From CTIA: Disney Mobile: Interview, Steve Wadsworth, President, Walt Disney Internet Group

@CTIA: Steve Wadsworth@ CTIA: Disney Mobile Handset[By Staci D. Kramer] The question from a colleague came up enroute to the Las Vegas Convention Center for Disney Mobile’s unveiling: Wasn’t Disney making a mistake by not including Mobile ESPN in its Disney Mobile plans? Not at this point; they don’t fit. What the two have in common: owned by Disney, MVNOs, cell phones; Sprint Nextel and innovative navigation that requires control of the environment. The differences include diverse market segments — families vs. youngish male sports nuts; launch pricing — lower, value-driven cost vs. high-end features like Power Vision for Mobile ESPN; and retail sales path — mall kiosk For Disney Mobile, Best Buy exclusive for Mobile ESPN. The other key difference: the two staffs work together on back-end solutions and share info and ideas across the board but DIG has no final authority on how ESPN chooses to operate and vice versa. The results reflect the different personalities and missions of the two.Later that afternoon, I met with Steve Wadsworth and, until he was pulled away for another interview, George Grobar, SVP/GM for Disney Mobile. The setting was almost humorous compared to the emphasis on affordability for the service: a high-up suite in trendy, luxurious The Wynn with a plasma screen in the living room and its own massage room (being used as a spare storage space sans masseuse).
Wadsworth said they realized as research went deeper that the propositions are “radically different and had to be radically different because of what the needs of the two consumer segments are. Sports fans and famiies are looking for two different things.” Grobar: “We needed to develop the services and features in light of that. There’s actually very different approaches.” They see the possibility of integrating Mobile ESPN in some way but want the intense focus to remain on families. To try to cover too much at once, Wadsworth added, “dilutes the proposition.”
One goal from the beginning: have an affordable but feature-packed handset for kids. The $59.99 Pantech model has a camera and messaging. The more expensive shiny red LG clamshell meant for parents has Bluetooth and a higher quality camera, among other features. Disney wants families to be able to buy multiple handsets.
On retail: Wadsworth: “We’d been looking at a number of different outlets. We had never planned with Disney to do anything exclusive and have wanted to keep the options open, knowing we really targeting moms. Moms are in malls, moms are buying from mobile kiosks at the malls. They also want a personaiized sales experience. “We thought it would be good to focus first as we roll put on disneymobile.com where we’re going to be able to control the message and get iot clear and right in dedicated kiosks.” Because the Disney stores, which the company no longer owns, and Disney Mobile have similar demographic targets, odds are many of the kiosks will be in malls with the stores but not connected. The Disney Mobile team wants “A” malls, high-performing malls first; as the roll-out progresses they’ll move into other locations. “Selling a cell-phone service is a high touch sales process so it’s important we have dedicated reps there to sell it and understand it. … There’s an expectation here that after the first month things are nailed down. We will evolve and grow into this and get smarter and better and develop a retail channel.”
On Mobile ESPN and patience with MVNOs: Wadsworth: “It’s a great product. It’s doing well and it’s just getting going, just like we will. …. It’s ESPN’s business to build and run and all that. But as a company we’re very focused on making sure that we’re getting leverage scale learning across the company. … The success of something that’s branded ESPN is driven by ESPN. It has to be across television, radio, internet, all of that.” When he said again after some comments of mine that Mobile ESPN was just at its beginning , I asked if we were too impatient? “The response was immediate: “I think there’s this instant gratification, you want to see this huge thing. This is one of those things you’ve got to hone and improve and get better at over time. We expect that same focus on improving,. focusing and getting better over time with Disney Mobile as well. … I think we’re jumping ahead a little bit because I don’t feel that way at all. A couple of months into it very hard to reach any conclusions … Frankly, I think it’s doing great.”
On Profitability: Wadsworth: “Really it comes down to the pace length that we’re after in acquiring subscribers. To get right at your question, I think for us it’s going to be a 2-3 year time frame to build and invest in a subscriber base before we say, ‘hey, we’re at profitability’ and we go in knowing that.” … The company has said that this year we’ll spend $130-plus million on these services but in the scheme of the Walt Disney company , that’s the kind oif investment the company needs to make and wants to make and is not going to put the company at any risk at all because in the scheme of things it’s an appropriate and fairly prudent investment for something like this. As a major company we can afford to make smart investments …”

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