Ofcom says mobile web market is set to explode

A report by regulator Ofcom released late last month revealed increasing convergence of data and voice services in the UK communications market, alongside a further rise in broadband penetration. Perhaps less expected was the report’s prediction of strong growth in mobile internet uptake, which could be encouraging news for content providers.

The annual UK Communications Market Report 2007 predicted that although non-SMS data revenue comprised just five per cent of mobile operators’ retail revenues last year, “there are indications that the mobile internet may finally begin to deliver on some of its promises in the near future”.

A central factor cited was the increase in 3G take-up to 7.8 million connections by the end of 2006, as well as a rise in the number of handsets with internet capabilities. Eighty per cent of the handsets sold in the first three months of 2006 had XHTML capability, which is necessary to render web pages onto mobile phones, the report found. In addition to these factors, most network operators now offer all-you-can-eat data tariffs for around £5 a month.

The report also highlighted the work of content providers as a major factor in increasing mobile internet use, as they are now able to offer “a customer experience approaching that available to users of the fixed-line internet”.

Christian Lindholm, the former head of multimedia applications at Nokia who now works for digital innovations consultancy Fjord, argued that firms should be looking at ways to design a pared down, mobile-friendly version of their fixed web sites.
“The lack of standardisation is a challenge because there is a lot of fragmentation between different handsets,” Lindholm argued. “It’s also a bit chicken and egg in that if the content is not available people won’t browse.”

Lindholm advised companies to optimise their mobile web sites for 320x240 pixel screens on Nokia or Sony Ericsson phones as these devices have large user bases, and monitor the uptake. “This lets you manage the size of your investment better,” he added.

Peter Richards, head of mobile app provider Mobestar, echoed the report’s conclusions, arguing that the timing is now right for firms to launch their sites and applications on the mobile internet.

“When we started three years ago data charges were too high, the [download] speed was poor and the battery life of phones couldn’t handle it,” Richards added. “But if you get the user interface right, there is now an industry structure to support your application.”

However, Richards agreed with Lindholm that the lack of device standardisation is still a problem, explaining that Mobestar had to acquire the transcoding technology enabling content to be displayed on any handset, through the purchase of another firm.

John Lervick, chief executive of enterprise search vendor Fast, said the content that will really drive uptake of the mobile web is likely to be location-specific. “Initially, people thought it would be e-commerce, but one of the key drivers is the combination of locality and GPS,” he added. “Being able to find things in a geographic context with search and maps, for example.