Interview: Mike Eaton, Head Of Content, Vodafone UK:‘Don’t See Us Ever’ Swapping Ads For Paid Game
There was a time when operators wanted to lock in people to their own content portals, but for Vodafone (NYSE: VOD), that’s the past. Since last year, the UK operator has thrown its walled garden Vodafone Live open, and has even embraced Nokia’s portal Ovi, reasoning, as their CEO Arun Sarin recently articulated, that if they can grow the usage of the mobile web, and take a smaller slice of a bigger market, they can still make out well. MocoNews caught up with Vodafone’s head of content in the UK Mike Eaton to see what’s proving popular as subscribers begin taking to the mobile web. What’s emerging is a mixed bag, with customers eager to find certain sites off deck, but happy to stay on deck for others. Facebook, for instance, turned out to be the operator’s hit service after it allowed people off deck, with users checking in every few hours. As for music, however, subscribers are more comfortable with Omnifone, which powers Vodafone’s music store and sits on deck, though the all-you-can-eat service is also DRM protected. The jury on broadcast mobile TV is still out, as Vodafone—like a lot of other operators and content players—has yet to choose a technology to back. As for ad-funded models, Vodafone won’t touch it for games, but will consider it for video. Some excerpts from the interview:
Opening up Vodafone Live: Eaton: “Vodafone Live traditionally had services like music stores and mobile TV propositions. What’s different here is that we are starting to use Vodafone Live or the portal as being more of a gateway to allow customers to discover the wider mobile internet. We have very strong categories we call Friends, which gives people access within three clicks to their favourite social networking site, and that’s proved to be extremely popular, and a great usage driver. Facebook is our number-one search term, which when you think of the other terms that are usually so popular in the world of the search, that’s a great tribute. Customers tend to come back very frequently to check their Facebook account on their mobile once they’ve started using it.”
What happened to go off portal? “It’s a recognition that what’s important here is to drive usage and to get people using mobile internet services everyday. It was a recognition that customers want to be able to get out to the brands that they know and recognize from the internet. And, to understand that is something they value and to be able give them that choice but at the same time to retain the elements they’ve enjoyed from the Vodafone Live service in the past. We’ve managed to retain those services but at the same time give people access to other great services, so I think it felt like a very sensible decision to be more open in that way.”
The way Madonna’s album is being released: Vodafone has seven-day exclusive access to Madonna’s upcoming album Hard Candy. They plan to release one song for each day of the week, with each song disappearing after 24 hours. “The idea was to create some excitement and buzz around the release of the album, to encourage customers to come back every day and see that progression as they get a bit more of the album each day.” He added, “ It’s part of that bigger theme of encouraging people to come back and to use those services daily and to see the mobile internet as something that is a really strong provider of entertainment and other content.”
DRM-protected all-you-can-eat Omnifone: “Omnifone’s [Music Station service] has proved extremely popular as a format where customers are subscribing to unlimited music. It’s incredibly popular and is one of the top full-track download services in the UK.
Location-based services picking up: “Location based services—that’s a very interesting one. We have more and more services coming through that use location as an element of them [including an estate agent service, a Google maps service, and a travel service]. We see a big potential for customers using their mobile phones to check the train times, or check their local traffic—those are increasingly being enabled by location, so I think there is a big story around location.”
Mobile TV: streaming vs. broadcast: “Our service is based on streaming on 3G and HSDPA networks at the moment. Vodafone hadn’t yet stated its position on [broadcast standards] or backed any technology or any way forward. It’s too early to say what will happen with broadcast. Obviously, the issue there is the investment that’s needed to build new infrastructure. I do think there’s a strong future for streaming over 3G and HSDPA networks and what we’ll see increasingly is more use of longer form video on demand content alongside some of the TV streams.
Who’s Watching Mobile TV and What Are They Viewing? “There are more men than women currently watching mobile TV, and they are younger than the average, but you do get quite a spread, and a spread of interests across the channels that are watched as well. The service is attracting a broad mix of customers, and not just hard core techies. Mobile TV is a bit like the mobile internet. You need a hook to get people to try the service in the first place and football does that. People will watch a match and they will have that ‘wow’ experience when they’re watching live TV on their phone. From there they will try other things. We see that with some soaps—people will tune in and watch Coronation Street live if they can’t be in front of their TV, so there’s a range of services that appeal. Different people have different reasons to use the service. We see these big increases in traffic at lunch time and around the commuter periods in the evenings which suggests that people are using as way to relax for five to ten minutes and watch a bit of TV on their breaks.”
Ad-funded content: Slippery slope that ends up devaluing content or good way to get people to try it?: “We’ve run ad-funded video trials, and yes, more is planned around ad-funded content, but not games. There will always be some kinds of content that are premium and that people will pay for. I don’t see us ever trying to replace the cost of the game with advertising. The economics would be quite challenging for a start, it’s quite a profitable industry. But short form video clips makes a lot of sense for us. For now, in the short term its possible to charge people £0.50 ($1) or £1 ($2) for a short clip of content, but how sustainable is that model? We will probably see as advertising is used more widely on video clips then the usage and the number of users who are interested in that service will increase dramatically. The average return per clip may be lower, but overall the benefit will be much larger for the industry. ”
Posted In: Entertainment, Games, Music, Media & Publishing, TV, Social Media, Video, Companies, Vodafone, mike eaton
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