The Mobile Video Market
June 16, 2009
The rise of web-enabled smartphones has led to changes in how video is presented on the mobile web and through carriers. Will the nascent mobile video distribution model more closely resemble cable, or the ad-supported model? Mark Hyland offers his thoughts.
Mark Hyland is VP Marketing at QuickPlay Media Inc., a solutions provider for companies offering mobile TV and video services over broadband wireless networks.
Q. How would you describe the current mobile content market in Canada, and what are the most popular types of content people are consuming on their mobile phones?
A. I can’t speak for the whole mobile content market but on the video side, people are watching longer-form content like prime time TV episodes, as well as music videos and entertainment news. Our data show double-digit percent increases in usage for both streaming and downloaded video between Q3 and Q4 2008, with similar increases for the prior quarter as well. The rise of web video available via mobile browsers is a big story in Canada as it is elsewhere.
Q. There seems to be a pretty robust business model emerging for mobile games and applications, but how about paid vs. free in the area of video? What are people showing a willingness to pay for?
A. There will be a ton of free video, a good deal of which will be ad-supported. As far as overall revenues go, the paid category will continue to generate more significant revenue than purely ad-supported for some time to come. That is not dissimilar to the
traditional TV world where, in aggregate, cable and satellite fees drive more dollars than advertising.
This leads to the real point here, that wireless video services won’t be islands unto themselves for long. Think about yourself as a consumer. If you’re signed up to get TV programming from a service, whether cable, satellite or online, it probably makes sense for you to have that service to extend to wireless, along with your preferences, subscriptions and programming. The service will likely need to be rethought for mobile to a certain extent, especially in terms of discovery and user interface, but more and more end consumers are indicating an interest in having their content travel cross platform.
Our research shows that in-home use of mobile video is one of the faster-growing usage scenarios, so I think people are using these mobile video services in all kinds of ways and places to complement and extend their existing viewing habits. If consumers can get more value out of existing TV services, by taking them to go, for example, it’ll probably increase loyalty to that service, whether it is free or pay.
Q. With the rise of online video portals and viewing video in the mobile browser, should rights holders bother negotiating carrier deals anymore for on-deck distribution? Is the carrier deck becoming a thing of the past?
A. For video, carrier decks still generate the bulk of the revenues in North America. It is certainly fashionable to predict the end of the carrier deck. The iPhone and other devices with great browsers suggest a future — to a number of commentators at least – where the mobile operator is just another ISP, and all the real activity is out on the web, or “over the top”. Some operators will take the approach of offering low-cost mobile internet access, and not trying to offer much in the way of portal-type services, no question. But operators have a bunch of important tools they can use to take a different strategy, if they wish. These include a billing relationship with customers, a wealth of information about those customers, the ability to promote services and the ability to manage their networks and devices to a much greater extent than traditional ISPs. So I’m sure carrier decks will change a great deal in the next few years, but I’m not predicting their demise.
Q. How about content presentation and discovery more generally. What are some of the challenges around discovery of video on mobile, and how can it be encouraged?
A. I believe mobile behaviour is different than online or traditional TV behaviour. So discovery needs to be rethought and reinvented for mobile. You can’t just take a UI or navigation construct from online and cram it into a smaller screen. Look at all the specialized apps for Google services on RIM devices or the iPhone. Some of the issues get solved by technology: better screens, better input methods, for example. And some are content and rights related issues that are getting sorted out with time. I think people want to see the same channel or show they are used to on TV when they choose it on mobile, for example, and today that is often not the case. And we’ve been successful presenting an integrated experience that includes live TV, VoD, radio and other content in a single user interface.
Q. What kinds of metrics do you use to assess engagement for video over mobile?
A. We use sessions per unique user per week/month, and well as average stream length as two of the main ones. And then we try to do some qualitative analysis based on user panels and surveys. Our most recent quarterly consumption analysis showed about 17 streams per user per month with an average stream length of just under three minutes. So that works out to about 49 minutes of viewing time per month, per user, on average. We expect viewing time to increase considerably with some of the longer-form content we’re launching soon. You can see more of the quarterly consumption analysis at www.quickplay.com.
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