MOBILE ENTERTAINMENT INDUSTRY OVERVIEW

Looking more closely at the entertainment industry, we see that its value chain is made of intellectual right owners, producers, artists, technologies/production and distribution. The revenue stream in this industry rewards the contributors based on their contribution and risk.

However the combined industry has so far failed to build a consensus on the form of the value chain nor generated a reference business model that is sustainable. One of a major result of this lack of clarity is the obvious shortage of large-scale application development, and lack of branded content.

To analyze the mobile market, it is necessary to understand who the key players are.

Subscriber: The use of the service, who enjoys (and pays for) it. The subscriber is also the target audience of campaigns in a free-to-air model.

Operator: The mobile operator is responsible mainly for the billing as well as maintaining a relationship of trust with subscribers. In most cases (except VMNOs – virtual mobile network operators) they provide the transport layer for the application (e.g., SMS, MMS, voice, download).

Service providers: The organization providing the actual entertainment services in conjunction with the relevant consumer marketing. The role of the service provider can be undertaken by the mobile operator, a white label Wireless Application Service Provider (WASP), or a mobile portal.

Publishers: Publishers traditionally select the applications to develop and the type of content to use (branded or not). They then source the development to application developers. Once the application is complete, publishers distribute and market it to the service providers.

Content providers and owners: These are the large content brand owners and aggregators.

Application developers and designers: The firms to actually develop the applications (flow, software and graphics). In the mobile entertainment market, we currently see they are often also the content owners and/or the ASP, as referenced in the RETRO-TREND business model.

Technology solution vendors: Mobile-entertainment-dedicated technology, which can be roughly categorized to software platforms and authoring tools. Platforms are the backbone of the service providers and allow managing of various entertainment services, such as games, streaming audio and video and ringtone downloads. Authoring tools are a necessary component for delivering applications by application developers. It is common to find parties that take on several of the roles listed above. For example, we find mobile operators that are also service providers, service providers that are also application publishers and developers that are also publishers and/or technology providers.
The market is not yet mature, and therefore many parties have either chosen, or been forced to take on, more than one role.

Reference Business Scenario

There are many ways in which a value chain can be built up to form a full business scenario. In particular, one can ask what the source of revenues for the value chain is. The revenue that flows through the value chain is based on payments the subscriber makes to the operator for the use of the services, as shown in Figure.

However, no matter how subscribers are charged, it is assumed that the overall revenues generated by a given application – traffic plus content fees – form the basis for discussion on revenue flow.

Operator & service provider: The relationship between operators and service providers is one of revenue sharing. The shared revenue can be based on content and/or traffic. In SMS gaming environments, subscribers are billed based on traffic. Therefore, revenue sharing between theses parties is based on traffic alone.

The difference in the relationship between operators and service providers varies based on which party takes responsibility for marketing the applications and providing customer support for the service. If, for example, the service provider undertakes responsibility for marketing, then it is entitled the lion’s share of the revenue to offset the risk it takes. If the operator undertakes the marketing of the service and sets the prices, then the service provider has less risk, and hence is entitled to a smaller share of the revenue.

As a conclusion RETROMEDYA and its ASP partner or “sistercompany” TRENDTECH has re-structured and provided an optimum solution into the existing Turkish mobile entertainment market. Below this structure;

Retromedia produces and aggregates exclusive content, produces on demand and creates ideas for mobile services and markets these services into the target audience. Retromedia is mainly specialized on TV market as well as using them as a marketing communication channel.

On the other hand Trend-tech is the co-partner of this operation by means of providing technological solutions into the ideas demanded by Retromedia and its clients. Upon this cycle Trend-tech develops the application, integrates and provides multi platform technological solutions such as, Mobile into Open TV or analog infrastructures. As an operational flow Trend-tech is also the one who is responsible of maintenance, durability and reliability by monitoring the whole technological framework 7*24.