Despite all the dramatic advancements that the mobile entertainment industry has made, there is a still one important ingredient it has not obtained: customers.
There has been a flurry of content-related deal-making and partnership activity in the past year between those who create content and those who distribute it. Granted, this was a necessary step in the development of the mobile entertainment industry, but the focus is shifting to how to sell this newly acquired content properly.
The content is there, and there's plenty to choose from, says Richard Siber, an industry consultant who formerly led Accenture's mobile media division. It's just not intuitive to discover or actually purchase (the content). It's about making the discovery easier and making the transaction seamless.
Mobile tracking firm M:Metrics has determined from data collected in the three-month period that ended in July that ringtones -- by far the most popular form of mobile content -- are bought by only about 10 percent of the total user base. In addition, 2 percent have bought games, 3.5 percent subscribed to a ringtone service or downloaded a wallpaper image, 0.4 percent watched paid video and 0.2 percent downloaded a full song. Overall, about 28 million, or 15 percent, of the 190 million U.S. wireless subscribers, have downloaded some type of multimedia content.
By any definition, that is a niche market. Granted, it is still early in the evolution of the industry. M:Metrics is quick to point out that these figures triple when narrowed to consumers who use more advanced phones and networks better optimized for multimedia content.
But hand in hand with technological evolution is a growing perception that the industry must develop a better way of selling all this product.
People are throwing a lot of things at the wall to see what will stick as opposed to taking a step back and asking themselves what's the best way to consume content from an end-user perspective, says DP Venkatesh, CEO of mPortal, a mobile services application provider. There seems to be an overemphasis on making more content available rather than relevant content.
The biggest concern is that each type of mobile service -- ringtones, games, video -- is sold separately. Consumers who buy a ringtone of a given artist, for example, may have no idea that the same artist may have a mobile game for sale or that the artist's music video is available for download.
Record labels, for instance, are keen to offer what EMI senior VP of digital and mobile strategy Tom Ryan calls mobile albums, a variety of artist-related applications combined into a single package.
Fans want to buy content based on the artist, not based on a specific product, he says. Just like a CD is a bundle of tracks, a mobile album could be a bundle of mobile products around one artist.
There are several technical and business-related challenges that must be resolved before this can become a reality. First, carriers must develop a service delivery platform that allows users to buy multiple application types in a single download. Second, labels and carriers must determine exactly how much content should be bundled together and at what price.
THE SEARCH IS ON
One stopgap solution is content-related mobile searches. Companies like JumpTap and Medio offer carriers technology that enables users to search for any content available for their phone based on a specific term. So a search on Lil Jon, for example, would list any ringtone, wallpaper, game or video featuring the artist accessible via the carrier's system.
A number of third-party providers are rushing into the gap as well with their own direct-to-consumer strategies. With a strong enough brand, these providers can launch a Web site that aggregates a variety of mobile content around certain niche audiences.
News Corp's Fox Mobile launched a direct-to-consumer play called Mobizzo this spring. It's a place where fans of Family Guy, for example, can purchase voicetones, wallpapers and other content based on the popular adult animated show.
The challenge, though, is to develop a service that works just as well on all mobile devices. Even in Europe, where off-deck content is now considered the norm, off-deck sales struggled early on because people were buying content that was not properly formatted to a given phone.
Another danger is that too many direct-to-consumer offers will result in further cluttering of the space. In Japan, carrier NTT DoCoMo pioneered the wireless content industry by offering anybody the chance to create and sell content on its network. It ended up with around 65,000 off-deck sites, creating a massive amount of confusion.
Now you have to worry about how that is organized and how people access those off-deck sites, Siber says. The risk is the consumer goes that route, has a bad experience and then never purchases anything again.