MEDIAWEEK 4 April 2005

Video Keeps Going Mobile  By Mike Shields

Video content is popping up left and right on various mobile devices. Just last week, Microsoft launched MSN Videos, which includes content from programmers like MSNBC.com and Fox Sports, primarily for its iPod-esque Personal Media Center devices. Also, hardware manufacturer Viseon, which makes Voice Over Internet Protocol phones, announced plans to distribute TV content to digital telephone users.

What’s interesting about the announcements last week is that companies are rushing to offer content on mobile devices that very few people have. Until recently, mobile content has been moving toward a phone-centric world, with aggregators like Verizon’s VCast, MobiTV, and SmartVideo all gearing up for an explosion in sales of super-sophisticated “3G” phones, which offer crystal-clear TV images.

That is still the direction most observers expect the business to head, as cell phones become more pervasive. (Last week, mobile media company Enpocket released a survey indicating that 65 percent of the population has access to a mobile phone, a larger percentage than those with home Internet access.)

While video content on handheld devices is still in an experimental stage, the bet most providers and content aggregators are making is that video is going to drive mobile content usage. “Carriers think that video is going to be the killer application for users to upgrade,” said Noah Elkin, senior analyst at eMarketer.

But which device will consumers use to view this mobile video content? It’s still far too early to tell, as the options--PDAs, laptops, BlackBerries, iPods, PlayStation Portables, and even Microsoft’s PMCs--continue to multiply. “The industry, in the next couple of years, is anticipating broadband connectivity everywhere,” said Elkin. “A lot remains to be seen.”

For the immediate future, content providers, aggregators and hardware manufacturers will place content everywhere, until users tell them exactly where they want it. That might explain why Microsoft is pushing content to not only its PMCs but other platforms. And, in the current media environment--where phone companies, cable companies, electronics manufacturers and even traditional utilities are able to deliver content to consumers--there is likely to be much trial and error with mobile content distribution.

“Companies that connect are also media companies all of a sudden,” said Joel Lunenfeld, vp of media services at Moxie Interactive. “Along with connectivity comes content.”

Yet in the end, most believe that the phone will win out as that elusive “third screen,” for consumers. “People want to carry one device,” said Lunenfeld, who works with Verizon Wireless. “The phone is always going to win. That’s what you carry with you.”

“Convergence is where we are headed,” agreed eMarketer’s Elkin. “I don’t think the future is that we are all going to be wearing cargo pants with pockets for all of our devices.”