Mobile video players waiting to see what North Americans will watch

At the first annual NATPE Mobile++ forum in Las Vegas last January, the TV production industry was abuzz about the seemingly unlimited potential of cell phone video content. Executives from mobile carriers, small-screen content aggregators and non-linear network programming sold each other on the notion that everyone will be using their cell phones as pocket televisions sooner rather than later. But as industry execs start buying plane tickets to Vegas for the sophomore NATPE Mobile++, the excitement surrounding mobile video adoption has simmered down slightly. The technology is there, but it’s still a relatively expensive investment for both carriers and consumers. The long-term potential for cell phone programming is still bubbling under the surface, however, and key players are gearing up for an explosion of both long- and short-form content they say will produce a booming mobile video market in early 2008. In Canada, mobile video content is approximately one year behind that provided by wireless carriers south of the border, due to the expense of launching a local mobile video infrastructure and the fact that mobile phone penetration in Canada is relatively low compared to most other developed countries. Even though video is more widespread in the US, Boston-based research firm The Yankee Group says only 7% of cell phone users are interested in subscribing to a mobile video service. Those at The Yankee Group’s Ottawa-based Canadian offices say this country’s adoption of mobile video is so low, it has yet to reach measurable numbers. What’s more, the appeal to have TV capabilities on a cell phone isn’t on the average Canadian consumer’s radar. When 500 adults 18 and older across Canada were asked last May and June which five cell phone services they would purchase if they had additional money to spend, only 4% indicated mobile video or television would be an attractive option. Jeff Leiper, director of consumer research at The Yankee Group, says the cell phone is still seen and used as a personalization device primarily. "What we’re seeing is the mobile phone is still very much about communication, voice, email, SMS, personal video messaging and picture messaging, and those purposes are still between users," he says. But he points to the recent deal between American carrier Verizon Wireless and popular user-generated online video site YouTube as a step in the right direction to broaden mobile video’s appeal. For a US$15 per month (or US$3 per day) fee, the carrier offers subscribers a selection from the website’s uploaded videos. "It’s not traditional TV, but a unique community-based experience for the mobile phone," he says. It’s also something that Virgin Mobile Canada will experiment with in a more community-centered way for its users in the New Year. Instead of steering consumers to pre-selected clips from a website, Nathan Rosenberg, chief marketing officer at Virgin Mobile, says the firm has created its own user-generated portal, called Studio V, set for a hard launch in the first quarter of 2007. The system hopes to capture established YouTube fans who like to watch their friends (and strangers) embarrass themselves on video. Although its current soft-launch incarnation has consumers logging onto Virgin’s website to upload their own music and wallpaper creations for others to put onto their cell phones, the system could eventually lend itself to user-generated video posts to the Studio V system for downloading onto a mobile handset. Downloading the wallpaper and musictones costs about $2.50 each, but to sweeten the deal, a five to 10 cent credit is applied to the uploader’s cell phone bill each time his or her content is viewed. There’s no word yet if the same rates will apply if Studio V expands into user-generated video. Such money-saving or revenue-earning initiatives may help video downloading come to the forefront on mobile phones; certainly, Leiper suggests downloading costs may be hindering mobile video’s advance. Yet Chris Houston, president of content aggregator Amp’d Mobile Canada, says the US Amp’d Mobile service is charging consumers about US$30 a month to access video programming. Although he admits it’s difficult to assume Canadian consumption will emulate the US experience, he says customers are likely to spend money on content once they’re comfortable using it on their phones. "They will spend considerably more than what the industry average is, and for the Canadian market, we’re cautiously optimistic we’ll see the same thing," he says, adding a pricing plan hasn’t yet been announced for Amp’d Mobile Canada’s launch on Telus Mobility in March 2007. Just as Virgin has created a virtual studio for its consumers, Amp’d Mobile Canada will set up a studio for original content when it opens its Toronto office in the coming months. Instead of user-generated content, however, the content aggregator is promoting itself as a co-producing partner with the TV industry to create content exclusively for mobile phones. His team is speaking with a number of Canadian producers about the content Amp’d wants to produce for its local subscribers, which will likely begin by targeting early-adopter males aged 18 to 30. In the US, Amp’d Mobile Canada’s parent company experienced some success with a made-for-mobile short comedy series Lil’ Bush. Produced with The Simpsons and Just Shoot Me writer Donick Carey, it’s five seven-minute animated episodes about the fictional life of George W. Bush as a preschooler. A quarter of Amp’d subscribers in the States downloaded the first episode of the series and, thanks also to its viral success on YouTube, the series is the first made-for-mobile program to be picked up as a half-hour series for network television. Lil’ Bush: Resident of the United States will debut on US cable network Comedy Central in 2007. It’s a trend Houston thinks will continue, saying he’s seeing more producers looking to the mobile phone to test programming. Not only is creating for a three-inch screen less expensive than piloting (since there’s no need for high-definition or special effects), it’s a way for producers to track who’s downloading the show and determine if it’s on demographic before they pitch it to the network executives. But while the best way to test out a series eventually intended for television might be to float a trial balloon with a mobile audience, it also means keeping content bite-sized. In general, Amp’d customers tune into their cell phones for about five to 10 minutes a day, usually while on the move. Yet there are a handful of consumers – mostly the early adopter adult male – who watch for up to an hour when a sporting event is broadcast live on their handsets. Live-event and linear television on a handset has proven to be more popular with Amp’d consumers in the US than clip-based programming, a statistic Houston says was surprising. "We’ve learned when you’ve got five minutes to kill, you’d rather be instantly entertained than spend a few minutes figuring out what you want to watch," he says. Rogers Wireless’ director of new services Reade Barber says the live TV is working for its subscribers for timely and relevant content, but clips from known brands are popular as its demographic expands, including preschooler product from Treehouse for the parent needing a quick distraction for the kids. Raja Khanna, co-founder and COO of content delivery manager QuickPlay Media believes live TV on a mobile phone is more of a niche product than a long-term indicator of how consumers will use video on a cell. His company has been providing content for mobile video’s earliest adopters since 2004 for a variety of carriers including Virgin, Rogers Wireless and Bell Mobility. Although the newest handsets are now technically capable of live TV, he thinks it’s only for those who have a half-hour or longer commute (hopefully not watching mobile video while driving to work). "I think live TV will reach maybe 15%, best case scenario, but video experiences that are five minutes long and personalized could reach 70% of mobile consumers," he says. When it comes to short-form programming, Khanna says the content is shifting from the early-adopter male, who downloaded sports and images of bikini babes to news clips and music videos. "Babes aren’t even in the top three downloads anymore, showing mobile video’s adoption rate is expanding to new users," he says. To keep downloading relevant, Khanna adds content providers must offer experiences that people want everyday. There has been a lot of talk about how young males are driving the current content on mobile phones, but CanWest MediaWorks LP wants to target where they believe the money is: the business person. In association with Research In Motion, Rogers and Toronto-based interface developer Sona Mobile, the media company launched bbTV in the summer for executives who seem to be permanently attached to the BlackBerry. For $5 a month, subscribers have access to news programming provided by Canwest’s Infomart, movie trailers and the funniest clips from the previous evening’s late-night programming. "A business person doesn’t abandon his or her BlackBerry when leaving the office," Arturo Duran, president of interactive and business integration at CanWest MediaWorks, says. Yankee Group’s Leiper thinks bbTV’s success will depend on growing its number of everyday consumers, which he says currently make up of 2% of all BlackBerry users. Since business executives expense the BlackBerry bill to their employers, he says: "It’s going to be difficult to justify getting The Golf Channel because it’s…entertainment, not a business expense." Duran believes the information and entertainment clips, averaging 90 seconds long and updated every one to two hours, can be business-worthy as long as they are timely. To help focus the content, he says CanWest MediaWorks will become an aggregator and work with producers and networks to expand the channel’s offerings – the ink is now drying on a deal with CBC, for example. In the future, Duran sees bbTV adopting the on-demand nature of the Internet, where users can type in a topic and receive any video content that has been uploaded within the last few hours. Live TV is also being explored in the long term. A clearer idea of the type of programming that will eventually succeed on the mobile phone will emerge in about 18 months, by which time both carriers and content aggregators agree video-capable mobile phones will become more prevalent in Canada. But Leiper warns those looking to get into the made-for-mobile industry, be it with original clips or live TV, should not expect it to be a huge revenue generator just yet. "It would be a mistake to say it’s a small market and write it off, because the smart broadcasters and content distributors are going to be ramping up efforts in the coming months to partner and programming to the phones today," he says. It’s admittedly a service in the experimental stage, but by 2008, mobile video and TV will be a service the general public will expect in their handhelds.

Mobile video players waiting to see what North Americans will watch

News | 12/21/2006 5:00 am EST

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