It's hard to make money in Mobile, China's Smartphone market

Now it may seem obvious that a small screen limits the amount of advertisements that can be displayed which then effects the revenue possible from mobile devices.  In addition with iMessage and others creation of messaging services SMS is under threat as well.

WSJ has a post that describes some of these conditions occuring in China.  Tencent is threatening the mobile carriers the same way iMessage is.

Among the biggest losers could be the telecom companies. HSBC analyst Tucker Grinnan estimates that SMS (short-messaging services) accounted for about 15% of China Mobile'sCHL -1.41% revenue in 2011. That's under threat from Internet-based messaging systems like Tencent's Weixin. From zero users at the beginning of 2011, Weixin grew to 100 million in March 2012.

It's no coincidence that China's SMS traffic per subscriber declined 7% over the same period, or that Internet giant Tencent is reorganizing its business to focus more on mobile.

Mobile ads as well.

China's social-networking and portal sites like RenrenRENN -4.11% and Sina Corp. SINA -5.16%are also struggling to monetize a growing number of mobile users.

Mary Meeker's 2012 Internet Trends Presentation, watch out data center industry Mobile will change your world

Mobile is probably going to be one of the greenest effects on data centers.  Why?  The market penetration will dwarf the desktops, yet the lower mobile ad margins put huge pressures to be more efficient.  In addition all kinds of things are being re-imagined for mobile devices.

I was slow to move to Mobile.  i didn't get an iPhone until the 3GS.   The kids got an iPad, not me.  I stuck to my IBM laptop.  Now I have an iPhone 4S, Samsung Galaxy Note, Galaxy Nexus, Kindle Fire, latest iPad, and MacBook Air.  Mobile is where I spend more time thinking about new services.  Data Centers are critical to the mobile solution.  The way of fat clients is the past.  Mobile = Highly Connected cost effective energy efficient data centers.  

Mary Meeker gave a presentation at WSJ's all things d.  The presentation is here.

All things d has a post that gives you a good summary.

My cut at what I found interesting is as follows.  

Let's start with the bad news Mobile is 5X lower eCPMs vs. Desktop

Average revenue per user 1.7-5x lower on mobile vs. Desktop.

Google's cost per click is referenced as limiting revenue growth.

Apple's revenue growth is good news for its business model.

The change is illustrated by the past vs. present.

Page 36 starts a series of other re-imagination.

If you agree with Mary Meeker's questions, ask the questions are you rowing the same direction?

For the past year, I have been rowing in the same direction Mark Meeker describes and it is so much easier. Are you ready to change?

Video Google Employee shares How Google Search Works

Google is the dominant player in search, and has more data center capacity and servers than any one company providing information services.

With Google Search so much part our lives it is probably a good thing for you to understand how Google Search works.

The Elite go Private, Public companies are not so hot

There is all kinds of news on Facebook's IPO.  Some have learned to be cautious of an IPO.

What some people don't get is the elite, the smart ones have figured out that being a private company is better than being public.

The Economist has an article on this topic.  Here is an excerpt that will get you thinking.

Companies are like jets; the elite go private

Mr Zuckerberg will be joining a troubled club. The burden of regulation has grown heavier for public companies since the collapse of Enron in 2001. Corporate chiefs complain that the combination of fussy regulators and demanding money managers makes it impossible to focus on long-term growth. Shareholders are also angry. Their interests seldom seem to be properly aligned at public companies with those of the managers, who often waste squillions on empire-building and sumptuous perks. Shareholders are typically too dispersed to monitor the men on the spot. Attempts to solve the problem by giving managers shares have largely failed.

At the same time, alternative corporate forms are flourishing. Once “going public” was every CEO’s dream; now it is perfectly respectable to “go private”, like Burger King, Boots and countless other famous names. State-run enterprises have recovered from the wreck of communism and now include the world’s biggest mobile-phone company (China Mobile), its most successful port operator (Dubai World), its fastest-growing big airline (Emirates) and its 13 biggest oil companies.

One of the most unstable factors in a data center site is the economic situation

To be a green data center you need a sustainable solution that reduces your environmental impact.  This is complicated in itself figuring out the power grid, local weather conditions, and designing an efficient solution.  What few talk about is the #1 thing that will cause the top guys to go from one state to another though are the taxes.

Mike Manos's posts on his observation on the pay to play game to get data centers to be in a state can backfire.

The Pay to Play that I am referring to is an emerging set of regulations and litigation techniques that require companies to pay tax bills upfront (without any kind of recourse or mediation) which then forces companies to litigate to try and recover those taxes if unfair.   Increasingly I am seeing this in states where the budgets are challenged and governments are looking for additional funds and are targeting Internet based products and services. 

If the state your data center is in not financially healthy then you could be in for a few surprises.

It does beg the question as to whether or not you have checked into the financial health of the States you may be hosting your data and services in.   Have you looked at the risk that this may pose to your business?  It may be something to take a look at!