Coming to a handset near you

FRAMINGHAM (09/17/2003) - I come not to tout The Next Big Thing. I come to tout The Next Small Thing: mobile video.

It's easy to dismiss mobile video as a solution in search of a problem. But take a closer look and a different picture emerges.

Will mobile users watch full-length movies on two-inch screens? Of course not. But early results suggest they will watch movie trailers, music videos, news conferences and sports highlights. Operators in Korea now offer streaming TV service. For many mobile users, video on a tiny screen when you can't be at home in front of a large screen is better than no video.

"See What I See" is a compelling yet completely different application. Manufacturers are producing mobile phones with integrated cameras that let users take snapshots and short videos at Little League games, on vacations and while shopping. These videos can be sent to other mobile phones, PCs or Web pages. The market for user-created mobile video will be huge, if cost and ease of use don't get in the way.

The wireless industry has a huge stake in mobile video. More than US$100 billion has been invested in 3G licenses since 2000. According to my firm's research, another $100 billion will be spent on 3G infrastructure. Years of effort have been invested in 3G standards, handsets and business models. But the only feature likely to motivate hundreds of millions of mobile phone users to upgrade to 3G is mobile video.

The film industry has long searched for a larger market for short videos. Finally, that market has been found. Short videos are perfect for informing, instructing and entertaining mobile users. One operator, Korea's SK Telecom Co. Ltd., has commissioned short movies just for the mobile phone market. Short videos also can be played on laptops, PDAs and Pocket PCs, as well as handheld video players from companies such as Archos.

Mobile video is not a slam-dunk. There are only a handful of video-capable wireless networks in service. Video-capable handsets leave room for improvement in processing power, memory and cost. Very little MPEG-4 content is available. And the industry needs to figure out how best to handle content distribution and billing.

There is a debate over whether it is best to download or stream video content to mobile devices. Downloading requires more device memory and digital rights management technology to prevent unauthorized content redistribution.

Content streamed to a handset is stored temporarily and is arguably more secure. Downloaded content can be played back later; live video must be streamed.

Mobile video also could become a key application for Wi-Fi hot spots and emerging proximity points. Wi-Fi hot spots can serve video content to laptop PCs today. Once there is a critical mass of video-capable handsets, merchants could use Bluetooth-based proximity points to deliver video product brochures.

Skeptics say no one needs mobile video. But there are many things we buy that we don't need. I wouldn't underestimate how important staying plugged in visually will be to future generations.

Brodsky is president of Datacomm Research Co. of Chesterfield, Mo. He can be reached at ibrodsky@datacommresearch.com.

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