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Saturday, Jun 10, 2023

Companies Dial Into Interest in New Cellphone Feaures

The increasing advancements in wireless technology have corresponded with the public’s clamoring for more and more ways to customize their cell phones. Accordingly, things like ring tones, wallpapers, videos and games have exploded in popularity, allowing several Valley companies to reap the benefits. Calabasas-based THQ Wireless, a subsidiary of THQ Inc. has emerged as one of the nation’s leaders in the wireless sector, by providing ringtones, graphics, videos, and games from notable brands such as Star Wars, Hello Kitty, South Park and all the major professional sports. The growth stemming from these licensing agreements has allowed THQ to triple its revenues over the past year, going from approximately $6.5 million in 2004, to projected revenues of $25 million for 2005. Furthermore, Tim Walsh, the president of THQ Wireless, expects revenues to zoom to $50 million for 2006. “Our strategy has been to focus on branded content. Because THQ has so many relationships with branding partners, we can leverage those relationships to give us products that consumers want and it gives us the must-have titles that the wireless carriers want,” Walsh said. “We don’t have to fight for placement. We can just leverage those brands and get it out to the consumers.” Founded in 2001, THQ Wireless took an initially conservative approach to the sector, waiting to see how the then-new technology would play out. But as it exploded into a billion dollar industry, the company made moves to grow along with it. “We’ve only been ramping up seriously for the last 24 months. When the company was founded in 2001, we took a very conservative approach to the marketplace. We noted how it was emerging but didn’t want to be premature and jump in and lose a lot of money,” Walsh said. “We had a small team that developed distribution and technology. We wanted to be poised and ready when the market took off at the end of 2002. By the first quarter of 2003 we saw that there was a real market and accordingly ramped up all of our operations, marketing and acquisitions.” Built-in advantage Unlike many companies competing in the sector, THQ Wireless has a parent company pumping out creative output ready to be turned into games for mobile phones, providing the company with a built-in advantage. With analysts bullish on the industry, THQ Wireless seems to have a future as an integral part of its parent company’s growth strategy. “I wouldn’t shy away from using the word explosive to describe the growth of wireless content. It has become a real and important industry, not only in the U.S. but in the global market,” David Chamberlain, a senior analyst for In-Stat said. “Consumers want these premium services and what is as important to companies is not just the revenue that they generate, but the relatively low cost of what is being sold there. A lot of revenue comes from something that is not particularly expensive.” Having only jumped in the fray in the past year, Woodland Hills-based wireless firm, Telecast Mobile, comes to the table with vast experience gleaned from having operated in Europe for the past several years. Like THQ, Telecast is a provider of ringtones, graphics and videos (though it will not yet distribute games). Aiming at distributing content from the worlds of music, entertainment, and sports, Telecast believes that there is a vast market just waiting to be tapped into. “We’re excited about the scope of the potential in the wireless mobile market. The United States represents the largest new market in the world today and the largest amount of disposable income to be spent on wireless products,” Edward Bonn, the CEO and president of Telecast Mobile said. “We’re focusing on providing entertainment, sports and music content. As technology progresses and people can download richer and richer content, we see a great deal of opportunity.” Telecast functions as an enabler, taking companies’ pre-existing licensed material and making it wireless friendly. The company signed its first pact this month with Agoura Hills-based music merchandising and management company BandMerch. The deal calls for Telecast to provide wireless content and technology for the bands that BandMerch represents, including household names such as Snoop Dogg, Outkast, Linkin Park and The White Stripes. Profits will be shared between the two companies in a revenue sharing agreement. In addition to the BandMerch pact, Telecast is also slated to soon announce its next deal, a service called Racefan that will allow racing fans to receive race-related text messages, downloads, and other content, for $4.99 per month. Connecting to fans “Through our technology, people will be able to go to the BandMerch website or their favorite musicians website, click on the mobile content section, and have their choice of wallpapers, ringtones, voice-tones or video clips,” Bonn said. “Anything that the band wants to put out to connect with their fan base will be converted by us for mobile use. The real commercial attraction to this is that people want to personalize their phones with their favorite artists.” BandMerch’s decision to sign the deal with Telecast, also embodies the fast-developing nature of this trend, as companies line up to tap into this burgeoning revenue source. By signing the deal, BandMerch will suddenly stand to realize heretofore unrealized income from the multi-platinum artists that it represents. “Providing wireless content fits well into what we do as a business, because we’re going to take these new offerings and integrate them in the product offerings that we currently have for our bands,” Keith Chagnon, BandMerch’s vice-president of marketing, said. “We wanted something digital to be bundled together with the other products that we currently offer. It will be a big part of our offerings.”

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