The success of social networking sites such as Facebook, Bebo and even YouTube could represent the next boom for the mobile phone operators.
Revenues from putting so-called user-generated content - meaning content such as videos and blogs created by consumers rather than media organisations - onto mobile phones is expected to rise more than tenfold over the next five years, according to estimates by Juniper Research published yesterday.
Allowing the legion of bloggers, Facebook posters and comedy clip makers to upload and view each other's every movement on their mobile phone could be worth $5.74bn (£2.87bn) by 2012, according to Juniper, from just $576m this year.
"One of the most attractive elements of social networking on a mobile phone is that it's universally accessible so people can look up their friends, update their status or whatever on the move, which for the young demographic is particularly appealing," according to the study's author, Dr Windsor Holden.
Social networking has become one of the fastest-growing internet trends of the past two years. According to internet metrics firm Comscore, Facebook saw users increase 270% from June last year to June this year. It now has more than 52 million users worldwide. MySpace registered lower growth of 72% but still leads the market with 114 million users. Bebo, with a majority of users in Europe, grew 172% to more than 18 million users. The mobile phone companies reckon the people who are using sites like Facebook are exactly the sort of people likely to be interested in using the internet on a mobile phone.
Further research by Comscore shows that people who are already experimenting with the internet on a mobile phone are younger than users who access the web only on a computer. In Britain, more than 25% of mobile internet users are aged 15 to 24, compared with 20% who go online using a computer; a further 41% of mobile internet users are 25 to 34 compared with less than 20% using a computer.
The concern for the mobile phone companies, however, has always been that offering the sort of flat-rate mobile internet access packages likely to lead to an explosion of usage would leave them as little more than big dumb pipes in the air. Their worry has been that once they offer fixed-rate packages, all they can compete on is price and over time they will end up as sidelined as internet service providers (ISPs) have become in the fixed-line internet world.
Some mobile phone companies have tried to retain their position in the value chain by setting up their own UGC services. For instance 3 has scored with its SeeMeTV portal, which lets users upload clips and share them with other 3 customers. SeeMeTV has also created its own social networking service called Moko (formerly Kink Kommunity) with users paying £2.50 a month to keep in touch.
But Frédéric Huet, director at Greenwich Consulting, says that the mobile operators have a real opportunity to persuade more customers to use their mobiles to access the internet by "mobilising" sites such as Facebook.
"I would not be too dismissive of data revenues. If the mobile operators can start increasing take-up of data services they will increase revenues for quite a few years before commoditisation and price competition sees those revenues erode again," he said. "By then the operators will be in a position to offer other services such as mobile advertising.
"The trick is to start building an audience now and the mobile phone operators are starting to understand that."
Sensing this opportunity, several mobile phone companies - such as T-Mobile, 3 and Vodafone in Britain - have launched flat-rate mobile internet tariffs.
Facebook, in fact, is already available on mobile phones in the US through the AT&T, Verizon and Sprint/Nextel networks, with users able to update their profiles and check on their friends. Several of the UK's mobile phone networks are understood to be eagerly chasing deals to add Facebook to their mobile web offerings. In addition, Vodafone has signed an exclusive deal to put YouTube clips on its mobile internet service.
Juniper Research's Dr Windsor, meanwhile, points out that the transition from social networking on the fixed-line internet to the mobile internet could allow new entrants to muscle in.
One such new entrant is Itsmy.com, owned by German tech company Gofresh, which has already signed up more than half a million users.
But these new entrants are going to have a fight on their hands once people can easily update their Facebook status to "I'm on the train" using their mobile.
Source:www.guardianweekly.co.uk
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