Mobile operators are spending billions of dollars to provide the infrastructure and new technology necessary to provide customers with mobile phone video capability. But a recent report from In-Stat says that competition from other mobile device video providers may cut deeply into the cellular providers’ expectations of huge video profits. In-Stat’s report could portend another bust cycle for telephone providers.
“Cellular operators may find that consumers won’t be as interested in their video offerings once other types of service are available,” says David Chamberlain, In-Stat analyst. “Of the five methods of mobile video delivery studied in a recent In-Stat report, two operate outside the current cell phone ecosystem, and a third—out-of-band video—seems to be allied to mobile operators for commercial convenience, not technological necessity.” All three, Chamberlain says, could bypass mobile operators altogether.
Some of the new competition sounds intriguing. In the future, current broadcasters could provide free video for mobile devices. Television is still broadcast over the airways for free and this could be done for mobile device consumption. The Japanese already do this with Japan’s 1-Seg.
A provider’s walled garden can be breached by in–time and place-shifting services like Orb and Sling Media. A walled garden is like the wall around the Garden of Eden, but without angles guarding the gate. A walled garden is a closed set or exclusive set of information services provided for users. It is a way of creating an information monopoly or a method of securing an information system. I prefer angles with flaming swords.
In-Stat research also shows that U.S. mobile phone users are apathetic towards video provided in an operator’s walled garden. Who can blame them? Suppose you get locked in a walled garden and there’s nothing but Apple iPhones to eat.
Video can also be delivered over 3G networks, which Verizon Wireless does. Or local cable operators can deliver video, like Sprint’s Pivot service. If the mobile phone video business gets lucrative, anything that delivers video anywhere will figure out how to get the video to mobile phones. But competition is a good thing. Consumers get better service for less money and technological wonders keep on the move.