The market for mobile TV and video is growing rapidly, but content providers are finding it difficult to finance new projects, according to 'Getting into Mobile TV and Video: Financing, producing and distributing TV and video content', a new report published by Informa Telecoms and Media in partnership with peacefulfish. Informa forecasts worldwide revenues from mobile TV and video services will rise from US$2.46 billion in 2006 to US$8.35 billion in 2011, but content providers vying for a share of this market face challenges.
"While mobile TV and video content is less expensive to produce than film or broadcast TV content, it still requires upfront production costs that typically run several thousand dollars per minute," says Chris Coffman, senior research analyst at Informa and author of the report. "Revenue shares don't fund the initial creation of content. The mobile TV and video sector would benefit from distributors, such as broadcasters, mobile operators and content aggregators, sharing in more of the risk."
One strategy distributors can adopt is to use revenue models such as minimum guarantees and licensing payments, borrowed from the TV and film industries, which involve upfront payments to producers. The report reveals companies from both the mobile and media industries that are using these techniques. Content providers are also relying on outside investments from a range of sources, from venture capital firms to public multimedia funds, though the process of connecting investors to projects and companies which need funding is not always a smooth one.
Mobile phones' portability, network connectivity and the personal connection users have with their phones set mobiles apart from TV sets or other consumer electronics devices, and at present, mobile TV and video users prefer to 'snack' on short video clips instead of watching lengthy TV shows. This points to an opportunity for content providers: creating new formats and programmes which address the qualities of mobile, and integrating mobile into cross-platform media development.
"Interactive TV and video content that is made specifically for mobile has great potential for creating highly popular formats," says Juliane Schulze, senior partner at peacefulfish and co-researcher of the report. "This can also open production opportunities for filmmakers experienced in different narrative forms, allowing them to successfully enter a new market segment. Content producers could accept the challenge of financing the development and production of made-for-mobile content, for example by actively involving brands and advertisers in their content creation."
Getting into Mobile TV and Video management report provides an overview of the mobile TV and video ecosystem and explores the opportunities for film and television producers, private and government funds, mobile content providers and others.
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About Informa Telecoms & Media
Informa Telecoms & Media is the leading provider of business intelligence and strategic marketing solutions to global telecoms and media markets.
Driven by constant first-hand contact with the industry our 90 analysts and researchers produce a range of intelligence services including news and analytical products, in-depth market reports and Datasets focused on technology, strategy and content.
Informa Telecoms & Media also organizes more than 125 annual events, attended by more than 70,000 executives. In addition to the GSM>3G World Series, our events cover subjects as diverse as fixed and mobile operator strategy, technology, TV, mobile music and games.
About peacefulfish
Based in Berlin, peacefulfish is a unique consultancy offering its strong expertise in strategy and finance to international companies in the fields of production and digital distribution and also to policy makers, financiers and brands working in the content industry.
Positioned at the convergence of content, distribution and finance peacefulfish is focusing on providing sound financial solutions for the digital media and film industry and to helping create new business models.