Research Notes

New opportunities for media companies

increased focus on the mobile telephones user interface is creating exciting new opportunities for media companies
All our research here at Strand Consult points to the mobile market moving towards an increased focus on user interfaces. This increased focus on UIs will lead to changes on the mobile market, especially for new players entering the market. For example media companies will be able to spread across the mobile value chain and offer their content and media in connection with the future mobile handsets UIs.

UIs can basically be divided into 3 types:

1. UIs that contains APIs
2. UIs that run on a VM (Virtual machine)
3. Simple UIs without APIs

UIs that contain API’s do not make the mobile service/mobile application independent from the mobile telephones operating system. This is due to that the APIs that are made available by the underlying OS are still used together with the APIs made available by the UI. When using the UIs that contain APIs the service developer will have to develop services specifically designed for both that OS in combination with its UI. One example of this is the Opera platform from Opera, which is a UI for handsets, but also functions as a service platform. But also Nokia’s Series 60 and UIQ from UIQ Technology are examples of UIs that contains APIs.

Some UIs run on a VM (Virtual Machine). A VM is an application that emulates a virtual computer/handset on the users handset and by using this virtual computer/handset the user can run applications. These applications are therefore completely independent of the physical handset/OS. To run this type of VM application there has to be developed a VM for the OS in question. By using a UI on a VM, the service developer can of course develop services specifically for that UI, regardless of the actual OS. This moves focus away from the OS and over to the UI. One example is Flash Light from Macromedia that can be used as a UI on handsets, but is also a handset independent service platform.

But it is not only the technical aspect that is causing an increased focus towards UIs. It will also be possible for operators or other players to use their own UIs on handsets. These UIs do not necessarily need to contain APIs or to run on a VM and can therefore be simple UIs, whose only function is to act as an interface between the user and the OS. These UIs can be branded by the operator (or by another player on the mobile market) and the UIs can therefore be one way of helping operators differentiate themselves. For example the icons, backgrounds, sounds etc. can be adapted/branded to an operator.

As Strand Consult has described in their new report – ”How to get success in the 3. Generation VAS market”- the most interesting thing about this increased focus on UIs is however the new possibilities this gives for other players than the mobile operators on the mobile market. In the future it will not just be the OS suppliers that can offer end-users UIs for OS/handsets – all players on the market will have this ability.

Especially media companies like Disney, Sony, TimeWarner, Bertelsmann etc. are likely to use these new possibilities to achieve a closer contact to the end-users by using simple UIs on the handset. Having control of the UI on the handset means that the UI can be tailored and adapted to that media company – and thereby used for branding. This will also be interesting for media companies like the Eurosport, MTV or national broadcasters like the BBC, that all have the resources and the brand to move into this area. There is no doubt that these companies well-known brands will mean that both the end-users and other players on the market will be interested in UIs that are branded/endorsed/licensed by these media companies. In other words this is already an interesting market to take a closer look at today – the demand is already there.

The increased use of these tailored simple UIs can however as a side effect reduce the value of the handset brand – up to now the handset brand has been very important to end-users. This can become a threat to the handset manufacturers, as the value of their brand will thereby decrease. The focus on UIs can also be a threat to the OS suppliers’ brands, as the OS would become a standard commodity that all handsets use, but that the end-users have no knowledge of, or interest in.

The most probable scenario is however that we start seeing triple brands, where the handset manufacturers, media companies and mobile operators brand handsets together. The handset manufacturers and OS suppliers will thereby lose part of their customer relationship, but the synergy effects that derive from the triple branding will almost certainly partly compensate that loss.

If only simple UIs are used, the applications/services will still need to be developed for the OS/handset which means that the media companies UIs will not limit the selection of services/applications for the end-users, as all the services/applications will function independently of the UI. So any handset manufacturer or operator can easily replace the UI with their own, without this changing the functionality of the mobile handset.

For some media companies it might be advantageous to use the more advanced UIs that support the APIs on the OS/handset. This would only be relevant for larger media companies that can do this successfully, as this will require the development of a large enough number of attractive services for that UI before end-users will find this of value. If they are unable to achieve those numbers the UI will in reality function as a simple UI.

As Strand Consult has written in their new report –  ”How to get success in the 3. Generation VAS market” – there is no doubt that the media companies are ready to use the new opportunities that can be achieved by using UIs. There is also little doubt that the handset manufacturers and OS suppliers will have to be on their toes as the media companies enter this exciting new area. 

the 3. Generation Value Added Service Market

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