Parks Associates supporting Digital Media Conference West

Parks Associates is supporting the Digital Media Conference West on October 27th in San Francisco, California.

DMC West is a full day of in-depth discussions and networking focused on the top business issues impacting digital media companies, including online video, social media, investments, online advertising, mobile entertainment, mobile apps, the future of news media and the relationship between Hollywood and Silicon Valley. More Info

CBS Increases Mobile Value-Proposition - Will They Score or Draw a Foul?

NCAA March Madness is underway, and while I’m not a sports fan, I am interested in digital media strategies of traditional media companies particularly from an ad-focused research perspective. And it looks like CBS is making a play for mobile.

In partnership with Apple, CBS has created an iPhone application featuring mobile video streams of NCAA March Madness basketball games. While AT&T and Verizon mobile customers have access to the March Madness games via a $15 per month mobile TV subscription, this sports app is affordable and includes interactive features and capabilities (however, one must have a WI-FI connection to receive video). For example, the app provides game statistics as a transparent overlay of the video.

CBS’ mobile value-proposition is two-folded:

• Consumers get on-the-go access to March Madness basketball updates and games (albeit at a price - $4.99 per mobile application).
• Advertisers/brands receive free cross-platform ad exposure within the app.

CBS is providing free ad space, as a bonus offering, within the application to current NCAA March Madness advertisers on broadcast TV. One can safely bet CBS will charge advertisers for the space in the future especially if the app is a hit among iPhone owners.

Taking advantage of dual-revenue stream models is an increasingly popular business strategy for mobile content publishers/providers. First, get consumers to pay for the content (or charge distribution fees) and then supplement the content with advertising. The arrangement has already been accepted by consumers when considering cable TV, so why not employ the same strategy on the mobile channel?

To date, CBS has been committed to the enhancement and monetization of consumer experiences across digital media platforms. CBS’ NCAA iPhone application is just another example of these efforts as the network provides access to March Madness on broadcast TV, online, and now, mobile. Kurt Scherf posted a blog regarding the recent CBS online video offering, NCAA March Madness On Demand.

When considering CBS’ current mobile media strategy and its true value-proposition, the following questions must be answered.

• How many mobile consumers paid for this application? How many engaged and used the application?
• Is current ad exposure via the mobile app significant enough to justify future media spend by advertisers? (I assume this application appeals to a relatively small group of avid college basketball fans.)
• Moving forward, will advertisers insist mobile ads be offered as a value-added offering to complement their existing broadcast NCAA March Madness buys - especially now that they’ve received the app-ads for free?

Even if the app is downloaded by only a few thousand mobile users, I’d say, “CBS scored with their NCAA March Madness app!” Why? Because the network is hustling after the consumer while making key digital media plays – ones that will hopefully increase CBS' out-of-home audience ratings and brand affinity for advertisers.

Note: To date, the App Store has received 900 reviews of the application. The application has a 3 (of 5) star rating.

UPDATE: Per MediaPost on 3/24/09, the CBS NCAA iPhone app is the second-most-popular paid program in Apple's App Store. In addition, in the first four days of coverage, NCAA March Madness via CBS' on-demand digital service attracted 5.6 million unique visitors, a 60% increase year to year.

The Race to Open Mobile App Stores Has Another Runner: Samsung

After Microsoft, RIM and Palm disclosed their respective plan to launch virtual stores for consumers to download mobile applications, Samsung, now the No. 2 mobile handset maker, also jumps in. The South Korean giant will unveil its App store for users of Symbian and Windows Mobile devices during the Mobile World Congress event this month. Although it will open only to UK consumers initially, there is no doubt that the company will expand it to other nations very soon if the UK store resonates well with consumers.

This is a recap of what has happened in the mobile app space since Apple’s success story was widely published.

· September, 2008: the press first reported Microsoft’s mobile app store: SkyMarket, then rumor has it that Microsoft will also announce it at this month’s Mobile World Congress.
· Oct 21, 2008: Research in Motion announced its Blackberry application storefront will open in March 2009; developers will get 80% of the revenue from sales.
· Oct 22, 2008: Google Android Market went live with 50+ applications and Google promises to give developers 70% of the sales and the 30% will go to carriers and pay for billing settlement.
· Jan 9, 2009: Palm announced plan to launch its WebOS App Catalog.
· Feb 4, 2009: the Samsung’s move

When adding Qualcomm’s BREW Shop, Nokia’s Download Store, and third-party mobile software reseller sites like Handango and GetJar, this space is getting quite crowded. As consumer app download market grows, the fragmented mobile OS market could become a dragging factor. Will Apple leverage its App Store’s success to lock in users just as it did with its iPod+iTunes franchise? The mobile industry should consider well beforehand such possibility. The more fragmented the market is, the more leverage Apple could gain.