The Mobile Market Gets Entertaining

12/14/2005

In a few years using your mobile phone to make a call might seem quaint. But not quite yet.

"Mobile video and audio entertainment are bringing new energy to the US wireless business," says Deborah Aho Williamson, eMarketer Senior Analyst and author of the new Mobile Entertainment: The Rise of the Very Small Screen report. "There are real opportunities out there."

"Watching video on cell phones could eventually surpass [demand for games, ringtones and wallpapers], to reach 100% of the population," Cingular's Rob Hyatt, executive director of mobile content, told BusinessWeek in October 2005.

In a trifecta of TV-mobile phone-recording industry integration, a new song by the band Coldplay rang as a ringtone on a "CSI: New York" character's phone this November, followed by an on-air CBS promotion allowing viewers to download the same tone to their own phones.

Obviously, some very big companies are working hard so that the wide world of entertainment can begin appearing on very small screens everywhere. Entertainment content could offer mobile carriers a rich new revenue stream — and mobile phones could provide a compelling new platform for media companies and marketers.

But there are problems.

"With the US lagging other regions in mobile data usage, it's not even clear that consumers here want to be entertained by their phones," says Ms. Williamson." There are also technology and standards barriers to be overcome."

The truth is that usage of mobile entertainment in the US is currently very minimal.

According to M:Metrics, as of October 2005, less than 10% of US mobile subscribers had used their phone's browser to get news and information, photo message or purchase a ringtone. Fewer than 5% had purchased wallpaper or a screen saver or downloaded a mobile game.

A sizeable percentage of US mobile phone users think their phone is just fine for talking, and that's about it. In A.T. Kearney's, 2005 worldwide survey of mobile phone users, two-thirds of US respondents said they agree or strongly agree with the statement "I will only use my mobile phone to make and receive calls."

Certain demographic groups are, however, far more interested in mobile entertainment than others.

About one-third of those aged 13-34 surveyed by The Management Network Group were interested in phone applications such as commercial-free radio and mobile TV.

According to Telephia, US mobile data users are predominantly young.

"Do US consumers want to be entertained by their mobile phone? That's the billion-dollar question," says Ms. Williamson.

Do not be caught sitting on your hands. For a very small investment you could read eMarketer's new Mobile Entertainment: The Rise of the Very Small Screen report today.