Content Delivery >> Mobile Rah!

As the number of cell phones on campus continues to rise, many schools are discovering newfound revenue by delivering sports-related mobile content at a premium.

Get your pompons ready, because in 2006, campus football and basketball stadiums aren’t the only place you’ll hear a school’s fight song. At many institutions, fight songs are now playing all over campus: on the quad, on the bus, in the cafeteria, and sometimes (though not the ideal situation) even in class. Just about any place you’d find a cellular phone, you can hear a school’s fight song in all of its rah-rah glory. Thanks to a new and lucrative form of content delivery, the songs actually come from the phones themselves, as special polyphonic ring tones that students can purchase, program to replace the phone’s traditional ring, and play every time they receive a call.

Students buy the ditties for anywhere from $2 to $3 apiece, and download them from a variety of Internet sites. But that’s only part of the transaction. Because the fight songs are licensed, colleges and universities receive a percentage of every sale. Taken individually, these fees don’t amount to more than 10 or 15 percent of the total price. As thousands and thousands of students sign up, however, colleges can see tidy new revenue streams. Rich Routman, VP of Business Development at Collegiate Images, one of the companies that licenses ring tone content, points to the revenue possibilities.

“If two years ago, you asked a college student what a ring tone or wallpaper was, they would have looked at you like you were crazy,” says Routman, whose organization is a subsidiary of the Collegiate Licensing Company in Ft. Lauderdale, FL. “Today, these kids simply can’t get enough of the stuff, and colleges and universities are cashing in.”

Though the mobile content business for higher education is still in its infancy, opportunities surrounding mobile content delivery could be veritable goldmines for colleges and universities. Those schools that have been licensing content for some time have earned tens of thousands of dollars in a matter of months since the industry took off in the summer of 2005. Other schools can’t sign up for the services quickly enough; across the country, campus VPs and marketing officials have been scrambling to get mobile content delivery programs up and running before the fall football season ends and the big-money winter basketball season begins.

Most of these deals are built around ring tones, still images (such as graphical-logo wallpaper for cell phone screens), and video clips; the basic trio of mobile content in higher education today. In some cases, however, trailblazing schools are also inking mammoth licensing agreements for anything and everything: sports scores via text-messaging, breaking news updates, sales on merchandise, and more. Though these latter deals are harder to find right now, Mike Merrill, chairman and CEO of content provider Smartphones Technologies, says they may be more common in the not-too-distant future, and that the sky’s the limit for what happens next.

“This is undoubtedly one of the most exciting industries in the world right now,” he says, likening the mobile content business to a second coming of the dot-com boom. “For colleges and universities, the possibilities are endless.”

The Environment

It’s no secret that there’s money to be made around college sports. The National Collegiate Athletic Administration (NCAA) generates more than $2.7 billion in licensing revenue per year, exceeding both NASCAR and the National Hockey League. Furthermore, college sports have the longest selling season of any major sports licensor, starting in August and running through June. Add to this the fact that six out of every 10 Americans own a cell phone, and that college-aged Americans love buying high-tech gadgets and gizmos, and colleges and universities have a great opportunity to earn big bucks delivering licensed content to mobile phones.

Currently, there’s no bigger mobile content market than that of ring tones. In 2005, global revenue exceeded $3 billion, according to Ispos, a firm that tracks these trends. And US forecaster Jupiter Research estimates that annual ring tone revenues totaled $417 million last year, and will grow to $724 million by 2009. A recent survey by M:Metrics, the Seattle market research firm, indicates that nearly 30 percent of all cell phone owners between the ages of 18 and 24 have purchased at least one ring tone. According to Mark Donovan, an M:Metrics analyst, no other demographic group has embraced mobile content with such passion.

“These statistics indicate that especially among young people, mobile phones are just another distribution platform for content and applications,” Donovan says. “The medium is something that should be on the roadmap for everyone, in terms of monetizing.”

In the consumer industry at large, the ring tone is quite literally ringing off the hook. In 2005, the popular R&B singer Beyonce Knowles went platinum selling ring tones alone, and rapper Eminem earned more money last year on $2 mobile downloads than he did on actual records. This past summer, Madonna became the first major artist to set up a ring-tone “shop” on the Internet. And in November, Billboard magazine even started publishing a list of best-selling ring tones alongside its more traditional categories such as best-selling album and top song—perhaps the truest and most earth-shattering acknowledgment of the ring tone’s value as pop culture currency.

In the higher education environment, ring tones are doing just as well. While no research firm specifically tracks mobile content in higher education, vendor and analyst experts estimate that anywhere between 300 and 500 colleges and universities are making money by selling this kind of mobile content, and that the number is growing every month. Donovan notes that the higher education marketplace has embraced other forms of mobile content too, including video clips and cell phone wallpaper. In some instances, schools even incorporate text messages and other alerts into their offerings (see “What’s Up Next?” below).

What's Up Next?

THE WORLD OF mobile content delivery is changing monthly. Today, most aggregators sell ring tones, still images, and video clips. Tomorrow, many of these companies will be supplementing their product offerings with text messages and news alerts that offer users upto- the-minute information on sports and other issues of interest.

Already, some aggregators have piloted this approach. Smartphones Technologies , for instance, recently rolled out a number of test projects revolving around Short Message Service (SMS) communications of no more than 140 to 160 characters per message. CEO Mike Merrill declines to specify where these trials are taking place, but notes that initially, the company will be broadcasting information such as scores, locker room reports, and more.

“Different schools have different desires, so as we figure out what it is that schools want to do, we’ll broaden the program a bit,” he says. “We’re trying to build flexibility into the program so our customers can use it as much or as little as they want to.”

According to Merrill, SMS is only the beginning. As the technology becomes more sophisticated, Smartphones and other aggregators ultimately are shooting for Multimedia Messaging Service (MMS), an enhanced transmission service that enables graphics, video clips, and sound files to be transmitted over mobile phones. Once this technology becomes reality, experts predict that advertisements will begin appearing on mobile content airwaves, as well.

Rich Routman, VP of Business Development at Collegiate Images , agrees, predicting that as more and more companies turn to MMS, the high-fidelity 3G Network that exists today (but is largely unpopulated) will become more crowded, both with legitimate traffic and with advertisements.

“I don’t think mobile advertising will relate to a ton of additional consumer product market sales, but it certainly will be present in the near future,” he says. How schools utilize these advertisements, he adds, is up to them. “One year from now, the mobile content industry could change again. That’s the beauty of it all.”

“There is no arguing that cell phones are the tools of choice with today’s generation,” says David Lovell, director of Marketing at the University of Miami (FL). “This [mobile sports content] lets us extend our brand and create a new revenue stream, while giving our fans something they’ll love.”

Market Leaders: Who’s Doing What

The current world of mobile content can be divided into two: content aggregators and content distributors. Aggregators are those firms that pull together content and put it up for sale. Distributors, on the other hand, are cellular carriers such as Cingular, T-Mobile, Verizon, and Sprint Nextel. Carriers present customers with the opportunities to purchase content at every turn, incorporating fight songs and other types of mobile content into broad-sweeping initiatives targeted at college-bound teenage customers. Students can either purchase content from their cell phone providers, or buy it directly from the aggregators, where it usually costs less.

One aggregator of note is Summus, a Raleigh, NC vendor that burst onto the scene back in 2004. Within weeks of its debut, Summus had unveiled more than 200 fight songs and logos for download on a special Web site, www.fighttones.com. The company promoted these efforts by running newspaper ads on major college campuses, and by distributing posters, brochures, and other information in freshman dorms and at tailgate events. Today, CEO Gary Ban considers sports low-hanging fruit around which colleges can’t help but build additional revenue streams. Mobile content, he adds, provides the perfect opportunity to do just that.

“If I’m going to Carolina, I want to make sure I have the Carolina logo and Carolina fight song on my handset, because whether I’m a sports fan or not, I’m a Carolina fan because I go to the school,” Ban says. “This is the kind of thinking colleges must acknowledge with very basic and affordable services, because it’s a great way to make money.”

Smartphones may well be Summus’s biggest competitor. The company launched quietly in 2003, when the ring tone market was something of an amusement for analysts. Two years later, by summer 2005, Merrill’s Smartphones and Routman’s Collegiate Images announced groundbreaking licensing agreements with more than 30 leading colleges and universities in the US. These agreements gave Smartphones exclusive licensing rights to many of the country’s top schools, and marked the first time officially licensed college sports content was offered for download to mobile customers—a truly big deal.

Today, under these agreements, Smartphones creates officially licensed wallpapers, animated screensavers, mobile video clips, ring tones, text messaging campaigns, and mobile games. In addition, to constantly refresh content, the company has made a practice of sending its own photographers and video crews to games throughout the year. Smartphones artists use these new images to create designs that combine school logos with action plays to create content that’s entirely unique for some schools. In the next few weeks, Merrill says the company even hopes to send teams to campuses to record cheers and sell them as audio files.

“Let’s face it—a loyal fan is going to download more than just one thing,” he says. “However a student or alumnus chooses to personalize a phone, we hope to have something for everyone.” Summus and Smartphones specialize largely in still images and basic audio files; College Sports Television Networks, however, focuses on more dynamic stuff. The company, which also owns the popular U-WIRE college news service, has made a name for itself broadcasting college sporting events and other sports-related programming including live games, special events, news programs, and talk shows on a private cable network and over the Internet. Since September 2005, however, most of the network’s regular programs have been available for download to mobile devices through the private MobiTV service, and V-Cast from Verizon Wireless.

The idea behind the CSTV/MobiTV partnership (and others like it) is simple: Give students what they want, when they want it, in the medium that they desire most.

The idea behind these partnerships is simple: Give students what they want, when they want it, in the medium that they desire most. While CSTV d'esn’t run the MobiTV or V-Cast services, the company works with these entities to deliver its ordinary television and Internet broadcasts in the form of mobile content. According to CSTV founder and CEO Brian Bedol, more than 600,000 CSTV subscribers signed up for the services in their first six months. Bedol says he expects that number to grow exponentially during the annual NCAA Tournament in March, a time of year when even professional sports fans turn their gaze on the college game.

“The passion of college sports fans and the availability of the technology are a perfect fit,” he says. “Students are completely mobile, traveling back and forth to school and back to their home towns, and as alumni they continue that practice. No matter where in the world they may be, they want to keep in touch with their alma mater. Our services enable that kind of connectedness.”

The Rest of the Pack

Summus, Smartphones Technologies, and CSTV are undoubtedly leaders in the higher education mobile content space, but they are not alone. A variety of organizations have joined the ranks in recent months, as well, offering a mix of ring tones, still images, and video clips for downloading at will. Atop this second tier of content aggregators is 2Thumbz Entertainment, an NC-based outfit that collaborated with Summus on Fighttones.com.

Under the auspices of CEO Mark Baric, 2Thumbz also sells its content through Verizon and Cingular. In all, the mid-sized content aggregator represents more than 250 schools.

Baric is a bit of a philosopher when it comes to content delivery, and he considers his company part of the wireless entertainment industry. When pressed, Baric insists that downloadable ring tones and logos are no different from downloadable games or other forms of content that cell phone users purchase to outfit phones exactly the way they want. For Baric, the burgeoning mobile content market works because it trades on something that just about every student or alumni possesses: pride. In Baric’s mind, mobile content delivery enables this pride, empowers it, and gives it a voice that each and every user can express in the way he sees fit.

“Every phone has to ring to one tune or another; every phone needs some sort of backdrop in its screen.” Baric says. “If you’re proud of your school, why shouldn’t that ring be the school’s fight song, or the school’s logo?”

On a smaller scale, Cellus, a Colorado aggregator recently acquired by Airborne Entertainment, offers ring tones and images via many of the biggest carriers. The company claims to serve nearly 300 colleges, but won’t reveal which ones. The no-frills SchoolFightSongs.com, on the other hand, is much more open with its customer list, cataloging all of the schools on one Web page. This last site d'esn’t work with carriers and instead has opted to sell content independently online. Surprisingly, the company manages to charge $5 per song—particularly high considering that most of the ring tones are monophonic.

Even television networks are getting into the game. ESPN recently launched ESPN Mobile, a partnership with Sprint, through which ESPN Insider members can receive a discount on ring tones, images, games, and other forms of mobile content in the area of college sports. FOX Sports offers a similar option through its FOX Sports Mobile service, a monthly $4.99 service that sends scores and updates via text message to cell phones from just about any of the carriers. As of now, both services mimic the providers’ general Internet sites, prompting some critics to question whether mobile content from a television network is really worth the investment.

“Sure, some sports fans will be interested, but the most important thing to mobile content buyers is still quality of delivery,” says Mike Masnick, CEO of Techdirt, a CA-based business and technology blog that tracks various industries including mobile content. “Who are you going to trust to have better quality?” adds Masnick, “A well-known mobile operator, or ESPN?”

What They’re Saying

These concerns haven’t seemed to phase academics one bit. On the contrary, throughout academia, officials at those colleges that have embraced mobile content simply can’t say enough about the new market. Many campus marketing executives only agree to discuss their deals off the record, for fear of violating confidentiality agreements. In all of these cases, officials say they are getting at least 10 percent of all mobile content purchases, meaning that for every $2 a student spends on a ring tone, the institution immediately earns 20 cents. In dribs and drabs, this may not amount to much, but if 10,000 students buy only one item each, the institution gets $2,000 it would not have had otherwise, and if over the course of the year those students purchase again and again, that’s a nice little revenue flow.

Officials also point to the way mobile content enables students and alumni to customize phones with their own recipes for school spirit. Steve Mackenzie, associate athletics director for Marketing and Development at the University of Arizona, hails the way a recent contract with Smartphones enables his school to let users set up their phones with whatever ring tones they like. Frank Cuervo, director of Marketing and Promotions at the University of Missouri, agrees, adding that he’s looking forward to parlaying this customizability into an opportunity for the school to extend its brand further and deeper than ever before.

“This new medium…is giving us a great way to keep in touch with our fans,” he says. “At the same time, [we’re] letting them show their spirit and support their school [in whatever way they want].”

At the University of Pittsburgh (PA), Lori Burens, assistant director of Licensing and Advertising, is looking forward to another aspect of mobile content delivery. While Pitt has offered ring tones for about a year, Burens explains that the school recently signed a deal with Collegiate Images to offer a variety of logos and other images for users to install on their phones as wallpaper. This deal marks the first time Pitt has signed with any aggregator to distribute images. In addition to variations on the school logo, images include action shots of football players, basketball players, the Pitt Panther mascot, and cheerleaders, to name a few.

Once the deal g'es live, Pitt students will have the ability to choose from hundreds of different images and buy as many of them as they’d like for $2 apiece. Burens declines to reveal what percentage of each purchase will go back to the school, but she says that the university is hoping to earn at least $10,000 by the end of the school year. Ideally, she notes, students will purchase five or 10 different images, store them on their phones, and cycle images in any way they deem appropriate. However the image experiment plays out, the feature will complement the school’s healthy ring tone business, adding to the number of forms of mobile content Pitt students and alumni can buy.

“If you’re willing to personalize your phone with a ring tone, there’s no reason you wouldn’t be willing to add some images to the mix, as well,” she says. “The more creative our [students and alumni] get with all of this, the more revenue we’ll generate as a result, and that’s something that will make everyone happy.”

comments powered by Disqus