UK mobile operator Hutchison 3G is researching ways of offering pornography to its customers.
UK mobile operator Hutchison 3G has appointed a head of adult services to explore the possibility of delivering pornographic content over 3G mobile devices. The company, which is scheduled to begin operations by the end of 2002, is considering delivering photographs and short video clips using the network.
Pornography is a good way to make money from online content. Datamonitor research has found that it is one of the most profitable Internet revenue streams, with the entire adult content industry (including the Internet, magazines, videos and phone lines) worth $8 billion per year in 1998.
Hutchison will be keen to build revenues by whatever means possible. As a new entrant, it will be at a disadvantage to the four incumbents. To attract new customers, it may have to offer cut-price services. However, if this happens, the other operators will also slash prices, possibly causing a price war – something that no one in this industry needs at the moment. Hutchison must instead offer innovative, fresh content that differentiates it from its rivals.
Offering premium content will also bring in direct revenues – Datamonitor expects mobile entertainment content will be a $692 million business in the UK by 2004. Hutchison has already secured access to exclusive, premium content, paying around $70 million to cover Premier League football.
However, mPorn may prove less successful. While it’s socially acceptable to watch football highlights to enliven a train journey, this is unlikely to be the case with adult content. The occasions when people want to view pornography may well fail to coincide with the occasions when they are away from a fixed-line Internet or TV connection. And there are technical questions surrounding the quality and viability of 3G video clips.
Mobile pornography could prove a revenue-generating niche market for 3G operators. As such, it’s an avenue worth exploring. However, it seems unlikely to replicate the success of the online pornography industry. The mContent market may well come to be driven by more wholesome pursuits.
