Analyst Angle: Verizon Wireless with YouTube and Three with X-Series: Opposite approaches to Web 2.0

Editor’s Note: Welcome our Monday feature, Analyst Angle. We’ve collected a group of the industry’s leading analysts to give their outlook on the hot topics in the wireless industry. In the coming weeks look for columns from Strategy Analytics’ Chris Ambrosio, Current Analysis’ Peter Jarich, Ovum’s Roger Entner and M:Metrics’ Seamus McAteer.
The thorny issue of whether or not cellular operators should allow their subscribers to access the World Wide Web and associated services from their cell phones has come under renewed scrutiny in the past few weeks on both sides of the Atlantic. In the US, the debate has been stirred by the actions of Verizon Wireless, which announced in late November that it had signed a deal with the Google owned, video-sharing site du jour YouTube to allow its Vcast subscribers to access YouTube content. So far no arguments; few would suggest that allowing cell users to tap into what has undoubtedly been a phenomenal success story could have anything but upside. However, it soon became clear that Verizon was not intending to allow users free reign on the YouTube website.
What is on offer is a cut down mobile version of YouTube, in which Verizon Wireless makes a limited subset of material from YouTube available to users, as well as allowing them to post in videos from their cellphones. Since YouTube content is compressed in Flash Video, for which there is currently no mobile player (although this is something we expect Adobe to address in upcoming iterations of Flash Lite), converting a selection of videos from Flash Video into Windows Media is about as much as could be currently expected. Nevertheless, the announcement was seen in many quarters as further evidence of a wireless carrier failing to “get” the open and democratic nature of Web 2.0, instead choosing to feed its users a watered down mobile version that would suffer when users compared it with the full flat flavor on their PCs back home.
This criticism is certainly justified in terms of what we are seeing in our own end user focus groups. In just about all service evaluations we’ve done, be it music downloads, mobile TV, or whatever, consumers are telling us that they want as close to the same experience on mobile as they get on their PCs. The physical and bandwidth constraints of delivery over cellular platforms are irrelevant to them (“Hey, that’s not MY problem”). For the most part, users relate the service to their online experience, and consequently have been seriously underwhelmed by what mobile services have to offer. We will shortly be testing the Verizon Wireless/YouTube service with consumers and our money is on more negative than positive comments coming back!
On the other side of the Pond, however, some operators appear to be throwing caution to the wind. On the 24th of November, cellular operator group Hutchison 3G (Three) announced its plans for X-Series. Billed as “the Internet the way it’s supposed to be,” the X-Series is the brand under which Three’s operating companies will deliver upon a number of partnerships with high profile Internet players.
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