Mobile Content Approaching Tipping Point?

The UK mobile content and services market is on the verge of becoming a multi-billion dollar industry, provided the sector can tap into an addressable market approaching 50% of UK mobile users, according to a report published this week by Informa Telecoms & Media.
The study, entitled UK Mobile Content Survey: What Consumers Want analyses the results of a survey carried out by Informa, in association with Orange UK and fieldwork partner Starcom Mediavest, exploring mobile content behaviour, in which almost 2,000 UK mobile subscribers participated.
Results from the survey reveal that the UK mobile content market was worth 661 million in 2006, with 50% of revenues coming from the mobile cash rich 25-34 year olds. Those revenues look set to skyrocket should the wireless industry generate a more consistent spending behaviour, says Informa.
Today, the regular buyers of mobile content, those who purchase a minimum of one item of content every three months, represent one-fifth of mobile users, says Nick Lane, Principal Analyst at Informa, and author of the report. However, the survey uncovers a further 30% of occasional consumers that will purchase at least one item of content per year. If the wireless industry can encourage these occasional spenders to regularly consume content, the addressable mobile-content-market spend over a three-month period will expand by 150%.
While 50% of respondents said mobile content prices were too high, the survey revealed 5 as the optimum figure consumers are willing to spend per month on top of their voice and messaging fees. Services and content priced above the 5 monthly threshold will appeal to less than 5% of UK mobile users.
This is presenting the industry with a dilemma, as premium rate pricing for services such as Mobile TV could potentially cannibalise revenues from other services within the mobile content ecosystem, says Lane. The door is now wide open for mobile advertising to subsidise mobile content and inflate the mobile content user base.
One key trend to emerge from the survey results is that of user-adapted content.
By side-loading songs from their PC on to their mobile and using as a ringtone, or taking a picture on the device and using as wallpaper, users are repurposing existing forms of content to perform numerous tasks on their mobile, says Lane. There are no confusing rights issues to negotiate and no costs, so its highly appealing to the consumer.
But while much is being made of content available on mobile phones, UK consumers are using existing services and demanding more practical services. While 35% of respondents claim to have used the mobile Internet, location-based services and mobile banking topped the poll asking respondents to outline the service they would most like to see on their mobile phone.
Over the last few years, the mobile Internet has grown from a slow and clumsy monochrome experience into an essential consumer and business tool for news, entertainment and other services on the move says Gavin Forth, Head of Entertainment at Orange UK. As an industry, we now need to eliminate the barriers still facing our customers to ensure the mobile Internet eco-system thrives, by driving smart pricing, innovative partnerships, and allowing the phone to become an extension of our customers own personalities.