Music Phones Want to Be Free
05-06-06 suggested by: Zé Vance
By Eliot Van Buskirk
For years, people have been speculating about the two possible futures of portable devices. Are they going to continue to be somewhat specialized, or will we end up with one device that does everything? From the music fan's perspective, the core dilemma is a practical one: whether to replace iPods with cell phones that can play music.
Although conventional industry wisdom is that the switch to music cell phones is all but inevitable, I took the opposite position in a recent , predicting that I'd never make the switch. I cited capacity, interface and battery problems, as well as the issue of control over one's own media.
Some of the people who responded agreed with me. Chuck, for instance, wrote, "I carry my iPod everywhere, anyway. As an owner of a completely full 60-GB (player), a cell phone would never be up to par."
But I took a beating from respondents who are already happily listening to side-loaded MP3s on their phones. Cloksin wrote, "I highly disagree with you. I have a Samsung A950 phone with built-in MP3 player. The interface is simple, a Play/Pause, Stop, FF and Rew buttons are on the face of the phone when closed. Just hold down the Play button and the screen on the outside shows all my songs, I don't even have to open the phone. An iPod-like dial lets me navigate through my music with ease."
Not everyone was so genial. D wrote, "This is the most backward article I have ever read! You are totally misled in your perceptions of music on a cell phone."
After reading these comments, the music cell phone question was very much on my mind as I attended the conference the following day.
Panelists on the "future of wireless devices" panel made it clear that cell phones will need to be easy to use in order to gain traction in the portable music market. Troy Ruhanen, executive vice president of BBDO North America, told me, "Anything in this space has to be dead easy. I mean, look at the iPod."
That's good advice. But the industry shows few signs of heeding it.
Howard Homonoff, CEO of Homonoff Media, said that carriers are excited about music cell phones because they see a "dual-revenue system" on the horizon, in which they'll sell music and other content to customers, as well as selling ads based on their customers' geographical location and consumption preferences. This dual-revenue system is crucial to cell carriers' success. According to Ruhanen, "It has to pay out, because the voice model will not pay out."
The first part of the equation is already working quite well. Ruhanen revealed that "Cingular already makes more money from music than iTunes does," and said that a significant number of subscribers pay $10 per month for six new ringtones.
However, the panel acknowledged that cell phone customers could revolt against the second phase. Carriers plan on ramping up cellular advertising slowly. "My concern is that the first phase could kill it," Ruhanen said. And later on, he said, "Ads later, subscriptions first."
As for privacy concerns associated with geographic and music-customized targeting, "This is a generation that publishes itself on MySpace," Ruhanen quipped, eliciting a chuckle from attendees.
A large percentage of Americans have expressed interest in listening to music on their phones. According to a study conducted late last year, 47 percent of Americans want music cell phones and, interestingly, "women were more interested in new functionality ... 18- (to) 34-year-old women were off the charts ... 76 percent wanted a music player."
So, demand for music phones is strong, and consumers and carriers/manufacturers want cell phones to be as simple to use as an iPod. Will carriers, seemingly hellbent on adding advertisements and targeted promotions, be able to offer a simple, uncomplicated listening experience? Worse still, will they eventually eliminate MP3 support to get customers to buy their protected content? After all, MP3s are not part of the dual-revenue system they're counting on.
It seems clear that carriers for now will see music cell phones as a failure if people end up using them like iPods. But that's exactly the experience they'll have to offer if they want music fans to make the switch. It's a contradictory situation. But if they're smart, they'll keep the lesson of the iPod's simplicity in mind, even at the expense of ad- and music-sales revenue in the short term. If they miss a trick, Apple Computer's rumored to be waiting in the wings with its iPhone, and probably wouldn't mind repeating the lesson.
Eliot Van Buskirk, who also contributes to the , has covered digital music since 1998, after seeing the world's first MP3 player sitting on a colleague's desk. He plays bass and rides a bicycle.
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