iPhone Has Potential to Alter Mobile Video Market

SANTA MONICA, July 17:
According to a recent study conducted by the new-media research firm Interpret,
the iPhone has the potential to be a catalyst for growth in mobile video usage,
with 63 percent of iPhone owners already watching video on the device, compared
to only 28 percent of regular cell phone owners.

According to the survey,
51 percent of iPhone owners have watched a YouTube video on their phone, while
46 percent have watched a music video, 34 percent have watched the news, and 32
percent have watched a movie trailer. Prior to buying the iPhone, few owners
had watched video on their cell phones, with only 17 percent having seen
YouTube clips, 21 percent having watched a music video, 16 percent having seen the news, and only 15
percent having watched a movie trailer on a phone.

The survey also revealed
that a free, ad-supported model is popular among both iPhone owners and
non-owners. For example, 66 percent of iPhone owners and 73 percent of
non-owners said they preferred to watch content for free, with ads. One-third
of iPhone owners (34 percent) would consider a monthly subscription
model—compared to only 21 percent of non-owners—and 28 percent
would consider pay-per-download, compared to only 20 percent of non-owners.

"In order to fully
capitalize on the opportunity for mobile video, Apple and its competitors will
need to move beyond a pay-per-download business model," said Michael
Dowling, Interpret's CEO. "Consumers are used to an ad-supported model for
video, and are open to a wide range of advertising if companies like Apple can
deliver on the user experience."

A majority of both iPhone
owners and non-owners consider carriers, broadcast and cable networks, movie
studios, and Internet portals appropriate sources for mobile video. iPhone owners
and non-owners have some different expectations regarding the source of their
mobile entertainment, with 73 percent of iPhone users expecting to get it from
iTunes—compared to 43 percent of non-owners—and 46 percent of
non-owners expecting to get it from their cable or satellite company, compared
to 37 percent of iPhone owners.

The interest in mobile
video usage among non-iPhone owners is not strong, according to the survey.
Only 28 percent of non-iPhone owners have ever watched video on their cell phone,
and only 25 percent are interested in watching music videos and TV shows on the
phone; 24 percent of non-owners have watched movies and YouTube video clips on
their mobile devices. However, the survey also showed that the interest in
mobile video would spread if non-owners were exposed to the features of the
iPhone. After viewing a 2-minute video about watching video on the iPhone,
nearly three-quarters, or 73 percent, of non-owners said they are interested in
watching video on an iPhone, and 42 percent said they are "extremely"
or "very" interested. In addition, half of non-owners who are open to
buying the device say that seeing the iPhone's video capabilities makes them
more interested in buying one.

The survey was conducted
online among a representative sample of 1,000 cell-phone users aged 13-64,
including 200 iPhone owners and 800 non-owners.