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Explosive Growth Predicted for Mobile Social Networks

By John P. Mello Jr.
Dec 21, 2006 8:51 AM PT

Social networking is going mobile and is poised for spectacular growth over the next five years, according to a research report released Monday.

Explosive Growth Predicted for Mobile Social Networks

The report from ABI Research predicts that mobile social communities will be attracting members in swarms, more than tripling in size worldwide from some 50 million this year to 174 million by 2011.

"The rapid rise of online social communities -- gathering places such as MySpace and Facebook -- has done more than bring the 'pen pal' concept into the 21st century," ABI Vice President of Research Clint Wheelock said. "It has created a new paradigm for personal networking.

"In a logical progression," he continued, "many social communities are now based on the mobile phone and other portable wireless devices instead of -- or as well as -- the PC. Such mobile social communities extend the reach of electronic social interaction to millions of people who don't have regular or easy access to computers."

Table Stakes

Although mobile social networks garnered early adopters as far back as 2003, "what's new is the number of people participating in it," Howard Rheingold, author of Smart Mobs, told TechNewsWorld.

"It's only really recently that we have had large numbers of people around the world with access to both broadband Internet at home and Internet connections on their mobile phones," he added.

Nevertheless, online communities will remain a hub for social networkers and the mobile scene just a spoke of those hubs -- albeit a very important spoke.

Retention Strategy

Mobile social networking will become "table stakes" for any online social networking site, according to Charles Golvin, a principal analyst with Forrester Research. "It will be an obligatory piece of the social networking service they need to offer," he told TechNewsWorld.

MySpace, the Net's largest social networking site with more than 80 million members, appeared to recognize that this week when it announced a deal with Cingular to allow its users to access their MySpace profiles through the mobile carrier's system.

"Are we going to see other social networking vendors doing that?" asked Jill Aldort, an analyst with the Yankee Group. "Yes. I believe that is the direction that we are moving in.

"The strategy here, though, is less one of customer acquisition for the social networking vendors and more one of retention," she told TechNewsWorld.

"Mobile services are going to appeal to consumers who are already using social networking services on their PCs," she explained. "I don't think it's going to be a significant driver for new subscribers."

No MySpace Replacement

The primary demographic group using online social networking sites and mobile data applications are 18- to 34-year-olds, Aldort noted, so mobile social networking applications will resonate with them. However, they will continue to use both mobile and online services.

"No matter which way you cut it," she observed, "the PC-based experience is always going to be more full-featured and richer than accessing a service on your mobile phone.

"Mobile services are convenient and may increase loyalty and stickiness to an online community, but they're not a replacement for the online experience," Aldort added.

There are some companies trying to build mobile-only social networks, noted Forrester's Golvin.

"In my mind, that doesn't make a whole lot of sense," he said. "The model here is that you build your social networks online and then you extend them to the mobile environment. That is more likely to be a successful model."

Show Me the Money

One of the great conundrums of the online social networking space is how to monetize its popularity. That's less of an issue with mobile social networking.

ABI's Wheelock pointed out that mobile operators profit from the data usage that underpins all mobile community activities they carry, and in some cases from monthly subscription fees.

"There's a direct revenue benefit to the carriers," Golvin observed. "As people use these sites, they sign up for richer data plans. And they're using their phones for more things, so they're more likely to use other services.

"In general, things on mobile networks are easier to monetize," he added. "However, they're easier for the carriers to monetize. That leaves an underlying question about what portion of those revenues should the online social networking sites get."


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Digital River - Talk to the Experts
Contact Center AI Explained by Pop Culture