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US mobile media and entertainment market to see strong growth
Posted: 22-Apr-2008 [Source: Analysys]

[Analysys projects revenue from mobile media and entertainment (MME) services in the US will more than double during the next five years.]

Washington, D.C. -- Revenue from mobile media and entertainment (MME) services in the US will more than double during the next five years, according to the latest research from Analysys, the global advisers on telecoms, IT and digital media (www.analysys.com). US MME services (excluding messaging, and mobile browsing and data charges) generated US$3.1 billion in revenue in 2007, and Analysys Research forecasts that revenue will grow to $6.6 billion in 2012, at a compound annual growth rate of 16.3%. The strongest growth will not occur until after 2010, as the technical and market environment for MME services improves, according to the latest Analysys report, Mobile Media and Entertainment in the US: forecasts 2007-2012.

Key trends that are driving market growth include:

*Improvements to service accessibility: mobile Web browsing platforms will improve and facilitate access to off-deck content, and presentation of off-deck content will become more streamlined and user friendly.

*Wider availability of content, driven in part by higher-generation network and device penetration: "As 3G, 3.5G and Qualcomm's MediaFLO network coverage increases, a greater range of services will become available to a wider audience, and off-deck content markets (both operator-billed and non-operator-billed) will develop," said Katrina Bond, co-author of the report. "Non-operator-billed revenue from MME content and services will increase significantly during 2007-2012, and will account for $1.3 billion, or nearly 20%, of MME revenue by 2012."

*Improvements to service usability: providers have not focused enough on the end-user experience for MME services, and users' frustration when the experience does not meet their expectations has inhibited the growth of some services.

*Simplified and more attractive pricing of MME content and applications, as well as mobile data access: complex pricing, high data charges, and unfavorable revenue-sharing arrangements for content providers have inhibited growth in the MME market.

Analysys Research forecasts that MME services will account for 12.3% of non-voice service revenue in the US by 2012. Mobile TV and VoD services will experience the highest growth rate of any MME service during the next five years. When combined, broadcast and unicast TV and video services will account for 36% of MME revenue by 2012. By contrast, revenue from personalization services will decline from 47% of total MME revenue in 2007 to 17% in 2012.

"Operators, content providers and device manufacturers will have to work together to increase subscriber awareness of MME offerings and to ensure straightforward pricing, and simpler purchase and delivery processes," said Alexandra Rehak, co-author of the report. "It is also critical that the user experience of MME services be compelling and complementary to the subscriber's experience of entertainment across other media."

Mobile Media and Entertainment in the US: forecasts 2007-2012 provides forecasts for subscriber numbers, adoption rates, ARPU and revenue for mobile MME services. The forecasts are broken down by prepaid and contract segments, as well as by technology generation. Market drivers and barriers to growth are analysed for the overall MME market and for individual mobile service types. The specific mobile services discussed include music, TV and video on demand, games, social networking and user-generated content, browsing and information services (including location-based services), adult content and mobile advertising. The report examines the drivers and barriers that will shape the US MME market, identifies key market participants and evaluates market growth opportunities.

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