Will Mobile Video Matter? Yes -- But Not Anytime Soon
Today's mobile handsets set the bar for multitasking: Sony Ericsson's S710a puts music, photos, video, and gaming all on a 4-inch by 2-inch handset. In February, Verizon Wireless -- the largest US mobile service provider -- unleashed V CAST, a video on-demand service. And in late 2004, Europe's Vodafone paired with Fox to produce mobisodes of the hit TV show 24. As handset manufacturers like Nokia or Samsung try to cram other emerging mobile technologies like Wi-Fi and WiMAX onto their multifunction devices, should you care that TV is going "mini" on your handset? We think so, but not immediately.

Mobile Video Delivers Content To Mass And Niche Markets
Just like its bigger-screen predecessors, mobile video comes in multiple flavors, including unicast, broadcast, and on-demand. Mobile operators like Cingular and Sprint and content owners like ABC and MTV will partner to offer wide-appeal content via broadcast, while The Food Network will offer cooking tips to its niche audience through on-demand unicast instructional clips.

Mobile Video Shifts Programming, Advertising Paradigms
TV-on-handset renders the standard programming 30-minute grid useless, as consumers will look to fill incongruent blocks of time with available media. This means 10-minute mobisodes to watch online at the DMV, 1-minute basketball highlights from last night's game, or 45-minute dramas to enjoy on a long commute. The ad model for this mobile entertainment represents a new end to the 30-second spot. TiVo-loving consumers who regularly block ads from their PCs won't tolerate the usual TV ads and might find sponsorships or short interstitials more acceptable.

But The Excitement Over Mobile TV Is Premature
It will take another five years for mobile video to be a mainstream reality. Why? First, the technology for delivering content to handsets across the US falls into two incompatible categories -- DVB-H and MediaFlo -- forcing users to choose. The earliest handsets with video capability will be hefty and expensive for the mainstream mobile user. Finally, a large majority of consumers aren't sure they even want TV service on their mobile handsets, and those who do aren't necessarily willing to pay for it (see figure).

In the meantime, to bring mobile video to the masses, service providers must strike a chord with stubborn consumers who eschew other mobile offerings like data services, while negotiating with content owners like ABC or the PGA Tour to offer the programming consumers want. NBC Universal and other content owners should reach the mass audience by avoiding partnerships with a single operator while working to determine the best formats for delivering the right content to the appropriate consumers.

Handset manufacturers should appeal to consumers with devices that showcase voice and data functions first but add the capabilities of a TV, MP3 player, camera, or PDA at a more accessible price point. Advertisers should keep their placements unobtrusive through sponsorships or short spots.

In the upcoming weeks, we'll be wrapping up research on consumer technology potential, database marketing trends, advergames, event-triggered marketing, young consumers and blogging, local search, youth and music piracy, and consumer security on the Internet.


Chris Charron
Vice President, Research Director
Devices, Media, & Marketing Research

P.S. If you'd like to suggest research for us to write or if there are data points you're looking to track down, feel free to drop me a line anytime at chrischarron@forrester.com.

Research Referenced In This Issue How Consumers Buy Mobile Phones (36429) How To Make Video On-Demand A Success (33831) Left Brain Marketing Planning (36427)    Let's Get Real About WiMAX (36986) Mobile Data Has Yet To Hit Its Mark (36438) Organizing For Customer-Centric Marketing (36499) Podcasting For Marketers (37016) RSS 101 For Marketers (37422) The Advertising Model For Video On-Demand (35144)    The Business Model For Telco TV (36978) The Consumer Advertising Backlash Worsens (35123) The State Of The Customer Database (36982) Three Rules For Consumer Technology Success (37299) TV Ad Technology Vendor Profile: TiVo (36980) Using RSS As A Marketing Tool (35005) What Next For TV Advertising? (35120) What Consumers Plan To Do With Content (36741) What It Will Take To Reach PC Have-Nots (37051) What's The Buzz On Word-Of-Mouth Marketing? (36916) When Will The Phone And PDA Merge? (35638) Will Mobile Phones Get Wi-Fi? (36342)

EMAIL: Email this issue to a colleague.

PRINT: View a printer-friendly version of this issue.

VIEW ARCHIVE: View past issues of First Look.

TECHNICAL SUPPORT: Call the Client Resource Center
1 866/FORRESTER (1 866/367-7378) or +1 617/613-5730.

EMAIL SUBSCRIPTIONS: If you'd like to subscribe or unsubscribe to First Look, please go to your Email Subscriptions page.