Mobile entertainment growth could decline to 7%

Juniper Research warns that, while its best case forecasts estimate that the mobile entertainment market will reach nearly $36 billion in 2010, revenue growth will be markedly lower if the global recession fails to bottom out over the next 12 months.
 
Using a scenario-based approach to assess the impact of recession on the mobile entertainment industry, a new report found that average annual growth over the next two years declines from nearly 19% under the best case scenario to less than 7% in the worst case. Mobile TV, user generated content and music are particularly exposed.
 
Lower discretionary spend on services and handsets were the primary contributory factors to the decline in top-line entertainment service revenues. The report also found that other factors - such as a lack of available funding to finance the development of new applications, and faster migration to ad-funded services - would have an impact on revenue growth over the forecast period.
 
Some entertainment services appear to be susceptible to the downturn. Given that operators perceive consumers will be increasingly reluctant,  or unable, to pay for content, providers may be less likely to roll out expensive, higher risk services: a dedicated mobile broadcast TV network is a prime example.
 
However, some sectors, such as adult services and gambling, were more robust: for mobile gambling, there was a possible upside in the migration of bets from physical to remote sites with consumers going out less and instead placing bets via the mobile or PC.
 
Across all scenarios, mobile music remains the largest single mobile entertainment sector, despite the continuing decline in revenues from ringtones.

Downturn aside, growth in service deployment and adoption remains constrained by the excessive cost of data services across many markets.

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