Making a Success of the Mobile Content Value Chain

This publication has been discontinued on July 19, 2011.

Introduction

Abstract

The mobile content and entertainment services market reached about EUR3 billion in 2003 -- less than 3% of total mobile service revenue and less than 19% of non-voice revenue. There is, however, a potential for the market to grow by hundreds of percent cumulatively over the next six years. Once a number of barriers to service adoption are overcome, mobile content and entertainment services are expected to quickly become significant contributors to the overall mobile service market.

However, as the value chain evolves, some types of players will win bigger chunks of the total market revenues than others. Several trends are shaping the value chain, including greater participation of large content owners and mobile operators efforts to control the handset/user interface. It is crucial for mobile operators, content owners, games developers, device manufacturers and middleware providers to understand the specific drivers and barriers to the development of various mobile content and entertainment services. These companies also need to understand the value of the market for mobile content and entertainment services, and how revenue from those services is likely to be distributed across the evolving value chain. Making a Success of the Mobile Content Value Chain provides detailed analysis, estimates and forecasts of the mobile content and entertainment market in Western Europe for 2003--2009, by country, type of service, market segment and technology generation. Detailed quantitative analysis is complemented by an in-depth survey of the key drivers of the mobile content and entertainment market in Western Europe, exploring the current status and likely future development of networks, service and device usability, interoperability and standards, and revenue models.

Making a Success of the Mobile Content Value Chain answers your key questions:

• How big is the market for mobile content and entertainment services in Western Europe, and how quickly is it likely to grow?
• What are the drivers of adoption of specific services? What are the barriers preventing this market from significantly contributing to the total mobile service revenues?
• What needs to be done to eliminate the barriers, and when is it likely to happen, given the current trends in the market?
• What is the forecast value of different types of mobile content and entertainment in Western Europe, split by key countries, market segments and technology generation?
• What categories of content are likely to dominate the mobile content and entertainment market?
• What trends are shaping the emerging value chain in this market? What industry players are likely to benefit and lose out because of these trends?
• How will the revenue for mobile content and entertainment services split along the value chain?

Who should read this report?

• Mobile operators: understand the main barriers and drivers that will shape the market for mobile content and entertainment services, and learn the value of the market for different types of content and entertainment service. Understand how to take advantage of the trends in the value chain.
• Portals, content providers and application developers: discover where the opportunities lie for mobile content, and the size of the market. Understand the opportunities and threats presented by current trends in the value chain.
• Investment banks and consultants: understand how the mobile content and entertainment market is likely to impact upon the performance of mobile operators, content owners and other companies in the value chain. Understand the opportunities and threats to these companies presented by current trends in the value chain.

Table of Contents

• 0 Executive summary
• 1 Introduction and scope
• 2 The current market for mobile content and entertainment services
• 3 Market forecasts and analysis
• 4 Revenue distribution and trends in the value chain
• 5 Barriers to adoption and growth drivers
• 6 Actions
• 7 Methodology

Excel data file

Figures in the report are backed up with an Excel data file containing forecasts for Western Europe as a whole, as well as individually for France, Germany, Italy, Spain, Sweden, and the UK.

Forecast adoption rates, adoption levels, average spend, ARPU and revenue to 2009 are provided for the following service categories:

• Mobile information and entertainment -- information (such as news, weather, sport, finance, and directory) and entertainment (such as jokes, cartoons and horoscopes) excluding such content delivered in the form of music and video
  • free information and entertainment -- whereby the subscriber is paying only for traffic at standard rates, irrespective of the content accessed (e.g. browsing)
  • paid information and entertainment applications -- downloadable applications allowing to subsequently access paid content
  • paid information and entertainment services -- paid content other than that accessed via downloadable applications
• Games -- games played or delivered to mobile devices over a mobile network
  • online games
  • downloadable games
• Personalisation -- ringtones, logos, celebrity voicemail greetings and other content services used to personalise a mobile device
• Content messaging -- person-to-person messaging using third party content, e.g. greeting cards
• Cross-media services -- mobile communications used to interact with other media, e.g. voting in TV programmes, submitting comments on news information
• Music, video and TV -- music, video and TV entertainment services, such as downloadable or streamed music and video clips, or broadcast radio or TV

The data file also includes forecasts of subscribers, ARPU and revenue by market segment and technology generation for France, Germany, Italy, Spain, Sweden, the UK and for Western Europe as a whole.

Market segments:

• Residential prepaid
• Residential contract
• SMEs
• Large corporations

Technology generations:

• 2G
• 2.5G
• 3G

List of figures

• Figure 1:Distribution of mobile service revenue in Western Europe by broad service category, 2003
• Figure 2:Mobile service revenue in Western Europe by broad service category, 2003--9
• Figure 3:Distribution of Western European active mobile subscribers by country, June 2004
• Figure 4:Distribution of Western European mobile content and entertainment service revenue, 2003
• Figure 5a:Mobile content and entertainment service revenue in Western Europe by service category, 2003--9
• Figure 5b:Mobile content and entertainment service revenue growth (CAGR) in Western Europe by service category, 2003--9
• Figure 5c:Mobile content and entertainment service revenue in Western Europe by content category, 2003--9
• Figures 6a--d:Adoption rates, average spend, ARPU and revenue for free information and entertainment services in Western Europe, 2003--9
• Figures 7a--d:Adoption rates, average spend, ARPU and revenue for paid information and entertainment applications as well as paid information and entertainment services in Western Europe, 2003--9
• Figures 8a--d:Adoption rates, average spend, ARPU and revenue for online and downloadable games in Western Europe, 2009--9
• Figures 9a--d:Adoption rates, prices, usage, ARPU and revenue for personalisation services in Western Europe, 2003--9
• Figures 10a--d:Adoption rates, average spend, ARPU and revenue for content messaging services in Western Europe, 2003--9
• Figures 11a--d:Adoption rates, average spend, ARPU and revenue for cross-media services in Western Europe, 2003--9
• Figures 12a--d:Adoption rates, average spend, ARPU and revenue for mobile music, video and TV services in Western Europe, 2003--9
• Figure 13:Historical 3G service adooption and 3G handset battery life in Japan, 2002--4
• Figure 14:Mobile subscribers by technology generation, 2003--9
• Figure 15:Illustration of assumed average network access charges per Mbyte, by market segment (Germany, 2003--9)
• Figure 16:Illustration of assumed price per transaction for selected services (Germany, 2003--9)
• Figure 17:Percentage of revenue billed for by operators and airtime resellers in Western Europe, by service, 2003
• Figure 18:Operator-billed and non-operator-billed revenue in Western Europe, by service, 2003
• Figure 19:Percentage of revenue billed for by operators and airtime resellers in Western Europe, by service, 2003 and 2009
• Figure 20:Distribution of revenue along the value chain, by service, 2003 and 2009

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