Getting Into the Apps Market

In the past year major television networks in the United States developed smartphone apps reports Broadcasting and Cable. Paul Carton, director of research at ChangeWave Research, said “the pool of potential app buyers is more than 40 million strong and growing.” The numbers are difficult to ignore when all media is raging about the over 100,000 apps sold by Apple’s App Store.

Like most recent business models, dollars returned are small by on air advertising measures but return on investment is overwhelming. Stations developing apps charge for programs and sell advertising with them. The double revenue source often pays for development of applications. In the B&C report MTV Networks Entertainment Group executive VP Erik Flannigan says “we are intrigued by their possibilities as modest revenue generators.”

Consider CNN’s example of iPhone apps which are one click programs delivering easy access to content. The cable news network sells its app for almost two dollars and includes advertising. Louis Gump, VP of mobile at CNN says “in the case of applications…the best way to do that is to have a dual revenue stream.” CNN goes further in permitting iPhone users to send video from their phones to their iReport feature. It almost sounds crazy. Consumers paying premium costs for an application that delivers news content with advertising to their mobile device and permits them to send free content back to the provider. Gump bragged about impressive return on investment and their brands unduplicated reach to consumers away from their computers and television sets.

Smartphone sales were predicted to grow despite up and down sales numbers over the last year. Everyone is still trying to get a handle on the market. You can see how fragmented the smartphone audience is in a Slideshare presentation on trends from Justin Lee (try Google Translate if you require help reading Lee’s website). The research company BIA/Kelsey claims out of home advertising revenues will grow to almost $4-(b) billion in the next four years. There’s a reason every major network developed an app last year.

Next Broadcast Newsroom Computers examines whether video consumer producers are sources or competitors.

James Rowe

Rowe and Company, LLC

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