Pushing premium content

Mobile content, from ring tones and film clips to mobile TV, is changing the shape of the mobile sector.

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By  Administrator Published  January 6, 2008

The global market for mobile content is expected to reach $US150 billion in value by 2011, according to research company Informa Telecoms & Media. And while applications such as SMS messaging will remain a stalwart of the market, generating about 50% of mobile content revenue in 2011, industry insiders are increasingly turning their attention to more eye-catching content such as film clips, wallpaper, music and mobile TV.

The Middle East in particular is likely to be at the forefront of this phenomenon, with high mobile phone penetration rates, high levels of disposable income, and a population that has a general penchant for new gadgets all driving demand for premium mobile content.

The network itself becomes effectively a utility, a transport pipe – there is no value there. - Paul Gainham, head of marketing at Juniper Networks

One of the region's leading providers of mobile content services, Dubai-based Info2Cell, recently expanded its operations in the Middle East with the opening of a new hub in Saudi Arabia, while players from outside the region are also eyeing the potentially lucrative Middle East market.

One such company is India-based IMImobile, which provides the technology platforms that allows content providers to reach handsets. The company's CEO, A.R. Vishwanath, is particularly enthusiastic about the Middle East market. "Growth in the Middle East is pretty good now," he says. "Growth could be anywhere between 15% and 20% if you take it as total revenue of operators, but this also includes P2P SMS. It was originally predicted that data traffic would go up to 40%, but it is more like 20%.

"The Middle East is quite good because there are 3G networks coming up, which means the quality of the services are much better and users can also get video clips and downloads, which can help promote the growth.

IMImobile is seeing demand for a wide variety of mobile content, from images and wallpaper featuring film stars, singers, sports stars, and models from the Middle East, India and other regions, as well as film clips and ring tones.

Despite starting its Middle East operations quite recently, IMImobile is optimistic about growth in the region in the coming years. "We look forward in the next couple of years to reaching $10 million revenue," Vishwanath says.

While mobile content is established as a fast growing part of the mobile phone sector, reasons for the popularity of the content seem more ambiguous.

"The human appetite for entertainment is what's important here, although the mobile phone has not become a medium of entertainment, people are conditioned to look for entertainment wherever they are," says Vishwanath.

Advances in technology have also allowed the mobile phone to develop as an entertainment device. "The trend [toward mobile content] is also because of the enhanced capabilities of the new devices," Vishwanath adds.

Despite its rapid growth, the mobile content sector remains in an embryonic stage, and it is likely to undergo significant changes, particularly in the way end-users gain access to content. Vishwanath thinks end-users will increasingly look to gain content for free via the internet, and that advertisers will start to offer content for free. "The popularity of content will not change, only the way it is being sold on the device," he says.

Indeed, the mobile content medium holds much potential for advertisers, with some analysts pointing to benefits it has over more mainstream mediums such as TV, radio and print media. By using SMS advertisements, advertisers can target a far more specific group of people, and advances in data recognition software could allow advertisers to fine-tune this further.

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