Mobile Multimedia

The Mobile TV market is moribund - too many standards chasing too few users. And the non standardisation of standards makes the end to end video content production for most mobile phone types totally uneconomic.

However, we think this is about to change. One of the impacts of the iPhone is that it creates a set of de facto standards for online video services to design to – so, for example the Web TV service Joost released an iPhone version of its service on the 29th November 2008. This lets users stream and watch any of Joost's 46,000-plus videos for free.

As one reviewer commented:

“When you load up Men in Black on Joost, it just feels like a whole different ballgame. This isn't a video of a dog on a skateboard anymore. This is real, Hollywood-produced content, delivered to your phone, for free.”

Just add surround sound via stereo headphones (we've heard it trialled, it is stunning what a difference it makes to a small screen picture's "believability"), and I suspect its a game changing experience

I stepped in at the last minute this week to do a keynote slot at the Mobile Content Summit when a colleague had to pull out, topic was on "Mobile Web 2.0 and Ecosystems", and i stayed to listen to some interesting presentations from Flirtomatic, Vodafone etc. I think the talks will be put up by the organisers, will link to it when that happens or if not will put mine up.

Coming hot on the heels of the Future of Mobile, it was interesting to see how the memes are flowing.

Now I am the first to be sceptical about Planet Mobile's overblown market projections (vs its Utility-arian ways), but in the 8 or so years I've been involved with Mobile Internet I'd say this is the closest I've seen to a tipping point emerging - mainly because:

- some very big players from outside, Google and Apple, have pushed new business and product models into an ossified industry - and started to gain users, which the industry understands and is what really changes things. They may not win in the end, but they have set off the gun.

- (In my opinion) the locus for innovation has moved outside Europe to the fresher minds of the US and Developing world

- The competition from WiFi is starting to drive more "non-zero" strategy pricing behaviour from Operators

But you've heard this from us before....but this article in the Economist today they made this point that the Mobile industry:

...is going through two important shifts that promise to generate much growth and profit in the years to come. First, even though overall sales may fall in 2009, sales of “smart” phones—those that allow you to surf the internet, download music and use other data services, as well as make calls and send text messages—are booming. According to Informa, a market-research firm, the market for smart-phones will grow from $39 billion in 2007 to $95 billion in 2013, by which time they will make up nearly half of the handset market by value (though only 34% by volume).

Second, and more important, as handsets get smarter the nature of the industry will change. It will be less about hardware and more about software, services and content. In fact, for the first time, more will be spent this year on such intangibles than on the handsets themselves (see chart). And this is why, also for the first time, a fierce battle between operating systems for handsets has broken out.

And that shift to Software and Services will make all the difference. Somehow, watching the industry memes at these conferences I sense a small but imperturbable shift in the forces driving Planet Mobile has occurred. It will still take time though, the Mob-Evangelists will still have to wait awhile for Coming 2.0

Couldn't make the Future of Mobile Conference today, but caught it via the formidable firehose of the Twitterstream - boy, do mobile people like to Twitter! (just check here if you don't believe me!). The firehose is so vast (270 twts and rising) that I'd have to write an auto parser to sift it. Instead, I'll use the pattern recognition engine in the wetware in my head and have a go:

1. Stuff you already knew but heard again

- The iPhone changes everything
- Android will change everything - squared
- Nokia and Blackberry have their supporters but not the hearts and minds of the audience
- If they are lucky, the other mobile Old Order makers may scrabble a seat at the top table
- The Mobile Telcos are still too expensive but not as bad as last time round
- Location based services is the new black

2. Stuff you didn't know and probably heard for the first time

- That 6 bloggers can make more sense than a room full of Industry veterans?
- The m:metrics guys are always good for a fascinating set of analysis - we eagerly await the slides going up

3. Stuff that sounds wonderful and stirring but you know deep down its probably bollocks, really

- All the fluffy community / happy family stuff that people love to spout, you know - treat people as people, we are all valuable and lovely etc etc, companies must love and have deep relationships with their users no treat them as cattle. C'mon, you know most people don't pay enough money (and most are PAYG) to be worth more than a quick snog at most
- That rousing rhetoric can change economic reality
- 2009 is The Year of the Mobile Web 2.0 revolution ? (As was 20007, 2006, 2005.....)

4. Stuff you always really knew but hate to admit

- That the mobile Telcos still own the really valuable real estate and will for quite a while longer, no matter how many names they are called
- That the only reason anyone uses a mobile social network is to get laid
- That the UI on a mobile is still crap compared to a laptop, and the notebook PC is scary competition
- That half the reason for going to the conference is to go to the pub afterwards
- The US is now ahead of Europe in mobile innovation

5. Stuff you didn't know and no-one mentions in Mobile conferences (leastways not on the Twittersream as far as I could see)

- That Moore's law changes everything 2 cycles out with the $5 phone as a commodity
- That WiFi/WiMax is applicable in 70% of "mobile" situations and is cheaper, faster, better
- That compared to the state of mobile in Japan or Korea, anything we do is a sorry joke
- That the Future of Mobile is in the developing world
- That the Future of Mobile is by and large to be bought up by fixed line Telcos and integrated onto their platforms

6. Stuff you always knew and can't wait to tell me:

- That people who can't go to great conferences will always write snarky blog posts, 'cos their grapes were sour anyways

Nice piece by mjelly (James Cooper) on why he thinks Mobile 2.0 will weather the coming storm:

1. handsets and networks are still improving
2. consumer adoption is just moving into the mainstream
3. mobile is starting from a low base not a boom or bubble
4. the recession happened for mobile in 2005/6
5. mobile internet is being driven by hyper-growth markets
6. lots of innovation is still happening in mobile
7. multiple players are driving growth

I am also more cautiously optimistic than in the past (just search the term Planet Mobile on the blog here to see uncautious pessimism), mainly because I see Apple starting to drive this world like it did the early PC environment. Who will play IBM and Microsoft is unclear, but there are more and more lining up (Android etc), and we are starting to see mobile plans at reasonable pricing. What can be achieved is clear just by studying Japan and Korea .

Just to show that its not a slamdunk, however, Disruptive Wireless (Dean Bubley) cautions that:

I think it's going to be pretty patchy over the next few years, to be honest.

While I agree most of your assertions, there are a number of counterpoints:

- slowing handset upgrade cycles, and lower levels of subsidy
- possible "capacity crunch" for mobile broadband on existing 3G networks and delayed capex for upgrades. Less likelihood for operator CFOs to want to bid for spectrum, rush to LTE etc
- slow adoption by mobile operators of real "Telco 2.0" business models - too much emphasis on unwanted end-to-end controlled services like Mobile TV
- Lower consumer spending may impact the "second device" market and hence impact uptake of smartphones, 3G dongles etc
- Patchy adoption of services like Mobile IM, and a risk of cannibalisation of SMS revenues

I think that on balance, mobile will probably survive OK over the next few years. But I wouldn't be over-optimistic, there will be some pain as well.

One thing I would say by the way, is that those Europeans thinking this is ripe for their plucking need to get off their featherbedded *rses - it is my view that the US is now ahead in innovation terms (Shock - I actually agree with Mary Meeker - see her slides, page 29!).

Dare Obasanjo on the silliness of Planet Mobile in wanting a separate Web:

I recently switched to using Skyfire as my primary browser on my mobile phone and it has made a world of difference in how a use my phone. No longer am I restricted to crippled versions of popular sites nor do I have to lose features when I visit the regular versions of the page. I can view the real version of my news feed on Facebook. Vote up links in reddit or Digg. And reading blogs is no longer an exercise in frustration due to CSS issues or problems rendering widgets. Unsurprisingly my usage of the Web on my phone has pretty much doubled.

This definitely brings to the forefront how ridiculous of an idea it was to think that we need a "mobile Web" complete with its own top level domain (.mobi). Which makes more sense, that every Web site in the world should create duplicate versions of their pages for mobile phones and regular browsers or that software + hardware would eventually evolve to the point where I can run a full fledged browser on the device in my pocket? Thanks to the iPhone, it is now clear to everyone that this idea of a second class Web for mobile phones was a stopgap solution at best whose time is now past.

We agree - we've been banging on about this (I Told Ya So) ever since we helped Tony Fish write Mobile Web 2.0 in 2006. Its been obvious since then that if Mobile form factors move to use the Web then it gets a huge "free benefit". The sad thing is it took outsiders to make Planet Mobile sit up and notice.

Rory Cellan Jones asks "which way to the mobile web"

How do you get the mobile internet? Via wi-fi - or perhaps through one of those dongles that you plug into a laptop?

Many using laptop Wi-fi and 3G have been battling it out for the last few years to be the technology that keeps you connected on the move. But today 3G gets a big boost, with the unveiling of an alliance between leading computer manufacturers and mobile operators to promote devices with mobile broadband built in.

The answer right now is both. Neither is good enough to be compelling as a single solution.

Technically the user sees very little difference. Right now, 3G has better coverage, WiFi usually has better speed.

Economically, there is little to choose between them IF (i) your usage is vaguely normal (video downloading is extortionate via 3G) and (ii) you are paying for WiFi - what is shifting is that WiFi is increasingly being given away for free in "fixed mobile" places - ie places where you sit down, even when you are on the move - coffee shops etc. However, as Rory notes, the grand plans to create WiFi municipalities has died, as did those for WiFi ISPs in 2002/3, the technology still doesn't lend itself well to more than local area broadcast.

Who will win in the future is the person who can make the best convergent platform:

The trouble is that, for most users, dealing with two rival connection methods is a lot of hassle and can prove expensive - especially if you go abroad. We need to know that we can move effortlessly between different wi-fi zones and providers and then onto the 3G network when appropriate. Steve Andrews of BT says providers around the world are working to make that happen: "Our mission is to make it seamless," he says.

We welcome the day....and a seamless bill as well would be very nice.

Google has filed a patent for connecting phones to a multiplicity of providers (seen on Techcrunch) and letting those phones then negotiate automatically for the best rate in real time. Picture below:



Great idea as a business to execute, and Planet Mobile badly needs someone to play the "Microsoft" role to create a a unifying "mobile OS" and ecosystem, as none of the current incumbents have shown any will or leadership. For "Mobile Web 2.0" or similar to break out, this is a pre-requisite.

But I'd be astounded if they actually get a patent - the amount of prior art in this space must be huge, I have seen these sorts of diagrams and ideas for price negotiation for going on 10 years - and a lot of it within those Telcos themselves. Google must know this, so either the US patenting process is near valueless, or they are making a point.

Still, this should really rattle the cage of the Planet Mobile oligopoly. I guess its sad that it will be replaced by a Google Monopoly, but it seems clear that no one else has the cojones - or cash? - to step up to the mark.

Except Microsoft - given their tenacious defence of their interests in so many other spheres, its interesting that their approach to mobile has been to play within the industry rather than impose a solution. After all, mobile is the next frontier for the OS as well as the browser.

Maybe this will set the Microhares running.....

According to this article in the NYT, the art of texting reduces one's IQ:

“The act of texting automatically removes 10 I.Q. points,” said Paul Saffo, a technology trend forecaster in Silicon Valley. “The truth of the matter is there are hobbies that are incompatible. You don’t want to do mushroom-hunting and bird-watching at the same time, and it is the same with texting and other activities. We have all seen people walk into parking meters or walk into traffic and seem startled by oncoming cars.”

Judging by some of the conversations one hears on mobile phones, especially on the move in trains etc by loud peoples, actually talking reduces IQ by a lot more

From MocoNews:

When it comes to mobile, the perception is that the U.S. is always behind Europe, but a new report being released today says that when it pertains to the adoption of 3G, the U.S. is now on top, according to comScore (NSDQ: SCOR), which recently bought Seattle-based M:Metrics. In the U.S., 28.4 percent of subscribers now have a 3G device vs. the five largest countries in Europe, which have a combined penetration rate of 28.3 percent. In the past year, the number of U.S. subscribers with 3G devices has grown 80 percent to 64.2 million users. The only countries in Europe to exceed the U.S. in 3G penetration are Italy and Spain.

And I don't see anything on the horizon that puts it back.

Good news is the US on the whole just wants to stick Web over mobile as a dumb pipe, so service philosophy will probably be more rational. Bad news is that Planet Mobile Europe will have lost the tech lead in yet another arena it invented first. Hmmm...maybe the 2 are related?

Interesting twist on the race to be the mobile multimedia device of choice - as the size of laptops shifts downwards, it looks like Dell is hoping to get the mobile subsidy business model going as well, as ZDNet notes:

When asked about Dell’s margins on netbooks, the CEO said he would expect telecom carriers to subsidize them in order to sell 3G and later 4G services. “Telcos will embrace it. It’s the type of product that could easily take advantage of data,” said Dell.

The argument is that Netbooks will be the 2nd or 3rd machine in the OECD, the first machine in the developing world.

To take the business model to the next logical step, I hope the netbook makes phone calls !

Update - ah - I never realised it was being launched today, hence the razzmatazz. From $399 in US, £299 in UK. Eh - £399 is £200, people!