Wireless gaming and entertainment content providers key to wireless revenues

One of North America’s leading wireless gaming and entertainment content providers says that these types of services and applications will have a huge impact on how wireless carriers gain revenue from emerging data services. Industry watchers have projected that wireless data will begin to make up a larger portion of wireless carriers’ revenue in the coming years. Garner Bornstein, president/CEO of Montreal-based Airborne Entertainment, says wireless gaming and entertainment services will be a major revenue generator for operators, citing the experiences in Japan with the popular i-Mode services. There, he says, "95 per cent of i-Mode subscribers actually pay premium rates for entertainment content." According to Bornstein, all indicators point to a similar trend here in North America. There are three primary factors that will contribute to an exponential growth rate of wireless gaming and entertainment content, he explains. Wireless penetration is expected to top the 70 per cent mark within the next four to five years, and an increasing adoption of wireless data and technological innovations combined with the consumer’s willingness to pay for this type of content are all considered key drivers behind the growth. "If you take all of these graphs and multiply them together, which is the net effect of what generates revenue for us, you get a steep graph, a hockey stick," he tells Canadian NEW MEDIA. "So we’re confident in the growth not only over the year, but over the next five years in terms of the whole mobile entertainment field and people’s willingness to spend money." Content providers getting paid no longer a barrierContent providers have long wanted an effective payment system that allows them to evaluate their slice of the revenue model, which has traditionally been based on a sharing model where the wireless carrier gets a portion as does the content provider. In the wired space, it has been a struggle, but Bornstein says the wireless environment makes for the ideal platform for making money from wireless content. "There’s less of a challenge in the mobile world than there was in the web to create revenue just because it’s not a new paradigm to know that you’re using your phone and know you’re being billed for it. The web was never positioned that way, it was hard to change and there was no micro-payments platform," Bornstein explains. "It turns out that the wireless carrier’s phone bill is the quintessential micro-payments platform built in, which is a huge difference." There’s also the influence of the user. "And (then there’s) the psychological barrier of just saying OK on your cell phone to this will cost you 25 cents," he says. "It’s a lot easier than filling out a questionnaire to give your credit card number." Challenges still remain While the wireless gaming and entertainment market has a bright future ahead of it, according to industry watchers, there are still challenges facing the industry over the coming years. Bornstein says that on the regulatory side, privacy and gambling may well be two of the issues looked at. As location-based services become more widely available, issues such as the disclosure of locations and the general use of this information will probably be discussed at some point, he says. Other controversial areas such as pornography and gambling will also have to be explored, he says. However, much of this is being explored by the Canadian Wireless Telecommunications Association’s Wireless Internet Council, he says (CNM, June 14/01). "We’ve addressed a lot of those issues on a proactive basis within the Wireless Internet Council by coming up with our own code of ethics and morals that we would expect everybody to uphold."

Wireless gaming and entertainment content providers key to wireless revenues

Broadcast | December 21, 2001

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