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Smartphone users to drive highest video consumption on mobile in 2014: Deloitte
TT Correspondent |  |  01 Feb 2014

Smartphone users are expected to drive the highest video consumption on mobile in 2014. This is based on the prediction that the number of smartphone users in urban India will cross 104 million in 2014 compared with 51 million users in 2013, according to the 4th edition of Deloitte’s predictions for the technology, media and elecommunications (TMT) in India in 2014.

The report said that that consumers are increasingly becoming screen agnostic, and are viewing video content on their smartphones both inside and outside the home.

“In 2014, mobile video is likely to be the preferred service over other mobile value added services,” says PN Sudarshan, Senior Director, Deloitte in India. “We anticipate 50-60 percent of all the mobile data consumption in India to be driven by video over next 2-3 years.” With improved networks and connectivity, users will increasingly consume higher resolution video. While pre-downloaded and side-loaded form of video will continue to be a major part of the overall video consumption on mobile, Deloitte envisages emergence of innovative business models in mobile video streaming/time-restricted download space in 2014.

Instant messaging (MIM) services on mobile phones may win the battle for volume in 2014, but short messaging service (SMS) will be victorious in revenue terms. Deloitte predicts that in 2014, MIMs will be more than twice the volume of messages sent via a SMS. However, despite the burgeoning volumes of MIMs, we expect SMS to generate more than $100 billion globally in 2014, equivalent to approximately 50 times the total revenues from all MIM services. This might be slightly different in India as operators have reduced low cost SMS plans due to regulatory changes; resulting in subscribers using other means to communicate.

Local language content will be crucial in 2014. Deloitte predicts that India would witness a surge in the development of local language applications and localization of content, as any incremental increase in mobile data and internet subscriber base would be achieved among the section of the population whose digital accessibility is limited by language constraints. Additionally, Deloitte predicts that regional print industry will continue to surge primarily driven by factors such as under penetration in regional markets, rise in regional ad-rates and sustained pressure on English print advertising by digital media.

About social media the report observes that it would continue to grow as a favored platform for targeted advertising as its adoption surges, driven by increasing mobile usage and higher penetration of smartphones and a young population.

It said that in 2014 shipments of phablets, smartphones with 5.0-6.9 inch screens, will represent a quarter of smartphones sold. After initial rapid consumer success, 2014 may mark a ‘peak phablet’ year, as only a (sizeable) minority of smartphones users will want to handle such a large device. Two thirds of phablets in 2014 will be less than 5.1 inches, just meeting the definition, and less than 10 percent are likely to be 6 inches or larger.

Deloitte envisages emergence of innovative business models in mobile video streaming/time-restricted download space in 2014. Telecom companies will alter their position from high cost dumb pipes to affordable smart networks that will support third party video service providers as well as help developing video consumption habits among customers.

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01 Feb 2014(IST)  
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