How will the Comcast-NBC deal affect mobile?
The $30 billion deal between General Electric and Comcast Corp. to bring NBC Universal under the cable operator?s control could have a significant effect on mobile content and media.
Assuming that the deal clears all regulatory hurdles, the Comcast-NBCU joint venture would create a veritable broadcast and digital-media behemoth. And that could be a very good thing for mobile content distribution?and for mobile marketers.
?Anybody that pays attention to the space knows that this does portend some significant changes in the TV and broadcast space, and while Comcast doesn?t have a mobile play currently, they haven?t become an MVNO, will they add a mobile component to their triple play?? said Mike McGuire, vice president of research and media industry advisory services at Gartner, San Jose, CA.
?The increase in the adoption of smartphones, particularly the iPhone, has heated up the space, so it will be interesting how the combined entity views mobile,? he said.
One of the most fascinating questions in the wake of the Comcast-NBCU deal is what the joint venture?s monetization strategy will be for its branded mobile content.
?Mobile content is probably not going to be for free?the combined entity is going to ask ?Is there a way to extract payment in the mobile channel??? Mr. McGuire said. ?Certainly the mobile channel is going to be important to them, but now that this is a content company as well, they will probably have a very interesting take on free versus paid and trying to crack down on piracy
?Comcast will want to extract payment?they will probably not provide free access to content on the mobile channel,? he said.
Whatever monetization models the combined companies employ, there is no doubt that the mobile mobile channel will continue to increase in importance for the joint venture.
?I don?t think anyone there in biz-dev will ignore the mobile channel for long, whether they launch a specific mobile portal or mobile delivery content offering,? Mr. McGuire said. ?The next question is ?Who do they look to sidle up with?' Andriod? The iPhone??
Mr. McGuire cited the MLB.com At Bat application for iPhone and iPod touch, which is $9.99 in the App Store, as a good example for Comcast-NBCU to follow (see story).
?The app features a significant amount of video, and it?s a full-on paid app,? Mr. McGuire said. ?That?s going to be an example that they look at very closely.?
The joint venture will consist of the NBC Universal businesses and Comcast?s cable networks, regional sports networks and certain digital properties and certain unconsolidated investments.
The joint venture will support entertainment, news and sports content development across all platforms including film, television, online and mobile.
It will be anchored by a portfolio of cable networks and regional sports networks that will account for about 80 percent of its cash flow, including USA, Bravo, Syfy, E!, Versus, CNBC and MSNBC.
Under the terms of the transaction, GE will contribute to the joint venture NBCU?s businesses valued at $30 billion, including its cable networks, filmed entertainment, televised entertainment, theme parks and unconsolidated investments, subject to $9.1 billion in debt to third-party lenders.
Comcast will contribute its cable networks including E!, Versus and the Golf Channel, its 10 regional sports networks and certain digital media properties, collectively valued at $7.25 billion, and make a payment to GE of approximately $6.5 billion of cash subject to certain adjustments based on various events between signing and closing.
Both Comcast and NBC Universal have launched mobile initiatives of one form or another.
Comcast ran a mobile ad campaign within the Newser iPhone application to get companies to sign up for its Business Class Internet, voice and cable television services (see story).
In July, Comcast launched a free mobile application for the iPhone and iPod touch provide mobile access to live TV listings, SmartZone email and voicemail, and video-on-demand movie trailers (see story).
Comcast.net, Comcast's broadband service, has partnered with Thumbplay to add a mobile entertainment library to the site (see story).
NBC Universal?s Universal Studios Home Entertainment has launched iPhone and iPod touch-enabled features to enhance the upcoming Blu-ray releases of various movies (see story).
NBC Local Integrated Media launched 10 applications for iPhone and iPod touch, each backed by an NBC Locals Only city-specific Web site (see story).
NBC?s ?Heroes? extended its superpowers to mobile for a fourth year with exclusive content for wireless customers who are fans of the show (see story).
NBC Universal?s cable television network Bravo has a robust mobile strategy for its programs to better engage consumers (see story).
NBC Sports launched the Notre Dame Central application, a signal that mobile television is on the up and up (see story).
NBC?s Today Show, MSNBC and Rachel Maddow tapped Zumobi to create iPhone applications, which they have promoted with banners ads within the Sporting News Pro Football application and other Zumobi applications (see story).
?Certainly NBC Universal has already had a play in mobile content, and Comcast has been building mobile capabilities, although Comcast is known for cable TV, broadband Internet and wireline telephone service for homes,? said Jeff Orr, Bend, OR-based senior analyst for mobile devices at ABI Research. ?It?s not known for mobile, so NBCU brands will be leading the charge in the mobile space.
?Does this give Comcast better reach into this space? Possibly, but it depends on whether Comcast can introduce its brand into the areas currently branded as NBC Universal,? he said. ?It might be able to fold in some of the Comcast services and applications to make them available on mobile devices.
?Does that get inserted into a social-media context, or just an on-demand or subscription service? I?m not sure if there is an immediate synergy for mobile, but maybe it can be built over time in the minds of the audience.?
With this deal with GE, Comcast is making it clear that it wants to cast as wide a net as possible. And mobile is definitely on its radar.
?Certainly with the breadth of channels and areas Comcast tries to cover, mobile will be a priority?it?s not just cable TV to your home, it?s a voice phone service and broadband Internet,? Mr. Orr said. ?It has a partnership with Clearwire in the U.S. for mobile broadband services in WiMax markets, and there?s certainly the opportunity for more of a direct relationship relating to mobile.
?Because it?s an early agreement, there?s going to be a lot of speculation for what it will mean, but it will be business as usual for the time being,? he said. ?There will not necessarily be huge changes, because NBCU has a lot of contracts and agreements are already in place that Comcast has to honor.
?I tend to think that the mobile side of the business is not necessarily high on their list, but it?s definitley part of the mix, and there will be no big shifts in strategy today, but maybe in 2010 there will be.?