An Australian mobile telephone content distribution company may be on the verge of cracking the lucrative $US50bn ($66.9bn) United States mobile phone market if the hopes and claims of its director are borne out.
Hype Marketing director, Paul Stevens, said his company is now unofficially the largest third-party mobile phone content provider in the United States, after he recently concluded several deals to distribute mobile phone, internet and radio content.
Stevens said his deals will eventually give his content distribution network access to 87% of the more than 200 million mobile phones in the US, as well as 32 million radio listeners and 7 million registered internet users.
He says he has invested more than $1m and two years to get to this position, and is now inviting Australian content creators or advertising agencies looking for a quick and easy way into the US market to give him a call.
Industry experts are cautious in their appraisal of Stevens’ chances of success, even if they think his deals are certainly noteworthy and good news for the industry.
Stevens got his television production company involved in mobile phone content about four years ago, saying Hype was among the first companies to bring services such as ringtones, horoscopes and chat to the Australian market.
Hype recently signed deals with radio giant Citadel Broadcasting Corporation and the American Basketball Association to add to previous deals with all the major US phone networks, and is looking for fresh mobile phone download content. Stevens said Hype can also create ads for its online video player and is looking into options for mobile telephone marketing.
He said the lessons he learned operating in Australia will act as a “crystal ball” for his operations in the relatively immature US market.
“As of June last year, only 40% of the US market even knew how to send a text message. That’s how far behind they are,” Stevens said. “This is a mind-blowing opportunity. The only time Australia is usually in front of the United States is the time zone.”
Stevens says he isn’t sure what the deal means for him financially, but says analysts are predicting that by 2008, ringtones alone in the US will be worth $US6bn ($8bn) plus a year in revenue turnover.
“You might have the greatest bit of content in the world, but if you don’t have a way of distributing it, and getting it out to the masses, it means nothing,” he said.
“It’s not for everyone. There are certain products that only have a domestic appeal, but you are looking for products that have an international appeal and the ability to get out there into the global market.”
However, some industry pundits question Stevens’ optimism and say technological advances may make Hype’s distribution network obsolete within a couple of years.
Mobile 365 director of business development, Jo Rich, said that everyone wants to get into the US market.
“If for whatever reason they didn’t have an ability to market the service themselves, which you can get a variety of different agencies to do on your behalf, then they could indeed take up that offer,” Rich said.
“I wouldn’t have thought getting your content to the US carriers’ portals is all that difficult. It’s more about selling your content to the end consumer, getting your own shortcodes over there so the consumer will buy it from you and not from another carrier.”
Rich said that the carriers’ distribution portal may also be superceded within years.
“If you think back to the early internet phase, something like OzEmail was the biggest,” she said.
“You would log on to the internet on your 28k modem and you wouldn’t know to go to specialist sites. As the specialist sites came up, people knew how to navigate to those sites independently and so you changed your home page and you wouldn’t go to OzEmail anymore.
“It’s a similar sort of thing going on with mobiles at the moment. Our view is that, ultimatel,y [portals] will be done away with. People will know to go to the particular specialist sites, they won’t need to go elsewhere.”
