Gianluca D'Agostino, CEO di Neomobile, intervistato da Class CNBC

Class CNBC Focus Today
Welcome to the special edition of Class CNBC from the London studios. Today our guest is Gianluca D’Agostino CEO of Neomobile, welcome and thank you for being here with us.
Good morning
First of all, we would like to know which is the primary focus of your company since, just like the name explains, it’s related to the communications via mobile.
We are a mobile commerce company, a new business in rapid expansion and growth.
The company has started up its operations 5 years ago, it’s both an Italian and a global group, as we operate in 70 markets worldwide. Still our core and our identity are Italian, along with our Vision
thanks to the relevance of the mobile industry in Italy over the past years, today and in the future. We have successfully driven and anticipated some trends
making certain smart choices which later on came up to be the right ones. As a consequence, we started to achieve an increasing international expansion and exposure. Maybe shortly I can provide you a better picture about the industry.
Yes sure. We would like to understand a little bit better, to be a successful company in a moment of crisis, which is the role and how much the industry may contribute to this success.
Choosing this sector was certainly a good intuition.
Just some days ago I was recalling when we mentioned “mobile commerce” for the first time: it was back in the 90s, I was in another group at that time, TIM Telecom Italia Mobile
the leading Italian mobile operator, where I learned so much about the mobile industry, and back to the 97’ and 98'
we referred to the mobile commerce as something that was about to come soon in the future
the purchase of mobile entertainment products through mobile devices.
We had to wait some more years, years of great hype and expectations
connected to the UMTS and the related services.
Luckily the time has come and now we have herein in “our pockets” mobile devices able to manage processes and transactions better than a PC in some way.
We can surf on the web trough mobile; you know, today about 30%
of the global traffic on the internet is processed through mobile devices
6 billion of people around the world own a mobile device
and the Google searches or whatever we do to discover digital goods or physical goods we aim to buy have significantly increased.
5 years ago in 2007, myself and the co-founder Claudio Rossi
we set-up Neomobile be ready to serve this
new world where people can easily discover and buy
digital goods, such as games, music, entertainment, virtual credits for social networks
Sorry Gianluca, you mentioned the years 97’ and 98’
so many changes occurred since then, the launch of the UMTS for instance and so on.
A number of technological developments since then, the world is much changed
your group has certainly changed as well over the last 5 years
At present, as you mentioned, 6 billion of people use a mobile device, which represent the majority of the world’s population, so something has changed..
Indeed a lot has been changing.
Back in 2006 we chose as our company’s pay off “touch & play”
and today the word “touch” has become something amazing and familiar
the object has somehow evolved also into something that allows interaction with the touch.
As a consequence, you can get closer to the digital world very easily, especially when compared to the limits we faced in the 90s
when only few pioneers
like me were able to “play” with this technology, think about the emails just as an example.
Now this world is available to everyone and young population
use it as a basic tool to discover the world.
And, after having discovered something they like
people buy and this is why we see mobile commerce
as a key rising phenomenon which will grow a lot in the years to come, we are actually at an early stage.
It’s not simply the mobile version of the e-commerce
it’s rather a completely different world. It’s a different prospective
another way to discover and to pay with one click as we like to say
We have the one click technology
all it takes is one click from the discovery to the transaction
especially when it comes to small amounts
that’s why we are focusing on the micropayments
3, 4, 5 or maximum of 10 euros or dollars depending on the markets.
How to pay: we made an alternative choice which has been to partner with the mobile carriers
and not the banks, neither the credit cards, nor proprietary systems
all our mobile commerce transactions are completed via the carriers, via the telephone bill.
Hence, which is the demand in your view
since you are present not only in the western world but also in the so called emerging countries
how does this demand vary across the various countries?
Thanks, it’s a very interesting question, since the world of mobile is pretty homogenous in its behavior.
In Italy, which was a pioneering country, the process lasted 10 years
but probably in India it will take just 3 years
and in Brazil 4 or 5, because they manage to fill the gaps shortly.
Another example that I usually like to mention is Turkey.
Turkey is a country open to innovation, also in the user and mobile carrier level.
I had the opportunity to live in Istanbul and to open our office there, our first office abroad after the one in Rome
then we started the collaboration with the Turkish mobile operator Turkcel
which is an innovator in the mobile payment segment - the payments through mobile.
So which big barrier there?
The difference between the cost of the operators’ fee
compared to those of the credit cards’.
Therefore the ecommerce merchants chose the credit card payments, because the gross margin could represent up to 95%
while in the mobile operators world it was around 50-60 %.
Thanks to this and other pioneering experiences
things have been changing and the mobile operators clearly understood the importance
of the market beneath the smartphone users
instead of going to an Apple store or to Google Play
you can simply use the telephone credit.
This was the great innovation which allowed us and the entire business system
content providers, social networks and operators
to create value.
In this moment we are a living a phase of continuous value creation.
Well, let’s talk more about the phase we are in now, at a global level.
Despite the moment of crisis you are thinking about going public on a major Stock Exchange
or at least it’s your objective in the near future.
The mobile sector is attractive, although an IPO process is tough and long and we see very few companies capable of doing it.
We’re trying to be forward-looking.
Since last year I have been living here in London also to broaden our views
and to get “closer” somehow to USA, to San Francisco
where the crisis is not happening at all. Even in tough periods certain areas, like the Tech California space, continue to grow.
Talking about the IPO, you know companies like Neomobile
naturally evolve and expand
aiming at becoming a sort of “magnetic pole” in a new industry such as the mobile commerce
At present, just to give you a flavor on this, no mobile commerce pure players are listed, not even on the NASDAQ. There’s a need for innovation…
We need to think big
so for us the Stock Exchange is the typical topic we have on our mind
if I was to ask to all of our 300 employees which is their dream
they would probably not answer they wish to be acquired by Google
or be merged with other companies
but to achieve this dream, as the ultimate goal of a project started 5 years ago
by a group of people who believe in what they do and are committed to go ahead.
Fine, to continue, let’s talk about the innovation also in our country.
In your view, which is the current situation in Italy
in the mobile sector and also more widely in the digital sector
what can be changed and where we stand compared to the rest of the Europe and world?
Over the last couple of years we have noticed
a number of young and active people who are launching their own digital companies
probably start-ups are on the rise, although the opportunities are few and on the other side the risks are high.
Those guys should decide what they want to do at 25 years old.
Sometimes we notice it also taking a look at our employees or at other companies that we follow
Neomobile can offer a commercial “way out” or a consumer monetization for companies who have their own products.
Most of the times they are not able to process and monetize the transactions and to grow in the advertising field.
I’m very optimistic as I recognize the spirit in the young people of Neomobile
many of them are 25 or 26 years old, I am 43 now
and I perfectly recall that when I started to work I had never even thought about the entrepreneurial option.
Today I consider it as a significant possibility.
For example when someone decides to quit Neomobile
in one case only I’m happy do accept the decision
it is when the person is ready to start its own business, and in that case we also help them
we strongly believe that this is a effective way to create value: 5 years ago we were 15, today we are 300.
And talking about the digital agenda of our Government, you know it is difficult as the benefits for Italian companies who are willing to grow from 10 to 300 employees are limited.
As we mentioned before, let’s try to focus on start-up companies, and on the difficulties to set-up a company or your own business at present.
Frankly, I think the challenge is not merely to have more start-ups, there are also some incubators which can help today rather the steady growth to allow the business to take off.
The critical point is actually to get from 10 to 100 employees
usually this is the threshold when companies fail.
Hence, what we need to do is to further push in this direction.
It’s easier to move global today: on the communication and advertising, we have great tools
like Skype
and all the Google products
just let me point out that us in Neomobile we lean more towards Google than towards Apple, for many reasons including
what Android brought to build an open mobile world.
Back to the legislation frame on the domestic side
the process is extremely complicated when/if I want to provide further jobs and invest in Italy, move people abroad
or attract foreign workers to Italy.
For example, we have people from 20 different countries in Rome
and people from several countries
have difficulties to come working in Italy, so Government should work to facilitate this aspect.
Obviously, the globalization is a key fact today
so at this point, what can we expect in the future Gianluca?
Well, according to me the consumer market will become even more mobile
the smartphone will be more and more user friendly in our everyday life
helping us to save our time and money, and it will allow us to discover the world in an easier way.
Neomobile aims to be a true global group
we want to show that the “Made in Italy” does not refer to fashion and interior design only, but also to technology
I travel a lot and I’m happy when I hear good words spread about our company and our team
the business approach or our relations with the carriers or with Google for instance
since we are one of their top worldwide mobile partners and we speak the same 'language'.
Above all, we would like to create value, while remaining an Italian company, but with an open minded approach which looks constantly at the future.
At this point I’d like to thank to our guest, Gianluca D’Agostino, CEO of Neomobile
thank you for being with us. From the London studios of Class CNBC Europe