Mobile-Video Demand Mounting Fast, But Right Pricing Model Is Elusive

Despite low adoption so far, video delivered via mobile phones will generate $501 million in annual revenue by 2010, up from $62 million last year, according to a new study from JupiterResearch, New York. A total of 41% of cell-phone users surveyed indicated interest in receiving some form of video content on their handhelds, with 17% saying they are interested in watching real-time TV and 11% showing interest in short clips. This expression of consumer interest contrasts with the 2% of cell-phone users who currently have a subscription to video services, the research firm says. “This consumer interest bodes well for the mobile industry as vendors use different business models to try and tap into this consumer demand,” said Julie Ask, research director at JupiterResearch, in a statement. Indeed, the challenge for wireless carriers, content providers, and payment processors may well lie not in consumer interest but in arriving at the right combination of premium content and price, Ask says, adding this combination has so far been missing. “Our research shows that there's strong consumer interest in consuming mobile video,” said David Schatsky, senior vice president of research at the firm, in a statement. “Consumers are just not interested in paying large fees for mediocre content.”