Reports on the mobile industry from around 2000 predicted that adult content on mobile devices, as well as mobile content in general, would be key revenue sources for mobile phone operators. The industry has seen exceptional content revenues from ringtones and SMS but has only seen modest development in other areas of mobile content.

Much of the delay in additional content and services can be attributed to delays in bandwidth advancements, but there is also a better understanding in the market now (arguably) of what consumers’ want access to on their phones.

How do adult services fit into this picture? A recent study by Gartner believes that 5% of the mobile content space in 2010 will be attributed to adult services. While this portion may seem small when compared to music and games, Daniel Winterbottom senior research analyst at Informa is quoted in an article by The Guardian as saying “If you take it out of the context of the wider market, $2.3bn is not a small amount of money.”

Also in the article, Julia Dimambro, director and co-founder of Cherry Media, which operates the Cherry Sauce mobile phone adult content portal, says “Operators are saying that it is not the big revenue driver, but they cannot be seen to be promoting adult content because it affects their brand as a mobile operator.” This is a great point.

Adult content has been a “touchy” area for wired ISPs for years. ISPs must provide access to adult content much of the customer base, but several companies (e.g. AOL) have differentiated themselves by offering family friendly filters and software to limit access to this type of content. Carriers are in a difficult position here, as generally any content made available on their networks is accessible to all (at a cost, generally). This is one of the areas that companies like Cherry Media can help carries, by age-verifying users and providing filtered content.