Phone enables video star

27 July 2010

Revenue from mobile video services is expected to top $2 billion in 2013, according to ABI Research
Revenue from mobile video services is expected to top $2 billion in 2013, according to ABI Research

Revenue from mobile video services is expected to top $2 billion in 2013, according to ABI Research.

The video services included in this forecast are video telephony, video messaging, video sharing, video-on-demand, VoD downloads, and other video services.

“Video services revenue will only amount to about $121 million this year,” says Senior Analyst Mark Beccue. “But the growth curve is very steep indeed, and will only continue to accelerate through to the end of our forecast period in 2015.”

Video sharing is expected to be a small portion of this revenue, while video telephony, video messaging and video-on-demand will account for the lion’s share.

Consumers’ appetite for mobile infotainment, sparked by the availability of 3G networks, is one of the main drivers for this market. This will only increase as MNOs move to 4G. At the same time, the proliferation of connected mobile devices means more screens in the hands of subscribers. Web 2.0 services, with their emphasis on real-time collaboration, communication and networking further add fuel to the fire.

However, a few factors do have the potential to limit this growth:
• The recession may affect consumption patterns, especially in industrialised nations
• The popularity and adoption of OTT services provide intense competition for MNO-branded mobile video services
• There is still an insufficient range and variety of video-capable mobile devices
• Because this industry is still in its infancy, the business models are still immature and imperfectly matched to consumers’ preferences

“MNOs mustn’t settle for the role of undifferentiated mobile ISPs that manage ‘dumb pipes’,” advises Beccue, adding: “They should provide a variety of mobile video services and leverage strategic ecosystems until they upgrade their networks to provide quality video services. Partnering with device OEMs and software solution providers will help to optimise mobile devices. This will contribute to an already significant investment, but the rewards will be great.”

ABI Research’s ‘Mobile Video Services’ study focuses on regional mobile video services that are branded or co-branded by MNOs and provided to mobile consumers for a periodic subscription fee or a per unit transaction fee, including video telephony and video messaging, P2P and Web 2.0 video sharing, and mobile video entertainment.


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