As the battle between Apple and Google hots up at the Mobile World Congress, the smartphone boom signals good times for media firms
Delegates browse phones are displayed at the Mobile World congress in Barcelona.
Announcing the BBC’s move into the mobile phone market with its own news, sport and video applications for the iPhone last week, Erik Huggers, the director of future media and technology, said the new generation of so-called smartphones are a “great conduit to our audience”.
It is a conduit that until recently has been, if not closed, then certainly constricted for media companies. But the explosion of downloadable applications, rapid rise in mobile broadband take-up and, crucially, the weakening of network operators’ stranglehold on the market have opened up a massive opportunity.
The attraction is easy to see: there are already four times as many mobile phones in the world as there are PCs, and those phones are getting cleverer. In the run-up to Christmas, one in four of the phones sold by Vodafone across the world was a smartphone – that is, a phone with the same computing power as a laptop you could buy a few years ago. Within a couple of years there will be more smartphones than PCs on the planet.
Even the mobile phone operators’ reaction to the weakening of their position, banding together in order to mount a fightback in the apps world, should benefit media companies. Then there is Google, which has not only provided the industry with a serious, and more importantly open, competitor to the iPhone, but looks increasingly likely to usher in a new era of mobile advertising.
Huggers made his announcement in Barcelona at the mobile phone industry’s biggest annual get-together, Mobile World Congress, which showed that while the iPhone began the boom in the smartphone market, the rest of the industry is catching up and a range of devices are set to hit the shops that will help media players get to a mobile audience. And the important tool for mobile phone and pc users is Total Video Converter
The iPhone drove a wedge between customers and the mobile phone networks. Other players had tried it, such as Nokia, but Apple succeeded. For years the mobile phone companies acted as gatekeepers to their customers. Content companies had to strike deals with each operator, jostling for position on the “portals” created by the networks. Consumers, however, did not want their phone company picking what content they could view on their phones and portal usage was minimal.
So the networks knocked down their walled gardens. As consumers ventured into the mobile web, many media companies – including the BBC – created mobile versions of their websites that could be easily viewed on a phone’s small screen. But usage remained low because even the mobile web, on many devices, was a pale imitation of the “real” internet.
The iPhone was different and when it switched to 3G technology a year and a half ago the mobile web came of age. It has weakened the networks and given media companies the chance to bypass them. The relationship an iPhone customer has is with Apple first and their network provider second. The network is merely paid for providing access – Apple gets paid for content. It is an aggregator for media companies worldwide, and what started with music has become a wide variety of content, thanks to its App store.
But Apple does not have the market to itself. Already more than 20 phones with Google’s rival Android operating system have been produced, which have a crucial advantage over the Apple device: Android supports Flash, which should help advertisers realise the potential of the mobile web. “Crucially, Apple does not and will not support Adobe Flash on its iPhone or iPad products,” explains Brad Rees, chief executive of Mediacells Limited, the mobile market experts. “From an advertising creative perspective, this has meant iPhone application specialists win most of the pitches for mobile microsites. In the online world, the language of big-budget agency creatives is Adobe Flash, and this is precisely where Android hits the sweet spot. Even though Nokia has been offering full internet phones for a while, it’s the Google proposition which resonates.”
In his keynote speech in Barcelona, Eric Schmidt, chief executive of Google, promised the search engine giant is “not trying to run roughshod” over the mobile phone companies or turn them into “dumb pipes” in the air. The companies, however, are not so sure. Two dozen of the world’s biggest announced during the congress that they are getting together to produce a completely open apps platform – allowing consumers to take their applications with them when they change handsets.
In return for this portability, the networks would start to get a slice of revenues – although exactly how is still unclear.
This is potentially big news for media companies as it raises the possibility that they will be able eventually to develop their apps just once, and put them on a massive array of handsets straight away. And it’s another indication that at long last the mobile floodgates are open.