At the Future Of Television West conference in Hollywood this week, there wasn’t nearly as much discussion about mobile video as I’d hoped. Maybe that’s because traditional stalwarts are finding it hard enough dealing with online distribution. If video on the Internet seems new and scary, then they probably can’t even wrap their heads around mobile TV.
But even when very few European explorers had visited the Americas or Africa, there still were pioneers who had. In the same vein, those few who are embracing mobile already have a game plan and a business model.
Below are excerpts and summaries of discussions on how to monetize mobile video and mobile TV. You’ll find what best generates revenue, why the handset matters more than the carrier, and what made me think that mobile video and LBS (location-based services) could make a great team.
Model business models
Eric Berger, SVP of Mobile Entertainment & Digital for Sony Pictures Television, said Sony has found that the ad-supported model for mobile video doesn’t seem to make as much money as the pay-per-view, subscription, and licensing models. Sony has distributed movies on memory cards or through media flow broadcasts over carrier networks. “Paid products are all tremendous growth models for us,” Mr. Berger said.
Jim Eadie, VP of Digital Distribution for MTV Networks, however, noted: “There’s a shift around expectations of the (mobile video) ad market. We’re pretty bullish about mobile video… Ad market estimates are 3-4 times what they were a year ago.”
Tim Connolly, VP of Mobile Distribution for Disney/ESPN Media Networks, then countered: “We’re not a big believer in ad-only business models. For us to spend the money needed to create great content (requires that) we have dual-sharing subscription revenue. It’s exactly like cable TV. Not a lot of people think $50 a month is a bad deal to get 250 cable channels at home.”
On the idea of packages, Mr. Connolly added: “We’ve seen in cable TV, when they tried to have sports packages, or kid packages, that the (consumer) adoption of this is pretty small. I’m not a one-trick pony–I love news, sports, the Comedy Channel, so I would want a broad-based general package of channels. (It’s best to) have a basic level and unlimited views of that.”
Jonathan Barzilay, SVP of Programming & Advertising for MediaFLO USA Qualcomm, talked about watching during scheduled broadcasts vs. watching whenever the customer wants: “There is a lot of room for time-shifting… We’ve got live things, but it’s also true that if you miss David Letterman or Conan O’Brien, (those videos) are made available to you throughout the day.”
Mr. Connolly described the multi-channel with mobile video: “We’re for the most part taking our traditional franchises to mobile. But we try to create something unique for each platform–and then have something that reinforces the other platforms. For example, the website for the TV show Lost gets people to want to watch episodes as soon as they air, he said.
Not Just A Plot… Device
Mr. Berger said: “People are always going to migrate to the largest screen they have access to. If they’re out and about, they are comfortable watching video on their cell phones.”
Steve Bradbury, VP of Business Developments for GoTV Networks, said: “Android is leading to the coming proliferation of (specific) stores for different handsets. The whole idea of carriers no longer being that central focus is a trend that’s continuing to accelerate.”
Kraig Baker, Partner at the law firm Davis Wright Termaine LLP, added: “Everyone thinks of the handset as the carrier platform… (But) we’re seeing entertainment devices that aren’t tied to the carrier.”
John Lawson, EVP of Policy & Strategy Initiatives for ION Media Networks, talked about U.S. television’s switch from airwaves to digital, a technology that will also enable true mobile TV broadcasts. ION is one of the founding members of the Open Mobile Video Coalition, which has created mobile TV tech standards. “We think this represents the biggest breakthrough for the broadcast industry in decades,” he said.
Mr. Lawson continued: “In the 60-year history of TV broadcasts in this country, we won’t be sending free content to a dumb device. We broadcasters will be able to get data back–what people are watching, when they are watching… There will be a back channel, a lot of stop and go activity.”
Mr. Lawson added: “People want real television… But the opportunity will be there for other content providers–think of the bandwidth optimized. We think of our ability to push out massive amounts of video without clogging the channel.”
Mr. Lawson assuaged fears that the public isn’t ready for the digital changeover of TV broadcasts (a worry that caused the U.S. government to delay the switch from February to June of this year): “Our research indicates that awareness of the transition is off the charts. We are going to make sure the public understands the offering of initially free TV on a variety of devices.”
Mr. Eadie said his company is combining mobile optimization with video. “One thing starting to happen is video on our mobile Web sites. The opportunity we’ve begun to exploit is, how to push consumption–we’ll use that initial, free experience to maybe push consumers to premium content.”
A Surprising Opportunity for LBS Marketing and Mobile Video
Mr. Bradbury said, “Established newspaper brands–50, 100 years old–are folding. The question is, where will investigative journalism come from? Online, but not nearly has branded… Are we going to have 5-10 national news brands, with lesser brands underneath?”
Then Mr. Lawson said, “What we have found (from trials) is that consumers want local. They want news, sports, business (sales announcements).
Bill Sanders, President of Pervasive Media, replied, “If I were a local TV station, mobile is what I’d want to exploit.”