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Video Opportunity to Bypass Mobile Operators

Just like the late 1990s when 3G was being deployed, billions are now being spent to deploy systems capable of delivering video to mobile devices. However, In-Stat reports that the term "mobile" doesn't necessarily mean the same thing as "cellular."

New technologies and business models are now under development that will likely threaten traditional mobile phone service provider's ability to profit from video content, the high-tech market research firm says. Consumers will surely use mobile video, but without paying a fee.

"Cellular operators may find that consumers won't be as interested in their video offerings once other types of service are available," says David Chamberlain, In-Stat analyst. "Of the five methods of mobile video delivery studied in a recent In-Stat report, two operate outside the current cell phone ecosystem, and a third -- out-of-band video -- seems to be allied to mobile operators for commercial convenience, not technological necessity."

All three, Chamberlain says, could bypass mobile operators altogether. However, given the high price of mobile value-added services in some markets, perhaps that's exactly what mobile operators anticipated all along -- the revenue opportunity is with a small premium-priced niche offering targeting a limited addressable market of non-technical early-adopters.

Moreover, as I've stated before, I believe that side-loading multimedia content via memory cards will be the pervasive mobile media transfer method for the majority of mainstream users, with on-the-go content updates enabled via free wi-fi hotspot access -- when it's available.

I anticipate that most users will eventually apply client software to aggregate topical videos via a personalized syndication feed, and then selectively download their chosen attachments from that feed -- either by synch via home/office PC with broadband connection or via a wireless wi-fi link direct to the handheld device when they're mobile.

Recent research by In-Stat found the following:

- Free-to-air mobile video, being considered by broadcasters, could also disrupt other video services associated with cellular operators.

- Tech-savvy users' interest in time- and place-shifting services from Orb and Sling Media threaten to totally bypass operators' walled gardens.

- Even though video that can be delivered entirely from within the operators' walled gardens was first to market, it suffers from general user apathy, according to an In-Stat survey of U.S. mobile users.

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