It rings, it plays, it has TV
First there were TVs. Then came PCs. Now, mobile phones are becoming the 'third screen' for viewing video.
Mobile phones once wanted only your ears; now they're after your eyes, too. By delivering a variety of viewing options - video games, music videos, clever ads, news, weather, and sports - the littlest screen may have the biggest of futures. Already, cellphones serve as a third screen for some consumers - along with their televisions and computers. Because it's always with its user, some think the cellphone could become the most important of the trio - the first source for entertainment and information.Skip to next paragraph
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Plenty of questions remain, of course. Some are technological, such as the need to beef up battery life to power heavier usage and to employ bandwidth more efficiently so that the system doesn't jam. Others are financial: How much will subscribers pay to watch something on a tiny screen? If phones eventually can share video with other users, can the content be designed to prevent unauthorized sharing?
Still, the promise of a new viewing audience is luring everyone from manufacturers to content providers.
"We're at the very early stages of [producing] what could be pretty interesting" video for cellphones, says Larry Shapiro, an executive vice president at the Walt Disney Internet Group, the online arm of the Walt Disney Co.
So-called third-generation (3G) mobile phones, which transmit data at much faster speeds than today's 2G digital phones, will open up the prospects for better content, Mr. Shapiro says. Already, 3G games on phones "are equivalent to Game Boy Advance quality in terms of graphics and richness."
For advertisers, phones represent new opportunities to reach consumers. For mobile-phone companies, video and other data offer new revenue streams as increased competition for cellphone customers squeezes profit margins.
Third-generation phones are already in use in Japan, South Korea, and Europe. In Germany, mobile-phone giant Vodafone announced this month that it had sold 411,000 3G phones there since they were introduced late last year. Though that represents just 1.5 percent of the company's German customers, they bring in 4 percent of total sales revenue. The company aims to have 10 million 3G customers in Germany by next March.
In the United States, mobile-phone companies are in the midst of field trials of 3G phones with the expectation of broad deployment in the next year or two.
Better video will be one of the chief advantages of 3G. Worldwide, about 25 percent of all digital TVs sold in 2010 will be in the form of mobile phones, predicts a report last month from Strategy Analytics, a consulting firm in Boston.
Meanwhile, "for younger consumers, cellphones are already the third screen," says Avi Greengart, principal analyst for mobile devices at Current Analysis, another consulting firm. They're being used for everything from text messages to downloading ring tones and playing games.
"Their phones go with them everywhere," Mr. Greengart says. "They've grown up with these devices. They expect them to do just about anything. And they're willing to pay for additional services - certainly to a much higher degree than baby boomers."
Mobile phones aren't going to replace TV or computers, but they will become a complementary source of media, says Dan Steinbock, author of the new book "The Mobile Revolution" and a researcher at Columbia University's tele-information institute in New York.
The quick, widespread adoption of cellphones has led to some optimistic projections about their future, he says. But so far they have been used in concert with existing media, such as when TV viewers used their cellphones to vote for contestants on the "American Idol" TV show.
It's likely that cellphone video may be used to deliver short bursts of information, which in turn will cause people to seek out a TV or computer screen for more extended viewing.
That's been the strategy so far in Asia, where short-form video, in one- to five-minute bursts, has taken off among 3G phone users.