Near the top of my personal list of confusing industry terms is "mobile video." Does it mean watching on a smartphone? A tablet? Both? Does it mean using a wireless carrier's network (e.g. Verizon, AT&T) or a WiFi network or both for access? Does it mean watching while out of home (and if so, where?) or at home? And what content is watched - live? on-demand? short-form? long-form? genre? The list goes on and on. Mobile video is truly one of the most confusing and misunderstood industry terms around.
And that's why recent data from Leichtman Research Group, a well-respected media research firm founded by a former colleague of mine, Bruce Leichtman, really caught my eye. In its 7th annual "Emerging Video Services" survey, of 1,240 adults age 18+, LRG found that of those who said they watched video on their mobile phone in the past month, 63% said they usually watch at home. More striking, of those who watched video on their iPad, tablet or eReader in the past month, 89% of them said they usually watch at home.
Other places where video is watched are substantially lower. For mobile phone, what follows at home are at work or at school (21%), while waiting for an activity (18%) and in a car (9%). For iPads/tablets, it's at work or at school (4%) and while waiting for an activity (4%).
Bruce and I talked about what to interpret from the data. For Bruce the data reinforces his perception that for most people, mobile phones and tablets are essentially secondary viewing screens for at home use (equivalent to "additional outlets" in cable TV terminology, something I experienced and wrote about a while back). Tablets in particular provide a form of "personal TV" that flexibly allow long-form viewing in rooms that don't have a TV or connected TV. That's not to say people don't use phones (in particular) or tablets for outside-the-home viewing, but this is mostly for shorter-form snacking.
Adding to this dynamic is a concern I've raised in the past about out of home mobile viewing, which is that with most wireless carriers transitioning users to expensive tiered data plans, it can get very expensive very quickly to watch a lot of video outside the home, unless a high-quality WiFi connection is used. In fact, LRG found that of those who watch any video on a phone, 33% are concerned about hitting their monthly data cap (no doubt that percentage is even higher for the heaviest viewers who are likely acutely aware of their cap status).
Further supporting this point was a story earlier this week in the WSJ regarding the possibility of ESPN subsidizing wireless connectivity for its heaviest users. The article notes that while the average U.S. mobile user used just .659 gigabytes of data per month, ESPN "has received feedback from at least one big carrier that significant numbers of its mobile users reach their monthly cap before the end of the month, after which their usage drops off." No surprise.
For ESPN (and possibly for others), a decision to subsidize mobile data usage would be an intriguing arbitrage strategy - a bet that it can make more monetizing carrier-based out of home video via advertising or subscriptions than the cost of paying the carrier for the required bandwidth. If the numbers work for ESPN, it could be a meaningful advance in mobile cap relief, at least for certain hardcore sports fans.
All of this underscores the whopping pricing/cap disparity between wireless data and wired broadband data plans. For example, in my area I can subscribe to a Comcast broadband service for $50/mo that allows 300 gigabytes of usage. Conversely, a $50/mo Verizon Wireless "Share Everything" data plan only gets me 1 gigabyte. Users aren't stupid; the fact that wireless data is so expensive today virtually ensures that most long-form "mobile" viewing will remain in the home, safe on WiFi networks. Snacking outside the home will also continue (the reason why YouTube's online viewing is down 32%), but for longer-form usage to really ramp, something significant has to change with wireless data.
Categories: Mobile Video
Companies: Leichtman Research Group