ESPN Mobile Strategy Hitting Stride

After waiting out its Verizon partnership before entering the smartphone application world with its Scorecenter app earlier this summer, ESPN is about to go full throttle with its mobile strategy. Announced this week, the Worldwide Leader will debut a Fantasy Football iPhone app and an ESPN Radio app for the iPhone and Blackberry, along with an MVP service for Blackberry.

The key factor – all will generate subscription revenue. Put the MVP service aside for now, it will charge a recurring monthly fee, since details of the service remain sketchy. Fantasy football is one of the most deeply engaging products on the web and attracts an avid user base that is more likely willing to pay for an application than an average user, making it a perfect candidate for a revenue generating application. Finding the right price is a trickier proposition, but if they bundle enough value it should warrant more than the median price of $1-$2. Likewise, the ESPN Radio application – assuming it includes podcasts and radio shows – leverages an already established national audience and specific personalities (i.e. Bill Simmons, Mike & Mike, etc.) that have rabid followings. Build in the on-demand ability to access content wherever, whenever, on-the-go and its an automatic value add for listeners.

If ESPN simply converts a percentage of current Fantasy players and radio listeners, they can easily generate $10mm (that is a conservative 5mm total users at an average price of $2). Even without free, ESPN should find new sponsors for each app to earn incremental revenue, something they have integrated well into most of their mobile ventures. Further, by integrating Mobile Web into applications it indirectly lifts traffic to the mobile website, as does the constant bottom line and the simple brand extension of ESPN to the mobile device. All this amounts to additional mobile web ad revenue. Add in the opportunity to steal market share by providing a differentiator over the competition, and the lifetime value of the new customers it may attract, not to mention the revenue they gain by increasing engagement with their platform and having users view more pages and use more services.

Two key notes that content owners should take. First, while this has not proven itself out yet, though I feel strongly it will, don’t give away the house for free. Scores are a commodity, so they made Scorecenter sponsor-supported, but Fantasy and Radio content are premium services where ESPN can add value and provide a unique offering. Users User’s will pay for that – or at least we’ll find out. Second, it’s not necessary to develop the most innovative, groundbreaking product to capitalize in mobile. Reinventing the wheel with slight changes is more likely to succeed. ESPN is taking proven content and simply repackaging it for mobile, adding a few new features that cater to the distribution channel, and maybe bundling the content together in a unique way, but in the end its Fantasy and Radio two of ESPN’s core competencies.

It’s harder to see these lessons given ESPN’s scale and breadth of success. However, for a smaller entity or a struggling entity, leveraging these concepts can yield significant benefits in digital media

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