It is with great pleasure that we present to you a brand new edition of the Netsize Guide 2010, Mobile Renaissance. For the first time in its 9-year history the book is now updated in its publication year with five new interviews and hot new 2010 telecommunications market data. We´ve kept the original 2009 data, providing you with a unique quarterly view on the mobile telecommunications market trend in 40 countries globally.

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We are confident you will benefit from the content and case studies we are covering in our upcoming projects, and we look forward to learning what content and companies you would appreciate most.

Netsize offers mobile payment solutions based on operator billing (through premium SMS, MMS and WAP for example) for 100 mobile operators in 28 countries, reaching over 1 billion billable subscribers worldwide, and provides mobile messaging, with SMS and MMS delivery to over 200 countries.

Netsize was founded in 1999 by Stanislas Chesnais, who will remain as CEO. Prior to this capital increase, Gemalto already held 24% of Netsize. Headquartered in Levallois Peret, near Paris, France, Netsize employs approximately 180 people. Netsize will continue to operate as a stand-alone company within the Gemalto Group.

Olivier Piou, Chief Executive Officer of Gemalto, stated: “Gemalto invested in Netsize back in 2001 and was the first and largest outside investor in Netsize. It is natural extension of our long term relationship that Gemalto now becomes Netsize’s majority shareholder. Netsize’s mobile payment platform complements our rapidly expanding mobile software and services offering.”

“Netsize has been a pioneer in mobilizing business and commerce” commented Philippe Vallée, Executive Vice President for Telecom at Gemalto. “Netsize’s “one click” mobile payment solution is a key brick in enabling the monetization of mobile phone downloads and app-stores”.

Stanislas Chesnais, Founder and CEO of Netsize, added “Gemalto’s investment will facilitate our expansion into new markets such Latin America, Africa and South East Asia. We look forward to leveraging Gemalto’s digital security technology to make mobile payments even more pervasive and convenient”.

Investor Relations
Vincent Biraud
M.: +33(0) 6 08 48 33 23
vincent.biraud@gemalto.com

Corporate Communication
Rémi Calvet
M.: +33(0) 6 22 72 81 58
remi.calvet@gemalto.com

About Netsize
Netsize is a leading mobile communications and commerce enabler. Netsize solutions include Mobile Messaging, with SMS and MMS delivery in 200 countries; Mobile Payment through operator-based billing (Premium SMS, MMS and WAP) in 28 countries; and Mobile Content Management platforms with publishing & editing tools to manage messaging services and mobile Internet portals. Netsize manages more than 60 million mobile transactions per month for 800 customers worldwide, including Fortune 500 companies. With 180 employees in 10 offices worldwide, Netsize provides both robust technical infrastructure and marketing expertise to support this successful deployment on a global scale.

For more information about Netsize please visit www.netsize.com

About Gemalto
Gemalto (Euronext NL 0000400653 GTO) is the world leader in digital security with 2008 annual revenues of €1.68 billion, and 10,000 employees operating out of 75 offices, research and service centers in 40 countries.

Gemalto is at the heart of our evolving digital society. The freedom to communicate, travel, shop, bank, entertain, and work—anytime, anywhere—has become an integral part of what people want and expect, in ways that are convenient, enjoyable and secure.

Gemalto delivers on the growing demands of billions of people worldwide for mobile connectivity, identity and data protection, credit card safety, health and transportation services, e-government and national security. We do this by supplying to governments, wireless operators, banks and enterprises a wide range of secure personal devices, such as subscriber identification modules (SIM), Universal Integrated Circuit Card (UICC) in mobile phones, smart banking cards, smart card access badges, electronic passports, and USB tokens for online identity protection. To complete the solution we also provide software, systems and services to help our customers achieve their goals.

As the use of Gemalto’s software and secure devices increases with the number of people interacting in the digital and wireless world, the company is poised to thrive over the coming years.
For more information please visit www.gemalto.com.

The largest mobile network operator is Vodacom (52% market share, source: Vodacom), MTN is second (35% market share, source: MTN) and Cell C, a subsidiary of Saudi Arabia’s Oger Telecom, is third (4.2 million subscribers, 8.8% market share, source: Cell C). Some 7% have 3G subscriptions.

Mobile, anyone?

South Africa is a very attractive market for mobile services. According to a report from Frost & Sullivan, demand for mobile content services in South Africa will grow by an average of 15 per cent per year until 2013.

It is also the most advanced mobile territory in Africa, with a European-style infrastructure, and consumers whose first introduction to telecoms and the web comes from mobile. Mobile broadband usage is as common as fixed line.

The Mobile Marketing Association recently released some interesting statistics about the phenomenal growth in this market and the current state of mobile adoption in South Africa, as summarized in an article by 20fourLabs.

South Africa is a nation sparkling with confidence, higher than many parts of the world (source: Bureau for Economic Research), and with great ambitions as the 2010 World Cup is gripping this sports mad country!

Launching mobile content services in South Africa

In November Netsize launched its mPayment operator-based billing solution with South Africa coverage with MO premium and MT premium billing. On Vodacom and MTN (total 87% market share) both MT and MO premium are available, and a long number for sending and receiving messages.

Multiple price points per short code are possible. MO premium is available on Cell C with a single price point per short code. For the most common price points shared short codes will be available.

Applications …

Popular mobile applications include banking (money transfer services), advertisement (mobile marketing) and entertainment (content/infotainment and social networking).

Whereas traditional direct marketing and online marketing is costly and less effective due to the language situation and lack of broadband access, mobile is providing an alternative marketing channel. Direct and personal, it has the widest reach of all in this vast country.

With 4 times more people using sms than email, it is clear that in this country the mobile is everyone’s “first screen.”

Regulatory aspects

As most countries, South Africa has put in place industry self regulation. The WASPA Code of Conduct promotes fairness and decency in dealings with subscribers and members in the content value chain.

Advertising must follow the rules in the Advertising Code of Conduct, with clear communication on pricing matters. Operators have set some specific rules as well in particular for MT subscription services.

Online seminar

If you would like to know more on how to launch mobile content services in South Africa and Netsize mobile messaging, billing and marketing solutions, we invite you to view the Netsize online seminar on South Africa at www.netsize.com.

Netsize, a leading mobile commerce and communications enabler, today announces that it has extended the network coverage of Netsize mPayment, its solution for global remote payments, with three mobile network operators in South Africa, Vodacom, MTN, and soon, Cell-C.

The expansion follows the acquisition by Netsize of Africa2you’s assets, a wireless services provider based in Johannesburg, South Africa.

“South Africa is at the forefront of mobile, having one of the highest growth rates for mobile content services,” says Stanislas Chesnais, Chairman and CEO, Netsize. “With Netsize mPayment, content providers can use operator-based billing for charging pay-per-use and subscription services.”

In addition, Netsize announces the availability of subscription services billing with Netsize mPayment on the network of MTS, the largest mobile network operator in Russia with close to 66 million subscribers.

Netsize mPayment enables clients to define alias, end user price point, billing frequency, retry scheme and expiry date. End users confirm their subscription service opt-in by sending an SMS MO message. Opt-in through WAP or PIN-code authenticated web request will be available in the first quarter of 2010.

The new services will be presented in a live online seminar on November 26, 2009.
For more information and to register for this seminar please visit www.netsize.com

Netsize Smart Application Billing enables Application Stores to use operator based billing to charge for application downloads and usage, and permits charging from the mobile application itself.

“Reaching the largest consumer audience and making it easy to buy content are the key success factors for Application Stores. With Smart Application Billing they reach 1.3 billion consumers globally, and consumers can conveniently purchase applications and application extensions via their mobile operator phone bill in both Pay per Use and Subscription business models,” says Stanislas Chesnais, Chairman and CEO, Netsize.

“Our Application Store customers observe an increase of their revenues by 400% as soon as they add operator based billing. Having an alternative for credit card billing clearly removes an obstacle in the purchasing process.” He adds, “On Application Store visits that use a mobile device over a Wi-Fi connection we record a 30% increase in payment transactions. It proves the business case for operator based billing as a successful internet payment method.”

Smart Application Billing uniquely combines three operator based billing methods: Direct Operator Billing, Premium SMS Messaging, and WAP Billing. Depending on the characteristics of the consumer’s network operator Smart Application Billing dynamically proposes the preferred billing method to the application. Direct Operator Billing and Premium Messaging allow the user to make the payment while remaining in the application. WAP Billing is used when the other methods are not available. The user makes the payment outside of the application on a mobile internet payment page.

Direct Operator Billing is the billing method where an installed application on a mobile handset initiates a billing transaction via Netsize directly to the user’s mobile network operator.

Netsize is the delivering operator billing solutions to some of the largest Application Stores. Sony Ericsson has chosen Netsize mPayment for PlayNow™ arena to cover multiple countries in Europe.

“Direct consumer charging by mobile operators remains the favorite purchasing method of consumers to get entertainment content or to access services over SMS or Mobile Internet/WAP media,” says Stanislas Chesnais, Chairman and CEO, Netsize.  “We witness 800% transaction volume growth year-to-year mainly held up by Mobile Internet/WAP services growth.  Our higher aggregation level enables the best revenue pay-out to publishers.  Covering more than 100 mobile operators in 28 countries makes Netsize the global market leader.”

“The Netsize mPayment solution enables publishers and content providers to achieve 12% more revenue in comparison with other implementations, thanks to an in-depth knowledge of the operator’s payment platforms,” says Stanislas Chesnais. mPayment also enables reaching any consumer worldwide over alternative methods such as credit card, PayPal™, and other e-Wallets.

“The automatic and transparent consumer authentication makes mobile purchasing easy and avoids users from having to open an online account.  The secured transaction is initiated from a single click without entering sensitive data which ensures the best transaction achievement ratio.  The ease of use and convenience quickly recognized by consumers enables mobile handsets to be the tool for purchasing physical goods,” says Stanislas Chesnais.

Analytics is an integral part of the mPayment solution.  mPayment Analytics provides customers with a billing and payment dashboard with three statistics views.  The summary view shows the key performance indicators such as revenue and transaction quantity split by country and handset model.  The real-time statistics view shows all processed transactions allowing users to filter up to twenty criteria.  The customized statistics view enables users to build his view by service, country, operator, or business model (subscription or pay-per-use).

Hutchison 3G started in May 2003 with the brand Drei as the first sole mobile multimedia provider in Austria. Drei offers multimedia products such as video calling, music videos and mobile television on the UMTS-mobile and in addition provides the classic ways of communication such as voice calling, SMS and MMS.

With 94% of Austria covered with its UMTS service, and all its mobile handsets equipped with access to Facebook, Google and eBay, Drei is particularly targeting the heavy mobile internet consumer.

Netsize provides operator-based billing through premium messaging (MO as well as MT) on all four network operators. End user price points start from €0.20, up to €10.00.

The use of MT premium however is subject to a few operator regulatory limitations. Drei for instance does not allow MT premium charging for services where the user can use a web browser (mobile or PC) to make a purchase commitment or receive the content / information service.

Operators generally prefer that content providers use WAP billing instead of premium messaging for content services billing. WAP billing has many benefits, as it enhances the user experience, increases transaction clarity and trust, and improves campaign conversion rates. Netsize Online Payment, our platform for operator-based WAP billing in 15 countries, provides a single aggregated access to all operator billing systems.

Since summer 2008 A1 Mobilkom, Austria’s largest operator, has been banning the use of MT billing for new content services entirely, in favour of WAP billing. As of March this year, they have now revised this full ban to allow the use of MT premium again for pure text services that do not make use of a WAP push message to download content from WAP or web, and that cannot make use of WAP billing. As a most trusted Mobilkom partner, Netsize can help content providers with deploying new MT billing services, subject to strict regulations.

Czech Republic is the fourth largest market in Eastern Europe, after Russia and Ukraine and Poland. In terms of mobile subscribers, its mobile penetration rate of 133% is the highest in Eastern Europe and in the top-5 globally (source: Netsize Guide 2009 / Informa Telecoms and Media). Some 3% of the 13.6 million Czech subscribers have 3G subscriptions.

Messaging continues to grow. O2 reported that its 5.3 million customers sent and received over 3.3 billion SMS in 2008, a year-on-year increase of 8.1% (source: Telefónica O2 Czech Republic annual report 2008).

The main operator-based payment model is MO Premium and it is used with applications that end users can exclusively use through their handsets: wallpapers and logos, ringtones and micropayment services. Micropayments are usually intended to purchase digital content, access to internet sites, etc. and generally all services are allowed. Voting is allowed too, as are mobile entertainment and mobile gaming content.

In Czech Republic it is also allowed to use MT premium. It is mostly applied with content subscription and infotainment services, and the subscriber opts-in via SMS, IVR, WAP or Web. Recently it has become possible to use MT premium also for pay-per-use micropayment services where the user is billed if the transaction was successful. Local regulations for MT premium are very precise and maintain a high level of end user protection. Still many opportunities exist for new business models that can do well in this vibrant market.

The most often used price points for premium services are 35, 40, 50, 79 and 99 CZK. We recommend a price point of 3 CZK for standard rate services and marketing campaigns but on this rate there is no revenue sharing.

Mobile operators in Czech Republic do not have a WAP billing offer yet. However, viewing the success of WAP billing in other countries, operators have started to investigate the opportunity. In the past year all operators have been introducing mobile internet offerings and bundles, and consumer use of mobile internet is growing rapidly. We keep a watch on the further developments.