Tài liệu Nothing But Net 2009 Internet Investment Guide 7 pptx

We expect growth to continue in 2009, helped by: • Continued global e-commerce growth, helped by increased global broadband penetration; • The growing acceptance of payment solutions on

Medio Systems

Medio Systems is a provider of mobile search and advertising solutions Created specifically for mobile, Medio Mobile Search combines a user interface with recommendation and personalization technologies Using the targeting capabilities

of the mobile search platform, the Medio MobileNow Search Advertising Network enables advertisers to identify and reach interested audiences Through Medio's unique partnerships with mobile carriers and publishers, ads are integrated into the consumer mobile search experience where increased relevance drives response

Millennial Media

Millennial Media is a mobile media network that specializes in the “millennial” audience With Millennial Motion rich media for engaging user experiences, the MBrand network for targeted audiences across premium content and Decktrade for performance-driven campaigns, Millennial Media has a broad advertising offering

MoVoxx

MoVoxx is an interactive advertising agency focused on mobile advertising via SMS/text Solutions offer traditional and interactive agencies, media buyers and brand managers a quick, silent way to have a 1-to-1 dialogue with mobile consumers INTXT allows advertisers to append ads to the outgoing SMS messages of MoVoxx Publisher Network traffic, creating a method of instant mobile distribution Ads can

be targeted by geography, daypart, and content channel INADS enables advertisers

to build their own mobile inventory through keyword/shortcode placements within their existing advertisements - print, TV, radio, Internet, or in-venue This product helps leverage existing ads with an interactive call to action and a method for success reporting

mSnap

mSnap is a mobile ad network, enabled by a platform for Broadcasters and Advertisers to easily create and manage mobile campaigns The mSnap Network currently includes over 650 broadcast media partners, with the potential to reach over

200 million mobile users a week Through exclusive relationships with broadcast partners like Citadel/ABC, the company offers the ability to target mobile ad campaigns locally or nationally, and by numerous demographic and interest-based criteria Broadcasters can mobilize their programming, making it more interactive, engaging and measurable SMS traffic can be monetized while increasing

listener/viewer engagement and interactivity

Quattro

Quattro is a mobile ad network that provides targeted, interactive multi-media mobile

ad units (Video, SMS, WAP, click-to-call, email, share) all tracked in real time For publishers, the company offers its proprietary Juicing technology (allows publishers

to run wired assets on wireless devices without feeds), handset expertise, and interactive feature sets

2009 Online Payment Outlook

2008 proved to be another strong year for online payment platforms, especially PayPal, which saw revenue in the first nine months of the year grow 32% Y/Y, compared to 30% in F’07, with the unit’s off-eBay business posting particularly strong growth Further, in October 2008, eBay acquired Bill Me Later for nearly

$1B In Latin America, Mercadolibre has seen strong growth in its payment business and has rolled out direct payment features in several countries, including Argentina

In China, Alipay has continued to grow rapidly, as well, adding stores and users to its portfolio We expect growth to continue in 2009, helped by:

• Continued global e-commerce growth, helped by increased global broadband penetration;

• The growing acceptance of payment solutions on third-party platforms, including travel sites;

• Increased use of mobile money transfer platforms helping drive revenues for those with a presence in the market, such as PayPal and Amazon Payment (through its relationship with Textpayme); and

• Increased fee generation from deferred payment plan options, which are particularly attractive in developing markets

At the same time, we see several challenges to the Payment space, which may cloud the outlook somewhat

• Although we expect eCommerce to continue to win wallet share from offline shopping, the challenging environment could significantly hamper growth

• A tough credit environment may likewise dampen the growth in the segment derived from improved financing options

Key Highlights from 2008

This past year was a successful one for online payment companies Both PayPal, which benefited from strength in its off-eBay business, and MercadoPago, Mercadolibre’s Latin America Payment platform, saw faster revenue growth through the first nine months of F’08 than F’07 Some key events in 2008:

• PayPal continued to add buyer protection features, raising the dollar value of purchases insured for eBay buyers paying with PayPal The company also bought FraudSciences in January to improve fraud prevention

• eBay started pushing for mandatory or near-mandatory acceptance of PayPal on its site, including a short-lived attempt to make it fully mandatory in Australia, which encountered regulatory difficulties

• MercadoPago continued the rollout of its MercadoPago 3.0 platform, with Argentina the most recent and largest geography to begin using the service

• eBay acquired Bill Me Later for $945M, with plans to integrate the offering more

• Alipay announced several sizable merchant deals, including Amazon and Giant Interactive, and reported, as of August, that it had 100M users and processed over 2M daily transactions; over 460K merchants now accept the service

Global eCommerce Growth Expected to Slow

We expect online payment portals to benefit from eCommerce continuing to take wallet share away from offline channels in 2009 in both the U.S and global markets;

we continue to see rising broadband penetration as a key catalyst of eCommerce growth, and we expect eCommerce growth to flow through to higher usage of online payment services

While we expect the overall retail environment in the U.S to remain weak, we expect online retailers to benefit from the continued shift of retail dollars online, driven by (1) increases in product selection, (2) continued Y/Y online sales improvements for brick-and-mortar retailers, (3) volatility in the offline retail space and (4) further improved efficiencies from site optimization

Our international forecast is driven by (1) continued rises in online shopping penetration, especially Western Europe, (2) continued investments by online retailers

in broadening selection, (3) improvements in shipping infrastructure, (4) improved payment systems and (5) better fraud protection

Table 34: J.P Morgan Global eCommerce Projections (Excluding Travel)

$ in millions

Global eCommerce Forecast 2004 2005 2006 2007 2008E 2009E 2010E 2011E ’08E – ’11E CAGR

Y/Y Growth 29.1% 27.0% 23.8% 18.3% 5.7% 17.1% 14.0%

Source: Department of Commerce, Internet WorldStats, UK eStats, Forrester Research, Iresearch, Korea National Statistics Office, Japanese Statistics Bureau, eMarketer, PhuCusWright, TIA.org, Jupiter, company reports, J.P Morgan estimates

PayPal Remains the Largest Online Player; Still Trails Credit Cards

According to our proprietary survey, 55% of online shoppers use PayPal, compared

to 6% who use Google Checkout and 14% who use Amazon Payment Although the number of people who reported using all three payment services was quite small, among them a 57% majority reported that PayPal was their preferred service

Credit cards remain the preferred method for online shoppers, with 84% stating that they use credit cards to make online purchases; the results were very consistent with the findings of our survey a year ago, when 83% noted using credit cards and 55% noted using PayPal Unsurprisingly, PayPal’s penetration was even higher among those who said they had sold on eBay in the past: 78% of such respondents were PayPal users

Figure 33: Payments Methods Used by Online Shoppers

% among respondents who stated they shop online

83.6%

55.1%

5.5% 13.8% 9.5% 0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Credit Cards Pay Pal Google Checkout Amazon Pay ment Other

Source: J.P Morgan Internet Team 2008 Consumer Survey

Online Payment Providers Offer a Viable Alternative to Other Payment Options

Users Are Still Driven to Online Payment Options Despite Strong Satisfaction with Credit Cards

PayPal, as well as Amazon Payment and Google Checkout, have been able to make inroads into the online retail business despite 89% of online shoppers who use credit cards rating their experience as either excellent or very good

It doesn’t appear that dissatisfaction with credit cards is the catalyst for growth for the third-party online payment platforms Even users who are happy with credit cards are still choosing other options some of the time Among respondents who used both credit cards and an online payment service, credit cards received one of the top two ratings (“Excellent” or “Very Good”) 90%+ of the time

Figure 34: Online Shoppers’ Satisfaction with Credit Cards for Users of Online Payment Services

% of online shoppers who use the selected payment option

48%

39%

58%

48%

42%

32%

0%

25%

50%

75%

All credit card users Pay Pal users Google Checkout users Amazon Py mts Users

Ex cellent Very Good Satisfactory Needs Improv ement

Source: J.P Morgan Internet Team 2008 Consumer Survey

% among all shoppers who use the payment method; may not add to 100% due to online payment users who don't use credit cards

Figure 35: PayPal Dominant among Shoppers Who Eschew Credit Cards

% of online shoppers who don’t use credit cards who use the selected payment option

69%

5%

14%

40%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Pay Pal Google Checkout Amazon Pay ment Other

Source: J.P Morgan Internet Team 2008 Consumer Survey

Given the high level of satisfaction with credit cards, we find it remarkable that online payment services have been able to establish significant footholds online We believe online payment services offer users security and ease-of-use advantages over credit cards, including eliminating the need to enter credit card numbers Extending beyond eCommerce shoppers, online retailers can benefit from lower total

transaction costs and P2P users benefit from lower costs and the added security benefit from not having to share personal financial information, such as bank account numbers

Figure 36: Online Payment Providers Simplify the Payment Process

Traditional payment structure

Payment gateway provider

Card issuer processor

Merchant bank

Card-issuing bank

PayPal payment structure

Merchant bank

Consumer bank

Source: J.P Morgan

Younger Users Are More Likely to Use Online Payment Providers

Our proprietary survey revealed that younger users are more likely to be comfortable with more than one method of payment: nearly 60% of online shoppers in our survey between the ages 18-41 reported having used multiple payment choices (e.g., both credit cards and Google Checkout), compared to 46% among those older than 42

Figure 37: Younger Users Choose More Payment Options

% of online shoppers who selected a single payment provider, vs those who chose more than one

40%

54%

60%

46%

0%

10%

20%

30%

40%

50%

60%

70%

Use just one pay ment option Use multiple pay ment options

Source: J.P Morgan Internet Team 2008 Consumer Survey

Additionally, younger users had a higher rate of use at each of the three online payment service providers we asked about, with Google Checkout in particular showing a higher penetration rate among the 18-41 set in our survey, vs those older than 42

Figure 38: Online Payment Services Have Higher Penetration among Younger Users

% among online shoppers in each age group

63%

67%

48%

52%

0%

20%

40%

60%

80%

Pay Pal Google Checkout Amazon Pay ments At least one of PP, GC,

AP 18-41 42+

Source: J.P Morgan Internet Team 2008 Consumer Survey

Key Features of Current U.S Online Payment Providers PayPal

PayPal expanded its merchant portfolio in 2008, adding several more airlines such as Delta and JetBlue, as well as new merchants including Blockbuster Video and American Eagle, which ranked 35 and 59, respectively, in Internet Retailer’s 2008 Top 500 list PayPal is now offered by thousands of merchants around the world PayPal offers a money market account for deposits, financing options and P2P money transfers Additionally, PayPal made two notable acquisitions in the year, adding FraudSciences to help improve buyer protection – the company now offers unlimited buyer protection for certain on-eBay purchases – and paying $945M for Bill Me Later to add a financing option to its payment portfolio

be another strong year for PayPal as it grows its international and Merchant businesses and are forecasting transaction volume to increase 18% Y/Y to $72B

Users in our survey reported a high level of satisfaction with PayPal, with nearly two-thirds of users calling it “Excellent.”

Figure 39: Majority of PayPal Shoppers Rate It Highly

% among online shoppers who use the service

Ex cellent 66%

Very Good 26%

Needs Improv ement 2%

Satisfactory 6%

Source: J.P Morgan Internet Team 2008 Consumer Survey

Table 35: PayPal Fee Structure

Description Personal Account Premier/Business Account

Fee for a buyer to make a purchase Free

Fees for specific actions

Withdraw Funds Free for bank accounts in the US Free for bank accounts in the US

Receive payments funded by PayPal Balance, PayPal Instant Transfer or PayPal eCheck

Receive payments funded by Credit Card, Debit Card or Buyer Credit 4.9% + $0.30 USD (limit of 5 transactions per 12 month period)

for domestic or U.S transactions

1.9% to 2.9% + $0.30 USD

2% + applicable Fees for cross border payments

4.9% plus $0.30 USD for card payments received using PayPal

on Skype Multiple Currency Transactions Exchange rate includes a 2.5% fee Exchange rate includes a 2.5% fee

Source: www.paypal.com

Amazon Payments

Amazon rolled out its Amazon Payments Service in 2007 Amazon Payments offers P2P money transfer options Amazon Payments is also integrated with Amazon Web Services to help developers accept payments more flexibly

As with PayPal, an overwhelming fraction of users reported a high level of satisfaction with the service:

Figure 40: More than 90% of Amazon Payments Users Called It “Excellent” or “Very Good”

% among online shoppers who use the service

Ex cellent 49%

Very Good 42%

Needs Improv ement 1%

Satisfactory 8%

Source: J.P Morgan Internet Team 2008 Consumer Survey

Table 36: Amazon Payments Fees

Fees to send payments Fees

Sending Payments No fees

Fees to receive payments (by payment method) less than $0.05 $0.05 to $9.99 $10.00 and more

Bank Account 2% of T V + $0.05 2% of T V + $0.05 2% of T V + $0.05 Credit Card 5% of T V + $0.05 5% of T V + $0.05 2.9% of T V + $0.30 International Credit Card 6% of T V + $0.05 6% of T V + $0.05 3.9% of T V + $0.30 Amazon Payments stored

funds 20% of T V, minimum fee of $0.0025 1.5% of T V + $0.01 1.5% of T V + $0.01

Source: payments.amazon.com

Google Checkout

Google Checkout is now available on hundreds of Internet retail sites Google AdWords advertisers are offered discounted processing rates Google Checkout does not currently offer P2P money transfer services

Figure 41: More than Half of Google Checkout Users Called It “Excellent”

% among online shoppers who use the service

Ex cellent 52%

Very Good 42%

Needs Improv ement 0%

Satisfactory 6%

Source: J.P Morgan Internet Team 2008 Consumer Survey

Table 37: Google Checkout Fees

Description Fee

Fees to use Google Checkout to process sales 2% + $0.20 per transaction

AdWords advertisers are also eligible for free transaction processing for some or all of the Google Checkout sales each month

For every $1 spent on AdWords each month, an advertiser can process $10 in sales the following month for free through Google Checkout

Source: www.google.com

2009 Social Networks Primer

Key Takeaways

• Runaway usage growth continued in 2008 Of the major sites, Facebook

and LinkedIn posted the most impressive usage growth, and across the group of social networking sites, user minutes worldwide grew 30%+, according to comScore data And while its overall usage growth was not as rapid, Classmates posted a solid rise in paid accounts, up 37% Y/Y in the most recent quarter

• Not a fad – a technology that solves users’ problems With another year

of rapid growth behind us, there remains little doubt that there is very strong demand by users for the kind of interaction offered by social networks We believe the sites’ gains in usage share, partly at the expense of email sites, demonstrate user needs are being better met

• Monetization remains tough nut to crack Thus far, the problem of how

to monetize all that traffic persists; CPMs did not see the hoped-for rise in

2008, and we are skeptical about monetization improvements in the near term We think social networking sites will need to expand beyond the advertising model in order to successfully drive monetization

• Older users remain largely on sidelines Our proprietary survey indicates

75% of users aged 18-41 used social network sites, and only 35% among those aged 42 or older Further, whereas 40% of social network users 18-41 reported visiting the sites at least 20 times a month, older users tend to be occasional users: in the 42+ group, 63% visited the sites 1-4 times a month

Growth Remains Robust in 2008

The growth of social networks in 2008 remained very strong, with comScore estimating that minutes of usage across all worldwide social networking sites were

up 32% Y/Y through the first nine months of the year

Although the rising tide lifted most boats, Facebook was a particular beneficiary, and

is now the leader in terms of worldwide unique users and time spent, both of which were up more than double at the site In the US, MySpace remains the usage leader; MySpace unique users were 8% higher Y/Y through the first nine months of 2008, while minutes were 24% higher