Broadcasters generate new revenues and customer loyalty

The great success of SMS-TV applications provides broadcasters with an unprecedented opportunity to generate additional revenues as well as to increase customer loyalty.

Broadcasters generate new revenues and customer loyalty

Amsterdam, 6 September 2002 - In a development unforeseen by most analysts, European television broadcasters have embraced SMS text messaging as a revenue generating tool enabling users to interact with television broadcasts. Game shows, reality television and channels dedicated to teenagers and young adults are using SMS text messaging to enhance their programmes with interactive features. The great success of SMS-TV applications provides broadcasters with an unprecedented opportunity to generate additional revenues as well as to increase customer loyalty.

Early in 2001, MTV UK invited viewers of its "Video Clash" show to cast votes for their favourite video clip via SMS. The integration of SMS interactivity in the show greatly increased audience size as well as viewer retention. According to the station, the number of viewers rose from 295,000 to 500,000 per show. During an average show, 25,000 SMS were received. In Germany, the show enjoyed similar success with over 40,000 SMS messages generated during a one-hour show. The messages were priced between €0.19 and €0.29 depending on the network operator. Over 500,000 users have already participated in the "Video Clash" show in Germany alone.

"In todays advertising market it is not surprising that television broadcasters are embracing SMS interactivity to generate these much-needed revenues," said Senior Research Analyst, Ashley Smith. "Even public television channels in some countries are offering premium SMS services, often claiming to use the revenues to finance their non-commercial activities."

The enormously successful Big Brother television programme, developed by Endemol Entertainment, used SMS voting in various markets throughout Europe. In the UK, Big Brother 3 experienced an enormous influx of votes via SMS. According to mobile operator O2, who handled the SMS traffic, on the night that Adele was evicted from the Big Brother house, just under a million text votes were received - a third of all votes cast.

"This example shows the enormous potential of SMS TV in terms of revenues," said Mr. Smith. "Almost one million messages were sent during one show, at a cost of 0.25 (€0.39) per message. Whats more, the viewers that participate in votes or other forms of SMS interactivity represent a valuable database for broadcasters future mobile marketing campaigns. Interactivity helps broadcasters to create new revenues but also enables them to learn more about their audience."

These, and other key findings, are included in the forthcoming report from Van Dusseldorp & Partners which analyses the various business models spawned by the marriage of SMS and TV. "SMS-TV: Interactive TV Reinvented" covers the sustainability and division of the substantial revenues generated, the complex value network and the changing roles therein. The report assesses and analyses the balance of power and the tensions between the SMS application developers and providers, the telecommunication networks, the TV concept developers, production companies, production distribution companies and broadcasters. With over 100 pages of detailed case-studies, and an extensive directory of the major players in the SMS TV sector, this timely report is essential reading for anyone who needs to be up to speed on this burgeoning European industry.

This report was launched during the SMS Meets TV Seminar in Amsterdam on 16th September 2002. For more information about both the report and the event please visit www.smsmeetstv.com or contact Ashley Smith, Senior Research Analyst on +31 20 330 2983 or at ashley@vandusseldorp.com

The publication price for SMS-TV: Interactive TV Reinvented" is EURO 450 for PDF and EURO 500 for print. To order please visit
www.vandusseldorp.com/publications/smspreorder.asp
To request a review copy of the report please contact Rob Allen on +31 20 535 6986 or at rob@vandusseldorp.com

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About Van Dusseldorp & Partners

Van Dusseldorp & Partners BV is an Amsterdam-based research and development company concentrating on European digital media strategies and policies. Van Dusseldorp & Partners provides commissionable research and analysis, pan-European data gathering, publishes independent reports, produces its own seminars and workshops as well as events for third parties, provides pan-European marketing and PR services, and operates several new media news websites and free newsletters.

Contact information:

Rob Allen
EuropePR Manager
Tel: +31 20 535 6986
mailto:rob@vandusseldorp.com