The current trend of using your portable device for an ever increasing amount of leisure and business activities is set to continue. The Blackberry is lending the way for the business community and the Apple iPhone for the more entertainment minded.
Mobile phone based entertainment over the last 10 years has been based on music and games downloads which accounts for around 70-80% of the revenue. Juniper Research (2007 figures provided) stated that the industry received 9.3 Billion dollars of mobile music revenues and 5 Billion dollars of video-gaming download and subscription revenues.
For mobile video and TV to come of age, the keys aspects of usability (handset, 3G coverage) and cost (data plans) have to be provided. In most western countries, 3G has already gained a penetration of 23%. Also bear in mind, the population of 3G phones is about twice that – many more happen to have a 3G phone, connected to a 2G network than those who actually sign up to 3G service and price plans.
The usage of mobile data has also seen a massive rise in the last 2 years, with data plans being common place and tariffs simple to understand and operate from a consumer perspective. In the UK, the MDA reported that 17 million (around 30% of the population) people accessed the internet via their mobile in December 2007.
This comes at a time when the media industry is looking for new revenue sources, with the decreasing sales of Music CDs and film DVDs. The music industry has to get in front of the customer again, delivering the value to the end user and also providing real value for the bands. This has to lead them to providing music videos to the end user. Why Video and not audio?
The free download and sharing of audio music is currently very high in most markets and therefore this service currently has a very low value to the end user. However, the MTV video still has value while mobile. Streaming music videos to a mobile provides a valuable time wasting activity for the mobile user. The monetisation of this must be centred around the brand and the unique content.
If we look at the film and TV industry, the normal argument is that people will not watch a film on their mobile phone. The average consumption of mobile TV is around two hours per day in Korea. This is based on consumption of ‘what you want when you want it and where’. We also see that that a larger number of people are now downloading movie length videos to their data card to watch on long journeys. The largest group of users are viewing 1-3 minute clips which are either streamed or downloaded. The habits are forming which will lead to mass market adoption.
Mobile TV and Video is now reaching a critical mass and this will continue to expand as the cost of accessing these services is decreasing, the availability is increasing along with the customers knowledge of the service.
This market can only expand.