Subject: [NEXTEL-1] Slot Machines And Wireless Data

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Date: Mon, 02 Dec 2002 14:17:49 -0500

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Slot Machines And Wireless Data

By Andrew Seybold
December 2, 2002

Wireless Week
© 2002, Reed Business Information, a division of Reed Elsevier Inc. All Rights Reserved.

Fall Comdex was recently held in Las Vegas, which is home to thousands of slot machines. What do slot machines have to do with wireless data? Many slot machines are based on TV shows such as the "Wheel of Fortune," "Hollywood Squares" and even "Dick Clark's Rockin New Year's Eve Party." They are designed to attract people who like these shows and are, in essence, an extension of the brand.

This same model is coming to wireless. MTV inked a deal with Virgin Mobile, and Yahoo! and AOL have made deals with other wireless operators. Digital Orchid out of San Diego is the most recent entry into the world of "affinity wireless marketing." Just before Comdex, Digital Orchid announced a deal with Foxsport news and Nascar to provide wireless devices that will keep the several million Nascar race fans in touch not only with their friends and business associates, but to the world of Nascar as well.

I believe this model is a winner. Many people live and breathe Nascar and can't get enough of the sport. They are such avid followers of their favorite drivers and favorite teams that even before the service went online, many were signing up on the Nascar Web site and paying for access to Digital Orchid's service to get a Nascar wireless device and really stay on top of the sport. With this service, they can choose photos of their favorite car or driver for their screen background or screen saver and get updates on standings and the latest news. On race day, they can follow the race on the phone with lap-by-lap updates and "tune" into the chatter between drivers and their pit crews.

Digital Orchid is not a mobile virtual network operator. Instead, it provisions the phones across most networks so fans don't have to change networks and phone numbers. Because Nascar is marketing the devices and services to its existing hardcore audience, the cost of customer acquisition is low. As the system rolls out, additional features and services will be available on a premium basis, thereby providing Nascar (and Digital Orchid) with additional forms of revenue. And this will drive more minutes and packets of data across the various networks.

This is the first of many programs that will be launched by the Digital Orchid folks. You can easily understand the opportunity here. In any sport, virtually any TV show or other type of entertainment you will find fans who are, for the lack of a better word, fanatics about it. These folks buy products that are extensions of the brand: t-shirts, hats, bobblehead dolls, toys with logos and more. Brand extension represents a great opportunity for wireless. Wireless devices can be branded with logos and provisioned with information that will be of value to affinity groups. Affinity junkies will gladly pay for services that keep them abreast of what's new, who's doing what and upcoming events.

For many years now I have predicted that in the future most people won't be buying Nokia, Sony-Ericsson or Motorola phones–they will be buying affinity branded phones. Digital Orchid, along with a startup called Wildseed (with its phone partner Kyocera), have recognized that there is a great opportunity here and are capitalizing on it. If you believe, as I do, that we are past the technology phase of the wireless market and entering the "content is king" phase, what better way to capture customers quickly and easily than to give them the ability to stay connected to something they are passionate about?

The Nascar product launch is a great example of what can be done to attract affinity groups. Think about the possibilities. Special ringtones might appeal to Nascar fans: "Start your engines," the roar of a car as it races around a track, the squeal of tires or even the roar of a crowd. How about being able to "watch" a race unfold on your wireless device's screen: Each car is equipped with a GPS system so you can follow the race in near-real time. For a few extra bucks, you might view the race from a camera mounted in your favorite driver's car.

Affinity group devices and services will change the way we think about wireless devices and where we purchase our phones and services. This trend will be huge, which is great news for both the wireless network operators and the companies offering affinity group products and services.

Author Information

Andrew Seybold heads the Andrew Seybold Group and is editor in chief of
Forbes/Andrew Seybold's Wireless Outlook. He is a regular contributor to
Wireless Internet Magazine.

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