Years from now, analysts and prognosticators looking back at the wireless industry might find it difficult to pinpoint the moment U.S. mobile operators embraced adult content.
Today, it is no less difficult a prediction. Has it happened already? Will it ever happen in an overt way? Or are we merely at an “inflection point” where the potential appeal is so great that it can no longer be ignored?
In March, when the Cellular Telecommunications and Internet Association announced that it was leading the development of a content rating system, the stars seemed to be aligning. The venerable trade association acts as a unifier among its carrier membership on a variety of wireless issues. But even if a cooperative effort among the American wireless carriers leads to a voluntary ratings system by year's end, it is unlikely to signal the full mainstreaming of adult mobile content. Major wireless operators in the U.K., including T-Mobile, O2, Orange, Vodafone, and Virgin Mobile, were more than a year ahead of the U.S. in agreeing upon voluntary guidelines to keep adult content off devices owned by the under-18 crowd, and a recognizable adult mobile industry sector is growing there as a result.
American carriers are hungry to justify the costly build-outs of their evolutionary wireless networks with a surge in the use of data and multimedia services. Screens on mobile phones are being designed with higher resolutions and in larger sizes, and audio quality has improved dramatically. The giants of the U.S. wireless landscape are growing more dominant, as evidenced by the marriage of Cingular and AT&T Wireless and the ongoing process that will bring Nextel and Sprint together. Forecasters say that revenue from adult content delivered via cell phones will soon deliver revenues measured in billions of dollars.
So why does the U.S. appear to be behind the curve? Trepidation may be trumping greed among wireless carriers—at least for now. The proactive nature of adult content companies seeking mature consumers has led them to mobile markets in Europe and Asia first, where wireless networks are more technologically mature.
Most industry observers fail to see the error in comparing mobile content delivery mechanisms to the adult industry’s previous benchmarks. The widely held opinion that the demand for adult video content serves as a primary boost for the adoption of each new media platform is not necessarily true. And this summary conclusion shortchanges the business acumen of those in the adult industry. In reality, it is the proactive nature of those who are forbidden from mainstream distribution channels that fuels the innovative marketing efforts and technology investment that leads to consumer adoption and demand.
As markets developed for VHS/Beta, satellite television, VideoDisc, CD-ROM, DVD, and web streaming technology, adult content owners were quick to seize the opportunities for distribution. Mainstream owners of licensed content were content to sit on the sidelines, feeling that each new advance in media hardware would cannibalize their existing product base.
In cable television, for example, there never should have been an ESPN or a CNN. Think about it. Entrenched sports and news content brands such as Sports Illustrated or The New York Times should have jumped head first into the cable TV and satellite business. But they did not, and their brands have diminished as a result. ESPN and CNN are among the most engaging mobile brands and use the wireless medium to further promote their established television and Web offerings.
So why should adult marketers wait for the U.S. wireless industry to warm up to them? Why move cautiously as mainstream companies work through their political and public relations issues with adult content? After all, the industry has been built by strong-minded individuals who see market opportunities and then seize them. And historically, the adult industry has not partnered with the status quo to any great benefit.
There are several reasons. …
For perhaps the first time in history, the mainstream distribution channel appears to be acknowledging that it needs to consider the potential of adult brands and content from the very beginning. Whether it is a full embrace that coincides with age-appropriate restrictions and registration procedures has yet to be determined. But unlike the Internet distribution channel, mobile operators are licensed entities and that means they are subject to regulation. The thought of government bodies like the FCC or other third-party regulation of content is a great fear to them, which means that the big carriers will find a way to self-regulate sooner rather than later. U.S. government authorities and industry watchdogs will expect no less of them in light of the recent mega-mergers that have put the biggest players under increased scrutiny.
In addition, many adult enterprises are now corporate giants with well-known talent, Internet services, and DVD brands to protect and nurture. Operating independent of mobile operators will mean that the reach and quality of video, audio, and messaging content could be compromised. With a wide variety of connection speeds, coverage areas, and technical standards (not to mention a nearly unmanageable number of device screen sizes and aspect ratios), the consistency of consumer exposure and viewing experience is at risk. As a result, well-branded logos and personalities will not be properly distributed and protected on the open market.
Considering U.S. operators and their overseas counterparts as part of a cohesive global strategy is the only way to go. This means that the same brands and images may be delivered in different formats for specific markets. In much the same way as language-specific content is developed for each home market, the native network throughput and content restrictions need to be incorporated in tandem.
Adult content owners also have to accept the fact that restrictions could result in content that is much less explicit than they are accustomed to selling. In working with carriers who are universally interested in increasing their Average Revenue Per User (ARPU), adult content owners will find that their potential mobile market opens from a pool of millions to a pool of hundreds of millions. Branding opportunities for adult media companies is not strictly limited to traditional adult content anymore. The mainstreaming and growth of the adult industry in retail, entertainment venue, and television-based tie-ins has done much to promote adult brands and its stars. Considering there are currently more phones sold worldwide than PCs and TVs combined, mobile content is the next evolution and provides the greatest and most far-reaching potential in history of the adult industry.
While adult branding does not need to be explicit in its approach, adult content owners should look at mobile operators as shopkeepers who will determine the brands of media content that is sold in their stores. These products will include a growing variety of music-oriented wares, wallpapers and still images, streaming and downloaded video, live applications, and interactive games. Depending upon the level of industry cooperation, they will also determine whether adult brands are displayed near the front of the store or stigmatized by layers of protective packaging even when offered in the mildest forms.
Although it most certainly can provide an important new revenue stream, adult content owners should not look at the mobile market as an industry unto itself. Mobile branding should be seen as a key element in a campaign to cross-promote and drive consumers to core Internet and DVD products.
Those who question the potential of the adult industry’s role in the mobile data universe often use invalid reference points. They see a World Wide Web of adult content and suspect that these images can easily be transported to mobile platforms. And they are right to an extent. Random images and multimedia of questionable origin and quality can be loaded onto a phone. Yet the mobile operator wants to control well-branded content and see that it receives its fair share of the distribution revenue through strong partnerships. After pioneering efforts in the online space, the adult industry should think along these same lines.
Tomorrow’s mobile devices and networks will offer American consumers a new level of interactivity with the brands that are important to them. The phone is fast becoming the most personal device in our lives. In concert with mobile operators, it will provide the tools for cashless spending, peer-to-peer video conferencing, personal identity, security, and countless new forms of multimedia access. We have seen these advanced services begin to take hold overseas. We also have seen that there are two classes of content providers: those who operate within the “walled gardens” of the mobile operators and those who do not. The barriers to entry for those who operate independent of the operators are few. But they will struggle to bill for their services in any meaningful way and will find a lack of quality control and digital rights management over time. Plus, the independent will lose out on the opportunity to reach million of potential new consumers who may not be familiar with their brand.
If you haven’t tried it before, I encourage you to access the carrier “store” on your mobile phone. Notice the ease of access, the simple shopping experience, one-step billing, and immediate gratification of purchasing a ring tone or wallpaper. This is the reason why mobile content projections have reached dizzying heights.
As adult content providers, it is important to work with carriers and industry groups to ensure that we may participate in this space and leverage a well-developed customer experience. The nature of the mobile marketplace is making it a very attractive medium to implement well thought out content strategies that consider the industry, carrier, and consumer needs. It also provides the best avenue to further your relationships with existing consumers and create new ones. Well-branded adult content provides mobile phone owners with a new ability to personalize their devices and supplement their interests. Movie trailers, photos, personal appearance promotions, audio, video, text messaging, games, ring tones, and more are yours to be leveraged. As the one device that a consumer carries with him or her 24 hours a day, a mobile phone can offer the most far-reaching yet most intimate experience the adult industry has ever witnessed.
L.R. Clinton Fayling is the president of Brickhouse Mobile, a market leader in the development and worldwide distribution of wireless adult content.