Carriers or Content: Who Will Take the Lead with <?XML:NAMESPACE PREFIX = ST1 />ODP?
Scott G. Silk
President and CEO
Action Engine

What’s in a name? Over $1.5 billion, if the name is “on-device portal” (ODP). That’s what ARCchart estimates as the total ODP market size for media companies and mobile operators in 2009. Similarly, ARCchart projects the market’s growth rate at 166% compounded annually, and this doesn’t even include the multi-billion dollar revenue stream that mobile advertising is predicted to add in addition to the ODP space.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />

Of course, there’s more driving this market than the potential for exponential revenue growth. High-speed networks now provide dependable connectivity. A new generation of powerful, reliable handsets can deliver a vast array of rich content. In addition, today’s ODP solutions make it simple for users to access that content and easy for media companies and operators to manage and monetize that content.

Operators Play It Safe.
Given their relationships with subscribers, mobile operators, like Verizon Wireless and AT&T Wireless, should be leading the ODP charge, right? Wrong. At Action Engine, we see ODP being driven first by big-brand media and content companies, like ESPN, Apple, Yahoo!, and MSNBC.com, that want to elevate their brands across millions of handsets and monetize their content via mobile advertising.

Today, mobile operators are taking a conservative approach when it comes to deploying ODPs. They have a strong installed base of subscribers that they want to protect, and this means that they will wait to embrace ODP technology until it is fully certified in their labs and accepted in the market. ODP presents an opportunity for them, but they will take a ‘pragmatic’ approach before investing heavily in this emerging growth opportunity.

Media Companies Lead the Charge.
Conversely, media and content companies are aggressively pursuing their on-device portal strategies. They are anxious to put their brands and content on millions of phones to start reaping the mobile advertising revenues and brand awareness rewards that come with this new ODP technology.

Some media companies are also taking a direct-to-consumer approach to get to market fast. Others are choosing to work together with the operators to leverage the marketing and distribution power that those partnerships can offer. Either way, nearly all of the big brands have RFPs out on the street to find new ways to elevate their brand and leverage the usability, monetization, and manageability benefits that ODPs can provide.

Better late than never?  Only time will tell how the ODP market unfolds. My take? Media and content companies are going to continue to take the lead in driving the ODP market in 2007, and mobile operators will join them when the ‘risk’ of losing the market is greater than the ‘risk’ of not acting aggressively. At that critical juncture, the mobile operators will jump in with both feet. Stay tuned…..