Sunday, November 05, 2006

YouTube goes 'moblogging'

YouTube goes 'moblogging'

The future Google unit has big plans to help consumers create and share video with their cell phones. But so do a lot of competitors.

First news broke that Cingular Wireless will launch a new music service on its cell phone network. Then YouTube said it would bring video-sharing to mobile phones.

That's two big announcements from two big companies. But which company is likely to have more success? YouTube, for reasons that have little to do with the company's $1.65 billion sale to Internet goliath Google.

Here's the reason: Consumers want to share content more than they want to listen to songs on their cell phones. At least that's what they told In-Stat, a technology research firm, this summer. Sending a clip of Junior's soccer match to Grandma, it seems, is much cooler than watching the latest 'mobisode' of "Desperate Housewives" on a two-inch scr! een.

At the tone, leave a video-mail

"It was striking to see how strongly people feel about using video to communicate," says David Chamberlain, the In-Stat principal analyst who conducted the consumer study.

On Wednesday, YouTube CEO Chad Hurley told attendees at an advertising conference that the video-sharing site will allow users to send clips to other YouTube members within a year, according to a Reuters report. YouTube users already can upload clips from their phones to the company's site and then watch from their personal computers.

Hurley told the advertising execs that video-sharing via mobile phones is an obvious next step for the company. "[I]t's going to be a huge market," he said.

'Moblogging' - the industry term for the nascent mobile user-generated market - is expected to reap $13 billion a year in advertising and subscription revenues come 2011, according to Informa Telecoms & M! edia, a research firm.

YouTube's push into the mobile market is both good and bad news for entrepreneurs like Alex Kelly, the CEO of San Francisco startup Veeker.

On the one hand, it validated Kelly's vision. So far mobile operators have had a hard time offering inexpensive, easy-to-use and fast services that consumers can use to share images and videos captured with their cameraphones. Only about 50 percent of U.S. mobile phone subscribers with built-in cameras actually snap photos. Even worse, a meager 3 percent shoot videos.

In late October, Veeker rolled out a free service that lets users publish short video clips, which the company calls "Veeks," taken with their cell phones. Registered users can then send their output, via Multimedia Messaging Service (MMS), to and other sites that accept HTML embed codes, including MySpace and Blogger.

Veeker members have used the service to leave "video voicemails" for friends and to create personal video diaries.

"Mobile video is very immediate, and that's what people are looking for," says Kelly, who's betting the advertising revenues, both on Veeker's website and embedded in videos, will sustain it. "I think [demand] is going to grow a lot faster than people predicted."

YouTube: the kiss of death?

YouTube's move into mobile video could be a boon for startups like Veeker. Rivals could start scouting for their own mobile video service - and that's always good news for smaller players looking to be acquired.

The biggest risk of all? Mobile video will never live up to expectations. That's the prediction from Ken Hyers, an ABI Research senior analyst. Hyers estimates there will be a scant 655,000 mobloggers worldwide at year-end. He expects that number to quadruple to 2.7 million by 2011. That's just a fraction of the estimated 3 billion mobile phone users around the world.

By Michal Lev-Ram, Business 2.0 Magazine writer-reporter

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