Link to Admission Document - InternetQ

The history of mass media has been characterised by paradigm shifts in the underlying communicationtechnology, such as the development of the printing press in the 15th century, audio and photographicrecordings in the 19th century, radio in the 1920s and television in the 1940s. The emergence of theinternet in 1994 marked another development in the ability to communicate with a mass audience withthe added advantage of being able to tailor the mass message to the individual.Over the last 20 years, mass media marketing techniques have changed significantly. For the majorityof this period, terrestrial broadcast television was the predominant advertising and marketing medium,using advertising breaks as a method of marketing. This form of communication suffered from thedisadvantages of being costly, difficult to change and adapt quickly, interruptive, and for manyconsumers, unwelcome and irrelevant. With the development of the internet, new methods of massmarketing have been developed to overcome many of these disadvantages. Google ad words, Facebookand recommendation engines on Amazon and iTunes are good examples of interactive andpersonalised forms of mass marketing.The global proliferation of mobile technology together with the increasing functionality andaffordability of mobile devices has helped to deliver targeted consumer-friendly mass marketing. Anera of ‘mass-market personalisation’ has been created, in which the individual and their personal needs,habits, preferences and desires can be identified, anticipated and marketed to.With the development of mobile networks as a widely recognised platform of communication,combined with sophisticated database management and associated computer technologies, new massmarketing techniques have evolved beyond online marketing. This new marketing model, termed‘mobile marketing’, allows businesses to actively engage directly with the mobile subscriber. It benefitsfrom the fact that mobile devices are usually turned on and kept within personal reach of the user,resulting in a greater target audience. This means that the mobile device is typically open for directcommunication and the marketer has the added ability to choose the timing of the receipt of themarketing message as well as the identity of the recipient. Together, these factors increase the chancesof eliciting a response from the mobile subscriber in contrast to passive forms of advertising which relyon a mobile subscriber going on the internet and then reacting to a marketing message.The Directors believe that during the course of the past six years, the Group has remained focused onthe design of its interactive mobile technology platform and the delivery of marketing solutions whichgenerate revenue and profit growth.1.3 Business DescriptionThe Group’s technology platform provides mobile marketing solutions which enable its clients to gainbetter access to and improve interaction levels with mobile subscribers. Through this mobile marketingtechnology platform, the Group also provides premium digital content directly to mobile subscribersthrough its Akazoo module, a proprietary and versatile online and mobile entertainment hub. Akazoooffers its members content within a social network environment, allowing them to interact and getrewarded for their loyalty and usage. Apart from its content driven business focus, Akazoo aims atdeveloping mobile communities.The Group maintains connectivity agreements with mobile network operators in the territories inwhich it operates and, in most cases, transacts with its business partners through revenue sharingarrangements under which the net revenues generated from the relevant mobile marketing initiativesare divided. In several cases, those mobile marketing initiatives are devised in cooperation with theoperators themselves. In other instances, campaigns are instigated by the Group and may be rolled outconcurrently across several mobile operator networks and in a number of different countries.More specifically, through the use of its mobile marketing platform, the Group tries to attract as manymobile subscribers to participate in any given campaign and then make them engage with the content.To attract potential mobile subscribers, the Group employs promotional seeding techniques whichinclude the use of traditional media, the use of mobile and also its Akazoo network. Once mobilesubscribers are initially attracted, the Group tries to make them engage by offering exciting mobileutilities or providing incentives. The pool of mobile subscribers that eventually engage is analysed and17