Why the World Cup Matters to Carriers

Mobile video has long failed to gain much traction, but carriers are hoping the segment takes a big step forward over the next few weeks as users around tune into World Cup action on their phones. So as I discuss in my weekly column over at GigaOM Pro, operators looking to boost their data revenues in the coming months had better be able to deliver the goods.

The iconic soccer tournament is already making a big impact on digital media, with Akamai reporting Friday that opening day resulted in the busiest day ever for bandwidth demand on news sites. That activity is expected to expand to mobile, too, according to Nielsen, which said more than one-fifth of mobile users around the world plan to access World Cup information via their phones, and 23 percent of U.S. consumers will get mobile World Cup content.

Much of that content will come in the form of scores and news updates, but a lot of traffic will be data-intensive video from streaming services like ESPN Mobile or applications like Slingbox. The increase in data usage presents both an opportunity and a threat for carriers at a crucial time. Network operators are struggling to manage and monetize network congestion, as evidenced by AT&T’s recent move to kill its all-you-can-eat data plans; other operators are expected to follow suit.

And the end of those unlimited plans will give carriers unlimited opportunities to grow that all-important data revenue: a hardcore soccer fan with a decent phone will surely pay $5 or more to watch his team compete, for instance, as long as the user experience is solid.

As we enter the era of metered billing, then, the World Cup gives carriers a chance to showcase their network strengths and build the foundation for future data revenues — especially when it comes to video. Users who tune in and enjoy high-quality broadcasts will be inclined to spend more to watch other content, which would give mobile TV the push it has long needed.

So carriers should be watching their networks relentlessly to stay ahead of the curve and do all they can to meet demand. Operators that can consistently deliver high-quality content with minimal hiccups will encourage future video consumption and will be positioned to leverage lucrative data traffic as we enter the world of 4G services. Those that can’t provide a solid user experience will have missed a great opportunity to score big with consumers. While you’re watching the games in South Africa, keep one eye on the carriers to see how they’re performing. Read the full post here.

Image courtesy Flickr user currybet.