Editor’s Note: Welcome to Reality Check, a feature for RCR Wireless News’ new weekly e-mail service, Mobile Content and Culture. We’ve gathered a group of visionaries and veterans in the mobile content industry to give their insights into the marketplace. In the coming weeks look for columns from Mark Desautels of CTIA, Laura Marriott of the Mobile Marketing Association and more.
A new year is here, and I got so tired of reading all of the banal lists of predictions from virtually everyone that I wrote my own. While it is true that I just tried to pack as many buzzwords into the headline as possible, I think you will agree that it is not too farfetched that my prediction may be correct. I offer you the following evidence, by buzzword:
Social
The term “social networking” is very broadly defined and most social networkers would never use the term, but one thing is for sure-it is so popular that it is a must-have in the mobile space. It’s among the top three priorities for most mobile carriers. The category-defining undisputed leader, MySpace, is scarcely available via mobile except on a handful of carriers. A recent M:Metrics study estimated mobile social-networking usage stands at 3.3% of mobile subscribers in the U.S., beating out Italy at 2.9%, the UK at 2.7%, Spain at 2.4% and France at an even 2%. Contrast those penetration numbers with the staggering number of users of MySpace and other social networking sites, and the massive potential in the mobile space becomes clear. I predict 2008 is the year in which we will see those penetration stats increase dramatically as social networking providers make a push toward mobile ubiquity.
Open
“Open” is a much-abused term of late. I honestly do not know what it means. Have you ever repeated a word over and over again until it loses meaning and doesn’t even sound like a real word anymore? That is what “open” is to me. I have seen one network operator refer to their network as open, but it isn’t. I have seen another network operator refer to their commitment to openness, though I think in that instance it means they are not going to pay their vendors or developers anymore. I have heard yet another network operator say that their network was always open because anyone can download any application. I have seen multiple “open” operating systems. The notion of open devices is a hot topic, but I still haven’t seen one. Of course, that is probably because I do not know what “open” means, so how would I know an open device from a snowy egret? With everyone talking about it, perhaps just the inertia of the collective consciousness is going to will openness into existence. Mark my words: 2008 is the year of openness.
Converged
Whether “fixed mobile,” “service platform,” “content ecosytem,” “triple threat,” “quadruple threat” or “internet integrated,” convergence is another hot topic that cannot-nay, will not-be ignored. Much of this makes a ton of sense, and I cannot believe it has taken this long to put a Wi-Fi radio in a cellphone. Most interesting to me is not the technology behind it or the new consumer offerings it promises, but the implications for the very long value chain of players who will now have to work together to bring this new value to the mobile space. In many cases, nobody knows what the ultimate result will be except that someone will win and someone will lose. Driven mainly by competitive pressure exerted by hyper-accelerated technology availability, convergence in all of its forms is going to have a major impact on the mobile space in 2008.
Ad-driven
eMarketer predicts that the mobile ad market is going to grow from $421 Million in 2006 to nearly $5 Billion by 2011. And that is just in the U.S. ABI says the global mobile advertising market will reach $19 Billion by 2011. One network operator expects ad revenue to account for 30% of its revenue within a few years. A slew of companies promising to repeat the success of Web-hit wonders such as Overture, DoubleClick, Google and Yahoo have emerged and are making real progress as WAP penetration increases. AOL bought ThirdScreen. Microsoft picked up ScreenTonic. Is the future of mobile advertising going to be about little banner ads on little WAP pages that take you to other little WAP pages when clicked? Maybe. I personally hope it gets more interesting than that. While perhaps slow to start, the momentum behind the ad-based mobile movement is gaining steam, and it looks like 2008 is the year it really gets moving.
Free
“Free” is a close cousin of “ad-based.” Will this work in the mobile space like it (sort of) did on the Internet? On the Internet you can find free content, but the mobile industry is about providing services-valuable communication services-that have a much higher cost basis than Internet content. Can the value of completing a call be paid for by a certain amount of advertising? Reality check: With paid mobile penetration approaching 100%, what is the rush to make it all “free?” Certain communication services such as Facebook are trying to bring a free experience to their mobile users, but Facebook is a Web-based site with a business model that works there. Will mobile-only service providers be able to survive? I don’t know, but watch what happens in 2008.
Operating Systems
You cannot swing a dead cat in this industry without hitting a new operating system. I think the logic is that owning the OS is owning the highest ground available, and short of starting your own wireless network, it is the best strategy to implement if you want to own a chunk of the mobile space. After all, Microsoft has a practical monopoly on the PC OS market and that seems to have been good for them. I love Google as much as anyone, but from my perspective as an application developer, their Android platform will just further complicate an already fractious environment. I remember PC software developers in the eighties lamenting the fact that they had to support both the Windows and Apple operating systems. They don’t know how easy they had it. It would be very good for the industry if a single leader would emerge. That will not happen in 2008. But the introduction of more operating systems can be expected.
I think the most exciting prospect for 2008 is that a variety of these buzzwords will merge to form a super-buzzterm resembling the title of this column. What will happen when Google successfully deploys a free operating system that enables them to sell advertising right onto the phone’s UI? I don’t know, but it will be different. I like what the mobile industry has become. It feels exciting and full of potential. And buzzy. Here’s to 2008-good luck to everyone.
You may contact Shawn at [email protected]. You may contact RCR Wireless News at [email protected].
