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Mobile TV
The Death Of The Ringtone
(c) MocoNewsDodgy sales techniques, piracy and full-track downloads are all being blamed as the bottom falls out of the ringtone market. Research by MusicAlly tracks UK ringtone sales growing from Ј34.8 million in 2000 to Ј177.3 in 2005, but predicts that will fall to Ј143.5 million this year and Ј78.8 million by 2007.It's quite understandable though: the kids don't see the point in paying Ј3.50 for a tinny 10-second ringtone interpretation of a new song when they can often copy the full MP3 onto their phone and set that as their ringtone. That's not always done legally though - this piece says younger phone users are using their phones to record music on their computers or are Bluetoothing tracks from friends. There's also software floating online that converts MP3s to ringtones. Misleading sales subscriptions are also a factor because users often don't trust ringtone services. M:Metrics data for Europe shows a 42 percent drop in sales, part of what senior analyst Paul Goode described as a significant shift for the ringtone market: "As mastertones supersede polyphonic tones, and short codes gain steam as a merchandising vehicle, the economics of the business will have to change. The availability of tools to make user-created ringtones more accessible to the masses poses an even greater threat to companies who can offer no additional value to a consumer who buys a ringtone in lieu of making one themselves."
MVNO: The Industry Is Not Broken
(c) Forbes
Don't let Mobile ESPN's flop stand for the whole virtual network industry, says Peter Adderton, founder and chief executive of Los Angeles-based Amp'd Mobile. While ESPN's parent, the Walt Disney Co., said this week it will cost $30 million just to shutter its sports-driven wireless service, Adderton says Amp'd is alive and well. As a mobile virtual network operator, or MVNO, Amp'd resells access to the Verizon Wireless network, a joint venture of Verizon Communications and Vodafone. It is aimed squarely at the lad-mag set and offers all sorts of high-concept, low-rent come-ons: The company sells music downloads for 99 cents, instead of the industry-standard $2, for instance. Users can also download videos from Playboy, Girls Gone Wild and Maxim, as well as CollegeHumor.com, a Web site whose stars include streakers and drunk skateboarders. The company started slowly nine months ago, but Adderton says it is accelerating now: He says Amp'd has more than 50,000 subscribers in the U.S. and is adding more than 20,000 per month. Its subscribers spend about $100 per month on Amp'd service, he says, including $30 per month for data services--about five times the national average. Adderton has deep pockets, with more than $250 million in funding from investors ranging from Intel's venture capital wing to Qualcomm, Viacom's MTV, Universal Music Group and other groups. He may need them. While Adderton and Amp'd insist they're doing fine, both the company and its business model have raised questions from skeptics who think MVNOs burn through cash much quicker than they bring it in. ESPN, for instance--even with all of its marketing might--couldn't convince more than a few thousand subscribers to sign up for its failed wireless service. Adderton, who previously ran Sprint Nextel's urban-youth-focused Boost Mobile walkie-talkie service, spoke with Forbes.com Wednesday about Disney's flop, his plans and the importance of selling a sexy phone. Forbes.com: The latest Amp'd subscriber numbers are a month old. Are you still hitting your goals? Adderton: We're on target to do our projected hundred or so thousand for the end of the year. We're on plan, which is really good. It will be interesting to see how the holiday season goes. Traditionally, at Boost, it was a very big part of our business. A lot of people are coming off contracts at the holiday season, because most of them got their phones over that period. We're pretty optimistic about how our holiday season is going to go. How much money does Amp'd burn through in a month? We don't give out the exact numbers, but every MVNO is purely based around subscriber gross additions. The more subscribers you get, the more cash you go through. So, as long as we stay on plan, we're good. The big problem is if you go too fast and you start growing, but one would argue that that's not a bad problem. If you have plenty of subscribers coming in, you have the ability to go out there and fund that business. Right now, we're on plan and feeling very comfortable with where we are, and we'll look at raising money when we think that that's necessary. Did Disney pull the plug on Mobile ESPN too fast? When will you take a good look at how Amp'd is doing? I've always said that you need to give companies at least a 12-month period, not before you write them off, but before you [press] the reset button. For us, March-April is the time. After the Christmas period, [you] get January sorted out, look at the data coming through from those customers. It's one thing to connect to a lot of customers; you have to make sure those customers are going to pay you. Does the ESPN flop give the MVNO industry a black eye? With Mobile ESPN, it was, "We have a big brand. What do we do with it?" And they outsourced everything to everybody else. This is the fourth MVNO I've ran. We've got a pretty good handle on what it takes to run a successful MVNO. The industry is not broken. In fact, MVNOs are only getting stronger. The concept of virtually using somebody else's network to deliver voice has been around for a long time. This concept of an MVNO isn't the part that's broken. We talk about different industries: You'll have a lot of cars that are extremely successful, that will sell like hotcakes. And then you have cars that don't sell at all. It doesn't mean that the factory's broken--it means that the product isn't right, that the design isn't right. Don't kill the factory just because they put out a dud. If we succeed or fail, it will be purely on not the fact that we were an MVNO, but the fact that nobody wanted our product or that everyone wanted our product. Carriers have to constantly upgrade their networks to the latest generation of network technology. How does that affect you? It makes it better. The one thing that I've seen is that technology constantly keeps evolving. America's a large country. By the time you roll out a network to cover 200 million people, there's probably four more technologies that are half the cost that give you twice the bandwidth. When do you stop? Operating on somebody else's network, when they've spent the infrastructure and cost to lay the fiber cables, to set up the cell towers, to build the back end, and then we get a certain price per megabyte and the same price for voice, and then we get the same service level? Why wouldn't you want to be an MVNO? It's like an arms race. Everyone is trying to lay out the fastest, cheapest network--I think it's an advantage for us. Google and Yahoo! don't build networks. They ride on other peoples' networks. And I think that's where, if you look at what Amp'd is doing, we're doing exactly the same thing. The best way served to companies like ours is to be able to wholesale other peoples' networks. Some industry observers, such as Forrester Research's Charles Golvin, suggest that a big part of Mobile ESPN's failure was that they didn't focus on a phone's primary purpose: to make phone calls. That's 100% correct. This is a "send and end" business today. Right now, today, it's a voice product. Amp'd has a four-pronged strategy attack. The first life cycle of Amp'd is to be a good phone company. The barrier to entry is reasonable pricing on a cool-looking handset. It doesn't matter whether you can watch anything you want to watch. If you don't have the fundamentals right, then you're not going to build a business. Our strategy two years out is a lot different than our strategy today. And then there's the data and content you're distributing, such as an original TV show called Lil' Bush that started on Amp'd and will be expanding to real television. Is anyone using it? We're streaming over 200,000 videos a month right now. We're probably doing close to 50,000 or 100,000 tracks of music. We're doing tons of games, ringtones, wallpaper, text messaging. When we [started] the business, we expected to have a data ARPU [average monthly revenue per user] after two years of $18. And we're at $30 after really three or four months of going. It may not be the reason that they originally purchased Amp'd, but once they get it, they're coming back time and time again. Usage is going up; it's not going down. Donick Cary, who was one of the writers for The Simpsons and for Letterman came to us and said, "Today on television, there's not much for a comedy writer to do. Everything's for reality and drama." He wanted a medium [where] he could express some of his ideas, so he came to us. He pitched this concept to us on Lil' Bush, and I said, "I love it. Let's do it." We produced them, and it's been a great success for us. It blew our servers out when we launched it; everyone wanted to watch it at once. We learned two things: One, we need to get a better server system, but secondly, we've had people who've bought the phone just so they could get Lil' Bush on Friday morning because they love it so much. Thirty percent of our content is original. That's where the media company aspect of what Amp'd is trying to build comes into it. A lot of other MVNOs don't sell the name-brand phones consumers seem to like. Yet you're going to sell Amp'd versions of Motorola's RAZR and Q phones. How important is it to have popular phones in your arsenal? It's the number-one focus. At the end of the day, it's the device that's important. I think other carriers are seeing the fact that they didn't carry the RAZR as a reason why they had low subscriber growth. There's no doubt about it--it's the handset. We've been working on our handset roadmap from the start. We wanted to partner with Motorola. We felt they were the one with the best brand suited to Amp'd. I think the other MVNOs who don't have the RAZR are going to struggle this Christmas.
UK TV Personality Launches Rights Play In Mob
Новость годичной давности, но интересная: Andrew Neil, the ubiquitous TV media personality and and former Sunday Times editor, has launched a £30m fund to specifically acquire TV programme rights, distribute and trade them globally.Working not unlike a publically traded company which issues shares and dividends, WMR will allow investors to invest in intellectual property rights of programmes only, not the production companies which made them or the distributors. This way investors do not have to deal with produciton companies and all the baggage that goes with them. The reasoning is that there is about to be an explosion in the about of content required for new media platforms (mobile, IPTV etc). But right now there is a big disparity between TV production businesses - who are currently geared up only to pitch TV shows to broadcasters - and broadcasters, who are not geared up to license IP to new platforms. WMR hopes its model will allow production companies to make more of their archives, which TV broadcasters won’t re-commision, and revamp and reformat these old programmes for new platforms, like mobile. Think of Sale of the Century, re-jigged for mobile and IPTV, where the user gets the chance to interact with the show.WMR is headed by some big hitters in the UK media/tech scene, which, alongside Neil, includes Alan Griffiths, former BBC head of multimedia, and David Honey, founder of sports statistics company Opta Index and a serial entrepreur. Neil said: “A few years ago it was argued that only large well-funded broadcasters could provide the risk capital for innovative and challenging television production, but now with new media needing electronic content, there are many operators for whom content, and rights to it, are valuable. Broadcatsers don’t have time to exploit rights. They don’t have the focus. We do.”
Neil said WMR would be “Wholly devoted to acquiring and then exploiting a diverse range of rights in multimedia. We’re not a productoin company, not a TV company and not a broadcaster. New media is hungry for content, has the money, and WMR will provide the bridge between content owners and new media.” Neil will take on the chairman’s role while Griffiths is chief executive and Honey is non-executive commercial director of the new venture. The concept of WMR’s is relatively new, opening the door to allow investors to diversify their risk across a range of rights and across several genres. This is different from investing in a production company or a genre-specific rights firm or a distributor. In fact, WMR’s business model is not dissimilar to that employed by the King Street Media Group which acquires music catalogues and have so far raised about 100m Euros. In fact it’s probably no coincidence that WMR and King Street share the same investment banker, Robert Fraser of GMP Securities.
M:Metrics Unveils Industry's First Definitive Mobile Marketing Metrics
Measurement Firm Finds That 36.5 Million Mobile Subscribers Responded via SMS to an Ad Across the five countries for which it measures mobile content consumption, M:Metrics found that monthly use of text message short codes in response to ads was as high as 29.1 percent of mobile subscribers. The firm, which today released the first definitive metrics for mobile advertising, found that a sizable percentage of mobile subscribers are responding to short codes placed in advertisements or in other media, with Spain topping the list at 29.1 percent, followed by the UK at 18.5 percent, France at 10.1 percent, the United States at 7 percent and Germany at 3.4 percent. "These numbers are not unlike what we saw in e-mail response during the mid-1990s as the Web emerged an advertising medium," said Will Hodgman, CEO, M:Metrics, who also founded AdRelevance, the global standard for advertising measurement on the Internet. "The growing adoption of major brands using SMS and the substantial consumer response rates indicate a couple of important trends: mobile as a commercial medium is on steroids; and multimedia convergence is real." Source of Short Code Ad: August 2006
France Germany Spain
Projected % Projected % Projected %
Subs Segment Subs Segment Subs Segment
Television 3,212,330 7.5 865,250 1.9 6,632,898 21.7
Radio 502,843 1.2 154,542 0.3 728,929 2.4
Magazine 967,628 2.3 271,888 0.6 1,139,167 3.7
Newspaper 263,838 0.6 150,288 0.3 605,246 2.0
Unknown 291,291 0.7 313,328 0.7 1,094,403 3.6
Source: M:Metrics. Copyright © 2006. Survey of French, German and
Spanish mobile subscribers. Data based on three-month moving average
for period ending August 2006, n= 12,458, French, n=15,078 German,
n= 12,228 Spanish. mobile subscribers
Source of Short Code Ad: August 2006
UK US
Projected % Projected %
Subs Segment Subs Segment
Television 4,747,001 10.9 8,740,129 4.5
Radio 1,025,866 2.4 2,074,555 1.1
Magazine 1,079,488 2.5 1,837,851 0.9
Newspaper 594,052 1.4 775,950 0.4
Unknown 1,015,634 2.3 2,385,117 1.2
Source: M:Metrics. Copyright © 2006. Survey of UK and U.S. mobile
subscribers. Data based on three-month moving average for period ending
August 2006 n= 15,051 UK, n= 35,016 U.S. mobile subscribers.
Contests are the leading driver of short code usage, such as game or reality television shows or chances to win free merchandise, with 18 million subscribers across the geographies reporting they participated. Again, Spain shows the highest rate of participation, at 17.8 percent, followed by the UK at 10.6 percent. Type of Short Code: August 2006
France Germany Spain
Projected % Projected % Projected %
Subs Segment Subs Segment Subs Segment
Contest 2,369,351 5.5 703,319 1.6 5,434,395 17.8
Downloads
for device 1,074,209 2.5 448,846 1.0 2,899,149 9.5
Entertainment 1,252,033 2.9 206,281 0.5 741,923 2.4
News 351,838 0.8 190,832 0.4 458,548 1.5
Source: M:Metrics. Copyright © 2006. Survey of French, German and
Spanish mobile subscribers. Data based on three-month moving average
for period ending August 2006, n= 12,458, French, n=15,078 German,
n= 12,228 Spanish. mobile subscribers
Type of Short Code: August 2006
UK US
Projected % Projected %
Subs Segment Subs Segment
Contest 4,603,128 10.6 4,872,668 2.5
Downloads
for device 1,302,113 3.0 5,302,334 2.7
Entertainment 1,255,263 2.9 3,567,218 1.8
News 501,434 1.2 2,085,459 1.1
Source: M:Metrics. Copyright © 2006. Survey of UK and U.S. mobile
subscribers. Data based on three-month moving average for period ending
August 2006 n= 15,051 UK, n= 35,016 U.S. mobile subscribers
The numbers for those who received an SMS ad are even greater. In Spain, 66.8 percent of mobile subscribers reported receiving an SMS ad. France follows at 50.1 percent, then the UK at 36.8 percent, Germany at 29.6 percent and the United States at 12.8 percent. The largest source of the ads by a wide margin is mobile operators. "Remember the early days of the Internet, when spam was still a meat by-product?" asks Hodgman. "At that time your Internet service provider was the major commercial e-mailer in promoting their services. It appears that the mobile operator is functioning in the same capacity today on mobile. It will not be long before brand advertisers supersede the mobile operators, though, given the robust activity and consumer response rates we are already seeing in the medium after only a few years of the existence of common short codes." French Mobile Subscriber Monthly Consumption of Content and Applications
M:Metrics Benchmark Survey: August 2006
Activity Subscribers (000s) Percent % Change
Sent Text Message 30,312 70.5% 2.5%
Used Photo Messaging 8,797 20.5% 5.0%
Browsed News and Information 3,867 9.0% 2.9%
Purchased Ringtone 2,594 6.0% -0.8%
Used Personal E-Mail 2,532 5.9% 0.4%
Used Mobile Instant Messenger 1,291 3.0% 2.3%
Purchased Wallpaper or Screensaver 1,093 2.5% -2.0%
Used Work E-Mail 794 1.8% -7.8%
Downloaded Mobile Game 491 1.1% 0.1%
Source: M:Metrics, Inc., Copyright © 2006. Survey of French mobile
subscribers. Data based on three-month moving average for period ending
31 August, 2006, n= 12,458
German Mobile Subscriber Monthly Consumption of Content and Applications
M:Metrics Benchmark Survey: August 2006
Activity Subscribers (000s) Percent % Change
Sent Text Message 36,388 80.9% 2.5%
Used Photo Messaging 9,239 20.5% 3.0%
Purchased Ringtone 2,888 6.4% -1.6%
Used Personal E-Mail 2,477 5.5% -3.2%
Browsed News and Information 1,741 3.9% 2.1%
Used Mobile Instant Messenger 1,425 3.2% -6.6%
Purchased Wallpaper or Screensaver 1,240 2.8% -1.6%
Used Work E-Mail 1,189 2.6% -7.1%
Downloaded Mobile Game 1,157 2.6% -0.9%
Source: M:Metrics, Inc., Copyright © 2006. Survey of German mobile
subscribers. Data based on three-month moving average for period ending
31 August, 2006, n= 15,078
Spanish Mobile Subscriber Monthly Consumption of Content and Applications
M:Metrics Benchmark Survey: August 2006
Activity Subscribers (000s) Percent % Change
Sent Text Message 25,392 83.3% 1.6%
Used Photo Messaging 8,671 28.4% 8.0%
Used Personal E-Mail 2,804 9.2% 5.6%
Purchased Ringtone 2,771 9.1% 4.0%
Browsed News and Information 2,264 7.4% 5.3%
Used Mobile Instant Messenger 2,164 7.1% 0.5%
Used Work E-Mail 1,578 5.2% 0.8%
Downloaded Mobile Game 1,475 4.8% 7.4%
Purchased Wallpaper or Screensaver 1,063 3.5% -8.2%
Source: M:Metrics, Inc., Copyright © 2006. Survey of Spanish mobile
subscribers. Data based on three-month moving average for period ending
31 August, 2006, n= 12,231
U.K. Mobile Subscriber Monthly Consumption of Content and Applications
M:Metrics Benchmark Survey: August 2006
Activity Subscribers (000s) Percent % Change
Sent Text Message 37,062 85.2% 2.3%
Used Photo Messaging 13,363 30.7% 3.8%
Browsed News and Information 6,273 14.4% 0.7%
Used Personal E-Mail 2,723 6.3% 0.1%
Purchased Ringtone 2,414 5.6% 3.1%
Downloaded Mobile Game 1,818 4.2% 4.7%
Used Mobile Instant Messenger 1,613 3.7% 1.8%
Used Work E-Mail 1,319 3.0% 1.6%
Purchased Wallpaper or Screensaver 968 2.2% 2.4%
Source: M:Metrics, Inc., Copyright © 2006. Survey of U.K. mobile
subscribers. Data based on three-month moving average for period ending
31 August, 2006, n= 15,051
U.S. Mobile Subscriber Monthly Consumption of Content and Applications
M:Metrics Benchmark Survey: August 2006
Activity Subscribers (000s) Percent % Change
Sent Text Message 73,635 38.0% 3.9%
Used Photo Messaging 28,218 14.5% 8.2%
Browsed News and Information 22,766 11.7% 9.9%
Purchased Ringtone 20,146 10.4% 2.20%
Used Personal E-Mail 16,890 8.7% 10.1%
Used Mobile Instant Messenger 14,449 7.4% 10.9%
Used Work E-Mail 9,901 5.1% 11.0%
Purchased Wallpaper or Screensaver 7,092 3.7% 7.3%
Downloaded Mobile Game 6,264 3.2% 10.5%
Source: M:Metrics, Inc., Copyright © 2006. Survey of U.S. mobile
subscribers. Data based on three-month moving average for period ending
31 August, 2006, n= 35,016
About M:Metrics M:Metrics is the mobile market measurement authority. As the only research firm to measure the audience for mobile media, M:Metrics provides the most accurate metrics on actual mobile content consumption by applying trusted media measurement methodologies to the mobile market. M:Metrics' monthly syndicated data service gives clients the critical insights and intelligence required to inform smart business strategies and the competitive benchmarks needed to evaluate the performance of competitors and partners. M:Metrics is a private, venture-funded corporation headquartered in Seattle, with offices in San Francisco and London.
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