Strategy Analytics: Sex Won't Sell Wireless Services; Wireless Adult Entertainment Services Will Generate Only 5 Percent of Mobile Entertainment Service Revenues in 2008

    LONDON--April 16, 2003--Strategy Analytics, the global research and consulting company, today released "Wireless Porn Opportunity Limited to $1 Billion in 2008." This report from the Strategy Analytics Wireless Internet Applications (WIA) Service, notes that adult community services, such as those recently announced by AT&T Wireless and Match.com, will ramp up quickly, boosted by the growth of the camera and videophone markets. Although skeptical of the revenue potential that streamed or downloaded adult services offers to wireless clients, the report further recommends that carriers must move swiftly to capitalize on their core messaging strengths by bundling branded dating applications into their service portfolios.
    Senior Analyst Philip Taylor notes, "We believe the advantages of the mobile phone as a personal and discrete device for viewing pornography are overstated. The value of the mobile channel to the porn industry will be greater as a CRM-tool than as a distribution medium."
    Speculation as to the potential offered by wireless adult services is often based on the premise that fixed Internet pornography providers are raking it in. Strategy Analytics disputes the often cited figure for global adult entertainment revenues of US$20B, and believes this figure is actually closer to the $4 billion mark, of which only around $500 million will be generated on-line.
    David Kerr, Vice President of the Strategy Analytics Global Wireless Practice, adds, "This is less than half of the value of the ringtones market in Western Europe in 2002. We believe that, with so much pornography available for free on the fixed Internet, demand for adult material will continue to be largely met by fixed Internet services." Kerr further states, "Carriers must not allow themselves to get sidetracked, and must focus on implementing applications infrastructure platforms and business models that will open up mobile to media and entertainment industries, including adult entertainment, as swiftly as possible."

    About Strategy Analytics

    Strategy Analytics, Inc., a global research and consulting firm, provides timely insights and strategic business solutions to companies operating at the convergence of information, communications and entertainment technologies. With worldwide headquarters in Newton, MA and principal offices in England, France and Germany, Strategy Analytics focuses on market opportunities and challenges in the areas of Automotive Electronics, Broadband, Telematics, Wireless Strategies and Enabling Technologies. For more information, see www.strategyanalytics.com