MaxxoMedia Digital Media and Entertainment Trends

By Mark Levy, CEO MaxxoMedia

Who do you want to be today?

At Universal Studios City Walk in Los Angeles, they have a store where you can have the picture of your face inserted into a variety of scenarios. For instance, you can have your face placed into a picture of Indiana Jones or onto the body of a supermodel. Well, today I found a place online where you can do this with thousands of different photos — all for free. You can even share the photos you make with friends.

If you’ve ever tried to manipulate pictures in order to try something different or just to have fun, you know that without the proper training and photo editing tools, it is very difficult and most of the time the results aren’t all that great.

By Mark Levy, CEO MaxxoMedia

MCPS-PRS, the U.K. music publishing licensing and collecting organization, recently released a proposal suggesting that new digital media companies that want to license their copyrights should provide equity in their fledgling companies in exchange for the license.

They cited as some of the reasons behind this proposal:

1. Start-up firms present an undeniable headache for music rights entities. At incorporation, emerging firms tend to lack the financial resources, both in terms of cash holdings and cash revenues, to pay otherwise standard fees for music rights.

2. Emerging firms are not stable entities, in terms of their chances for success and the nature of their business models.

…and…

By Mark Levy, CEO MaxxoMedia

I thought I had the social network angle all covered with my Facebook profile, Linkedin profile, Plaxo, my website and a blog. But then I noticed people “Twittering” and “Zanneling” through my Facebook updates and I was intrigued. What were these new strange verbs, I thought?

So I went over to www.twitter.com and www.zannel.com and I looked around.

What I found was people of all ages, all across the globe sharing their lives in bite size bits — sharing web pages, photos, news stories and conversations being overheard. More bits sharing ideas, new product launches, videos, bookmarks and slideshows. Even more bits with moments of the mundane, the sad and the peculiar.

Then I dug a little more and found that there are many more sites with strange names, encouraging people to share their interests, loves, hates and lives. Some of the sites share information with other sites. They create a daisy chain effect where, for instance, I can Zannel a new video of the woodpecker harassing me during my conference calls, and it will feed the link to my Twitter account, which then feeds Plaxo and Facebook.

But what if you wanted to share and collect all the information on all your friends regardless of which site they are using?

By Mark Levy, CEO MaxxoMedia

According to the International Telecommunications Union, worldwide mobile telephone subscriptions now exceed 3.3 billion — equivalent to half the global population. Cell phones now surpass the number of computers and televisions combined.

In the coming years, it is predicted by some that the cell phone will become the device of choice for watching video. There are a number of current challenges to this vision that to date have stifled the market. Much like the early mobile web browsing experience, user expectations are low. Users complain of poor image quality, complexity, slow downloading times and lack of selection of content.

Content providers, distributors and carriers see a huge pot of gold in mobile video. Before they can realize it, though, new tools need to be created that help people find the content they want, format it correctly for each device and deliver a quality experience through the subscribers’ network connection.

Last week, I explained some of the complexities within the mobile content retailing market. This week we’ll hear senior execs from Thumbplay, 9Squared/Zed and Flycell talk about what it’s like to play in this space.

Are Traasdahl is the CEO of Thumbplay, the largest direct-to-consumer player in the U.S. An independent company with 100 employees based in New York, Thumbplay is projected to own about 18% of the U.S. off-portal market. The company recently raised $18 million in venture capital to expand operations.

Brian Casazza is CEO of 9Squared, a part of Zed, the leading mobile content retailer in the world with over $500 million in gross revenue annually. Zed has 40 million consumers around the globe who buy on a monthly basis. 9Squared announced earlier this month that they would formally combine operations with Zed.

Guillermo Cengotitabengoa is the VP Marketing for Flycell, a wholly-owned subsidiary of Italian mobile-messaging pioneer Acotel Group. Launched in November of 2004, Flycell provides a broad range of premium mobile content products, including ringtones, games, mobile greeting cards and wallpapers that empower mobile users to customize their phones and make them an extension of their personalities.

I asked each of them about the state of the market, how the regulations were affecting their businesses and what they could do to build brand and grow their businesses.

By Mark Levy, CEO MaxxoMedia

Throughout the past few years, the mobile content industry has enjoyed strong market growth. Primarily fueled by the sale of master ringtones directly through the cell phone carriers, the market looked unstoppable.

Recent studies show, however, that the ringtone market appears to be peaking and is projected to decline in the coming years. So far, no other mobile content application has proven it is ready to take the ringtone’s place. Mobile video has yet to take off and full-track music downloads seem to be dead on arrival. Some project Ring Back Tones may be the one to break through although it’s growth has been slow to date.

As recently as last year, it was believed that the direct-to-consumer market, also known as “off portal” mobile content sales, would more than make up for any flattening sales at the carriers.

Foreign-based companies, which had been successful in their native markets, began entering the U.S. market. They launched multi-million-dollar TV and print advertising campaigns to quickly build brand and drive awareness. Many considered the ads misleading. They offered “free” ringtones without explaining clearly that the consumer would be signed up to a pricey subscription.

By Mark Levy, CEO MaxxoMedia

In a recent ICOM survey of U.S. shoppers, 77% of the respondents in the 18-34 age group see their coupon use increasing if they could use some form of paperless coupon technology … and 63% of those 35-54 said paperless would increase their usage.

The mobile phone is one of the best ways to reach the elusive set of 18-34 year-old adults who have disposable income to spend, brands with which to affiliate, but neither the time nor interest to read newspapers or watch scheduled television.

San Jose-based Cellfire has been working hard for over five years to meet that demand. Cellfire is the only nationwide discount offer service, enabling consumers to conveniently receive and retain savings right on their mobile phones. Today, 68% of Cellfire users are between the age of 18-34, and 27% are over 35.

Currently they offer coupons for popular retailers such as Hollywood Video, Hardee’s, Domino’s Pizza, T.G.I. Friday’s, Peet’s Coffee, 1-800-flowers.com, Omaha Steaks, North Beach Pizza, Pizz’a Chicago and more directly to your cell phone. The service is available on all major cell carriers.

By Mark Levy, CEO MaxxoMedia

Last week, Las Vegas played host to the telecommunications industry’s annual CTIA conference. Over 20,000 people converged for the event to exhibit and explore the many opportunities of the wireless telecom world. Vendors were on hand to showcase the latest mobile-based applications — here are a few that stood out for me.

PC Games Come To Life On Mobile Phones

Back in 2003, Universal Pictures released “The Incredible Hulk” movie. About one month prior to the movie hitting theatres, I was part of a team that licensed the mobile content rights to the movie from Universal and Marvel. We had the rights to make a mobile game along with releasing various ringtones and graphics. Given the time frame to produce and release the game, we opted to produce a simple puzzle game.

By Mark Levy CEO of MaxxoMedia

In the midst of recent pronouncements that ringtone sales are in decline, Clear Channel Radio announced that mobile content offerings will be integrated into the websites of over 650 stations within the chain. The service, offered in partnership with Thumbplay, a leading mobile content retailer, will offer listeners direct access to purchase the tones for their cell phones.

Ringtone sales are projected to drop over 7% to $510 million in sales for the US in 2008. BMI says this is the second year of the declining sales trend. Some of the reasons blamed for the decline include high or complex content pricing models, advanced handsets that allow consumers to side-load content, mobile content sharing websites, social networks and the waning novelty factor.

By Mark Levy CEO of MaxxoMedia

The vision of the digital living room has been around a long time. This is where the living room and Internet collide centered around a screen (namely the TV) and information, video, audio, games, and communications all converge. Over the years, attempts have been made to bring this vision to reality mostly with lukewarm results. Anyone remember WebTV?

At a recent gathering just outside of San Francisco, this vision was discussed. The talks centered around three main topics: 1) What will the interfaces to this digital living room look like? 2) When will this vision become a reality? And 3) How will the various parties, from cable operators and content providers to ad agencies, hardware manufacturers and even consumers make money in this new world?

By Mark Levy CEO of MaxxoMedia

At the same time that Apple announced application and enterprise e-mail support for the upcoming iPhone update, one of the most respected and successful venture capital firms in Silicon Valley pledged $100 million to be invested in companies that are developing applications for Apple’s iPhone.The iPhone, which has sold just over four million units since it was launched, has been a massive consumer products success. It is redefining interfaces and design for the cell phone; you can see it in new designs from Nokia and LG. Now Apple aims to make the iPhone the next great software development platform.

Steve Jobs announced that the iPhone “Apps Store” will be the exclusive place to purchase applications designed for the iPhone. A new link on the home screen will give users access to a storefront from which they can access hundreds of applications specifically designed for the device. From games to productivity software and business applications, Apple is moving the computing experience from the desktop to the laptop to the mobile device.

By Mark Levy CEO of MaxxoMedia

Arbitron and Edison Research recently released some very interesting research with details on the web radio listening audience. The study found a deep connection between online social networks and online radio listening.Diane Williams, Sr. Analyst/Custom Research for Arbitron said, “We found that online radio listeners are more than one-and-a-half times more likely to have a profile on a social networking site as compared to average Americans, and that they tend to be power-users, with one-third of online radio listeners logging on to their social networking site nearly every day or even multiple times per day.”

In another study last May by Radio Network, it was concluded that 77% of online radio listeners find new music through online radio more than through traditional radio. This shift is monumental for the music industry. Promoting new music through traditional radio was a pretty efficient process.

As the radio networks became more consolidated, the efficiency increased even further. At the same time, more and more stations were managed by a single network and/or syndicated across the country to save costs, leading to fewer spots for new music.