from any other device (87.3%); being able to search through saved messages (83.5%) and being

able to automatically forward the messages received to an e-mail account (79.7%).

The least-mentioned option was the ‘receiving party pays’ possibility, whereby the recipient pays the cost of the

message sent (similar to the reverse-charge system used in voice services).

Chart 17

Which of the following features would you like to have available in the SMS service (text messages)? (Total sample: 800 cases) – Multiple choice

52%

65%

69%

70%

71%

73%

74%

76%

77%

79%

80%

84%

87%

0% 20% 40% 60% 80% 100%

Paid in the destination

Cloud message

Use an Alias to received SMSs andcalles instead of the phone number

Distribution list

Alias

Auto-signature

Auto-send to another phone number

White/black lists personalization

Receipt notif ication

Reminders

Auto-send to an email account

Search

Multiple SIM

Percentage of cases

Page 22: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 22 |

Most important solutions and products

The users questioned were asked to state the degree of importance for the same list of options.

SMS-sending from different devices was the optioned deemed most important (68.8%). The relevance allocated by

users to the possibility of sending SMS from other devices may be related to the massive adoption of the service as

well as to users being increasingly used to the fact that all the services (voice, data, video) are available on all the

devices at all times. Exploring the possibility of offering this type of solutions constitutes a good business

opportunity for the operators.

The fact of getting receipt notification and reading confirmation for the messages sent ranked second in importance

(67%). In this last case, it is surprising that, even though only 77% of the users questioned stated they might want

to have this feature available (fifth place of the question analyzed in the previous section), it is a highly valued

feature.

The possibility of sending and receiving SMS without revealing the phone number and using an alias or nickname

ranked third in importance (67%). This preference seems to derive from instant messaging services and it shows

how the features of different services increasingly tend to converge. The curious thing in this case is that, even

though this option is considered important, only 68.9% of the users questioned stated it to be of their preference,

thus resulting among the three lowest options for the question posed in the previous section.

Page 23: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 23 |

Chart 18

How do you assess the importance of each of the services you stated you would like to have? (Only the users who selected the feature mentioned)

53%

54%

55%

55%

56%

58%

61%

62%

64%

66%

67%

67%

69%

29%

28%

31%

29%

30%

26%

25%

28%

23%

23%

20%

23%

21%

18%

18%

15%

16%

14%

15%

14%

10%

13%

11%

13%

10%

10%

0% 20% 40% 60% 80% 100%

Alias

Auto-signature

Auto-send to another phone number

Paid in the destination

Distribution list

Cloud message

Search

Auto-send to an email account

Reminders

White/black lists personalization

Use an Alias to received SMSs andcalles instead of the phone number

Receipt notif ication

Multiple SIM

Percentage of cases

Important / Very important Neutral Not important / Somewhat important

Page 24: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 24 |

Willingness to pay per the product/solution type

When the willingness to pay for any of the new services analyzed is evaluated, the option of sending SMS from

multiple devices also ranks first. 30.9% of the users who chose the feature of being able to send messages from

any other device would be willing to pay for the service; therefore, this is the feature with the highest subscription

intent.

The possibility of automatically forwarding any messages received to an e-mail account ranks second in terms of

willingness to pay for the service (30.5%).

Chart 19

Would you be willing to pay a fair price for each of the services described? (Only those who selected the

mentioned feature) – Multiple choice

14%

14%

14%

19%

19%

19%

23%

23%

24%

25%

26%

30%

31%

0% 5% 10% 15% 20% 25% 30% 35%

Auto-signature

Alias

Search

White/black lists personalization

Reminders

Receipt notif ication

Paid in the destination

Cloud message

Use an Alias to received SMSs andcalles instead of the phone number

Auto-send to another phone number

Distribution list

Auto-send to an email account

Multiple SIM

Percentage of cases

Page 25: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 25 |

Features that users would be willing to pay

Features Percentage of

responses Average monthly price

the user would pay

Being able to save all the messages at an online storage service provided by operator

22.9 $MEX 14.39

Crete contact lists to define who may and who may not send me messages (White lists and black lists)

18.8 $MEX 13.22

Being able to personalize the origin address shown to recipient, with the possibility to configure alias or nicknames

14 $MEX 12.45

Get receipt notification and reading confirmation of the messages sent 19.4 $MEX 9.96

Being able to exchange messages with a group of contacts, who may, in turn, answer the messages to everyone in the group

26.1 $MEX 9.64

Being able to automatically forward the messages received to an e-mail account

30.5 $MEX 9.5

Being able to receive text messages or calls without revealing the phone number, but through a nickname

23.7 $MEX 9.47

Being able to send messages from any other device – tablets, dongles, USB modems, etc.-

30.9 $MEX 9.36

Possibility to search through saved messages 14.4 $MEX 9.36

Being able to set up a signature or a salutation which is automatically copied at the end of the drafted messages

13.9 $MEX 8.84

Being able to send messages to be charged to the recipient 22.8 $MEX 8.12

Receiving scheduled appointment reminders 18.8 $MEX 7.51

Being able to automatically forward the messages received to a different phone number

25 $MEX 7.4

In all cases, the users who would be willing to pay for the new services state average values which range from

$MEX 7.4 to a maximum of $MEX 14.39 per month. However, there is a wide dispersion and the most frequent

value for every category is $MEX 1.

The option with the highest price average is the possibility of saving and storing SMS online at a server provided by

the operator ($MEX 14.39). The creation of white and black distribution lists ranks second ($MEX 13.22), and the

possibility of personalizing the origin address shown to recipient, being able to set up nicknames ranks third ($MEX

12.45).

The service showing the highest willingness and importance in the previous sections (being able to send messages

from different devices) has an average payment willingness of $MEX 9.36 per month.

Page 26: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 26 |

New features configuration

When it comes to exploring new business opportunities through SMS, an important aspect consists in making

installation easy and in rendering the application a user-friendly service. Therefore, users were questioned about

which would be their preferred ways of making the service available in the subscribers’ devices.

43.8% of the users questioned chose to have the application installed in their cell phones, while 17.4% of users

would rather set the service up via SMS, and 12.9% of users would prefer to do it on the operator’s website.

Chart 20

In your opinion, which would be the best way of setting up the SMS services mentioned? (Total sample: 800 cases)

44%

17%

13%

11%

10%

4%

1%

0% 10% 20% 30% 40% 50%

Through an app installedon your cell phone

Sending an SMS

Through the operator's web site

Through a WAP portal

Through an app installedon your computer

Through a complement installedin the email manager

Other

Percentage of cases

Page 27: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 27 |

3.2. MMS

32% of the users questioned used the MMS service over the last three months. Only 24% of users had used the

service in the previous edition of MAVAM.

In this case, it is worth considering that many users just exchange images.

Chart 21

Have you sent any MMS from your mobile phone over the last three months? (Only for users whose

devices are MMS-enabled: Total sample (1Q 2011: 798 cases, 4Q 2011: 800 cases)

24% 24%

52%

32%

21%

46%

0%

10%

20%

30%

40%

50%

60%

I sent over thelast 3 months

I have not sent overthe last 3 months

I do not make useof the service

Perc

en

tag

e o

f cases

1Q 2011 4Q 2011

Page 28: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 28 |

The image-sending frequency is lower than once per week in 41% of cases (active users represent 28% of the

sample).

Chart 22

How many MMS do you think you send per week from the mobile phone you use most? (Only users who have sent MMS over the last 3 months: 259 cases)

Users’ purchasing power influences the use of MMS. MMS use is higher (43.5%) among users in the ABC+

socioeconomic level than among users in the C (26.3%) and D (21.1%) levels. These results could be related to

the fact that the highest-end devices offer more media-rich features which foster use and image exchange.

Chart 23

MMS users by socioeconomic level

The payment schedule also influences on the use of MMS. 51% of users who have hired post-paid plans used

MMS over the last three months. The figure drops to 28% among users who have hired pre-paid plans.

I send very few MMS, I hardly send

MMS41%

I send one MMS in average

31%

I send more than one MMS28%

21% 23%

56%

26% 24%

50%

43%

25%

32%

0%

20%

40%

60%

80%

100%

120%

140%

160%

I sent MMS overthe last 3 months

I have not sent any MMSover the last 3 months

I do not make useof the service

Perc

en

tag

e o

f cases

D+ C ABC+

Page 29: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 29 |

3.2.1. MMS Scenarios

The different scenarios in which MMS are sent (based on the users who used the service) are special occasions.

80% of users choose special dates, such as anniversaries or birthdays to send multimedia messages. Vacation

moments (25%) and meetings with friends (25%) ranked second.

Chart 24

In which scenarios do you send multimedia messages (MMS)? (Only users who have sent MMS over the last 3

months: 259 cases) – Multiple choice

80%

25% 25% 24%

9%

0%

20%

40%

60%

80%

100%

On special ocations (birthays,

aniversaries, etc.)

On holidays When hanging out with f riends

Because of work duties

Other

Perc

en

tag

e o

f cases

Page 30: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 30 |

3.2.2. Deterrents and incentives to broader MMS use

The factors which deter users from using MMS or from using MMS more frequently are: price (39%), the fact of not

knowing whether the recipient has actually recieved the message (25.6%), and general unawareness (16.4% of

users have never even tried to send any multimedia messages).

Chart 25

What stops you from using MMS from the mobile phone you use most or from using MMS more frequently? (Total basis: 800 cases) – Multiple choice

66.4% of the users questioned state that a price reduction would lead to broader use. 35.9% of users would

increase MMS use were they certain about message delivery. Part of the uncertainty consists in that users are not

sure that the recipient’s handset may be enabled for MMS receipt.

19.6% of users state that they would feel more motivated using MMS if they had targetted package alternatives.

This could show an opportunity to offer packages which may contribute to reduce the price per multimedia

message sent.

12%

9%

12%

15%

16%

26%

39%

0% 10% 20% 30% 40% 50%

Others

My phone doesn't support it

My cell phone is not set up properly

MMS service does not work well

Never try sending a multimedia message

I do not have how to conf irm if thereceiver received the message

It is very expensive

Percentage of cases

Page 31: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 31 |

Chart 26

What would encourage you to start using MMS or to use MMS more frequently? (Total basis: 800

cases) – Multiple choice

7%

4%

18%

20%

36%

66%

0% 10% 20% 30% 40% 50% 60% 70%

I don't know

Other

Owning a cell phone able to send MMS

Operators would have to of fer MMS bundle

Having a receipt notif ication

Cost per message should be lower(for example: it could cost the same as SMS)

Percentage of cases

Page 32: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 32 |

3.3. Instant Messaging

Instant messaging use is growing. Only 19% of the users questioned had used the service in the first quarter of

2011; the percentage grew to 24% in the last quarter of the year.

Chart 27

IM use over the last 3 months. Total sample (1Q 2011: 798 cases; 4Q 2011: 800 cases)

Instant messaging use is broader at ABC+ levels.

32.8% of the ABC+ users questioned use instant

messaging. Only 12.7% of the D+ users questioned

use IM.

The age factor influences the use of instant

messaging. IM use among users younger than 35

years old is higher than 20%.For older mobile users,

IM use figures do not reach 10%. 25-to-34 year olds

are the users who use IM services most, with 29%.

Chart 28

IM use per age (Total sample: 800 cases)

19%

81%

24%

76%

0%

20%

40%

60%

80%

100%

Yes No

Perc

en

tag

e o

f cases

1Q 2011

4Q 2011

28% 29%25%

8%6%

72% 71%75%

92%94%

0%

20%

40%

60%

80%

100%

14 to 24years old

25 to 34years old

35 to 44years old

45 to 54years old

55 to 65years old

Perc

en

tag

e o

f cases

Yes

No

Page 33: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 33 |

The mostly used messaging service is Facebook Chat (49.5%), followed by Whatsapp (39.7%), and MSN

Messenger (13.4%). The users questioned had the chance to choose more than one instant messaging service

option.

Chart 29

Messaging services used (Only users who use IM: 194 cases) – Multiple choice

3.3.1. Opportunities and deterrents for wider IM use

Not having a data plan is the main deterrent among users who are not using the Instant Messaging service (33%).

Not having an IM-enabled device ranks second (27%). And a little trust in sharing information including contacts,

messages, and location with any company providing the messaging application ranks third (22%).

Among users who used Instant Messaging over the last three months, the three deterrents to increasing IM use

most-widely mentioned are: message loss or delay in receipt (23%), not having a data plan (19%), and the little

trust in sharing information including contacts, messages, and location with any company providing the messaging

application (18%).

7%

7%

9%

11%

12%

13%

40%

49%

0% 10% 20% 30% 40% 50% 60%

iMessage

Google Talk

Skype Messenger

eBuddy XMS

BlackBerry Messenger - Ping

MSN Messenger

WhatsApp

Facebook Chat

Percentage of cases

Page 34: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 34 |

Chart 30

What stops you from using some instant messaging service or from increasing IM use frequency from the mobile phone you use most? (Users who do use IM 194 cases; Users who do not use IM: 606

cases) – Multiple choice

In response to the question about mobile phone operator’s providing a new messaging service to compete with IM,

63.4% of Instant Messaging service users’ stated that the main requirement for them to subscribe to a new

operator service is if itworks without interruptions. The image-sharing feature and the possibility of sharing videos

with friends rank second (58.2%). The certainty that the message may be received by the recipient in a few

seconds ranks third (58.2%). The forth requirement stated by users having the ability to access all contacts through

SMS whether they have the new messaging service or not. This demonstrates that SMS interoperability across

services is a key requirement and an opportunity for operators (51.5%).

In response to the same question, users who are not yet using any IM service stated that the main they would

move an operator with a new messaging service is that the cost charged for the service must be reasonable

(51.4%), guarantee that the service worksranks second (49 %) and the speed of message delivery ranks third

(23.7%).

8%

1%

6%

11%

12%

13%

22%

27%

33%

11%

11%

14%

16%

11%

23%

18%

4%

19%

0% 10% 20% 30% 40% 50%

Others

There're no reasons

People still contact me and I can't block them

I don't like the weekly updates

I don't have enough space/capacity in my phone to install the applications

I usually loose messages or I experience delays in the reception of the messages

I don't trust sharing my personal data (contacts, messages, localization, with any company

My phone does not support IM

I don't have a data bundle to access the internet

Percentage of cases

I made use of IM services during the last three months

I didn't make use of IM services during the last three months

Page 35: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 35 |

Chart 31

Suppose your mobile phone operator offered you a new messaging service, which of the following factors would be of the essence for you to be sure of using it instead of your current instant messaging service? (Users who do use IM 194 cases; Users who do not use IM: 606 cases) – Multiple choice

The users questioned were asked about the possibility of using one single messaging service which may make it

possible for them to contact any person (via SMS/MMS/IM/ File transfer / Group chat and video-sharing).

65% of instant messaging service users answered that they are very likely to use it, and 29% of users stated that

they would probably use it. 48% of users out of those who do not yet use Instant Messaging stated that they would

¨very likely use it¨, and 34% stated that they would ¨probably¨ use it.

Among individuals already using IM services, the results show that 94% of users would be willing to use one single

messaging service, and about 82% said they would use one solution among those users who have not yet used

Instant Messaging as their means of communication.

1%

11%

21%

28%

51%

33%

31%

42%

46%

38%

44%

42%

49%

54%

3%

20%

34%

42%

42%

44%

48%

49%

51%

52%

53%

58%

63%

69%

0% 20% 40% 60% 80%

Others

Able to share my location

Able to share status and feelings with f riends

Able to see the latter conversations

Cost must be reasonable

Able to see when the other party is typing an answer

Able to chat with others in the contact group

Service should be used also in the computer

Able to contact anyone

Able to contact all SMS users

It must be sure message is received af ter seconds

Able to share f iles, images, videos with my f riends

Service should always work, without troubles

It must be without cost / included in the contract

Percentage of cases

I made use of IM services during the last three months

I didn't make use of IM services during the last three months

Page 36: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 36 |

Chart 32

If you could have one single messaging service which enabled you to contact any person (via SMS/MMS/IM/ File transfer / Group chat and video-sharing), would you use it? (Users who do use IM

194 cases; Users who do not use IM: 606 cases)

Users who stated they would be willing to use the service were asked about the possibility of paying a fair price for

the service rendered.

51% of users answered that they would be willing to pay for the service. 43% of users stated that they would only

use the service were it free of charge.

Chart 33

Would you be willing to pay a fair price for this service? (Only users who answered ‘yes’ or ‘maybe’: 761 cases)

65%

29%

4%1% 1% 1%

48%

34%

12%

1%3%

1%

0%

10%

20%

30%

40%

50%

60%

70%

Certainlywould use

Probablywould use

Maybe yesor no

Probablywould not use

Certainlywould not use

Don't know

Perc

en

tag

e o

f cases

I made use of IM services during the last three months

I didn't make use of IM services during the last three months

Yes, I'd be willing to pay a fair price

51%

No, I'd use it only for f ree43%

I don't know6%

Page 37: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 37 |

3.4. Advantages of SMS service over instant messaging

The most likely reason to use SMS messages over IM (and its advantages) is its low costs (>41%), which was

referenced by both IM users and non-users, even though non-users make a relatively higher valuation than users

(48.8%). Both IM users and non-users agree that the ability of communicating with any person is a relevant

advantage (>31%) and that if an SMS is sent, the recipient knows the content will be important (>30%).

Chart 34

In your opinion, which are SMS’ advantages over Instant Messaging service on your MOBILE PHONE? (IM users: 194 cases; IM non-users: 606) – Multiple choice

2%

12%

20%

21%

26%

26%

26%

29%

31%

31%

49%

9%

6%

20%

23%

24%

28%

30%

26%

33%

42%

42%

0% 10% 20% 30% 40% 50% 60%

Other

I don't know

Be sure that the answer will be received fast

Be sure the receiver will read the message promptly

I know the service works without troubles

I can easily send a message to a large quantity of people

It's more economical when I use roaming (when I'm on vacation, traveling for work,

etc.)

To know that the message is received af ter seconds

When I use SMS I know that the recipient knows it's an important message

I can communicate with any person

Have low cost

Percentage of cases

IM users

Non IM users

Page 38: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 38 |

3.5. Advantages of IM services over SMS

For IM users, who stated instant messages are more valuable than SMS messages (>36%), below states some of

the reasons why. Users who only use SMS and only gave their opinion about the potential use of IM, do not believe

IM is as valuable as IM users have (<36%).

The advantages stated of IM use over SMS, which were most frequently mentioned by users who do not yet use

Instant Messaging include: the possibility of sharing files (36%) and the speed of message delivery (33%). These

two features are also mentioned among IM users, but with higher valuation (62% file-sharing and 60% speed of

message sending).

Chart 35

In your opinion, which are the advantages of using an instant messaging service on your MOBILE PHONE (such as WhatsApp, Skype Messenger, Facebook Chat, BlackBerry Messenger, Google Talk, etc.) over SMS? (IM users: 194 cases; IM non-users: 606) – Multiple choice

2%

18%

20%

23%

25%

27%

28%

28%

27%

33%

35%

32%

33%

36%

8%

1%

42%

36%

48%

47%

48%

52%

56%

45%

42%

53%

60%

62%

0% 20% 40% 60% 80%

Other

I don't know

I can share my status, feelings with my f riends

I know the service works without troubles

I can see the older chats with the person

Be sure the receiver will read the message promptly

Be sure that the answer will be received fast

Have low cost

I can chat in a group

I can communicate with any person

Use the service also in the personal computer

I can easily send a message to a large quantity of people

To know that the message is received af ter seconds

I can share f iles, images and videos with f riends

Percentage of cases

IM users

Non IM users

Page 39: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 39 |

3.5.1. Service preference per recipient

37.1% of Instant Messaging users utilize services predominantly to communicate with all contacts: relatives,

friends, workmates, and the other types of recipients presented as response options. In the case of SMS, this

option applies to 33.2% of the users questioned.

Despite the fact that indiscriminate use prevails in relation to both messaging services, there is higher preference

for using instant messaging to communicate with friends (39,7%) and SMS to communicate with relatives (29,8%).

Chart 36

With whom do you often communicate via SMS and via Instant Messaging service on your mobile phone? (SMS users: 786 cases; IM users: 194 cases)

6%

1%

9%

22%

30%

33%

2%

1%

7%

40%

14%

37%

0% 10% 20% 30% 40% 50%

I don't use the service

Other

Work colleagues

Friends

Relatives

A mixture of all options

Percentage of cases

IM

SMS

Page 40: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 40 |

3.5.2. Preference of service depending on the circumstances

As a general rule, the circumstances in which users choose to use a type of messaging service over another are

mainly related to the type of messages received. For example, users who receive an SMS, answer via an SMS,

and users who receive an Instant Message answer via the instant messaging service.

The second important factor is the type of contact to whom users intend to send a message. A user who does not

have access to another user’s phone number resorts to the instant messaging service. In contrast, whenever a

user does not use the same Instant Messaging service, the sender will opt for sending an SMS.

Chart 37

Under which circumstances would you rather use SMS instead of instant messaging on your MOBILE PHONE? (IM users: 194 cases; IM non-users: 606) – Multiple choice

1%

22%

28%

33%

34%

38%

42%

77%

3%

22%

23%

21%

30%

50%

60%

69%

0% 20% 40% 60% 80% 100%

Other

When I want to be assured that the message will be read as soon as possible

When I want to make sure the message will be received

When I need the message being received quickly

When I send important information

When the person that I want to contact is not available (not online)

When the person that I want to contact doesn't have the instant messaging that I use/ When I have the cell phone number of the person that I want to

contact

When I answer an incoming SMS

Percentage of cases

IM users

Non IM users

Page 41: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 41 |

The preference factors for messaging usage are related to the features which are inherent in each service. For

instance, 53% of Instant Messaging users choose the service to share files, images, or videos. 32.9% of people

who are not Instant Messaging users state that they prefer using SMS to send important information. This maybe

because they do not have access to other messaging services to send this information.

Chart 38

Under which circumstances would you rather use Instant Messaging on your MOBILE PHONE instead of SMS? (IM users: 194 cases; IM non-users: 606) – Multiple choice

2%

16%

20%

24%

36%

40%

42%

50%

5%

36%

39%

43%

30%

53%

54%

70%

0% 20% 40% 60% 80%

Others

When I want to be assured that the message will be read as soon as possible

When I want to make sure the message will be received

When I need the message being received quickly

When I send important information

When I want to share f iles, images or videos

When I don't have the cell phone number of the person that I want to contact

When I answer an incoming instant messaging

Percentage of cases

IM users

Non IM users

Page 42: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 42 |

3.5.3. Service Reliability and Speed

Both Instant Messaging users and SMS users consider that Instant Messaging is as reliable as SMS (45% and

40%, respectively).

Chart 39

How reliable are SMS services and instant messages to you? (IM users: 194 cases; IM non-users: 606)

IM users and non IM users have similar opinions with respect to service reliability. However, they have different

opinions with regards to speed. 43% of IM users think that the service is faster than SMS; 33% of non IM users

consider that SMS is faster than IM, indicating why they have a preference for a particular service.

24%25%

45%

6%

35%

16%

40%

9%

0%

10%

20%

30%

40%

50%

The SMS is more reliable than instant

messaging

Instant messaging is more reliable than SMS

The SMS is as reliable as instant messaging

Don't know

Perc

en

tag

e o

f cases

IM users

Non IM users

Page 43: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 43 |

Chart 40

How fast do you think IM and SMS message delivery is? (IM users: 194 cases; IM non-users: 606)

3.6. Use of messaging services to send Christmas and New Year’s greetings

86.3% used messaging services to send Christmas and New Year’s greetings.

Chart 41

Use of messaging services to send Christmas and New Year’s greetings (Total sample: 800 cases)

53.8% of users chose SMS. 18.3% of users opted for Facebook Messenger, and 7% sent their greetings via

Whatsapp.

Chart 42

20%

43%

35%

2%

33%

26%

34%

7%

0%

10%

20%

30%

40%

50%

The SMS is faster than instant messaging

Instant messagingfaster than SMS

The SMS is as fast as instant messaging

Don't know

Perc

en

tag

e o

f cases

IM users

Non IM users

Yes45%

No54%

Don't know1%

Page 44: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 44 |

Which was the messaging service you used most to send your Christmas or New Year’s greetings last year? (Total sample: 800 cases)

2%

1%

12%

1%

1%

2%

3%

7%

18%

54%

0% 10% 20% 30% 40% 50% 60%

Don't know

Other

I didn't use instant messagingfor the holiday's greeting

Skype Messenger

Google Talk

MMS

BlackBerry Messenger / Ping

WhatsApp

Facebook Messenger

SMS

Percentage of cases

Page 45: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 45 |

3.7. Advertising messages via SMS for discounts and purchases

79% of users questioned received SMS or MMS with promotional content or advertising. This represents a slight

decrease as compared to the 84% of users who received messages or promotional content as of the first quarter of

2011.

Chart 43

Have you ever received any advertising or promotional SMS (Text Message) or MMS (multimedia message) on your mobile phone? (Total sample: 1Q 2011: 798 cases; 4Q 2011: 800 cases)

50.1% of the users questioned stated they would be willing to receive advertising messages to obtain discounts in

the service tariff rates.

84%

16%

79%

21%

0%

20%

40%

60%

80%

100%

Yes No, I've never received that kind of messages

Perc

en

tag

e o

f cases

1Q 2011

4Q 2011

Page 46: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 46 |

Chart 44

Would you allow your operator to add advertising messages at the end of your text messages (SMS) in exchange for lower tariffs in the SMS service? (Total sample: 800 cases)

29.6% of users stated that they would question whether to purchase a product via SMS sent to a given phone

number.

Chart 45

If you happened to see an advertisement offering a product or service which you could buy immediately and safely just by sending an SMS to a given number, would you buy it? (Total sample:

800 cases)

25% 25%

16%

8%

24%

2%

0%

5%

10%

15%

20%

25%

30%

Yes, I certainly would allow

Yes, maybe I would allow

Maybe yes, maybe no

No, it's unlikely that I would

allow

No, I certainly wouldn't allow

Don't know

Perc

en

tag

e o

f cases

50.1% 31.9%

9%

17%

30%

13%

28%

4%

0%

5%

10%

15%

20%

25%

30%

35%

Yes, I certainly would allow

Yes, maybe I would allow

Maybe yes, maybe no

No, it's unlikely that I would buy

No, I certainly wouldn't buy

Don't know

Perc

en

tag

e o

f cases

25.5%

41.4%

Page 47: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 47 |

4. MAVAM Mexico

4.1. Entertainment

4.1.1. Types of Files (Images, Music, Games, Ringtones and Videos)

The entertainment files stored by users on their mobile phones are analyzed in this edition of MAVAM, irrespective

of the means used by users (Bluetooth, Internet, others) to download these files.

The entertainment files which users mostly store in their mobile phones are: games (76.7%), images or pictures

(76.2%) and MP3 music (71.9%).

Chart 46

Files stored in mobile phones

4.1.2. Mobile TV and Video

As the use of Mobile Internet and smartphones grows, higher video consumption is expected from users. This

edition of MAVAM analyzes online video downloading via cell phones as a generic aspect -irrespective of the type

of content- and also TV programs watching, whether it is paid TV or open TV.

77% 76%72%

54%

43%

25%

0%

20%

40%

60%

80%

100%

Games Images/Pictures MP3 Music Ringtones Videos GPS maps

Perc

en

tag

e o

f cases

Page 48: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 48 |

Chart 47

Have you watched any ONLINE video on the Internet on your mobile phone over the last three months? Basis: 800 cases. Total sample

33% of the users surveyed state that they have watched online videos on their mobile phones over the last three

months.

However, when asked if they have seen any open TV programs on their mobile phones, 3% of the users answered

that they accessed TV content on their mobile phones over the last quarter of 2011.

4.2. E-mail

76% of the users surveyed have Internet access enabled mobile phones. 62% out of the 76% has set up an e-mail

account, irrespective of whether the account has been used or not over the last three months. Users of email

represent 47% of the users surveyed. The figures are not valid for the total mobile phone users in Mexico because

the sample taken consists of users who are familiar with technology.

4.3. Mobile Internet

76% of the users surveyed have Internet access enabled mobile phones, which is almost 15 percentage points

above the first quarter of the year (61.7%)14. As it has been explained in previous editions of MAVAM, the

percentage of users who connect to Mobile Internet is lower, either because of the cost of access or because the

Internet-access interface on non-smartphones is not user-friendly. This is the reason why only 69% of users who

have mobile Internet access enabled devices have actually accessed the Internet over the last quarter.

14 As it has already been explained, the figures may not be extrapolated to the all of the subscribers in Mexico because MAVAM users are more

familiarized with technology.

Yes33%

Not in the last 3 months

7%

I never used the service

60%

Page 49: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 49 |

Chart 48

Mobile Internet access enabled devices. Basis: total sample (1Q 2011: 798 cases; 4Q 2011: 800 cases)

*Note: The data may not be strictly comparable because the questions were rephrased between quarters.

Chart 49

Internet access over the last three months (Only users whose devices are Internet access enabled: 608 cases)

62%

26%

76%

52%

0%

20%

40%

60%

80%

100%

Does your cell phone allow internet connection? Have you connected on the internet in thelast three months by your cell phone?*

Perc

en

tag

e o

f cases

1Q 2011

4Q 2011

Yes, I connected on the internet in the last three months by my

cell phone69%

No, I don't connected on the internet in the last three months by

my cell phone17%

I never connected on the internet with my

cell phone

14%

Page 50: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 50 |

Mobile Internet use is influenced by the type of contract a user has.. 77.1% of users who have subscribed to

postpaid plans used mobile Internet over the last three months. The figure drops to 46.4% among users who have

subscribed to prepaid plans

64.7% of the users surveyed who are at the ABC+ socioeconomic level stated they access mobile Internet. Only

38.2% of the users surveyed at D+ socioeconomic level access the Internet via their mobile phones

58.4% of 25-to-34 year olds used mobile Internet over the last three months. 35-to-44 year olds rank second

(52.4%) on Mobile Internet usage.

Chart 50

Internet access per age, gender, socioeconomic level, and type of plan hired. Basis: 800 cases. Total sample

53%

52%

54%

58%

52%

35%

44%

38%

42%

68%

46%

77%

14%

13%

10%

13%

16%

14%

21%

14%

18%

9%

14%

10%

34%

35%

36%

29%

32%

51%

35%

48%

39%

23%

40%

13%

0% 20% 40% 60% 80% 100%

Men

Women

From 14 to 24 years old

From 25 to 34 years old

From 35 to 44 years old

From 45 to 54 years old

From 55 to 65 years old

D+

C

ABC+

Pre-Paid

Post-Paid

Gend

er

Ag

eS

ocio

-E

co

no

mic

Level

Hired

Pla

n

Percentage of cases

Yes, I connected on the internet in the last three months by my cell phone

No, I don't connected on the internet in the last three months by my cell phone

I never connected on the internet with my cell phone

Page 51: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 51 |

4.3.1. Deterrents to the Use of Mobile Internet

The users who have Internet access enabled mobile phones but have not used the service over the last three

months were asked about which factors deter them from using it.

Price is the most significant factor with 52.6% of users considering the service is too expensive. The uncertainty

about the final cost to be paid ranks second: 23.2% of users do not use the service because they are not sure how

much they will have to pay by the end of the month. Users who state that they would rather access the Internet on

a desktop computer rank third (22.2%)

Chart 51

Why don’t you access the INTERNET on the mobile phone you use most? (Only users who have not

accessed the Internet over the last three months even though they have Internet access enabled devices: 190 cases) – Multiple answer.

2%

3%

8%

14%

14%

18%

20%

22%

23%

53%

0% 10% 20% 30% 40% 50% 60%

Don't know

Other

Because I do not know how to use mycell phone to access the Internet

Because I don't need it / I do not know whatto use the Internet on my cell phone for

Because I do not trust the qualityof the service

Because I tried the service and itwas a poor-quality service

Because I f ind my cell phone really uneasyto access the Internet

Because I use another device to accessthe Internet (notebook/laptop)

Because I do not know for sure how muchI will end up paying per month/I guess

it might be expensive

Because I can’t af ford it

Percentage of cases

Page 52: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 52 |

4.4. Social Networks

74% of the users surveyed who have Internet enabled mobile phones have accessed some social networks on

their mobile phone. 19% of users have never accessed any social network on their mobile phones.

Chart 52

Have you accessed any social network via your mobile phone? Basis: users who have Internet access enabled

devices (608 cases)

There is a greater access to social networks among users who have subscribed to postpaid plans (78.5%) than

among users who have hired prepaid plans (51.8%). The socioeconomic level influences the use of social

networks. 68.4% of the users surveyed access social networks at the ABC+ levels, while only 3% of the users

surveyed use social networks at the D+ level.

Users under 45 years old are most likely to use social networks. Within this group, 63.9% of the users in the 25-to-

34 year old segment use social networks on their mobile phones.

74%

19%

7%

0% 20% 40% 60% 80%

Yes, I have accessed a Social Network f rom my mobile phone

I've never accessed a Social Network f rom my mobile phone

No, I haven't accessed a Social Network f rom my mobile phone

Percentage of cases

Page 53: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 53 |

Chart 53

Access to social networks per gender, age, socioeconomic level, type of device, and plan hired. Basis: 800 cases. Total sample

Based on the users surveyed who accessed social networks (178 cases), it is observed that Facebook dropped

five percentage points with respect to the previous survey. However, Facebook is still the most visited social

network (92.2%), followed by Twitter (33.7%) which also dropped 8.4% with respect to the previous survey.

Google’s recently launched social network (Google+), which comprises 31% of the users surveyed, is also included

in this edition.

56%

57%

43%

51%

68%

58%

64%

57%

37%

38%

61%

53%

52%

76%

44%

43%

57%

49%

32%

42%

36%

43%

63%

62%

39%

47%

48%

24%

0% 20% 40% 60% 80% 100%

Men

Women

D+

C

ABC+

From 14 to 24 years old

From 25 to 34 years old

From 35 to 44 years old

From 45 to 54 years old

From 55 to 65 years old

DF

Interior

Pre-Paid

Post-Paid

Gend

er

So

cio

-E

co

no

mic

Level

Ag

eR

esid

ence

Hired

Pla

n

Percentage of cases

Access to social networks Do not access social networks

Page 54: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 54 |

Chart 54

To which of the following social networks have you accessed on your mobile phone? (Only users who access social networks: 178 cases in 1Q 2011; 451 cases in 4Q 2011)

97.2%

5.6%

1.1%

9.0%

5.1%

2.2%

0.0%

0.0%

42.1%

0.0%

92.2%

4.7%

0.4%

4.2%

2.0%

4.9%

0.2%

31.0%

33.7%

4.9%

0% 20% 40% 60% 80% 100%

Facebook

Myspace

Fotolog

Hi5

Sonico

LinkedIn

Plaxo

Google+

Twitter

Others

Percentage of cases

1Q 2011

4Q 2011

Page 55: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 55 |

4.5. Mobile Marketing

79% of the users surveyed received messages with advertising or promotional content at least once on their mobile

phones. In 73.3% of the cases, the messages received are sent by the telephone operator with which each user

has hired the service. Another 14.2% of users have received messages from a service providing company (not a

mobile phone service company) and 10.6% of users received messages from a consumer product company.

Chart 55

Do you remember which companies generally send the SMS/MMS with the advertising/promotional content you receive? (Only users who received some kind of message with

advertising/promotional content: 668 cases in 1Q 2011; 632 cases in 4Q 2011)

8%

4%

3%

5%

7%

8%

11%

14%

73%

6%

3%

0%

2%

3%

4%

6%

10%

88%

0% 20% 40% 60% 80% 100%

I do not remember

From another company

From a car dealership

From Provincial, Municipal orFederal Government Authorities

From a dif ferent Mobile Phoneservice company that is not mine

From a politician/political propaganda

From a consumer goods company

From a dif ferent company

From the operator/the companyI receive the service

Percentage of cases

1Q 2011

4Q 2011

Page 56: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 56 |

4.6. Mobile Banking and Money

29% of the users surveyed transferred credit from one cell phone to another one, which is almost 10 percentage

points below the figure for the first quarter of 2011 (38.3%). This drop does not necessarily indicate a trend, but

may be the consequence of seasonal variables.

10% of users accessed some kind of banking service on their mobile phones, a percentage which is almost three

times as much as it was in the first quarter of 2011. 7% of the users surveyed made some type of payment via their

mobile phones, which is almost four times as much the figures of March 2011.

Chart 56

Mobile banking over the last three months. Total sample (Basis: 798 cases 1Q 2011; 800 cases 4Q 2011)

2%4%

38%

7%

10%

29%

0%

10%

20%

30%

40%

50%

Pay bills via users cell phones User accessed the Bank's site Transfer credit f rom one cellphone to another

Perc

en

tag

e o

f cases

1Q 2011

4Q 2011

Page 57: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 57 |

4.7. GPS and Maps

35.9% of the users surveyed own devices with enabled GPS features. 67% out of such 35.9% of users have

downloaded maps on their phones.

Chart 57

Users who have GPS (Basis: 800 cases. Total sample) and users who have maps, among users who have GPS features (287

cases)

64% 67%33%36%

My cell phone doesn't has GPStechnology integrated

My cell phone has GPStechnology integrated

I have maps for GPS in my cell phone I have maps for GPS in my cell phone

Page 58: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 58 |

5. Conclusions

Over the third quarter of 2011, the revenues from value added services in Mexico represented USD 1,047 mdd;

38% above the figure for the same period the previous year.

Value added services represent 31% of the sales from the services rendered by the operators, which is six

percentage points above average in Latin America and the Caribbean (25%).

With regards to sales volume, Mexico is the first SMS business market in Latin America. In the third quarter of

2011, the sales of SMS and MMS services reached USD 601 mdd.

98% of mobile subscribers used SMS services over the last three months; 25% of users consider that SMS

services will be more important in the future, which could mean that the use of SMS could still grow.

In respect of the possibility of new SMS services outlined and surveyed in this study, acceptance was above 50%

for all the options considered. The three most required services are: being able to send text messages from any

other device (87.3%); being able to search through saved messages (83.5%); and the possibility of automatically

forwarding any messages received to an e-mail account (79.7%).

The possibility of sending SMS from multiple devices ranks first (30.9%). The possibility of automatically forwarding

any messages received to an e-mail account ranks second among users who are willing to pay for the service

(30.5%).

Users are willing to pay from $MEX 4 to $MEX 14 per month for these new messaging services, depending on the

service.

The use of multimedia messaging was increased, with 32% of the users surveyed using the service in the last

quarter of 2011; eight percentage points higher than the first quarter of the year. 79.5% of MMS users use

multimedia messages on special occasions, such as anniversaries and other celebration events. The MMS

subscriber basis could grow if the price charged for the service was reduced, because 66.4% of the users surveyed

considered that they would use the service if the price was reduced or if operators offered packages (19.6% of

users would increase MMS use if there were attractive MMS packages).

Instant Messaging is used by 24% of the users surveyed and it is more frequently used at ABC+ socioeconomic

levels (32.8%) and among users younger than 35 years old (use below 20%). Facebook Chat is the most widely

used messaging service (49.5%).

Page 59: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 59 |

6. Glossary

The description of the services presented in this report is presented in the following sections.

Messages

The services in this category can be defined as:

Answering Machine or Voice Messaging: gives access to the

automatic messages recording service offered by the carrier, in case

of receiving calls that can’t be answered.

E-mail: receives or sends emails via cell phone. Receiving or sending

can be done manually, in other words by user’s initiative, or can be

activated through the push mechanism, which periodically and

automatically receives and sends mail.

Instant Messages: service which permits access to instant messaging

systems like MSN or Yahoo.

MMS (Multimedia Message Service): sends short text messages with

image, photo, or video.

SMS (Short Message Services): sends short text messages.

Page 60: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 60 |

Entertainment

The services in this category can be defined as:

Games: service which provides the download of games to be played

on the cell phone, individually, or through internet or Bluetooth

connections, in groups. The cell phone must be able to run the games

available in the device and also the downloaded ones, and

additionally provide Bluetooth or data connectivity for internet access

(e.g.: EDGE, EVDO, or 3G).

Images: service which provides the download of images and photos to

be displayed on the cell phone. The handset must be able to display

several formats of pictures and images such as JPEG, GIF, among

others.

Music: service which provides the download of songs to be played in

the cell phone. The handset must be able to play several music

formats such as MP3, AAC, MP4, WAV, among others.

Open TV: This feature is present in some cell phones and permits

user to watch free TV programs with the handset acting as an

analogue or digital TV receptor and capturing contents through the

same signals (frequencies) received by traditional TV’s at home.

Ringtones: service which provides the download of ringtones to be

used in the handset. The cell phone must be able to play multiple

formats of ringtones, such as MIDI, AAC, MP3, MP4, WAV, among

others.

Video: service which provides the download of videos or video

streaming to be played on cell phone. The handset must be able to

play downloaded videos or received video streaming. The cell phone

must be able to play videos in 3GP, MP4, WMV, AVI, among others.

Page 61: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 61 |

Internet and Location

The services in this category can be defined as:

Internet Access: service which provides broadband access to the

Internet via cell phone or modem. In both cases users must have a

data plan contract with the mobile operator.

This service has the following characteristics:

Cell phone or Mobile Phone: the internet access from cell phone can

be done in the following ways:

1) Using a browser to access the same websites accessed by fixed

internet through a computer. Examples of browsers: the ones

offered by the cell phone or smartphone (Internet Explorer Mobile,

for Windows Mobile), or alternative browsers such as Skyfire or

Opera.

2) Accessing the WAP websites inside the Carrier network through

WAP browser.

3) Through specific programs installed in the handset (Widget, Web-

App) provided by companies like Yahoo Mobile.

4) Modem: devices which can be connected to desktop computers or

notebooks. Provides Internet broadband connection using a

computer browser (Internet Explorer, Firefox, and others).

Location Based Services: service which provides users’ geographic

location. These services have the following characteristics:

Location: can be provided as the following:

1) Through a process of triangulation using information from cell sites

and application systems provided by the operator for this purpose;

2) Through the GPS installed in the cell phone.

Page 62: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 62 |

Offered Services:

1) Location: service usually offered by the mobile operator which

allows informing the geographic location of a particular subscriber.

E.g.: service hired by parents to monitor their children’s habits, or

with the purpose of promoting safety.

2) Maps: service offered by other companies providing maps on cell

phones, usually to locate addresses, and also permits to locate

users in the map if their handsets have a built-in GPS.

3) Contextual Filter: permits the mobile operator, or other service

providers, to offer addresses or other types of promotions at

stores, restaurants, movies, among others, based on the instant

location of users.

Payments and Banking: usually offered by banks or other credit

institutions, which allows the access to users accounts in these

institutions. These services can range from simple balance consults to

the payment of bills or conclusion of investment transactions.

Social Networks: service which includes all the necessary elements to

provide access to social networks such as Orkut, Twitter, Facebook,

and others. This access can be done through browser and internet

access, both present on cell phones, or through a specific application

provided by mobile operators or other companies.

Mobile Marketing The services in this category can be defined as:

Mobile Advertising: similar to Mobile Marketing, Mobile Advertising is

also an advertising service implemented by mobile operators or other

companies. If the subscribers agree to receive it they can participate

of promotions such as free minutes, free SMS packages, and others,

as a reward for receiving advertisements.

Mobile Marketing: these services are implemented by mobile

operators, to advertise the operator itself or other companies for the

subscriber base. Usually these ads are sent via SMS. The

advertisements can also be sent directly by competitor carriers or

other companies, again using SMS messages.

Page 63: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 63 |

7. Technical File

Purpose Analyze the evolution of value added services in Latin America (Brazil, Mexico and Argentina)

Data Compilation Through the Web (Computer Aided Web Interviewing –CAWI–), quota sampling per socioeconomic status, age and gender, and geographic place of residence in Mexico.

Sample Size 800 interviews (CAWI) ± 3.5 p.p. statistical error margin, with 95% statistical confidence.

Data Collection Period

From January 3rd. to January 19th. (Results for the 4Q 2011)

Addressees Both genders from 14 to 65 years; socioeconomic classes ABC+/C/D (pursuant to Mexico’s Criterion); mobile phone users.

Gender

Sample

Male 416 52%

Female 384 48%

Age

Sample

From 14 to 24 years old 232 29%

From 25 to 34 years old 272 34%

From 35 to 44 years old 160 20%

From 45 to 54 years old 104 13%

From 55 to 65 years old 32 4%

Residence

Sample

DF 384 48%

Rest of the country 416 52%

Socioeconomic Status

Sample

ABC+ 344 43%

C 248 31%

D+ 208 26%

Operator

Sample

Telcel 633 79.1%

Movistar 107 13.4%

Iusacell 40 5.0%

Nextel 20 2.5%

Hired Plan

Sample

Prepaid 648 81%

Post-paid 152 19%

Page 64: MAVAM México 3rd Edition - Messaging - English version - May 09,2012

| 64 |

8. Team

Vancrei Oliveira | VP regional Latin America

Mariana Rodriguez Zani | Director

Ines Leopoldo | External International Advisor

Matías Guardiola | Research Manager

Pablo Castro | Analyst

Mónica Perez Serantes | Designer

Flavia Lorena Cebrián | Designer

Javier Carreto Mares | Owner

Mario Juvera Arriaga | Associated