A breakout panel at the Billboard Mobile Entertainment Live event was called Off Deck: Opportunity vs. Obstacles, but there was little talk about the opportunity off deck holds and plenty about the obstacles. Panelists echoed the earlier panel on mobile games, and elaborated on the same sort of complaints that off-deck companies have had for some time: difficulty in the user experience in terms of discovery and download, and pricing.
The problems of licensed content: Brian Casazza, the CEO of 9 Squared, a content aggregator owned by Zed, said that there isn’t enough off-deck traffic to create sufficient revenues to recoup and pay license fees. One big reason for this, he said, is problems with the billing infrastructure. Operators blame the high number of failed transactions on problems with content providers’ terms and conditions and other factors, but Casazza said the small amount of money providers are making (due to high operator revenue shares) and other factors out of their control prevents them from making improvements.
Lots of failed transactions: Steve Shivers, the CEO of OpenMarket, which is an Amdocs/QPass unit that offers mobile content billing services, said that three to four of every ten mobile transactions fails, killing content providers’ profitability. He said this is a big reason that while the overall mobile data market is growing at a 100 percent per year clip, off-deck content is growing at just 25 percent per year.
Looking overseas: Rajeev Raman, the CEO of myWaves, said the mobile video company has found overseas markets much more attractive for its ad-supported service than the US. He thinks non-US users are “much more addicted” to mobile entertainment and content than their US counterparts, who enjoy too many alternative media devices to their mobile handsets, whether it’s a big TV or PC monitor, or another device. Raman said 60 percent of myWaves users are from outside the US, and spend an average of 20 minutes on its site.
Changing business models could see off DRM: In response to a question from the audience about changes in DRM and content locks, Raman said that in an ad-supported model, such as that used by myWaves, DRM isn’t important. What is important is that the company’s ads follow the content. The panel agreed that ad-supported models could make DRM largely irrelevant since there’s an incentive for content to be passed around and viewed or consumed as much as possible.
The Verizon (NYSE: VZ) issue: Raman also addressed his company’s view of Verizon, in response to an audience question, saying that his main issue isn’t with its content practices, but rather with its handsets — since the Qualcomm (NSDQ: QCOM) BREW software they run, he said, doesn’t handle multimedia well.
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