Passing the baton at CBS Mobile

RCR Wireless News
To hear Cyriac Roeding tell it, CBS Mobile started in 2005 as a “department of one.” Just two suitcases and three boxes in tow, Roeding left his home in Europe after convincing top executives to let him build a new mobile business out of the media conglomerate that is CBS, but with the taste and feel of a Silicon Valley startup.

“It wasn’t clear to many people from the beginning that this was going to be a serious business that we wanted to build. And that’s what we’ve always had in mind actually from the very beginning,” Roeding said. “It’s certainly very new for a media company like this to build such a business — very new area, new rules — and at the same time a lot of connection to the old world as well, to the existing world. We had to find a bridge. Our job was mainly to be bridge builders between these worlds and bring them all together. It’s been a challenge but it’s been an awesome experience.”

By now, Roeding has left CBS, leaving the division in the hands of Jeff Sellinger, Roeding’s first hire (the new executive VP and general manager of CBS Mobile).

“I just have that entrepreneurial itch again — I need to find the next cool thing,” Roeding said.

“This was my second startup and I’ve never seen it as anything else but a startup company. I have this strange philosophy that the role of a good manager is to make himself useless because once you’re useless, the machine is running, and I feel that I have reached my state of uselessness,” he said.

Both were equally full of praise for the other as the duo held an interview in the main lobby of “Television City,” CBS’s landmark property in Los Angeles, last week. Sellinger called Roeding a “great mentor, an incredibly brilliant guy and a great friend,” while Roeding called Sellinger an “incredible combination of creativity and execution.”

Although Roeding feels confident in the business he charged at CBS, both acknowledge the load of work to come.

“When you start mobile it’s certainly about building a business first and foremost, but it’s also about making a clear point. We are serious about innovation, we are driving the envelope of the future and we want to create the future of media and mobile is a core element of that. Whatever we could do to prove that point — that we are not followers — we try to make that happen,” Roeding said.

“Generally speaking I would say the role of a media company like CBS is drastically shifting. We no longer have a two- or three-hour primetime entertainment job to do, we actually have an 18-hour entertainment job to do,” he said. “As we go through the day, our challenge is no longer to just serve you something to consume at one point in the day, but actually to seamlessly migrate audiences from platform to platform to platform.”

Content types

Part of it comes to a philosophy about mobile content. Sellinger doesn’t view mobile media types through the same paradigm of on-demand vs. broadcast vs. on-deck vs. off-deck vs. whatever the latest catchphrase might be.

“Part of mobile is being current and timely,” Sellinger said. “

“It depends on the situation that the consumer’s in at that point in time. I think that the ultimate offering is a combination of multiple services. The ability to get things that I’m not getting because I’m not home, but then things that are designed specifically for the experience that I’m in — made for mobile content, which we’re big believers in,” he said. “Within mobile video today, we have I believe about 10 original shows that are in production right now that are all geared toward the mobile audience.”

Sellinger said he’s particularly interested in peer-to-peer services and technology that makes the mobile experience more relevant and personal.

CBS hasn’t suffered the content bottleneck that other mobile teams have faced when trying to extend existing products to the cellphone.

“We have a good number of our shows out on MediaFLO, a lot of sports out there as well,” Sellinger said. “I think the answer is the more everyone can clear, the better the experience gets for everyone.”

Measuring success

A mobile content philosophy only holds interest for so long. Eventually, executives like Roeding and Sellinger have to deliver the goods — measurable success.

“There’s a couple ways you can measure success,” Sellinger said. “One is financial, whether or not you’re making money for the company. Another is in marketing and promotion. After all, our content works off the content of CBS, the television network, so if we’re able to enhance that experience or provide value back to the properties, then that could be successful as well. And when you look at things like mobile Web and mobile video, there’s pure numbers of how many consume, how many people you reach.”

The company has released stellar numbers for CBS Sports Mobile (5 million unique visits in the last quarter of 2007), which make it one of the 10 most visited ad-supported mobile Web sites. However, no subscriber numbers have been released for the company’s off-deck channels, MediaFLO USA Inc. or its litany of mobile video and picture alerts.

We want free

The true bottleneck exists at the cash register, they said.

“Everything has been paid by the consumer. That can’t be the future,” Roeding said.

So how much money does CBS think consumers are willing to pay for mobile content?

“I think it varies depending on the services that you offer,” Sellinger said. “Ultimately we’re all going to win in a larger way when content becomes more ad-supported. We’re seeing a nice shift in that today in mobile and I think that shift will continue. There are certain thresholds that consumers will pay, but the more we can do to make it ad-supported the more we will reach a larger mass.”

And this is where CBS Mobile has been focused of late. It’s proud to be the first media company to sign partnerships with mobile advertising networks: AdMob, Millenial Media, Rhythm New Media and Third Screen Media.

“I think in general we’re at a crossroads in the industry, at a very important juncture. We have grown the content market, the data market, significantly; it’s now more than 17% of all the carriers’ revenue. That’s fine, but if we want to bring this to the next level, if we want to explode this to like 50% or 60% and not wait another five or 10 years, then we need to really think fundamentally about the business model underlying this whole business,” Roeding said.

“The only way that we have seen so far that is interesting is truly moving away from charging the consumer for most of the content. If content is free, consumption explodes. If consumption explodes, advertising dollars grow,” he said.

Distribution models

Ads that make free-to-air content a possibility might provide the number of viewers everyone in the business is hoping to reach, but Roeding and Sellinger freely admit how difficult that gets over 3G networks without targeted ads.

“Right now you cannot cover the transmission cost with one ad,” Roeding said.

“That’s the reason why MediaFLO exists. It’s because of the transmission costs. If you go into a one-to-one connection, you’re talking about substantial transmission costs. The one-to-many model is very efficient. Now the question that arises out of this one-to-many model is ‘how do you ensure that this is a truly mobile experience?’” he continued.

“What we need to make these models truly mobile is to leverage the functionality that the phone has that TV sets do not have. Because the cellphone is not a TV screen that is constrained. The cellphone is a medium that has capabilities that the TV screen does not have and we need to make use of those.”