Mobile Entertainment Ready for Its Close-Up?
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SAN FRANCISCO -- In the mobile entertainment industry, the more things change, the more they stay the same.
Mobile content providers say their relationships with carriers are stronger, and they're making money. But the wireless operators are still bottlenecks, said executives at the Mobile Entertainment Live conference here. The event is part of the CTIA Wireless IT and Entertainment conference taking place this week.
Executives here cited incompatible handsets, a lack of standards and the slow-moving telecom culture as culprits behind their bottleneck woes.
Amanda Marks, executive vice president of digital distribution for Universal Music Group, told attendees that Universal is banking on the subscription model. (The company parted ways with iTunes after it couldn't come to an agreement with Apple over pricing for Internet downloads.) Universal has solid carrier partnerships, but Marks said Universal's expansion of mobile offerings is being held back by the sluggish pace of 3G expansion.
"There are lots of personalization and entertainment products we'd like to launch that need to be technologically enabled," she said.
Richard Bengloff, president of the American Association of Independent Music (A2IM), said it was particularly difficult for members of his group to get distribution via the carriers' music services. A2IM represents independent record labels, and Bengloff said that, while songs from indie labels represent from 20 to 37 percent of the music played on Internet radio, their representation on the carriers' decks -- or mobile portals -- was much less.
He said barriers include the multitude of handsets with different media requirements and hierarchical menus that make it too hard to find songs. Meanwhile, there are too many hands stretched out for a piece of the action. "People say we can get promotional value" from having songs show up in carriers' services, Bengloff said. "But revenues in the industry are falling, so obviously, the promotion isn't working." Independent labels want their content sold as a product.
There are more options for content providers going "off-deck," selling directly to consumers via their own mobile Web sites or third-party content aggregators.
"Off-deck is a great opportunity to leverage cues like shortcodes on posters and DVD boxes, so people can get everything related to a title, Sandi Isaacs, senior vice president of interactive and mobile for Paramount Pictures, told the audience. "You're closer to the point of decision-making."
Paramount uses the mobile platform for marketing theatrical releases and the launch of television shows. "The movie business is focused on big events," she said. "Mobile phones [are] an op to give consumers freedom to be wherever they want to be with movie content."
While content aggregators were important earlier in the industry's development, Isaacs said that larger players like Paramount can now work directly with the carriers while maintaining their own mobile distribution channels.
Jeremiah Zinn, senior vice president of syndication and operations for MTV Networks, emphasized that off-deck offerings are not a way to circumvent the carriers. MTV sees bringing in customers as a two-way street.
"We look at on-deck as where carriers do the marketing and bring people into a service. All the major carriers are spending a lot to build these services. Off-deck is an opportunity for us to bring the consumer and market the availability of the mobile platform."
MTV and RealNetworks recently announced a long-term and exclusive relationship with Verizon Wireless, in which the companies will partner to bring consumers digital music to their PCs and mobile phones.
There's plenty of interest from film and television producers in creating content specifically for mobile, Isaacs and Zinn agreed. MTV already produces mobile-specific content, and when possible, it plans for mobile distribution when it's shooting for TV.
But, as Isaacs said, "When we're trying to open at $100 million, mobile isn't a priority. The revenue isn't there. And until it is, it won't be the priority we might like it to be."
In other news pegged to the CTIA show, AT&T announced a deal with Napster Mobile that will let consumers search through more than 5 million songs, preview them, and then buy them for download. The service, for $1.99 per song or $7.49 for five, will deliver tracks simultaneously to the buyer's PC and handset.
AT&T announced two new music applications, too. MobiVJ is a streaming video service, while VIP Access is a mobile fan club and discovery service that lets subscribers search artist biographies and discographies, sample new music, and receive news alerts for $2.99 a month.
The Nielsen Company launched Nielsen Mobile, an audience measurement and consumer insight research service that includes the recently purchased Telephia analyst firm. Nielsen Wireless, a recent initiative to measure wireless media, will be rolled in.
Finally, Action Engine launched MediaPro, a platform for media companies and wireless operators to stream video and audio content on wireless devices. The system includes the insertion of advertising into audio and video content.