In the first part of our interview with Buzzcity co-Founder and CEO Dr Lai Kok Fung and India Country Manager Manish Mishra we discussed the state of BuzzCity and the company’s plans in India, their view of telecom operators, among other things. In part 2, we discuss the fragmentation between feature phone and smartphone in India, on advertising properties, and more.
MediaNama: What’s the market share shared by feature phones in India?
Dr Lai Kok Fung: Android is like 8-10% iPhone is very small. The Nokia feature phone takes up 40-45% and Micromax feature phones takes up 30-40%. Android is increasing rapidly, a year ago it was less than 1%, because the price of devices are coming down. Haven’t seen anything on Windows Phone.
Dr Lai Kok Fung: We like fragmentation. It’s not good for us that Android 80 or 90% of market because it levels the playing field and allow another content competitor which have much lower technical content to be just very good in one platform and be able to compete with oppositions. This is why we didn’t want to enter the US, for example, in the US Apple’s iPhone is very popular and there are many ad players in the market, we have to be very good on iPhone. We compete where there’s a lot of fragmentation.
MediaNama:Which platform, feature phone or smartphone, is performing better? Users are clicking on ads more on which platform?
Dr Lai Kok Fung: We are going to release a report soon on this, but our initial observation is that mobile web click through is performing much better than App click through. This happens because on the web when you click on the ad, you’re taken to a new webpage, however, on the app when you click on the ad, you’ll see a pop up to select browser and a lot of user would just close the browser before they see any ads. On the smartphone, there’s an option to hide the browser behind, even this reduces the visibility of the ad. On the other hand, it’s a lot harder to click an ad on the feature phone apps. You have to scroll down to the ad and then click on it. The click generated here is not an accidental click, the way it happens on smartphone.
This is why the click through rates on feature phones are much better than on smartphone. Between smartphone apps and feature phone apps, the feature phone apps seems to be performing much better for the advertisers. Among all the apps, the games apps are performing the worst.
MediaNama: How do you monitor the post click part?
Dr Lai Kok Fung: We monitor the post click part where when one clicks on a ad, we monitor whether they follow up few more steps. This is how we established that mobile web performs much better than apps, and games perform the worst of all.
MediaNama: Do apps takes a significant portion of browsing behavior on smartphone?
Dr Lai Kok Fung: I’m not sure how many percent, but some study says it’s 60:40 for apps to browsers. On a lot of tablets, the apps are basically a HTML files wrapped apps.
On advertising properties
Dr Lai Kok Fung: Couple of major publication apps on tablets are just HTML files. The native behavior between web and app is blurring. For some apps you need a lot of interactive materials, like for example, games which needs native app functions. But most of the news browsing properties, using web would be a good platform. In fact, for advertisers, web publishers are better for advertising because these are the places that you visit almost everyday and you don’t spend too much time, you read a couple of news and then you go away. But for games and social networking, you visit them and you spend couple of hours there browsing or playing games. So these are typically not good advertising properties.
MediaNama: How is the user divide between urban and rural India, and how is it performing?
Manish Mishra: The larger part of mobile internet users in India are from tier 2 and tier 3 areas, that is the rural areas. Almost two third of the mobile internet users are from tie 3 and tier 3 cities. Hence mobile advertisers like FMCG’s are focusing on this market. The mobile advertising spends are not diversified. We provide the ability to target the mobile platforms. For advertisers, you cannot target a certain region because technically it’s not possible for mobile advertisers to provide that filter.
MediaNama: Why did you sell Djbuzz and Mygama? Were they profitable when you sold off? For how much did you sell them?
Dr Lai Kok Fung: We started as a mobile ad network. In early days we thought, even we would grow some of the media properties so we would know our users better. As we grew, we realized that the skill needed to grow media properties are very different than the skill needed for a mobile ad network. So we picked the thing we do very well, that is aggregating publishers.
We were talking to couple of buyers to sell this properties. We had a set a deadline that we would shut down the property if we don’t cut a deal by then, so that we don’t have to divide the engineering talent. Nazara didn’t close the deal as fast as we expected. We thought they were having a second thought. But at last moment Nazara came informed that they were still profitable. When we sold off those properties, they were not profitable. We are not in the liberty to discuss for how much we sold off the property.
MediaNama: What happened to Buzzcity Mobilizer?
Dr Lai Kok Fung: That’s another technology that we experimented with, in early days. Most of the blogging platform are now smart enough to sense that the device is mobile device and throw a mobile page. We used to work with mobile bloggers. We don’t charge for the service. We wanted to help bloggers, media properties to convert their sites to mobile. But we realized that many use WordPress and blogger which automatically makes the site mobile friendly. Currently, the service is available for early users but we no longer accept new signups for the service.
MediaNama: What’s the payment cycle for publishers and advertisers?
Dr Lai Kok Fung: We pay the publishers in 45 days. For advertisers we have different payment options. We also offer prepaid option for advertisers. 30-40% of our advertisers are from prepaid option. Our maximum time period for advertisers is 60 days.