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How the Opera Web Pass is increasing data consumption in Asia

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Photo credit:

Toshihiro Gamo

Fabrizio_high_res-e1412180462880-762x1024Opera Software drastically reduces the data used by mobile browsers – great for operators and users in cost conscious regions. Like Asia Pac. Hot Topics met Fabrizio Caruso, Opera senior VP for Asia…

Everyone interested in mobile advertising knows that Google and Facebook dominate the space. They have all the users, after all. But fewer would be able to name the company in third place: Opera Mediaworks.

The Norwegian firm sometimes jokes that it’s the largest mobile ad company that no one’s ever heard of. And with up to 20 per cent of the market, you can see why.

Actually the ad business is a relatively new space for Opera itself. Opera Mediaworks was created by Opera Software, the browser specialist, in order to consolidate some of the gains it was making with brands eager to capitalize on the reach it had among mobile internet users.

So Opera went on the acquisition trail. It bought AdMarvel in 2010, Mobile Theory and 4th Screen Advertising in 2012 and this year added Apprupt and AdColony.

The investment worked. In Q2 2014, Opera Mediaworks business became the largest source of revenue for Opera (51 per cent of total revenues). Advertisers include American Express, McDonald’s, Coca-Cola, P&G and BMW while publishers comprise Pandora, Shazam, Bloomberg, The Wall Street Journal and others.

Of course, Opera’s historic revenue streams remain significant. The firm’s traditional specializm was browsers – especially the compression of data inside browser sessions – which it exploited by developing downloadable consumer products (which it then monitored with advertising, hence the Mediaworks business) and licensing to operators.

Telcos are especially keen on lightweight browsers as a means to reduce the pressure on their networks while also encouraging users to buy affordable data plans. Handset makers like it too: from 2015, Microsoft will pre-load Opera Mini on its low and mid-market Nokia phones in India.

Naturally, the desire to drive mobile web usage is especially strong in Asia, where hundreds of millions of users still have feature phones.

Indeed, in 2013, the firm opened a base in Singapore, its fifth new office in Asia as a hub for Opera’s operations in Asia Pacific, including greater China, Korea, and South East Asian countries.

Fabrizio Caruso, Opera Software’s senior VP for Asia, sees immense potential in the region. He says: “The browser has been the only point of entry to the web in the feature phone world – and Asia Pac is still largely dominated by the feature phone. The operators are still very powerful and relevant here, and we work with almost all of them to lower the barrier of entry for mobile internet.”

Caruso says mobile internet use in Asia Pac is still only around 30 per cent despite the large scale migration to low cost Android smartphones. He contends that one of the big hurdles is sheer confusion: many users don’t know what the mobile internet is or how to get it.

To address this, Opera introduced the Opera Web Pass to let operators offer access to Internet via the browser with basic packages such as a day or a week pass. “People don’t understand the concept of a megabyte. But if you tell them they can pay 30c for unlimited browsing for a day, they get that,” says Caruso.

“So the Web Pass has really changed the way people buy data. Before, you had to send an SMS to a shortcode nobody could remember. It’s a much better system.”

In time, Opera expanded Web Pass in the form of Sponsored Web Pass. The latter gives brands the ability to sponsor free browsing with high levels of consumer engagement, while adding another revenue stream for operators.

Of course, in a region where smartphone penetration is soaring, one obvious question arises: won’t these new users just migrate away from the web in favour of apps?

Caruso concedes that apps are on the rise. But so is browsing. “In Indonesia, we noticed Android users consume twice as much data as feature phone users, and that their browser activity rises even though they are using apps.

“Some of it is habit. But if you think about it, app usage is bound to boost browsing because people click on links and on social media posts etc. These users are also very cost conscious and they know that Opera Mini compresses the data, so they keep using it.”

Clearly, Opera doesn’t regard the app as any kind of existential threat. Quite the opposite, it’s even developing its own. As a response to the enduring demand for data saving, it created Opera Max, a free app that compresses the megabytes used by data-heavy apps such as Vine, Instagram, Vevo or Flipboard.

Caruso says Opera will be watching take-up closely. He says the firm’s consumer business is a useful guide for its B2B activities. “Anyone can download our products. That makes it really easy for us to see where demand is coming from.”

Hence the current focus on Myanmar, which Caruso sees as the next target for Asia expansion. “Everyone’s interested in Myanmar since it opened up, and given the plans by Telenor and Oredoo to launch 3G. We’re looking at it carefully.”