Mobile Content Expected to Dominate 3GSM

The mobile communications industry's frenzied efforts to reinvent itself as a mobile entertainment business will continue apace at this month's 3GSM World Congress in Barcelona. This is despite the fact that the vast majority of revenue growth - both for the operator and vendor communities - is coming out of developing markets where mobile is fulfilling a basic need for voice and text-based communications.

"The big story for the industry in 2007 is the continued growth of the global mobile population" says Mark Newman, Chief Research Officer at Informa Telecoms & Media. "The mobile phone is driving social and economic development throughout the developing world", Newman adds. "Market growth is creating economies of scale which, in turn, is bringing mobile communications within reach of new, lower-income market segments."

But this will not feature prominently at Barcelona. In the mature markets of Europe, North America and south-east Asia the search continues for the new mobile applications and revenue streams that will compensate for the stagnating voice business. This has been the main focus of the 3GSM World Congress over the last five to ten years and will continue to be so in 2007.

This year sees the Sundance Film Festival (Sundance has commissioned six independent film makers to produce made-for-mobile films) make its appearance at the 3GSM World Congress. With mobile TV also figuring prominently, the focus of this year's event will move away from devices and technology to the content and images displayed over mobile phones. "3GSM is going to be more visually dazzling than ever before. At times it's going to feel more like a TV than a mobile exhibition", says Newman.

Mobile television was already the hottest topic at Barcelona in 2006 but this year visitors will be expecting to see fully operational trials and compelling content rather than the slew of announcements and commitments that dominated last year's event. "Mobile TV services over 3G networks have rolled out in a number of European countries over the last year' notes Nick Lane, principal analyst at Informa Telecoms & Media, 'but none of them have really taken the market by storm", he adds. "There are still big questions that need to be answered about the viability of different technology platforms and - more importantly - the business models for mobile TV. People are going to want to see compelling content that consumers will be willing to pay for," adds Lane.

Mobile advertising is a concept that has been thrown around the mobile industry for a number of years but which finally appears to be gaining some traction. Informa forecasts that the mobile advertising market will be worth US$11.3 billion by 2011. "The sooner the mobile industry understands this emerging business model and its role within the advertising ecosystem, the sooner it can tap into that additional revenue stream," comments Lane. "Operators have to generate user profiling that can be highly-targeted for the brands, and truly personalised for the consumer. Until this happens, mobile advertising will remain largely experimental."

As the mobile phone morphs into a device that can capture both TV and Internet content, interest is starting to grow in the user-generated content and social networking space. Last month UK magazine publisher Emap acquired YoSpace, owner of the SeeMe TV service which has successfully taken the user-generated content concept into the domain of mobile communications and devices. "User-generated content plays on customer's vanity and ensures they receive their 15 seconds of fame by transforming them into mini Tom Cruises and/or Steven Spielbergs," enthuses Lane some more. "With SeeMe TV, the customer is rewarded for their creativity and the operator is generating traffic revenue at minimal expense. 3 can now sit back and reap the benefit of its transition toward the Internet model with X-Series safe in the knowledge that its content requirement is being met by its customers."

On the technology side the rival mobile TV platforms will all figure prominently at Barcelona. In 2006 DVB-H emerged as the clear frontrunner but this year we expect to see a lot of activity around other technologies because of the delay in releasing DVB-H spectrum across Europe. These include the French-backed satellite platform DVB-SSP, Multimedia Broadcast Multicast Service (MBMS) and MediaFlo solution. Currently only a UK phenomenon, "BT's DAB-IP mobile TV solution is also expected to feature at this year's event" according to David McQueen Informa Telecoms & Media principal analyst covering the handset space. Although last year witnessed the launch of a number of TV handsets by vendors covering the main broadcast technologies, we expect to see them put to better use this year through the broadcast of "live" TV, thereby fully showcasing the user experience.

Many of the new devices unveiled at 3GSM this year will incorporate new high-speed 3G technology HSDPA. Operators are hoping that HSDPA (and HSUPA which will be rolled out towards the lattter part of this year) will bring to life some of the services that are already available over 3G.

While mobile location services have failed to capture the imagination of either operators or end-users, there is growing excitement in the device space about embedding GPS capability into higher-end mobile handsets. 'We expect to see considerable activity around the GPS and personal navigation device space at 3GSM this year. GPS could become another one of those must-have features on high-end devices although it is not at all clear how operators will be able to monetise GPS', says Newman."

Posted to the site on 12th February 2007