TV and gambling to dominate mobile entertainment revenue: Juniper

Wireless carriers around the world are poised to generate a larger portion of their revenue from data services. A new whitepaper from Juniper Research, an edited excerpt of which appears below, suggests that mobile TV and mobile gambling will be boons to the wireless operators. The mobile phone is one of the lifestyle changing developments of the last decade. Not only has it provided freedom from the constraints of wired communication for more than two billion subscribers worldwide, but it has provided a mobile gateway to the Internet and access to an ever-widening range of mobile entertainment products and services. For many years mobile service providers saw increasing revenues on the back of ever increasing subscriber numbers. However that is no longer the case in most developed markets. Mobile penetration of the population varies considerably country by country, from near saturation in many developed markets to low single-figure percentages in some developing markets. As competitive mobile markets mature and become more saturated, price competition increases, particularly for basic voice and text messaging services and revenue growth opportunities become more limited. In maturing markets service providers have turned to value-added services and particularly value-added data services, to boost, or sustain ARPU. The deployment of 2.5 and 3G networks has dramatically increased the opportunity for revenue generation from value-added data services and for some countries/operators the proportion of total revenues accounted for by data services is now approaching 30%. A significant portion of mobile data revenues in the consumer sector come from mobile entertainment services of various types. This is expected to continue over the next five years as the mobile phone assumes the role of multi-function communications and entertainment device for an increasing sector of the mass market. The mobile entertainment market is currently still dominated by ringtones, wallpapers, chatting and information services. With steadily increasing 3G penetration around the world, this balance is changing as the take up of products utilizing video, picture messaging and mobile TV technology increases.The total global market for mobile entertainment products and services is estimated to be $17.3 billion in 2006, growing to $76.9 billion in 2011. This is a cumulative average annual growth rate of 35%. The fastest growing product sector is forecast to be mobile TV, which is forecast to grow to a total global annual revenue figure of $15.9 billion in 2011. No other sector is expected to generate growth at this rate. The next product sector in the growth rate stakes is forecast to be mobile gambling. Despite the recent legislative crackdown in the USA, Juniper still feels that there is a tremendous market for mobile gambling services, which are forecast to grow to over $16.5 billion in 2011 in terms of gross monies spent. Mobile music and infotainment are currently the largest sectors of the mobile entertainment market, dominated by ringtones and wallpapers respectively. These will continue to be substantial markets, but the rate of growth in these sectors will slow as the market for the major components matures. Juniper believes that the mobile games sector has a long way to go in terms of fulfilling its true potential, and sees the greatest revenue opportunity in the casual games sector for the mass market. The mobile adult content sector is regulation constrained and serves a particular sector of the population. Its uptake is anticipated to be less than for other major categories of mobile entertainment content, but nonetheless significant.

TV and gambling to dominate mobile entertainment revenue: Juniper

News | January 11, 2007

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