Conference session outlines key success factors in mobile entertainment market

There is money to be made in the provision of entertainment services to mobile devices, but operators in North America need to emulate strategies employed by carriers in Europe and Asia, a recent conference heard. At EXPO COMM Canada 2004, panelists during the Entertainment: The International Experience session highlighted key elements in a successful mobile entertainment strategy. Providing background on how the mobile market will evolve in the years ahead, Michael Doherty, VP of the North American telecoms practice of British research firm Ovum, explained during the session that mobile data services including mobile entertainment will take an increasing share of wireless operators’ revenue. He pointed to the current trend in Korea where SK Telecom found that music, games and adult content made up 60% of the packet traffic volume. On the music front, Doherty noted that real-time, all-the-time, anywhere access to music is one of the key drivers. This will only become more significant as the quality of the devices’ music capability increases and users will be able to conduct Napster-like sharing on their cell phones. The prospect for games is, however, less than stellar, the analyst explained. Up to 85% of wireless subscribers will never play a wireless game and "that’s pretty sobering," he said. That isn’t stopping carriers from developing youth-oriented marketing campaigns to boost gaming and other mobile entertainment use, "but at the end of the day, it’s a very small piece for any given operator’s market," he added. Paul Cebo, North American brand manager for Mobile Entertainment Europe (MEE), explained during his presentation that mobile industry stakeholders in Canada could look to Poland as an example of how to successfully deploy mobile entertainment strategies. In Poland, which has comparable wireless rates and total number of subscribers, operators are able to generate 30,000 game downloads per month compared to 600 in Canada. This, he added, is despite an average monthly income that is a third of that in Canada and a penetration rate of 36% compared to 42% in Canada. He said that one way to generate more games traffic is to develop games and other related content around timely events. As a first step, the easy content such as ringtones and wallpaper would be developed, Cebo explained, followed by more difficult products. "It doesn’t take very long to develop a game, anywhere from four to five months," he said. While it may take four months to develop and commercially deploy the game, that isn’t the case in Canada, he added. In Canada, it could take four months just to make a decision to move forward with game development. Cebo also explained that the use of portals is key to generating lots of games traffic and enticing the subscriber to play games. MEE has partnered with the four carriers in Poland for its portal strategy and reports that more than 80% of the games the company sells are sold through the portal it has with the four operators. "I think it’s very compelling to users that we have something that’s dedicated to just games. They don’t have to go through the carrier’s WAP deck and drill through 10 links to get (to the game)," he said. Vivianne Gravel, co-founder, president and CEO of LIPSO, pointing to the SMS experience as a benchmark, said that there are 11 million SMS-enabled handsets on the market, while only 14% actually use SMS. She wondered how the industry is going to increase usage of mobile entertainment when only 1% to 2% of mobile data services revenue is generated from mobile entertainment content. "To make mobile entertainment happen, we have to consider three key elements, which are technology content and marketing. In North America, many focus on technology. In Europe, they focus on both technology and content and some energy on marketing. But in Asia, they take into consideration these three key elements. To launch mobile entertainment, they really focus on technology, content and marketing."

Conference session outlines key success factors in mobile entertainment market

Broadcast | May 14, 2004

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