MEOW! Mobile
Entertainment Opportunity Watch A monthly report with a personal touch from the world creative media capital of Los Angeles. Focus on pinpointing opportunities in the mobile media and entertainment area. Subscribe at: http://www.anttila.net |
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MEOW! Mobile Entertainment Opportunity Watch #2, 2003 March 14, 2003 The wireless infrastructure market keeps on sliding down and the handset market is picking up steam - a development that is again lifting Nokia and pressing Ericsson deeper into the mud. In the big picture we are just heading towards preparing successful mobile wideband market launches sometime in 2005 - just like European manufacturers were always envisaging before the Japanese players convinced them to try to do miracles. The news are dripping in telling that Motorola will not sell millions of W-CDMA phones this year... in fact, they say they could sell 150,000. The truth is they have been removed from the (Hutchison) 3 launch plan and they will probably not sell more than 10,000. That leaves NEC to sell their (non-GPRS!!) phones to the users of '3' and we will have a similar disappointment as there was in Japan with FOMA with no handover to GPRS. But that will not mean UMTS is dead in the water - it will probably start selling well in 2005 in the enterprise segment through bundled voice deals based on price. Having followed through the announcements from Cannes and CeBIT and waiting for the US market launches at CTIA next week, my general sentiment is that both devices and applications start slowly building a significant wireless data market and ecosystem. The next 12 months will be exciting for those who understand to look for opportunities in right places. The right approach is to build onto existing successes (e.g. SMS), follow carefully the operator and handset vendor roadmaps and pick the low-hanging fruit. And for those who find it difficult to survive while waiting for telecom executives to correct their mistakes - hey, there are always innovative ways to make money, just look at this gentleman... www.rentmychest.com. Best regards,
P.S. At CTIA, call me on (310) 765-4902 if you would like to chat! WILL N-GAGE REDEFINE THE GAME INDUSTRY? GDC Mobile in San Jose last week was a highly successful event with some 400 participants. Nokia's N-Gage gaming device and development platform stole the show: Nokia had sent to adjacent GDC trade show some 40 people from Finland and their SVP Ilkka Raiskinen was available on the exhibition floor to discuss with developers - all that tells about a major commitment. To get across the point of Nokia as a company capable of introducing new ideas to the market, Ilkka mentioned that Nokia ships some 4 million phones per week worldwide which equals to annual shipments of xBox... The main takeaways from what I learnt are: 1) Nokia sees the game market segmented into (a) hardcore gamers, (b) social gamers, (c) entertainment gamers and (d) casual gamers. Nokia's focus is to build the developer following for (b) and (c) and that way maximize the utilization of communications technologies available on the device. Talking to Ilkka and others reveals that Nokia is in no way ready with all this but their approach seems to be down-to-earth and Forum Nokia has built a great reputation among everyone I know. 2) Nokia is building a new business line as a game publisher. They are busy recruiting developers and properties onto the N-Gage platform and in fact that process will delay the market introduction until the fourth quarter of 2003. The device itself seems to be fairly ready to be launched and it will be a tried and tested Series 60 platform and therefore the launch should go smoothly. The booth personnel told me Nokia will have massive quantities available at launch - unlike with normal phone device that tend to drip onto selected markets with minimal quantities. 3) The game deck on MMC cards are sold separately in an enlarged set of retail stores, including game, music and video stores. This is a significant move to introduce mobile phone and service sales into an extended retail distribution: it will make it easier to sell prepaid services and phones in those channels in the future as the retail personnel will have been introduced to the intricacies of that type of a sale (very important!). 4) Ilkka spoke about three 'mantras' Nokia uses when developing the mobile game market: (a) "Gamers are real people, too.", (b) "The software defines the device." and (c) "A killer app can break the rules." I find defining internal mantras like this significant: their focus seems to be on trying to really go and understand the end-user and help to expand and redefine the market. Looking at details (beyond the keyboard) in Nokia 7210 one can see that they are making serious efforts in that dimension. Another focus is innovation: Nokia was at the event downplaying the role of branded entertainment and highlighting the importance of "quality" and developer talent. 5) Another point in Ilkka's keynote was his emphasis on multi-radio capabilities going forward: Nokia believes strongly in expanding connectivity from cellular networks into WiFi, Bluetooth, RFID and ... DVB-T! From a strategic perspective anything that can help Nokia walk on water while 3G gets delayed (and watch the Swedes burn in hell...) is positive: users have new reasons to upgrade devices and p2p multimedia usage creates additional need to use wide-area connectivity (feed content into 3G networks). We will see where all this will lead us into. I have the feeling that N-Gage will not be a star seller but it will instead be a great vehicle to build game developer following for Series 60 and that together with the other media phone launches this effort will have continuity (very important!) for Nokia to avoid repeating a minor flop they had with the early media phone 5510. So that's it - the rest of the details of you can go and read on the web at http://www.n-gage.com/n-gage/home.html DON'T TOUCH MY PORN REVENUE! I stumbled this interesting phenomenon in the hotel industry: as hotels are increasingly offering high-speed Internet services, guests are reportedly refraining from ordering adult pay-per-view movies (which represent 80% of PPV consumption in hotels) and using their own favorite Internet-based adult services instead. This has prompted hotels and their cable TV partners to consider building (yikes!) walled gardens that would limit the Internet access the hotel room DSL line would offer. I wonder whether those people have heard of community WiFi or CDMA 2000 EV-DO... In any case, hotel PPV service providers could also innovate instead of trying to prevent the inevitable future from happening. How about a cross-media portal through the hotel cable TV system, offering also mobile adult services? Has this been done anywhere within the MEOW! readership? I bet at least in Amsterdam... feedback, please. THE US WIRELESS MARKET - RETRYING TO FEEL THE PULSE The marketing war between the US mobile industry is on. I have been recently listening to the executives at various conferences and it is interesting to note that excellence seems to concentrate geographically: AWS and T-Mobile in Seattle are leading, Virginia (Nextel, Verizon) comes in second, Chicago (Motorola) is hibernating and Dallas as the grazing ground for unemployed telecoms folks comes in as the last (did not want to insult Atlanta and Cingular). So why is Nokia still based in Dallas? Why did Samsung establish its US operations in Dallas? Why does Samsung set up a shop in Dallas? To lure some of the vagabond telecom executives under its arm? Motorola is again fledging its ad-agency-driven marketing excellence... the new deal with MTV Networks promises a lot but will the comfy executives in Chicago bother to leave their fireplaces and really execute on this? Another example is the new "Motofolio Content Source for Mobile Ecosystem", introduced by an executive with the title "VP of Consumer Experience Planning" - something tells me McKinsey has been there to add its magic touch to the Motorola organization... Well thought-out concepts, hopefully Motorola will build internal processes that help exploit all the good ideas coming from Ogilvy... It would be good for the whole industry. http://www.motorola.com/mediacenter/news/detail/0,1958,2350_1922_23,00.html Oh, by the way, sources tell me the mother Samsung in Korea has ear-marked $500 million in content rights acquisition worldwide. So the Matrix phone announcement we all saw was just a beginning... Watch for Samsung announce major content initiatives in the US this year. Hopefully they get enough inspiration from the Dallas entertainment scene... PICKS FROM THE HOLLYWOODISH MOBILE SCENE Crisp Wireless has completed a J2ME artist fan application for Sony Music. It will be sold on AT&T together with their ring tones offerings. It will sell as a subscription for $1 per month. Sony Music team will ensure the freshness of content for the application. See the demo site at http://www.crispwireless.com/demo/sony_music. A music startup DiscLive plans to offer live concert recordings onsite at concerts as CDs where additional giveaways such as backstage passes can be bundled into the offering. It is not far fetched to assume that their wireless plans are already under development: I could see this as a way of sending high-quality music dedications from the venue with ties into music merchandising. http://www.disclive.com Cable TV channel Game Show Network has partnered with interactive TV developer GoldPocket Interactive to offer an SMS-based wireless interactive TV service. GSN is a 50-50 joint venture between Sony Pictures and Liberty Media. By the way, the latter has a 20% stake in Sprint PCS... http://www.goldpocket.com http://www.gameshownetwork.com Mobile software start-up Xingtone offers a software platform that lets users convert MP3s for use on their mobile phones. Their service lets people take an audio clip of a recording they own, load it through a conversion filter, and transmit it to their phone. Here's a mammal the dinosaurs will try to stomp ASAP... When you look at their site you can see that they 'died' under the immense publicity - tactics or the truth...? http://www.xingtone.com/ Pseudo.com is launching a free hip-hop "TV channel" on Kazaa, sponsored by Red Bull and soon other brands. Boy, the TV and film industry is in for some major restructuring through the introduction of rewritable DVDs and personal video recorders! I bet mobile players will soon jump onboard to give their support to these license-free properties. http://www.slyck.com/news.php?story=111 And finally, Verizon just came up with a wonderful new innovation: international SMS to four foreign countries (Canada, UK, Philippines, Venezuela). This gives you an idea on how far behind the US market is. However, the new Verizon website gives and idea on the new value-added services the carrier is planning: www.vtext.com. If only the US carriers would start believing in premium SMS... they will deploy it in 3-6 months but I don't see too much enthusiasm... PICKS FROM THE WORLD MOBILE ENTERTAINMENT SCENE ICQ has been able to retain a remarkable independence within the 'radio-active' entertainment giant AOL Time Warner and it has has grown into the role of the 'international IM property' for the company. The recent announcement on their 19 global operator deals and particularly J2ME and Symbian client availability is good news. As we all know, IM over WAP and even SMS was nothing to be excited about. http://biz.yahoo.com/bw/030218/180353_1.html Orange, Telefonica Moviles, T-Mobile and Vodafone have announced that they have signed an agreement to form a new Mobile Payment Services Association aimed at delivering an open, commonly branded solution for payments via mobile phones, designed to work across all operator networks. If only the US GSM operators would have the marketing savvy to do the same - create a commonly branded service framework... http://www.europemedia.net/shownews.asp?ArticleID=15122 AsiaWireless has launched together with Mobile Entertainment Corporation in the UK a webcam network in Asia - including China . Webcams are a bit premature in my opinion, particularly in China... http://www.mobile-ent.com/ 3G Labs out of the UK is getting good traction with their UI abstraction technology Trigenix, the first major customer is T-Mobile International. With the help of the Trigenix, users of Nokia Series 60 devices can customize various screens on their phone with branded/themed interfaces, supplied by the operator, illustrated with graphics, sound and animation. On another note, Samsung at CeBIT was confirming its willingness to build customized phones for the likes of Vodafone. The war to please the operator is on! Microsoft, look what you started... http://www.3g.co.uk/PR/March2003/4998.htm Nokia will be bundling digital TV set-top boxes and Bluetooth-enabled camera phones at retail in an effort to drive cross-media usage of mobile services as well as the use of GPRS as a return path for interactive TV services. Even more interestingly, Nokia is planning to bring Club Nokia services available on Nokia digital TV platforms. In the light of the newly launched Nokia Image Viewer attachment to TV sets, it looks like all this is just the tip of the iceberg of a wider Nokia home communications strategy. We should not forget that still five years ago Nokia was manufacturing TV sets and saw itself firmly at the epicenter of 'convergence'. http://www.newmediazero.com/nma/story.asp?id=240673 INDUSTRY ANALYSIS GPRS charging and billing has always been the stumbling block in the industry. Now finally Ericsson and Nokia have both managed to pull out the obvious: a platform product which enables mobile operators to charge different GPRS bearer fees for different types of services. This will obviously enable a more profitable and easy-to-understand bundling of services based on service type, time, customer relationship and parameters alike. http://biz.yahoo.com/bw/030218/182480_1.html http://press.nokia.com/PR/200302/892145_5.html The mobile music market really seems to start happening in Europe... Analysts put the Western European market value of downloads, such as ringtones and logos, at EUR 1.2bn for 2002. It is estimated by Universal Mobile that, in 2003, European consumers will buy 100 million downloads of mobile phone greetings/dedications and 150m downloads of ringtones. Forty-five per cent of the European mobile user market are young adults for whom music-related content is the most compelling premium mobile service. http://www.3g.co.uk/PR/March2003/5006.htm Another Motorola offensive revolves
around its decision to bring Linux in as the OS in 'most of the phone
models'. That sounds a bit exaggerated to me: according to
my sources the whole initiative is funded by China Mobile (Motorola is
the market leader on the Chinese market). MEOW! EVENTS CALENDAR > Game Marketwatch 2003 - April 1-2, Los Angeles Put together by Jupiter. Focus mainly on game content. http://www.jupiterevents.com/gmw/spring03/glance.html > SMS TV - April 3-4, London
> Mobile Entertainment 2003 - April 8-9, London
> Global Messaging 2003 - May 13-14, London
> Mobile Messaging Americas 2003 - June 11-12, Miami
HOLLYWOOD MOBILE ENTERTAINMENT CAREERS I have opened up a a whole job market on my website - see www.anttila.net. Your submissions are welcomed. QUOTE OF THE MONTH "Let's not sacrifice quality for quantity!" - Ilkka Raiskinen, Senior VP, Nokia Mobile Phones, addressing game developers at GDC Mobile.
* * * Disclaimer: Opinions presented herein are those of the undersigned and do not represent the position or message of any company I might be affiliated with. |
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Latest changes: 11 April 2005 21:56 |
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