More about Cell Phone Video vs. Television Viewing

Yesterday's Wall Street Journal featured a Marketplace section article focusing on the spread of homegrown video content onto various competing sites. The reason I am returning to this theme again, as I have written about it before here, and here, is twofold. First, it is obviously now becoming significantly more important to the business planning of several large, would-be new media companies, such as Verizon and Comcast. Second, more of the discussion of these ventures and arrangements is beginning to articulate the ways in which users may actually consume these services. As a business person originally trained in marketing, the second always fascinates me. The first is obviously interesting as it relates to my portfolio management activities.

Specifically, the piece spotlighted Verizon's move to support, or feature, YouTube on its cellphones, while Comcast is trying to attract homemade videos to its ziddio.com website.

One line of the article stated,

"It's far from clear, for example, whether short homemade videos will appeal to TV viewers, who are accustomed to watching longer programs with a higher quality picture."

I watch YouTube videos on occasion. Some are video clips of network TV, or live concerts, and some are homemade clips. I also watch cable and, on occasion, network television. I'm one person- but I do both.

So, what sense does the above-cited passage make? Obviously, I adjust my expectations to the medium at hand.

So, back to cellphone videos. Yankee Group is cited as the source for the article stating that an estimated 5.7 million people "will watch video and TV on their cellphones," up from roughly 1.5 million in 2005. I can't, and won't, argue with empirical data. However, it's a big stretch to note that video viewing on cellphone is growing, and then assume that putting YouTube on cellphones is a good move.

My hypothesis would be that most of those cellphone views are of sports and breaking news, both global and business-related.

The overall image I have, reading recurring stories about how many distributors are rushing to license YouTube, or their own privately-originated video content, or pipe video onto every digital device imaginable, simply reinforces my belief that very few of the executives and development teams at these companies have any clear idea whatsowever of why and how consumers might actually pay for and use these services. It seems to be one very large, collective "Hail Mary" video content pass downfield for distributors, in hopes of avoiding the obviously increasing risk of disintermediation by content producers.

Which leaves me sceptical that Comcast or Verizon will enjoy much financial gain for their ill-conceived attempts to force consumer behavior into their distribution models.

For instance, the WSJ piece notes that YouTube has to be significantly altered to be viewable on a cellphone. This is allegedly the reason why device and content providers need to 'work together' to make sure the result is viewable.

I would be much more confident about these various business plans if I read that they were based upon actual research of cellphone users' video usage habits. Is it possible that most of this investment is being predicated on the viewing habits of a lot of 15-20 year olds whose parents won't continue to pay premium add-on monthly fees as these services become more expensive and technically complicated?