Frost & Sullivan North American Mobile Crm Analyst Briefing

North American Mobile CRM Market:Investment Themes Driving the Mobile CRM Space

Swarna Pasupathi, Research Analyst

Business and Financial Services

Information and Communication Technology

September 30, 2008

2

Focus Points

� Introduction

� Market Overview

� Investment Analysis

� Scorecards

� Question and Answers

3

• Frost & Sullivan’s Financial Research team has recently completed an extensive review of

investment opportunities in the North American Mobile CRM market.

• The study highlights the growth segments in the North American Mobile CRM market, and

identifies specific investment themes and opportunities within the market.

• It includes a comprehensive overview and in-depth financial analysis of the North American

Mobile CRM universe covered by Frost & Sullivan.

Introduction

4

Focus Points

� Introduction

� Market Overview

� Market Segmentation

� Industry Economics


� Investment Themes

� Growth Monitor

� Scorecards

� Sector Scorecard

� Mergers & Acquisitions Analysis

� Venture Capital Score Card

� Venture Opportunity Score Card


5

Market Overview - Segmentation

Segments Focussed

• Mobile Sales Force Automation (SFA)

• Mobile Field Service Management (FSM)

Major Industry Participants

• COGNOS

• Oracle (PeopleSoft and Siebel)

• Salesforce.com

• SAP AG

• Maximizer Software

• Vettro

• Dexterra

• SAGE

• Sybase – iAnywhere Solutions

6

Market Overview

• Enterprise inclination towards mobility platform is on the rise.

• Growth: CRM spending is growing at 11.8% CAGR

• Opportunity: Mid-market is still under-penetrated; only 20% of SMBs use mobile CRM

and the rest of firms are in decision-making cycle to adopt mobile platform during the

period 2008-2012.

Despite an economic slowdown SMB’s will continue to invest in mobile solutions :

• Competitive Advantage

• Increases Productivity with less staff

• Increases Customer Satisfaction

Market Overview Market Segmentation Industry Economics

7

ENHANCERS

INHIBITORS

�Increases Productivity and ROI

�The concept of mobile-commuting

in the workforce offers flexibility thereby

increasing the overall productivity of the

team.

�The is an increase in the number of

vendors offering of Mobile-CRM

integration applications.

�Steady tariff plans from Mobile

Network Service Provider

�Subsidized mobile device

prices have reduced the deployment

cost for organizations.

�Availability of varieties of high

powered mobile devices has created

a robust platform for mobile application.

�Lack of justifying the total

cost of ownership (TCO)

�Non-Acceptance of Technology

�Security and Integration issues on

mobile devices stunt growth in the

SMB segment

�Increase in Number of Vendors

�Information Lag

�Slow rollout and adoption of next

generation networks

Industry Economics

8

Investment FrameworkInvestment Analysis

1. Standardization of Mobile Network Operator’s Tariff Plans

2. Decrease in the Mobile Device Price

3. Immense Increase in Smartphone Shipment Worldwide

Investment Themes Growth Monitor

9


Source: Frost & Sullivan

1. Standardization of Mobile Network Operators Tariff Plans


0

20

40

60

80

100

120

300 600 900 1500

Anytime Minutes

Netw

ork

Serv

ice C

ost

($)

Verizon T mobile AT & T Sprint

10



2. Decrease in the Mobile Device Price


0

100

200

300

400

500

600

700

2003 2004 2005 2006 2007 2008

Years

Mo

bil

e D

evic

e P

ric

e (

$)

Windows Mobile Palm Treo Blackberry Apple

11


3. Increase in Smart Phone Shipment Worldwide



0

20

40

60

80

100

120

2004 2005 2006 2007

Year

Un

its

Sh

ipp

ed

(M

illio

n)

Shipment in Smartphone Devices Worldwide

12



40.060.015.0-20.024.44,064.0SAP AG

20.080.015.0-20.043.0557.9Salesforce.com

35.065.015.0-20.047.09,460.0ORACLE

100020.0-25.01.320.4ASTEA

15.020.6Segment CAGR (2007-2012)

FSM

(%)

MSFA

(%)

Growth Rank

(%)

NA Mobile CRM Revenues in 2007

($ Million)

Company’s Total NA Revenues in 2007

($ Million)

Company


13

Focus Points

� Introduction

� Market Overview

� Market Segmentation

� Industry Economics


� Investment Themes

� Growth Monitor

� Scorecards

� Sector Scorecard

� Mergers & Acquisitions Analysis

� Venture Capital Scorecard

� Venture Opportunity Scorecard


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Segment Opportunity Scorecard

Venture OpportunityMergers & Acquisitions Venture CapitalSector Score Card

Sector Average Company

Size

Number of Companies

Revenues ($ Million)

CAGR %

(2007 – 2012)

Sector Consolidation

Attractiveness to Venture

Capital Partners

Small < 15 25.3 Low-Medium High

Medium < 10 46.8 Medium–High Medium MSFA

Large < 5 132.9

15.0

High Low

Small < 30 19.8 Low–Medium High

Medium <10 56.9 Medium Medium MFSM

Large < 5 210.9

20.6

High Low

Small < 10 19.0 Low High

Medium <10 42.6 Medium–High Medium MSFA and MFSM

Large < 5 160.2

15.0 – 17.5

High Low


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Segment Growth – SFA & FSM


Venture OpportunityMergers & Acquisitions Venture CapitalSector Score Card

0.0

200.0

400.0

600.0

800.0

1000.0

2007 2008 2009 2010 2011 2012

Years

Gro

wth

$ M

illio

n

SFA FSM

16

Venture OpportunityMergers & Acquisitions Venture CapitalSector Scorecard


Mergers and Acquisition Analysis

1005.3949.05,000.0Business

IntelligenceCOGNOSIBM12-Nov-07

1005.078.8394.0Business Analytics

Visual Sciences

Omniture Inc

25-Oct-07

1005.41,250.06,780.0Enterprise

Software

Business

Objects

SA

SAP AG7-Oct-07

%OwnedAfter

Transaction

Revenue Multiple

Target Revenue ($ Million)

Deal Size

($ Million)

Business Acquired

Target Company

Acquiring Company

Date Announced

17

Venture OpportunityMergers & Acquisitions Venture CapitalSegment Opportunity


Venture Capital ScorecardFinancial Analysis

C and D14.0 + 5.5Experienced

IT, Biotech,

and Clean

Energy

1985New

Enterprise Associates

17-Oct-

05, 07-

Feb-08

A and B2.0 + 5.75ExperiencedIT and

Healthcare 1978

Draper

Fisher Jurvetson

01-Aug-

04 and

01-Feb-

05

CRMSugar CRM

ExperiencedDiversified1998Thoma

Cressey

N/A0

ExperiencedIT1983Battery

VenturesSince

2003CRMOnyx

Funding Round

Funded Amount ($

Million)

Relevant Experience

of Management

Team

Field of Investment

Year of Establishment

Venture Partners

Date of Funding

SegmentCompany

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Venture Opportunity Scorecard


Venture OpportunityMergers & Acquisitions Venture CapitalSegment Opportunity

Financial Analysis

Medium-HighMediumMediumHigh86.5MSFA

&

MFSM

Dexterra

Medium-HighHighMediumHigh45.5

MSFA

&

MFSM

Antenna

Software

MediumMediumMediumMedium50MSFA

&

MFSM

Metrix

Overall Attractiveness

Clients and Reputation

Technology Innovation

Application Catering to Mobile Devices

Company’s Funding Till

Date($ Million)

SegmentCompany

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Future Roadmap

• Increased adoption to mobility platform by SMB segment

• The roll out of Apple iPhone and Goggle Android phone

• Emerging Platforms and possible alliances in the future

• Mobile Applications vs. Mobile Network Service Providers vs. Mobile Device

Manufacturers vs. Internet Community vs. Customers

• Innovative, patentable and interoperable mobile application will attract future

investments.

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