Mobile TV

Wednesday, September 27, 2006

Industry Insiders Unhappy with Operators Cut of Mobile Transactions

Valista has released the results of research, carried out at this year's Mobile Content World Conference in London which quizzed over a hundred show attendees, and revealed that when it comes to mobile content, network operators are taking too large a share of the revenue.

Mobile Content World is a show attended by content owners, handset vendors, mobile operators and technology providers. Valista asked delegates for their views on the future of the mobile content market in the next three to five years.

Over half of respondents correctly answered that mobile operators currently take 40-50% of mobile content transactions, however, less than 6% believe this will be the case in three years time. In fact almost two-thirds, 65%, of those questioned believe that in three years' time, mobile operators should cut their share by at least half - to less than 20%, with 18% of respondents believing that they should take only 5%.

What is clear is that in order to safeguard revenues, the industry needs to drive the uptake of mobile content through creative and flexible pricing, content bundling and promotions and cleverly targeted content. More than 28% of delegates surveyed believe that targeting content by demographic groups and communities will be the most likely way to increase content purchasing, closely followed by flexible pricing (27%) and improved mobile search (20%).

According to Arlene Adams, Vice President at Valista "Currently, operators take the greatest share of mobile content revenue, but the distribution of power could shift - particularly when the major media moguls secure their foothold in the marketplace. Consolidation and the entrance of major consumer brands will shape the future value chain, and operators need to balance recouping revenues with the desire to maximise their share in the long run. In this regard, operators need to look at more innovative merchandizing and marketing tools to encourage their consumers to buy more. In addition, a payments model which lowers or eliminates revenue leakage and allows end-to-end traceability for transactions and the parties involved, will allow operators to look at lowering their fees while encouraging growth in the content market."

Good news for the industry came in the finding that mobile TV and Video downloads will be the most popular forms of content over the next few years, an opinion that mirrors recent analyst predictions. Broadcasting rich content will see a move from lower value payments (micro-payments) to higher value transactions (macro-payments). In this regard, operators need to protect their brand and look at personalized and compelling content to grow Average Revenue Per User (ARPU) and drive off competition from more traditional payment schemes. Less positive for operators was the finding that only 15% of content purchased will be part of an ongoing subscription model.

What may make uncomfortable reading is the fact that, according to attendees, mobile operators will not see content purchases making up for falling revenues. More than half of those who contributed (58%) believe that in three years' time, less than 25% of total operator revenue will come from mobile content and 15% believe that it might drop as low as 10%. This figure is interesting given that mobile content already accounts for 20% of an operator's revenue, and evidently figures working in the industry are unaware that this is the case. iGillott Research predicts that mobile content will account for 40% of operators' revenue by 2009.

Despite the variations in the predictions above, those questioned in the Valista poll were in agreement on the future of mobile payments, with more than 65% believing that the current system of paying for mobile content via Premium SMS will, in the next few years, give way to more flexible and robust payment methods such as paying via the monthly bill (direct-to-bill charging).

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@Mobile Content World: Artists - Bottom Of The Mobile Food Chain

(c) MocoNews

A few interviews still to write up from Mobile Content World last week. I had a quick word with Jamelia's manager Jonathan Shalit who has sold 10 million records through Charlotte Church, Big Brothers and a few others. Though he said new media is hugely exciting and mobile is clearly the medium to reach young people, he's concerned that so little of the revenue reaches the artist. "In most markets the price is dictated by supply and demand and the people supplying the product can have some say in the price. But when it comes to mobile technology the price is being laid down and the massive amounts of money being charged to the consumer are not going anywhere near the artist."

Online, he said Apple is so powerful it can tell the market what the price will be but the creators of the music are at the bottom of the food chain and typically get 3-4p per track. On mobile, he said even Robbie Williams' relatively high profile deal with Sony Ericsson wouldn't make him much money, but it's more about brand promotion. Jamelia's record label EMI already promotes her through a whole bunch of download stores as well as promotional podcasts and initiatives like a Bebo listening party.

Shalit said artists are the most vulnerable person in the equation but they don't have any choice because not being online or on mobile would be an even worse move. "Mobile operators, record labels and suppliers all get together... without the content there would be nothing yet because they are in such a dominant position the content providers get bullied into accepting those fees."

Tuesday, September 26, 2006

@Mobile Content World: Content Is About Context

(c) MocoNews

It's really important to see the practice as well as talking around the theory but that's something we don't see enough of at conferences - the actual content. Dubplate Drama is a series of four-minute mobile dramas for 16-19 year olds produced on a budget of GBP200,000 for three clients: Sony PSP, 3 and Talk to Frank, a government drugs advisory service.



Executive producer Sam Conniff freely admitted that the team had no background in producing for mobile, but said that made them much more flexible in their approach. "The entrenched script and budget, script and budget, script and budget lines of traditional broadcasters just don't work. You have to throw away the rules - it's a new medium and needs new methods."
He said their working approach was to think of "addictive" content - short bursts, quick easy hits, easy to get and leaves the user wanting more. The drama follows a young female DJ trying to make it in London and each episode ends up with a moral cliffhanger. Users vote for one of two choices.
3's offering had full-length episodes for users with certain handsets, cut-down episodes, a mini sub-series using background characters from the show, behind the scenes footage, diaries of two cast members and related music and video downloads. In all, 73 pieces of content.
Conniff said there had been a good level of downloads across the country but the episodes, along with the branding of Talk to Frank, were also being spread by Bluetooth. 3 recouped 10 percent of its investment through around 1,000 downloads per week (bear in mind the tiny cost of this production at GBP200,000). Most content was free for users with add-ons between 25p-50p. On the PSP, the series saw 5,000 downloads per week. Online votes for the series were around 70,000 each week. On mobile, votes dropped from around 1,000 each week at the start of the series to 300-400 by the end.
Dubplate Drama's second series is being worked on now: open auditions are being held this weekend on location and through video mobile. Conniff said the team have been approached by Universal and Channel 4 about new productions, and were the first ever mobile TV show to be nominated for a Broadcasting Press Guild award. He sees that as validation of their made-for-mobile approach. "Cut down 30-second clips of the X-Factor are never going to make the best of this medium. Content is about context."