There is a simple reason why some tier-one mobile service providers believe they will profit from mobile entertainment and advertising: that is where people increasingly are spending their time consuming internet-delivered media content. And advertising “follows eyeballs” (audiences).
Until recently, U.S. digital media consumption did not rival television or radio media consumption, but digital media consumption now exceeds TV and radio combined, while most other categories of media consumption are decreasing.
One can see the same trend in China, where digital media consumption is greater than television, for example. And digital media consumption also has moved from the desktop to the mobile device.
One can ask legitimate questions about whether any mobile service provider can create an advertising platform to compete (at some level) with the likes of Facebook, Google or Amazon. But the logic of trying to do so is clear enough.
Media consumption on mobiles creates both new revenue sources (advertising and subscriptions) as well as new sources beyond simple internet access (connectivity).
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