Potential and Pitfalls for Playboy on 3G
“We know what kind of contents sell, we know what the customers want and we can create a great user experience for the users on the networks,” says Playboy.com’s VP of Global Licensing, Markus Grindel, talking to Wireless Watch Japan in Part 2 of our exclusive video coverage from the 3G Mobile Forum 2004. With adult content helping kick-start and then drive the VHS and DVD revolutions, estimates of a $4-7 billion market for this content category in the wireless space in 2006 don’t seem far-fetched at all. But a number of roadblocks, including carrier technologies, billing and DRM pose significant hurdles as well. “Right now its very hard for me to determine if someone receives an image from us if that image is being sent to someone else. How old is that person.. I don’t know, and that’s a key factor to figure out,” says Grindel.
Girls, geeks and games; how they go together. And as with the VHS and DVD markets and with the development of the Internet, there is no reason why adult content can’t drive the Mobinet too, says Grindel.
First off, mobile devices are the perfect distribution platform for adult content because they are truly personal, on demand, and cellies as entertainment devices are perfect tools for impulse purchases of content. Add that to the fact that we are used to paying for the simplest Mobinet contents, the value proposition is potentially awesome.
Playboy believes the market could be as big as $7 billion by 2006, and this seems possible. A recent report by Strategy Analytics forecasts that up to 150 million users will be wirelessly accessing video clips (sports, movies and adult entertainment) by 2008, generating revenues as high as $4.7 billion.
Grindel says that in 2002, 60-70% of total consumer spending for content on the Internet was on adult entertainment. At the same time, European consumers spent about double the amount for Mobinet content on mobile phones as they did for fixed line Internet.
With adult entertainment already a killer application, what better tonic is there to buck up drooping ARPUs and stimulate more demand.
As Grindel points out, Playboy is already scoring significant success in Germany, where its i-mode (ePlus) content has proved the number one or number two most popular portal over 13 months since it was launched in summer 2002. In fact, the Germans seem keen to part with up to 4-5 euros to check out short video downloads. Look out for some new variants of tunnel carpal syndrome in Europe?
Sticky Fingers and Image Problems
Critical problems remain, however, with a huge gulf still separating Playboy and carriers from some lusty income. First and foremost, DRM needs to be sorted out to ensure that Playboy and partners secure incomes, and, vitally importantly, some sort of security that contents don’t end up in the laps of minors.
The most intriguing thing about the presentation that Grindel gave at the conference was about the company’s potential moves into Japan and China. At the moment, i-mode and Vodafone Live in Japan are in fact roadblocks to spreading Playboy’s image into Mobinet here. And that’s a huge problem, because Japanese carriers’ attitudes to adult content are deeply problematical (see our latest Viewpoint Article here).
Ironically, Japan’s carriers forbid nudity on their official contents services while allowing images that to the west might seem pedophilic on their contents platforms. At the same time, it is estimated that 77% of 20-40 year olds i-mode users in Japan have received an e-mail for an adult site, or, to put it even more bluntly, from brothels offering services.
Playboy doesn’t see itself in the sleaze business, of course, and is making all the right noises about being responsible and not wanting to creep into the back alleys of Japan’s Mobinet space. In the mean time, Grindel hinted quite heavily that if the carriers’s legs remain tightly closed to Playboy contents penetration here, China will remain the more inviting prospect.
— The Editors.