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Study: Mobile customers want video streaming

Data applications for mobile devices may not be taking off in the United States, but consumer demand for streaming video is growing, according to research company In-Stat/MDR.

The mobile market is experiencing increased demand for video services, as cell phone companies begin rolling out third-generation networks, according to a study that market research company In-Stat/MDR released Monday.

A number of operators have deployed 3G networks in a limited way, and more are likely to announce services later this year and next year, In-Stat/MDR said. The company predicts that mobile video services will generate revenue of $5.4 billion by 2009.

By that time, nearly 22.3 million Americans will be accessing mobile video content, the company said, while 31.1 million will use video messaging services. Mobile video services will account for nearly 14.9 percent of total wireless-data revenue, the company predicted.

A recent In-Stat/MDR survey of wireless consumers found that 13.2 percent of them are extremely interested or very interested in buying video services for their cell phones. Additionally, the company found that Sprint PCS customers are likely to be early adopters and are the most likely, among those surveyed, to be interested in mobile video services.

A combination of factors, including advances in compression technologies and the availability of multimedia handsets, as well as consumer interest, will boost wireless video services, In-Stat/MDR said.

"While still a relatively small niche of the market, (the number of people who want video services) is significant in that it represents the 'natural demand' for mobile video services, prior to any large-scale carrier deployments or market messaging," Clint Wheelock, director of In-Stat/MDR's wireless research group, said in a statement. "Moreover, interest in mobile video is higher than for all other prospective mobile multimedia services covered in this survey, including gaming and music services."

By comparison, video is also seen as a driver in Europe, but so are music services, ring tones and games, according to research company IDC.