Beyond the walled garden’s gates

25 May 2006

Mobile phones are probably due a name change as that particular moniker doesn’t encompass the full range of capabilities on offer. Mobile ‘internet browser, music system, email reader, image displayer, video player, camera’ might be a bit long-winded but it seems more accurate for modern handsets. For the purpose of this article, a simple ‘mobile’ should suffice.

The main Irish operators are adopting different approaches to mobile content, from a “walled garden” approach to internet surfing to full web access from the handset. Prices and priorities also differ.

Graeme Slattery, head of communications at 3, explains his company’s approach to mobile content. “Rather than giving our customers a portal into the full internet to go to any site we’ve picked the ones that are optimised for mobile. We’ve found if you give full access customers end up getting frustrated because they try to go to sites that there’s no WAP version of or ones that aren’t fully optimised. It’s just not a good experience.”

Every customer through a link on the 3 website can nominate a site to be added, says Slattery. There are currently about 450 sites that can be accessed. “We see that as the best way to grow it and keep a handle on the interaction.”

Other operators offer full access to the world wide web. “We don’t want to be censors regarding the internet so the services out of the box are open,” says Colm Codd, head of customer services at O2. “With i-mode you can go anywhere on the internet.” Meteor and Vodafone also offer unrestricted internet access.

One of the difficulties that Slattery hit on with this approach is the fact that so many sites aren’t optimised for mobile content, a point conceded by his competitors. Optimising internet content for handset use is one area that will have to be standardised across the board before mobile internet takes off. So far it’s been relatively ad hoc from the point of view of website developers, although the current industry initiative is seeking to address this.

O2 has done some additional preparatory work in overcoming this barrier. “We’ve approached a lot of the partners that provide internet-based sites right now — for example and — and asked them to provide mobile versions of those sites,” says Codd.

“With anyone’s service of mobile web it’s still pretty much a text-based experience, as all WAP basically is,” says Slattery. “The frustrating thing about that is we have an extensive 3G network; we’re able to do a lot richer media. Hopefully in the future site owners and developers will start building sites with the mobile experience over 3G in mind. It’s starting to happen already and the experience will continue to get richer for customers.”

The other obstacle to the mobile internet experience is price. All operators offer a certain amount of free browsing and in some cases free downloads under their respective branded content services — Planet 3, Meteor Stuff, Vodafone live! and i-mode. Outside of this inclusive content they charge for accessing the internet. Meteor charges 3c per KB of content; Vodafone charges 2c per KB; O2 charges 1c per KB; and Meteor charges on a timed basis — 30c per half an hour, €1 per hour, €2 per day and €10 per week — a tactic which the company claims is considerably cheaper than its competitors.

“Because it’s really difficult for a customer to keep track of KBs when they’re downloading internet pages we structure the pricing by time,” says Slattery. He argues that the criticism of mobile surfing as too expensive to take off doesn’t come into play with 3. “We’ve removed that barrier to entry already. The price doesn’t need to come down for us.”

Providing a certain amount of free content seems to be a conscious decision by the companies to get people used to the idea of using the broader services. As to what mobile content people are actually paying for, there does appear to be a difference between the operators with 3G networks — Vodafone and 3 — who are reporting good take-up of music downloads, and those still on GPRS — Meteor and O2 — whose customers are chiefly buying “traditional” content such as ringtones.

David McLoughlin, commercial marketing manager with Meteor, says “traditional” content still makes up the bulk of Meteor’s content revenue. “The vast majority of revenue is generated from downloadable content: ringtones is where the market is still at in many respects,” says McLoughlin. “That market makes up about 60pc of our content revenue. About 20pc of downloads are games, 20pc are images. The remainder [of revenue generation] would be around alerts.”

“Ringtones and games are still the most popular,” concurs Codd. “A lot of the teenage and early-20s market uses them. The quality of the games and ringtones has improved. You had monotones, then polytones and realtones and now you have videotones. That type of stuff is still very popular and the quality is getting better.” O2 plans on rolling out its 3G network in the near future.

3 has identified some more up-to-date tastes with its consumers, with games and music being the most downloaded. “A lot of the free content we offer gets huge hits continually: football highlights, downloading or streaming movie reviews or trailers,” says Slattery. “We do a lot of comedy stuff for free as well. They’re popular but the paid content — the games and music — would be the most popular of all. About 60pc of our customer base are regular users and downloaders of content.”

“3G changed a lot of things because the handsets and services available are much more sophisticated,” says Martin Wells, head of consumer data with Vodafone. “Really the only thing you could do on your phone prior to 3G was download a ringtone or play a game. Now you have much better audio quality so you can have a full track download or you can watch a live video stream or download a clip. “In terms of downloads, music’s going quite well for us: ringtones, full track music download and music videos,” he maintains. “Sports highlights packages are also quite popular.”

Codd identifies a new segment of slightly older customers who are using the mobile web to get updates on property and jobs, as well as consuming news and sport. “If you’re looking for a house in, say, Raheny you can set up an alert and an email will be sent to your phone from the site if something comes up.”

This is a very different audience than the teenage ‘games and ringtones’ audience, and potentially one that will be dissected by marketers eager to expand the scope of mobile services. McLoughlin also adds some thoughts on the mindset of content users.
“The reason why somebody might buy a ringtone but not a full track is that a ringtone is personal to the subscriber,” he says. “It’s a way for them to be identified in their social group: when the phone rings it says something about them as an individual. That’s a very different reason to why people will download a full track, which will be used simply to listen to. The mindset of the individual is very different and that’s one of the reasons why full track downloading hasn’t taken off to the extent that some predicted.”

Codd also identifies another emerging trend in mobile content services that is sure to be pre-occupying marketers at the moment, that of the rise in prompted usage. “People always have their handset on them, whether they’re in traffic or in the garden, but now they’re being persuaded to take their handset out of their pocket. When you get an alert into your handset there’s a link there you can access. With email alerts you can get an awful lot more information than with SMS, and it’s free to receive, same as with SMS.”

By Niall Byrne