BBC vs. The newspaper industry – mobile edition

The Independent captured the wrath of the Newspaper Publishers Association following the BBC's announcement of mobile applications at the Mobile World Congress.

The Independent captured the wrath of the Newspaper Publishers’ Association following the BBC’s announcement of mobile applications at Mobile World Congress in Barcelona. Mobile has become the latest digital platform for media providers to try and monetise.

Social network site Facebook receives 25 per cent or its audience (or 100 million unique users per month) via mobile devices and Apple recently paid $275 million for mobile advertising company Quattro Wireless in January.

The mobile advertising market is expected to be worth $18.5 billion by 2015.

Media companies also hope that the move to new platform will break the link between digital media and customer expectations of getting things for free, with consumers paying for the convenience to have the content whenever and wherever they want.

This viewpoint has been partly fueled by initial content sales through devices like Amazon’s Kindle and the Sony Reader ebook devices.

Newspapers are already providing mobile applications on the iPhone. The New York Times provides a high-quality free application on the iPhone; both the Wall Street Journal and Financial Times provide a free application but requires a subscription to see content and The Guardian charges 2.39GBP for its application.

The BBC has already been providing video content on mobile platforms through its iPlayer application.

BBC’s news applications follows the launch of a mix of free-and-paid for applications launched by US TV networks: ABC and CBS. Irish state broadcaster RTÉ has a paid-for application to provide video and text news to its viewers. It could be argued that the BBC is only keeping up with developments at its peers.

Regardless of the merits of the Newspaper Publishers’ Association it is questionable whether newspapers will actually receive a significant financial benefit from mobile devices.

Moody’s found that just 14 per cent of newspaper costs were derived from value-creating activity, a further 16 per cent was spent on advertising sales and 70 per cent was tied up in the print distribution model and corporate roles – in order to benefit from mobile and online they would need to get the same level of revenue as they currently do from offline channels which is not happening.

Recent anecdotal feedback from content providers on the Amazon Kindle device seems to indicate that revenue figures are disappointing. And Advertising Age (subscription required) reported on Nielsen Research findings that found existing cross-platform brand linkages are weaker than previously thought.

This means media brands were not terribly successful at migrating audiences to online media leaving room for pure-play digital brands such as the Huffington Post.

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