Mavam Argentina 2013 - ENGLISH

ARGENTINA Prepared by

3TH EDITION

MAVAM

Acision Monitor for Mobile VAS

Š Acision, August 2013.

All rights reserved.

MAVAM | Acision Monitor for Mobile VAS

Editorial The third edition of MAVAM (Acision Monitor for Mobile Value Added Service) Argentina, presented by Acision, is specifically centered on Instant Messaging and mobile Value Added Services. The report reinforces its commitment to provide the industry and operators with information to understand the market trends that enable the development of mobile value added services in order to increase usage and acquire new customers.

The rise in popularity of Smartphones is bringing the internet more and more into the hands of users. With this, new ways for end user interaction and connectivity are being launched over networks all the time, and today, SMS and chat-based over-the-top (OTT) and instant messaging services coexist with traditional voice services. This provides consumers with a variety of new ways to communicate dependent on the recipient and user usage trends.

Fatima Raimondi Acision President Latin America

The report highlights that the number of mobile subscribers in Latin America continues to grow, resulting in an increasing use of value-added services and total revenues. In Argentina, (VAS) accounted for 49.4% of the operators’ services sales in the second quarter of 2013, representing an increase of 30.7% compared to the same period in 2012.

VAS sales between April and June rose to $ARG 5.26 billion (USD 1.004 billion) with SMS accounting for over 57% of VAS revenue at $ARG 2.98 billion (USD 570 million).

Mobile Internet services represent that highest area of growth within VAS in Argentina.

Sales in the second quarter of the year reached $ARG 1.79 billion (USD 342 million), representing growth of 50.9% compared to the same period in 2012.

In this market there is a coexistence of Smartphones’ growth and the adoption of instant messaging: there is no replacement, but complementation. And as it happens in other countries of the region, there are plenty of packed SMS, data and voice services.

Additionally, we are observing a trend in which current consumers are increasingly using messaging service in several platforms and devices –a global phenomenon observed not only in this report but also in other assessments and data from the industry. Today, technology consumers want something 'extra' –a combination of universal reach, incomparable reliability and enriched functions– that could only be met by using multiple services at the same time. There is no unique application meeting all consumers’ messaging requirements that runs over any platform, any device all the time. However, is the operators’ responsibility to play that role by providing a unique chat/messaging service in the future?

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MAVAM | Acision Monitor for Mobile VAS

With the Chat OTT services being incorporated in different platforms, such as social networks, there are some moves towards platform consolidation. However, mobile operators globally are taking a number of approaches to address this trend, by either partnering with OTT partners or launching their own Rich Messaging and RCS type services, which may one day provide one access point for all messaging. When questioned about such a service in Argentina, referring to GSMA´s RCS initiative, "Joyn", the respondents showed a s hypothetical acceptance with (60%) stating they would surely use it.

In addition, operators are looking at ways to enrich messaging services, such as enhancing the traditional SMS experience. In this report we highlight some of the services which operators can activate across their network and their appeal to consumers. When questioned about a range of services, these triggered some high interest, showing that if operators were to launch some of this functionality it would fit with consumer expectations, and enable new routes for service monetisation and incremental revenue.

We hope you find the report interesting reading, providing analyses on user preferences in chat services; instant messaging, SMS and MMS, as well as the possibilities of generating other revenues based services on SMS that empower the value added business and user engagement in Argentina.

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MAVAM | Acision Monitor for Mobile VAS

Index

3

Editorial

6 7 11 14

1. Introduction 1.1. Value-Added Services in the World 1.2. Value Added Services in Latin America 1.3. Value Added Services in Argentina

17

2. MAVAM (Acision Monitor for Mobile VAS)

18 20 28 30 35 39

3. Messaging services (Special topic) 3.1. SMS 3.2. MMS 3.3. Instant Messaging (IM) 3.4. SMS vs IM 3.5. Joyn

40 40 41 41 42 44 44 45 45

4. Mobile Internet 4.1. Use of the Internet through Smartphones 4.2. Plan Type 4.3. Internet uses on the Smartphone 4.4. Social Networks 4.5. Mobile Banking 4.6. Mobile Commerce 4.7. Maps and location 4.8. Marketing and Mobile Advertising

47

5. Conclusions

49

6. Glossary

52

7. Technical File

53

8. Team

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MAVAM | 1. Introduction

1

Introduction The year 2013 has been focused on operators launching high speed, fixed (Fiber), as well as mobile (LTE/4G) networks. In the United States, LTE launches are contributing to market growth, while Europe is a region still dominated by 3G. In Latin America, two races are taking place: one for 3G universalization, together with a decrease in Smartphone prices with Firefox supported web phone expectations, and the other, for LTE networks to launch which, as of the closure of this report, stood at 21.

In developed countries, handset-grant elimination models, device-to-device shared data plans and operators' information systems redefinition are being tested, so as to offer integrated services and customized options that will allow fostering consumption and increasing the ARPU. This global crisis and the market dynamics are generating a new merge and acquisition process among operators as well as through the purchase of, or interest in, application and content companies.

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MAVAM | 1. Introduction

1.1. Value-Added Services in the World To understand the value added services (VAS) business worldwide, we analyzed VAS evolution across the biggest mobile operators in various regions around the world. We compared the Q1 values for 2013 and the same period in 2012, except for China Mobile, which publishes annual data as of the closure of 2012 and is compared to 2011.

The companies evaluated are:

Graph 1.1

Analyzed Operators

• América Móvil – Latin America • AT&T - United States • China Mobile • Orange (France Telecom) - France • NTT Docomo - Japan • Telecom Italy • Telefónica • Telefónica Spain • Telefónica O2 United Kingdom

1 As of the closure of this study, Telefónica was in the process of selling this operation.

2 In the sale process as of the closure of this edition.

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• Telefónica O2 Germany • Telefónica O2 Ireland2 • Telefónica O2 Czech Republic • Telefónica Latin America • Vodafone • Vodafone United Kingdom • Vodafone Germany • Vodafone India

MAVAM | 1. Introduction

Graph1.2

Total ARPU Variation - Selected Operators In USD - Q1 2012-2013

Source: Convergencia Research based on operators' financial statements

In most cases, these operators suffered decreases in their total ARPUs (Voice+VAS) in dollars, some of which is due to the change in exchange rates.

Among the companies studied, ATT kept its ARPU stable and Vodafone Germany incremented it. European suppliers register ARPU’s sharpest drops for different reasons; firstly, they cite that the economic crisis has been preventing greater consumption. On the other hand, some companies mention in their financial statements, that it is predominantly due to the negative impact of EU Regulation 531, which by mid-2012, imposed control over retail prices of roaming services and a reduction in mobile termination rates, among other regulating measures. And lastly, increased competition has pushed service prices downwards even more as operators fight to retain their customers.

In the case of Vodafone Germany, the drop in voice ARPU is compensated by VAS as a result of the increase in Smartphone adoption and SMS, voice and data packages. As a

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MAVAM | 1. Introduction

result, Vodafone‘s network plans are tailored to reflect this, which include SMS, unlimited calls, and a large capacity for data services for any Smartphone model, which may also be combined with fixed services, such as ADSL. ATT maintained its ARPU as the drop in voice usage is compensated with VAS generated

by Smartphones as well as by the new users who choose a more economical data plan line.

NTT Docomo drops are partly explained by the yen devaluation compared to the dollar, which accumulated 12.8% in the last year.

In the case of Telefónica Latin America and América Móvil, the ARPU fall is mainly explained by the local currencies devaluation compared to the dollar (Brazil, Argentina, Venezuela, among others), which is not compensated by the appreciation of other countries' currencies (Mexico, Colombia, Peru).

Graph 1.3

VAS Share / ARPU Services In USD – Q1 2013

Source: Convergencia Research based on operators' financial statements

3 In the sale process as of the closure of this edition

VAS ARPU continues increasing its share over the total revenue. NTT Docomo, Telefónica O2 United Kingdom, Telefónica O2 Ireland3, Orange (France Telecom), and Vodafone United Kingdom, already obtain 50% or more of their value-added revenues.

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MAVAM | 1. Introduction

AT&T reports on SMS combined with voice rather than separately, so their VAS cannot be compared exactly to the rest of the operators.

Although, VAS relevance grows, in absolute terms, some operators also suffered drops in VAS as well as Voice ARPU. Generally, they are European operators and this is explained by the crisis and competition.

Graph 1.4

Variation in revenue contribution for Voice services vs. total ARPU VAS Between Q1 2013 and same period in 2012

Source: Convergencia Research based on operators' financial statements

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MAVAM | 1. Introduction

1.2. Value Added Services in Latin America In the second quarter of 2013, Latin America registered 687.354 million mobile subscribers and 116% penetration. This year’s growth in the sector will be guided by a) increased Smartphone adoption and the potential positive effect of Webphones with a Firefox operating system that were launched in late June 2012, and to a lesser extent, tablets; b) LTE service evolution in Mexico, Colombia and Paraguay and LTE launches in Brazil, Chile and other countries to follow later this year and c) development of other value added services, such as mobile payments, content, operator OTT services and M2M. Spectrum bids expected in different countries for the next year could bring incorporation of new players. As of the close of this report (June 2013) for instance, DirecTV had obtained spectrum in Colombia. It is also possible that, as from this year, some mergers and acquisitions may take place.

Lines and revenue growth rates in Latin America, which are higher than those of developed markets, are strategic for operators groups. For example, in the case of Telefónica, revenues generated in Latin America are already equivalent to 51% of the group's revenues, and in the case of América Móvil, Latin America's strength allowed it to start, its expansion towards the European continent, between 2011 and 2012, with the acquisition of interests Dutch operator KPN, among other acquisitions.

Operators believe increasing the postpaid database due to the rise of Smartphones and, at the same time, they restrict the accounting criteria of prepaid lines, so in some cases decreases are observed in the number of lines.

Graph 1.5

Smartphones and mobile broadband lines share over the total lines Q2 2013

Source: Convergencia Research

4 Excluding Nextel

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MAVAM | 1. Introduction

In several countries, the ARPU is adversely impacted by a reduction in interconnection rates. Voice traffic appears to grow although prices are reduced by the packetizing effect.

SMS and MMS service usage continues to grow but at lower rates than previous years.

Latin America still isn’t showing a cannibalization effect from instant messaging (IM) and OTT platforms, such as in Europe. Meanwhile, SMS prices also suffer reductions due to packetizing.

Graph 1.6

Mobile telephony growth by type of revenue 2Q 2013 variation vs.2Q 2012 variation in U$S billions

Source: Convergencia Research

Graph 1.7

Mobile telephony sales by type of revenue 2Q 2013 vs. 2Q 2012 in U$S billions

Fuente: Convergencia Research

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MAVAM | 1. Introduction

Graph 1.8

VAS sales share 2Q 2013 in U$S billions

During the first semester, some devaluations (Argentina, Venezuela and Brazil, among others) and local currencies appreciations occurred, and as a result, total revenues measured in dollars were affected. Meanwhile, in the local currency, most countries saw an increase in their total sales.

Mobile broadband connections represent 20% of the lines, and Smartphones 18%, and both of which push VAS share in total revenues.

Total revenues in the second quarter represented 25.29 billion dollars, growing 12% compared to the same period in 2012. Voice generated USD 13.96 billion and had a 1% drop in dollars. VAS increased 24% and generated USD 7.67 billion during the quarter and, as a logical consequence of the rise in Smartphones adoption, handset sales grew by 61% compared to 2012 and added up to USD 3.64 billion during the quarter. Revenue growth is therefore driven primarily as a result of VAS and devices sales.

VAS represents 35% of Latin America operators' revenues. Mobile internet was the greatest rising VAS service(33%) and represents 50% of the total VAS market. SMS represents 41% of VAS and grew 17% in the second quarter 2013 compared to the same period of 2012.

Graph 1.9

VAS ARPU share / ARPU Services

2Q 2013 in U$S

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MAVAM | 1. Introduction

Graph 1.10 Market share by operator

1.3. Value-Added Services in Argentina

In thousands of lines for 2Q 2013

This MAVAM edition analyzes operators' results as of the second quarter of 2013. The country has 58.85 million lines, equivalent to 142% penetration of the population.

Growth for the second quarter of 2013 was5.6% when compared to the same quarter of 2012.

Convergencia Research estimates that as of the closure of the second quarter there were 12 million mobile broadband lines, out of which 90 per cent belong to Smartphones.

Mobile internet is driving growth in the postpaid base and there are many offers related to packaged services, including SMS, data and Voice bundles.

The total local currency ARPU increased by approximately 17% for rate variations as well as for a bigger use of data services (pushed by Smartphones) and SMS. The ARPU in dollars suffered a 4% reduction in the regular currency due to the devaluation of the local currency against the dollar.

Source: Convergencia Research.

The mobile business liquid sales, including handsets in the second quarter of 2013, were $ARG 12.462 billion (USD 2.378 billion) and increased by 23.1% year-on-year in the local currency (4.54% in dollars due to the currency devaluation).

Graph 1.11

Share by type of voice line. vs. Mobile broadband

2Q 2013 variation vs. 2Q 2012

5 Excluding Nextel and without considering multiple SIM, or low or null traffic lines (between 20% and 30% of the total).

Source: Operators' Balances Sheets. Excluding Nextel.

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MAVAM | 1. Introduction

Total ARPU main operators Graph 1.12

In the case of services (Voice + VAS), the year-on-year variation was 18.75% (0.85% in dollars) equivalent to $ARG 10.657 billion (USD 2.034 billion) of liquid invoicing in the first six months of the year, while handsets sales added up to $ARG 1.805 billion (USD 345 million) and grew 57% in the local currency (33.4% in dollars).

In $ARG and in U$S 2Q 2013

In Argentina, as well as in other countries of the region, the trend consists of larger revenue growth coming from handsets rather than services sales. This is due to the sale of smart devices that have a higher value than traditional telephones. Generally, operators tend to compete to obtain higher value customers offering more expensive handsets with fewer subsidies.

The growth in revenue is leveraged by VAS. While revenues from voice services grew only 9% (in local currency), VAS increased by 30.8% in the second quarter of 2013, compared with the same period of 2012.

In US$ 2T 2012

Graph 1.13

Mobile telephony business sales

In $ARG millions and in U$S millions 2Q 2013 vs. 2Q 2012

Source: Operators' Balances Sheets.

Excluding Nextel.

Source: Convergencia Research calculations based on operators' balance sheets. Excluding Nextel

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MAVAM | 1. Introduction

Between April and June 2013, value-added service sales reached $ARG 5.263billion (USD 1.004 million), and represent 49.4% of mobile service sales.

SMS and MMS sales in the second quarter were of $ARG 2.986 billion (USD 570 million), 20.8% more than in 2012.

Mobile internet posted sales for $ARG 1.794 billion (USD 342 Millions) and grew 50.9% compared to the second quarter of 2012.

The other VAS (content and other services) grew a 32% in the local currency (+12.25% in dollars) and posted $ARG 482 billions invoicing (USD 92 million).

Graph 1.14

VAS sales by type In billions of $ARG and billions of U$S - 2Q 2013

Source: Convergencia Research. Excluding Nextel

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

2

MAVAM

(Acision Monitor for Mobile VAS)

The Acision MAVAM study's objective is to analyze the evolution of services in Latin America. This has been carried out in Brazil since 2009 and in Mexico and Argentina since 2010.

This Argentinean edition has a new content structure adapted to support the changes in the market analyzing new aspects of mobile value-added services.

This edition has the following characteristics: 1. 833 internet surveys (CAWI).

2. The sample includes 50% cases in the Federal Capital City and Great Buenos Aires, and 50% in the rest of the country. The sample was selected respecting the percentages of inhabitants per region, revenue levels, gender and country age.

3. This edition's special topic is messaging services, and special emphasis was placed on the analysis of Smartphone users.

The Smartphones percentage found in the sample is higher than the one registered nationally, this is because of the methodological bias that the internet survey methodology implies. For this reason, the sample does not replicate the subscription modality and market share percentages. Smartphone use data represent smartphone users but do not represent the total number of mobile telephony users in the country.

N E

O

4. Other analyzed topics in this edition include: Mobile internet, social networks, mobile commerce, mobile banking, maps and location, and marketing and mobile advertising.

S

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MAVAM | 3. Messaging services (Special topic)

3

Messaging services

(Special topic)

In December 2012, the first SMS turned 20 years old. Since then, short messages via mobile phone networks have turned into a pillar for mobile communications, due to their massive nature as well as to the service profitability. SMS has won popularity in every demographic strip due to its simplicity and reliability. In Latin America, with a prepaid base that may be around 80% and 90% of subscribers and an ARPU of around USD 10, the price ration between the SMS and minute of voice was fundamental when expanding the frequency of use of text messages. In those countries where SMS was introduced with a unit value per message sent substantially lower than that of voice minute, the frequency was higher6.

In 1996, ICQ was created, the first computer instant messaging system. Then, ICQ was sold and, as from 1999, Microsoft Messenger has turned into the number one desktop chat platform. Some years later, MSN changed its name for Windows Live Messenger until 2011, when Microsoft bought the IP voice system Skype and decided to integrate, under this latter brand and platform, instant messaging and IP voice services.

N O

E

S

With Smartphones, instant messaging (IM) reached mobile phones and users adopted it at high speeds. In previous MAVAM editions, we could observe that, despite the many entertainment options, the telephone's main function was still communication with others: voice, SMS, e-mail, instant messaging and social networks.

The instant messaging growth is such that according to Informa consulting firm, in 2012, for the first time, more chat messages than SMS messages were interchanged in the world.

However, neither service is a perfect substitute: SMS may be sent from, and received in, every

6 See MAVAM Brazil, Mexico, Argentina, earlier editions

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MAVAM | 3. Messaging services (Special topic)

phone and from any operator in the world, while instant messaging systems are almost restricted to smartphones and also require data connection.

Users' appetite for instant communication gives rise to new Chat companies with varied business models. From the emblematic BlackBerry Messenger (BBM) linked to the manufacturer's operating system, to WhatsApp -which plans to start charging for its services at some point- to Line, which revenue comes from the sale of digital assets (stickers and games). Moreover, besides text chat, messaging platforms add functionalities such as sending photos, IP voice and other communication alternatives.

The number of IM ventures is giving rise to a merge and acquisition wave, where any member of the telecommunications value chain may be interested in acquiring or being acquired by another one. For example, Facebook acquired Beluga, Deustche Telecom bought Pinger, Yahoo acquired interest in Kakao and Samsung has shown some interest in MesaageMe and Viber, according to versions circulating in different media.

Operators and even social networks try to incorporate chat for their customer communities.

For example, in 2011, Facebook launched Facebook Chat; in 2012, Telef贸nica launched its TuMe rich communications application. And it is precisely rich communications that the market aims at.

Even with initiatives like the Joyn application, driven by operators and manufacturers through the GSM Association.

All these transformations happen at record speeds, that is why the special topic of this MAVAM edition is instant messaging.

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MAVAM | 3. Messaging services (Special topic)

3.1. SMS The 95% of respondents used the text messaging service (SMS) in the last three months. The user level remains constant, despite registering a 2% decrease against the first quarter of 2011. The difference could be explained as the sample in this edition shows a higher percentage of Smartphones and postpaid services than previous editions.

SMS use is more frequent in Feature Phones (97%) than in Smartphones (93%).

Graph 3.1

Test message users (SMS)

Basis: total sample (833 cases - 1Q 2013)

Graph 3.2 SMS: Feature Phone Users vs. Smartphone Users Basis: Feature Phones 365 cases, Smartphones 468 cases (1Q 2013)

3.1.1. SMS frequency of use In Argentina, according to data provided by Indec, 120 SMS are sent on average per month. However, the figures reported by operators on different occasions are almost three times this number.

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MAVAM | 3. Messaging services (Special topic)

Operators agreed that the SMS is still current as Smartphones penetration is not yet full7. Fernando Del RĂ­o, Business Director with Claro Argentina, pointed out that the SMS is a faster service, though as the Smartphone use grows, the number of SMS sent decreases; and but he added that due to packed services and its subsequent service price reduction, people still prefer it. He also considered that operators did not deem it a priority for the service to grow given that the natural evolution is instant messaging-oriented.

HernĂĄn Larrosasa, mobile productions development manager with Movistar, said that, in their case, the service keeps growing but at a lesser ratio, affected by the idea that instant messaging is free of charge (although it is not). He also explained that its gradual disappearance is a natural consequence of the technological evolution, as the demand focuses on data services. To satisfy such demand, Movistar launched in May an unlimited message, data and SMS service for around $3.90 per day.

Personal stated that the SMS business keeps growing although at a slower pace, and that its customers’ base sends 305 SMS average per month. For this operator, the services are supplementary and coexist. The operator launched Personal Messenger, a Chat application independent from the device, available for the operator's customers and a multi-device that is activated by sending an SMS. Personal continues making the most of the SMS through added value such as Facebook via SMS and competing with lower price packages in the market.

Graph 3.3

SMS Traffic - June

Evolution 2010-2013 - In millons

7 See note published in Convergencialatina.com

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MAVAM | 3. Messaging services (Special topic)

Use of frequency changes depending on the device. The clients with Feature Phones tend to have higher frequencies in the options of quantity of sent SMS per day. This behavior would be indicating that those who have a traditional phone make a less intensive use of text messaging from those who have a Smartphone.

Graph 3.4

SMS use of frequency (Text message) Sample: SMS users in smartphones and feature phones - 435 y 355 cases, respectively

3.1.2. Plans and recharges In MAVAM's sample (with a higher Smartphone percentage as the special topic is Instant Messaging and where given the sample type the national prepaid and postpaid proportion is not maintained), the preponderant hiring modality is postpaid, in the case of Smartphones (83%) as well as in the case of Feature Phones (62%).

Among those who have a postpaid plan, most of them said they hire more than 100 SMS (22%) or pay per message (21%).

Graph 3.5

Hiring plans by device type Sample: Feature Phones (365 cases) Smartphones (468 cases)

Feature Phone

Smartphone

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MAVAM | 3. Messaging services (Special topic)

Graph 3.6

SMS additional plans and hiring (postpaid) Sample: Postpaid users (432 cases)

Graph 3.7

SMS plans and recharges (Prepaid)

Only 8% hire unlimited SMS plans. 47% do not hire additional SMS plans.

Sample: Prepaid users (219 cases)

People who told they had a prepaid plan were asked how many SMS were normally included in the recharges they bought. 68% does not know how many SMS are included in the recharges they make.

3.1.3. Difficulties in SMS use Questions were made about the difficulties experienced regarding SMS and MMS use in Smartphones and Feature Phones.

The main difficulty for SMS use for Smartphone users in Argentina is its cost (47%), as sending SMS constitutes a more expensive option than other messaging alternatives. The second difficulty stated is not knowing if the person I want to get through is available (39%), a characteristic inherent to instant messaging platforms.

Graph 3.8

Difficulties in Smartphone SMS use Sample: Smartphones and SMS users: 464 cases - Multiple Choice

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MAVAM | 3. Messaging services (Special topic)

In the case of those who have a traditional phone, 41% mentioned delivery speed as a difficulty they have experienced and, in second place, 35% considered they have experienced no difficulties that would stop them from using the service.

Graph 3.9

Difficulties in Feature Phone SMS use Sample: Feature Phones and SMS users (358 cases) - Multiple Choice

Graph 3.10

(Detailed) Reaction in front of an eventual elimination of the SMS service Sample: SMS Users (822 cases)

3.1.4. SMS relevance To know the relevance that the SMS service has for users, they were asked what they would feel if operators eventually eliminated the service. The 60% considered that the lack of SMS service would represent a nuisance. This may lead to think that the level of substitution of SMS for IM is not total and that it has certain characteristics that users value and believe, to begin with, they are irreplaceable by another service or that the substitution process is incipient between one modality and another or that the SMS is an intrinsically natural service to mobile telephones.

3.1.5. New SMS-based services Due to the transformation time of the messaging business explained at the beginning of this chapter, it is interesting to analyze the consumers' willingness regarding new functions that could be offered together with the SMS service.

To find out about willingness, two questions were asked: one for users to indicate the appeal of a list of services and another one to indicate the appeal of a list of functions that could be offered with the SMS.

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MAVAM | 3. Messaging services (Special topic)

3.1.5.1. Appeal according to the type of service Respondents were asked how appealing the following services would be for them.

A message service that would ensure immediate delivery of all messages. For example: If you sent a WhatsApp message to a friend but at that time your contact did not have access to internet, the messaging service would send a message VIA SMS, ensuring that your message is delivered immediately.

A message service through which you may send ALL your messages to all your contacts, friends and family without worrying which means to use. Your message will be delivered regardless of the means that your contacts would rather use.

A message service through which you may reach everybody regardless of the means each of them is using at that time. For example: You are sending a message to three friends. Two of them are using WhatsApp and another one, SMS. The message will reach the three of them without your needing to shift from WhatsApp to SMS or viceversa.

A message service where you may receive all your messages regardless of the fact if you are using a Smartphone, computer or tablet. For example: A friend of yours sends a message from his/her cell phone.

Your Smartphone is off and you are using the computer at that moment. You will receive the message in your computer instantly.

An instant message service where you have a single history of all your conversations, regardless of the means used (Smartphone, tablet, notebook, desktop). For example: you and your friend are communicating via SMS or Facebook Messenger. You visualize all the messages in a single history.

To define the appeal of each of the functions, the respondents were asked to assign a score from 1 to 5 according to how appealing they found them, 1 being not appealing at all and 5, extremely appealing.

8 Multiple comparisons were carried out through a free distribution method (i.e., free from assumptions about the distribution of these data).

The idea of a unifying messaging service is, a priori, interesting for this market, as the options of receiving all messages regardless of the source device, the idea of reaching every person regardless of the means (platform or device) they are using and the idea that a sent message has delivery guarantee through SMS if the user is not connected to internet have the highest scores8.

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MAVAM | 3. Messaging services (Special topic)

Graph 3.11

New services appeal Sample: Smartphone users - 464 cases

3.1.5.2. Appeal of functions offered together with SMS To this aim, respondents were asked how appealing they would find the functions listed below if they were offered together with the SMS service.

1.

Presence: it shows whether your Smartphone is connected.

2.

Message notice: an indication of when an SMS was delivered/opened.

3.

Black List: blocking people who you do not wish to receive messages from.

4.

White List: presetting the people that you wish to receive SMS from.

5.

Automatic answer: Similar to the e-mail out of office function.

6.

Automatic subject: Similar to the e-mail automatic subject.

7.

A copy of the messages: all your SMS messages are sent (as a copy) to your e-mail.

8.

Collect SMS: when the addressee is the one who pays for the SMS if, for example, the SMS issuer has no prepaid credit.

9.

Prepaid SMS: for when you want to give courtesy credit, a text message for the person to be able to answer your message without paying for it.

10. Forward messages: when you ask for an SMS to be sent to a tablet or notebook that you preset.

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MAVAM | 3. Messaging services (Special topic)

Graph 3.12

Additional functions appeal Sample: SMS users (790 cases)

To define the appeal of each of the functionalities, respondents were asked to assign a score from 1 to 5 according to how appealing they found them, 1 being not appealing at all and 5, extremely appealing.

Most services generated a mild interest, with a 3.06 point average.

The service that generated more interest was the message reading notification (3.60 points) as, besides obtaining the highest average, answers have lower scattering levels. As a counterpart, the one that generated the least interest is message signature. It obtained low scores (2.77) and also there is less scattering in the answers, which is equivalent to a higher opinion consensus.

The Black list function obtained 3.29 points. It was the second option with the highest score, although with a lower consensus than message notice.

Presence (shows if the Smartphone is connected or not), which obtained 3.21 points, and prepaid SMS (3.06 points) also show an interesting potential.

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MAVAM | 3. Messaging services (Special topic)

Graph 3.13

3.2. MMS

MMS use in the last three months

Sample: Mobile phones users (833 cases)

29% of respondents used the MMS service at least once during the last three months. This figure is somewhat high and it could be explained by the larger percentage of customers with subscription plan the sample has in comparison with the distribution by type of plan observed at a national level.

The use of multimedia messaging is higher among Smartphone users (34%) than among Feature Phone users (23%).

It is considered that this second value may be extrapolated to the total country.

Graph 3.14

Reasons for increasing MMS frequency of use

Sample: Smartphone users who increased MMS use - 99 cases - Multiple choice

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MAVAM | 3. Messaging services (Special topic)

They were also asked about the situations when they use MMS, related to the fact that respondents indicated that the most frequent situation was "Special or funny moments" (55%), followed by Holidays (43%) and Everyday curiosity (41%). The answers may suggest that sending images is related to leisure time.

Graph 3.15

MMS usage situations Sample: Smartphone users that use MMS - 158 cases - Multiple choice

3.2.1. Barriers and motivations for MMS use The main barriers for MMS use are the lack of certainty if the person may receive the message (54%) and that it is an expensive service (47%) In concordance with the second most mentioned barrier is the fact that 47% considered that a price reduction could motivate a higher use of MMS. The positive impact on the

Graph 3.16

MMS use barriers Sample: Smartphone users that use MMS 158 cases - Multiple choice

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MAVAM | 3. Messaging services (Special topic)

demand of a price reduction would not only imply a challenge to find the reduction value to attract the highest number of customers, but also it will relate to its relative value concerning other communication services. Additionally, as Smartphones expand, MMS may be substituted by the delivery of images through IM platforms.

In second place, there were consider as possible motivations: having the certainty that MMS will arrive rapidly to sent people (35%) and the certainty that they could send it to any person (31%).

Graph 3.17

Motivation to increase MMS use Sample: Smartphone users that use MMS 158 cases - Multiple choice

3.3. Instant Messaging (IM) In this MAVAM edition, we asked about the use of instant messaging only among those who have a Smartphone, which, in the case MAVAM's sample, represents 56% of the respondents. This percentage is higher than the one estimated for Argentina, where approximately 19% of mobile lines correspond to Smartphones.

86% of Smartphone users in MAVAM's survey use at least one instant messaging application.

WhatsApp is the most frequently used application (77%), followed by Facebook (56%) and Twitter (28%). These three messaging applications differ from one another: Facebook Messenger is a function within a social network; WhatsApp is an instant messaging

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MAVAM | 3. Messaging services (Special topic)

application by definition, and Twitter is a microblogging platform. This could indicate that chat applications respond to different communication needs or interaction preferences.

Graph 3.18

Instant Messaging (IM) use Sample: Smartphone users 468 cases - Multiple choice

The use of instant messaging decreases as users are of an older age. Though, except for BBM, where the largest percentage of users is under 24 years old, all social networks have their highest peak in the 25-34 year-old group.

66% of the respondents use more than two applications of instant messaging. The applications combinations which are installed jointly are WhatsApp and Facebook (48%), Graph 3.19

Use of Instant Messaging (IM) by age group Sample: Smartphone users 468 cases - Multiple choice

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MAVAM | 3. Messaging services (Special topic)

Graph 3.20

Simultaneous use of Smartphone message applications

WhatsApp and Twitter (25%) and, Facebook and Twitter (22%). This evidence that different applications can coexist, and this coexistence it appears by the specialty of each platform: each platform has some different fortress and in that way it goes compensating for covering a wide range of communication demands of users.

Sample: Users of multiple Smartphone IM applications - 468 cases

3.3.1. Behavior and Attitude 66% of those who own a Smartphone use two or more applications at the same time and for 77% of them, this simultaneous use is common. These values could be reasserting the idea that instant messaging platforms coexist.

38% uses 3 messaging applications simultaneously.

Graph 3.21

Attitude towards simultaneous use of Smartphone message applications Sample: Users of multiple Smartphone IM applications - 464 cases

3.3.2. Frequency of use Respondents were asked about the number of messages they send on average per day using the applications installed in their phones. We have observed that those who use WhatsApp send 34 messages a day on average, while Facebook Messenger users said they send around 23 messages a day via this platform. Based on this information, we concluded that WhatsApp is the most frequently used application and that it is used extensively.

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MAVAM | 3. Messaging services (Special topic)

Graph 3.22

Average of messages sent per day via the three main IM applications in Argentina Sample: Users of multiple Smartphone IM applications – WhatsApp, Facebook Messenger and Google Talk - 361, 262 and 75 cases respectively

3.3.3. Contacts Respondents were asked to indicate how many contacts they communicated with via every application and we could observe that Facebook Messenger and WhatsApp are the most frequently used options to communicate with more contacts, with averages of almost 15 and 13 contacts respectively. These are also the most frequently used, which could explain a network economy effect. Additionally, GoogleTalk, although it is the third application regarding the number of users, has around half the number of contacts (6 contacts). On the contrary, Skype Messenger users, which make up only 13% of the sample, have 7 contacts on average.

Graph 3.23

Average of contacts by IM application in Argentina Sample: Users of multiple Smartphone IM applications 468 cases

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MAVAM | 3. Messaging services (Special topic)

3.3.4. Difficulties in IM use Respondents were asked about which had been the situations that stopped them from using instant messaging applications. The most frequently mentioned option was "Speed: Sometimes a message takes too long to arrive" (42%).

The second option most frequently mentioned was "Because I don't have WiFi access" (36%), which indicates that there are Smartphone users who try to leave the mobile network as much as possible or who do not use the mobile network for data service.

Graph 3.24

Reasons that hinder IM use Sample: Users of multiple Smartphone IM applications - 468 cases

3.3.5. IM Relevance Graph 3.25

Respondents were asked how they would feel in front of an eventual elimination of the IM service: 20% would feel lost; 43% considered that even with SMS, they would need the messaging service.

(Detailed) Reaction in front of an eventual IM elimination Sample: Users of multiple Smartphone IM applications - 405 cases

In a comparison with what was stated for the SMS hypothetical elimination, we can observe that the answers are very similar, so we deduce that IM, as well as SMS, are indispensable for users.

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MAVAM | 3. Messaging services (Special topic)

3.4. SMS vs. Instant Messaging (IM) To understand the SMS and instant messaging services coexistence, the preferences of one over the other under different circumstances were analyzed.

3.4.1. Superiority Respondents were asked if any of the two services was superior to the other one in relation to reliability, delivery speed, cost/price and quality.

IM was considered superior regarding delivery speed (43%), cost (63%) and quality (36%). In the case of the reliability attribute, there is not enough evidence to support that respondents consider one better than the other. Despite this, it is clear that, for respondents, IM is superior in the attributes analyzed.

Graph 3.26

SMS and IM service assessment Sample: Smartphone users - 464 cases

3.4.2. Service preference according to addressee 9 With 95% reliability, we may say that the distribution of percentages on which these statements are based are significantly different from 33%-33%-33%.

To know how SMS and IM applications coexist, respondents were asked which service they would choose in the face of different situations. From the data presented in graph 3.27, we conclude that IM and SMS use are perceived equally appropriate,9 except at workplace, where SMS is preferred.

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MAVAM | 3. Messaging services (Special topic)

Graph 3.27

Selecting the most appropriate service for each occasion Sample: IM and SMS Smartphone users - 464 cases

3.4.3. Reasons Graph 3.28

Reasons for using IM instead of SMS Sample: IM and SMS Smartphone users

Smartphone users were asked what the reasons were for which they would rather use IM instead of SMS. The two reasons most frequently mentioned were the cost (70%) and the possibility of sharing files (56%). Delivery speed (42%) and the possibility of knowing if the person to be contacted is available (41%) were also relevant.

464 cases

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MAVAM | 3. Messaging services (Special topic)

An inverse question was asked so as to learn the circumstances in which they would prefer using SMS instead of IM. What stood out in relation with this question is that SMS is more frequently used to communicate more important messages (40%) and for work or study matters (31%).

Graph 3.29

Reasons for using SMS instead of IM

Sample: IM and SMS Smartphone users - 435 cases

3.4.3.1. IM and SMS combinations Given that instant messaging and SMS coexist as communication options, it is interesting to ask about the SMS frequency of use against the highest penetration chat platforms (Facebook and WhatsApp).

N

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S

3.4.3.2. WhatsApp + SMS 93% of respondents who use WhatsApp also use SMS. This demonstrates that the use of an IM application does not eliminate SMS use, mostly because SMS is universal. Graph 3.30 shows that WhatsApp is more intensely used than SMS: the number of daily messages, in average, by this group through WhatsApp is 34 and average of SMS is 14 per day.

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MAVAM | 3. Messaging services (Special topic)

Graph 3.30

Sent messages average per day WhatsApp vs. SMS Sample: WhatsApp and SMS smartphones users - 335 cases

3.4.3.3. Facebook Messenger + SMS 96% of respondents that use Facebook Messenger also use SMS. Comparing the amount of sent messages, it is observed that there is greater intensity on the social network platform. The number of daily messages, in average, by this group through Facebook Messenger is 23 and average of SMS is 17 per day.

Graph 3.31

Sent messages average per day Facebook Messenger vs. SMS Sample: Facebook Messenger and SMS smartphones users - 251 cases

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MAVAM | 3. Messaging services (Special topic)

3.5. Joyn Graph 3.32

Joyn awareness Sample: Total 833 cases

Joyn is an application driven by the GSM Association (GSMA), which combines voice communication, chat with one or multiple persons at the same time and also allows sharing videos, photos and files. This application enables contacting users who do not have the SMS or mail application.

In general, it is a free-of-charge application with flat rate or prepaid plans within the territory of a certain country.

World operators are cooperating in the initiative for the platform to have interoperability, that is, for it to "simply be on the phone and work". Movistar, Orange and Vodafone have already launched this service in some countries.

Handset manufacturers10 are driving this platform and, in some models, it is already preloaded. It may also be downloaded for iPhone and Android platforms.

Grรกfico 3.33

Joyn awareness Sample: Total 833 cases

3.5.1. Awareness 2% of respondents stated having heard about Joyn.

3.5.2. Willingness All users were explained what Joyn consists in and then they were asked if they would use it or not. The willingness showed was important: 14% answered that they would surely use it, 18% would use it if it was part of a package and 28% if it was free of charge. The free condition seems to be necessary for customers to accept it.

10 Some Smartphone models by Huawei, HTC, LG Electronics, Motorola Mobility, Nokia, RIM, Samsung, Sony, ZTE.

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MAVAM | 4. Mobile Internet

4 Grรกfico 4.1

Internet users through Smartphones Sample: Smartphones - 468 cases

Mobile Internet In the second quarter of 2013, Convergencia Research estimates that 21% of mobile lines in Argentina were Smartphones.

In the sample selected for MAVAM, survey made to internet users, the ratio of smartphones climbs to 56%. As explained in previous editions, in general, the profile of the respondent surveyed through the Internet is a user more familiar with technology and usually has either more intensive uses of the services or more innovative devices, and as in the special topic related to messaging, the analysis of those having smartphones was prioritized.

Given these characteristics, usage patterns are representative of Smartphone users and should not be construed as being extrapolated to the entire population of Argentina.

4.1. Use of the Internet through Smartphones An 88% of those who have a Smartphone accessed the Internet over the last three months. 82% of those who have a Smartphone and access to mobile Internet do it on a daily basis.

Graph 4.2

Internet access frequency through Smartphones Sample: Internet users through Smartphones - 410 cases

N

O

E

S

N

O E

S

N

O

E

S

Among the 12% of those who despite not having a Smartphone do not use the Internet, the main reason (38%) is that they do not need it. Secondly they consider the browsing speed is very low (29%).

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MAVAM | 4. Mobile Internet

Graph 4.3

Reasons not to access the internet on the Smartphone Sample: Smartphone users whodo not access to internet through the mobile phone - Total 58 cases

4.2. Type of plan hired Graph 4.4

Amount of megabytes hired Sample: People who hire postpaid plan 388 cases)

The 83% of those who have a Smartphone hire a postpaid subscription plan and in most cases, they do not know how many megabytes are included in their plan. The 43% don’t know and a 20% don’t know, but the service is included in their plan. 32% of users hire unlimited plans.

In a 58% of cases, the limit of megabytes hired is not exceeded.

4.3. Uses of the Internet on the Smartphone The four most frequently mentioned activities when using the Internet on the Smartphone are use of instant messaging (73%), e-mails consultation (73%) and access to social networks (71%) and searches (68%).

A second group is made up of map consultations (56%), news reading, videos and downloading information on products, the last three with 51% of mentions.

The most frequently consulted news sites are Clarín 67%, Infobae 48% and La Nación 45%.

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MAVAM | 4. Mobile Internet

Graph 4.5

Activities performed when using the Internet on the Smartphone Sample: Mobile internet users - 410 cases

4.3. Social networks Among users who have a Smartphone and accessed to internet, 71% used the mobile phone to access a social network. 98% has an active profile in Facebook, 51% in Twitter and 40% in Google+.

Graph 4.6

Active profiles in social networks Sample: Smartphone and mobile internet users accessing social networks - 292 cases

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MAVAM | 4. Mobile Internet

Facebook (68%) and Twitter (53%) have the highest ratio of daily usage frequency, although the latter has a much smaller customer base, while Instagram concentrates its users on the weekly frequency (62%).

Graph 4.7

Access frequency to social networks Sample: It varies depending on the social network

Graph 4.8

Uses of Facebook Sample: Facebook users on smartphone

Facebook main activities are the relationship with friends through messaging (90%), photos and moments (80%), search for people and relatives (60%) and knowing people’s profile (55%).

(285 cases)

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MAVAM | 4. Mobile Internet

4.4. Mobile Banking 25% of Smartphone users make queries or access banking information. The main activity is making balance querie (83%) followed by pay bills (50%).

Graph 4.9

Mobile banking usage frequency Sample: Smartphones users that access to their bank website - 103 cases

4.5. Mobile Commerce 6% of those having Smartphones made searches for products and services over the last three months, but only 19% made a purchase.

The top two reasons mentioned for not making a purchase using the Smartphone are the preference to buy through the computer (62%) and that it is difficult to make payment through the mobile device (24%).

Graph 4.10

Search

Shopping

Products search and shopping through the Smartphone Sample: 50 cases

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MAVAM | 4. Mobile Internet

4.6. Maps and location 56% of those having a Smartphone use map services. 86% consult the map for getting oriented, and 23% mentioned that after consulting the map, they generally visit the site or store consulted.

Graph 4.11

Activity performed after consulting maps Sample: Smartphone users that access to internet trough their mobile phone and consult maps (231 cases)

Activity

%

I was just using it to localizate I went to the stand/store/establishment I went to the stand/store/establishment and use their services

86% 23% 18%

Website search of the stand/store/establishment

17%

I went to the stand/store/establishment and make a purchase

16%

I just wanted to know how the store looked like

8%

I called the stand/store/establishment

7%

I made a online shop in the store/establishment

4%

I started to recommend the stand/store/establishment

4%

4.7. Marketing and mobile advertisement Respondents were asked how much they agreed with receiving relevant messages from operators and other companies on the cell phone. In general, Smartphone users disagree, and Feature Phones users agree with it.

Considering both groups, it may be observed that there is concern about spam, since in most cases they agree to receive advertisement only if they have previously consent to it.

Graph 4.12

Prefered means to receive advertisements Sample: Total 825 cases

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MAVAM | 4. Mobile Internet

However, when asked about the preferred communication means when receiving messages from operators or companies on the cell phone, 50% opted for the SMS. 14% say they would prefer any application other than the proposed options (IM, MMS, Facebook) and the same percentage said that any of the proposed options are the same for them (14%).

Note: 61% of those who have a Smartphone pay low or none attention to advertising messages. 35% rarely pays attention and 26%, never do. 40% pays high attention (22% sometimes pay attention and 11%, most times) and 6% pays high attention (always watches advertisements).

Search sites (66%) and video sites (45%) are the places with the highest number of mentions regarding display of advertising messages.

52% click on the message or visit the advertiser's site.

Graph 4.13

Places mentioned where respondents say having seen an advertising message Sample: 162 cases

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MAVAM | 5. Conclusions

5

Conclusions Value Added Services in Argentina are mobile telephony’s growth engine. They represent 49.4% of the VAS and grew 32% in local currency (12.25% in USD) as compared with the second quarter of 2012.

Sales in the second quarter amounted to $ARG 5.2634 billion (USD1.004 million).

SMS continues to be the service that posts the highest revenue within the value-added solutions (56.7%) and generating more than $ARG 2.986 billion (USD570 million) in the same period.

Mobile Internet is the fastest growing service. It recorded sales totaling ARG$1.794 billion (USD 342 millions) and grew 50.9% in local currency compared to the same quarter 2012. It represents 34.08% of the VAS. Smartphones growth and the adoption of instant messaging coexist in this market with high usage of SMS; we do not observe a substitution process but a complementarity process. Such as in other countries of the region, there are plenty SMS, data and voice packaged offers.

Necessary. 60% of users claim that in case of a hypothetical disappearance of SMS they would have problems to communicate. 22% would feel lost and 38% would need it even when having other communication alternatives available. In the same situation, but in relation to instant messaging, 61% of Smartphone users also said they would have difficulties. 20% would feel lost and 41%, despite having SMS, would need Chat applications.

Opportunity. The idea of a unifying messaging service is, a priori, interesting for this market, as the options to receive all messages regardless of the source device, the idea of reaching every user no matter what platform or device they are using and the idea that a sent message is guaranteed to be delivered through SMS if the user is

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MAVAM | 5. Conclusions

not connected to the Internet, got high scores when asking on the interest aroused in those who have a Smartphone11.

Preferred. When questioned in the research, Smartphone users expressed a preference for instant messaging over SMS primarily due to its perceived cost advantage (63%), speed of delivery (43%) and quality (36%). SMS scored equally with IM regarding reliability.

Almost identical. The research highlighted that the messaging habits for Smartphone users often depends on the circumstances and the choice of which messaging platform to use can depend on the social context. For instance, both SMS and instant messaging (IM) are seen as good tools for informal communications with friends and family, etc. However, for work related matters and more formal settings, the speed and reliability of SMS are often preferred.

Simultaneously. According to the research, 93% of those who own a Smartphone use at least one IM application with up to 77% of them using more than one IM application at the same time to send messages to different users on divergent platforms. These values could be reasserting the idea that instant messaging platforms coexist with each other and other traditional forms of messaging.

Joyn. When asked about the possible launch of a service like Joyn in Argentina, the 60% of respondents showed a positive interest, although offering the service for free seemed to be necessary to drive adoption. The research highlighted that 18% of respondents would use if it were included in their pricing plan and 28% would only use it if it were free.

11 Multiple comparisons were performed through a free distribution method (i.e. free from assumptions on the distribution of these data).

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MAVAM | 6. Glossary

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

MMS (Multimedia Message Service): sends short text messages with image, photo, or video.

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.

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.

Entertainment The services in this category can be defined as: 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.

Ringtone: 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.

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.

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

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MAVAM | 6. Glossary

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 (eg.: EDGE, EVDO, or 3G).

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.

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.

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: 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.

Modem: devices which can be connected to desktop computers or notebooks. Provides Internet broadband connection using a computer browser (Internet Explorer, Firefox, and others).

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

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MAVAM | 6. Glossary

through browser and internet access, both present on cell phones, or through a specific application provided by mobile operators or other companies.

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.

N

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S

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.

Offered Services: 1. Location: service usually offered by the mobile operator which allows informing the geographic location of a particular subscriber. Eg.: 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.

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

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.

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MAVAM | 7. Technical File

7

Technical File Scope

Mobile phone users

Technique Method Sample Market Survey date

CAWI (Computer-Assisted Web Interviewing) 12/15-minute survey 833 cases Argentine June 1-10 2013

Sex

Sample

Male Female

421 412

Age

51% 49%

Sample

18-24 years old 25-34 years old 35-44 years old 45 or more

131 178 168 356

Location

16% 21% 20% 43%

Sample

CABA Pampa hĂşmeda NEA Cuyo NOA Patagonia

526 148 56 36 34 33

SEL

63% 18% 7% 4% 4% 4%

Sample

ABC1 C2 C3 d1 d2 e

242 256 160 175

Operator

29% 31% 19% 21%

Sample

Movistar Personal Claro Nextel Otra

316 266 232 17 2

Plan Types

38% 32% 28% 2% 0%

Sample

Prepaid (Rechargeable card) Pospaid (Monthly billed - without limit of use) Pospaid + control

219 289 328

26% 34% 39%

(A monthly bill, with limit of use.Once limit is reached, I can make a recharge and continue using it)

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MAVAM | 8. Team

8

Team

Fatima Raimondi | President, Acision Latin America Silviane Rodrigues | Market Development Director, Acision Latin America

Mariana Rodríguez Zani | Director Emilia Gibellini | Analyst Nadia Arno | Analyst Román Mergá | Analyst Leonardo Nocera, Bernabé Diaz | Design

Humberto Perissé | Director Izildinha Neumann | Commercial

Sol Caballero Juan Pablo Daniello

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