August 8, 2012
eMarketer released data last week originally from the MM Research Institute on soaring mobile video views in Japan. Total smartphone video viewers in Japan are expected to more than triple between 2011 and 2016. This increase has been attributed to rising smartphone use and long term evolution (LTE) subscriptions in the heavily-wired country—the number of smartphone users is predicted to reach 35.3M by the end of 2012 and more than double to 92M by 2016. In addition, the number of paid viewers makes up about a quarter of total smartphone video viewers in Japan. Likewise, it wouldn’t be far-fetched to say that paid viewers make up a fraction of total smartphone video viewers in other wired countries.
This rise in mobile video usage says a number of things about the mobile marketing industry in not only Japan, but for all other countries experiencing rising smartphone usage and LTE subscriptions as well. Mobile video is becoming an increasingly important marketing channel as consumers shift video viewing from TV and PC to mobile. The demand for mobile video transcoding services will rise considerably (if it hasn’t already), and the supply of these services will rise in turn. Mobile video ads will become more common—as the number of free video viewers outnumber paid, these mobile videos will need to be monetized somehow. As users watch more videos on their mobile devices, mobile data usage may rise as well. Rising mobile data usage would put pressure on wireless operators to either drop “unlimited data” plans, throttle data plans (as some already have), innovate their data services, or all of the above—which may or may not lead to high mobile phone bills altogether in the future.
Based on the chart above, below are some key highlights and takeaways I think are important for mobile marketers & advertisers to consider.
- High growth in smartphone video viewers in Japan between FY 2011 and FY 2012– 80.5% and 92.3% for total viewers and paid viewers, respectively
- Growth of smartphone video viewers in Japan will continue through 2016 at a decreasing rate
- Other countries experiencing growing smartphone usage and LTE subscriptions will see similar growth in mobile video consumption
- Mobile video advertising becomes an increasingly important advertising channel as video viewing shifts from TV and PC to mobile
- Supply of and demand for mobile video transcoding services will rise
- More revenue will flow into mobile video advertising
- Increasing mobile video consumption = rising data consumption, which puts pressure on mobile operators’ networks, forcing them to innovate further