Monday, July 05, 2004

What if Camera Phones Took Over the World?

see edited version at Media Guardian, July 5th, 2004

This year the average camera phone subscriber will spend nearly £50 on sending images. For mobile phone operators obsessed with squeezing additional revenues from their network investments, this is not revenue to be sneezed at; in fact it might just be the beginning of the promised land.

For those of us who have resisted the lure of the increasingly ubiquitous camera phone, this is the year it goes mainstream. In fact, if you’re only just getting used to seeing public events packed with digital camera wielding citizens, you would be pretty surprised to know that this seemingly new toy has already been overtaken in sales by camera phones.

InfoTrends predicts 150 million phones with built-in cameras will be sold worldwide in 2004 making up about 25% of all cell phone sales which will generate a staggering 29 billion digital images. In more advanced markets like Japan, this level rises to around 80%. Globally camera phone sales are set to reach 656 million units in 2008 and the likely winners this time will not just be Nokia but NEC, Samsung and Panasonic who have all leveraged local market experience to power into leading positions.

Although the US is not ahead of the rest of the world in terms of adoption, they are certainly alive to the social and regulatory implications of the widespread uses and abuses of camera phones. In May 2004, the House Judiciary Committee approved a bill, intriguingly titled the Video Voyeurism Prevention Act, which would make the taking of covert photos in places like locker rooms or bedrooms a crime punishable by up to a year in prison.

Of course there is nothing new about being able to record events, in fact with the advent and widespread use of both digital cameras and video cameras we have been able to share our experiences at an unprecedented level. But nothing we have experienced to date fully prepares us for what we will be able to do when we combine this ability to capture digital multimedia, with an ability to instantly share it through a global network.

In December 1999, a raft of extremely well-financed online photo ventures like Shutterfly, Ofoto and Snapfish were established to capitalize on a market which analysts at the time believed would be a $5.6 billion opportunity by 2003. The services they offered like film digitization, photo sharing and the redistribution of images to prints and reprints have all become staples of the Internet.

The reason this market has now hit the tipping point is not because these services were badly executed but rather they were perhaps ahead of their time and definitely lacking in connectivity. It is connection which is giving legs to the digital image revolution. Like audio before it, and no doubt video after, it is the emerging ability to connect to web services, which make it easy to share with friends, family and in some cases the rest of the world, that is making camera phones such fun.

This is perhaps the iPod lesson. Having great hardware like digital cameras or a great online service like Ofoto is fine, but it is the fusion of the two which creates alchemy. There were plenty of digital music players before Apple’s and plenty more now, but it is the fusion of their hardware with a superb digital music service in iTunes that has made Apple the dominant player.

The digital imagery business is about to experience a similar explosion as it capitalizes on three extremely powerful and converging trends: camera phones, wireless broadband and weblogs. Weblogs were canonized by Google’s acquisition of Blogger in 2002 and are becoming part of the mainstream Internet, but it is the growth of personal mobile Web logs, or "moblogs" that is likely to become the glue that binds camera phones to the Internet.

Moblogs allow you to send images directly from your camera phone to your own personal website, where depending on the sophistication of the service you can share those pictures with friends, family, colleagues or anyone who cares to look. In North America, the moblog revolution is already to starting to kick into gear with start-ups like TextAmerica and Buzznet going it alone, and leviathans like Nokia and Ericsson both poised to launch their own services.

But perhaps Newbay, a venture-capital backed Dublin business, has the smartest route to market for moblogs. They provide mobile phone operators, like T-Mobile in North America and O2 in Ireland, with all the infrastructure they need to provide their camera phone subscribers with a moblog and conveniently great reasons to drive MMS revenues. Newbay have even found a way to protect cautious operators against the Video Voyeur Act by providing MMS screening services.

This year megapixel quality camera-phones will be available and with two and three megapixel units coming close behind, suddenly the Internet will become a seamless bridge for you to point, click and share so that others can print. Future Image noted this June, that prints made from camera-phone images are already significantly better than those from single-use cameras — both film and digital — and comparable to those from standalone consumer digital cameras. Camera phones which can zoom and focus are expected on the market in the next few years. The only problem then will be what to do with your old camera and who to invite to your moblogs.