Mobile Video will Drive Adoption of Advertising Subsided Phones
One of the most exciting things about wireless broadband technology (4G, Wimax, LTE) is the ability to view video content on the go at your leisure from anywhere. Rarely do I ever sit down and watch a 30 minute episode of The Office on my TV anymore because I just don't have the patience for the commercials that are not targeted to me or my location . I am either watching on computer through my Slingbox / DVR while multitasking or laying in bed falling asleep and not engaged. However, if I could watch content from anywhere around my home on my mobile phone I might A) watch more content B) be a higher paying customer C) watch ads that are targeted towards me.
I live in Los Angeles and have the luxury of seeing two trends that are happening as a result of this recession. One is the much discussed "Mobile Internet Tsunami" and the other is the "Internet Advertising Renaissance". It's my belief that we are at the early stages of a major wireless telecom subscription disruption that will ultimately drive voice and data subscriber access fees on mobile phones to be free? Google "gets it" but big Telecom giants don't and they always always the excuse we can't possibly recoup the data costs for fear of cannibalizing their revenue streams. Its a rubbish excuse! The industry "drinks a lot of Coolaid" and nearly all of the 500,000 wireless telecom industry employees would say I am crazy we can't make any money at that. They are all wrong and don't see the future of targeted location based video, text and display adverting. We have the technology to allow advertisers to target consumers down to very granular levels on mobile phones and charge premium $25-$100 CPMs but there just isn't any inventory yet (no content). Its pretty hard to lose money selling advertising at that rate isn't it? If Clearwire owned Hulu they might just give their Wimax service away for free and wouldn't that be disruptive?
Early adopters will always buy the latest Wimax, 4G, LTE smartphones and femtocells. However, in order to "cross the kasem" and "reach the masses" of consumers (arguably 200M+ US) carriers will have to offer unique content and video offerings on the mobile handset. Time shifting TV onto the phone seamlessly throughout the home, office and car is going to be what gets consumers to adopt Clearwire Wimax and pay extra for femtocells in their home. Right now the only company that is in drivers seat is Comcast with their $1 billion dollar investment in Clearwire and I am waiting patiently for them to make thier first move. Oh wait, they already did and they are buying NBC / Universal. Stay tuned.