Mobile social networking stands a good chance of
jumpstarting mobile Internet adoption because mobile
social networking is based more on communication than content. Time and
again, communication services have led the way for content and
advertising to follow. In the case of the Internet, it was e-mail and
discussion boards—not Web pages—that triggered the explosion from early
adoption to mainstream consumer use. SMS services drove mobile data use
and they still account for the majority of mobile data revenues by
carriers.
It is not surprising, therefore, that mobile carriers and mobile
content providers have warmed to mobile social networking as a new
opportunity to ramp mobile Internet use. In truth, they have little
choice. Their attempts to convince the mass market to sign up for
mobile Internet have proved moderately successful, at best.
According to February 2008 research by Informa, the global market
for all current forms of paid mobile entertainment should reach $31.7
billion by 2012. Back in 2006, the same forecast optimistically
predicted $42 billion by 2011.
Juniper Research published a far more bullish outlook for mobile
entertainment in January 2008, projecting $64.8 billion worldwide by
2012. Earlier research by Juniper also tried to quantify the revenues
associated with mobile user-generated content such as chat room
services or mobile dating, predicting $5.7 billion for 2012.
Even with the most upbeat projections, paid mobile content is a tiny
market in comparison to revenues from communication-based mobile
services. In the US alone, mobile data service revenues (predominantly
message-based) reached $23 billion in 2007, according to industry trade
group CTIA—The Wireless Association. Mobile messaging for
SMS/MMS/IM/e-mail worldwide is expected to be between $100 billion and
$200 billion by 2011. When voice traffic is included, the global mobile
industry is on track for almost $1 trillion in total revenues by 2012.
The stark reality is that mobile users are more inclined toward
communications or task-centric interactions with their mobile device
than toward content or entertainment. The UK's Office of Communications study of global mobile markets showed a decided preference by users to
engage in mobile data sessions that are communications-oriented rather
than information-oriented. Even in Japan, long the poster child for
mobile information services, the primary use for the mobile device was
e-mail (57% of users) compared to mobile Internet access (20%).
The upshot for mobile carriers and mobile content providers is that
they need a new context in which to pitch mobile data access to users.
Without a compelling incentive for users to sign up for mobile data
access, it is likely that mobile carriers will see their mobile data
revenues jump sharply at first and then start to stall at around 30%,
as was the case in Japan. Mobile social networking potentially could
not only push mobile data access over that hump, but could pull in
other communications services to a social networking session.
Mobile content providers also need a relaunch to jumpstart their
business. To date, mobile content is generally considered difficult to
find as well as inferior in quality to other media channels—a
reputation that is somewhat deserved. Mobile social networking offers a
new environment for content discovery through recommendation as well as
distribution via the network effect.
To learn more about the marketing promise—and reality—of this channel, get your copy of the new eMarketer report, Mobile Social Networks, today.