Why Buy What You Can Get For Free?
By Carlo Longino, Tue Oct 12 21:15:00 GMT 2004

mmO2 is again rumored to be thinking of picking up i-mode -- but is there benefit in joining the i-mode alliance beyond business model changes the company could make on its own?


It wouldn't be much of a surprise to anybody if mmO2 linked up with NTT DoCoMo and joined the alliance of international carriers using the i-mode mobile content system. The rumors have been around for a while now, and popped up again this week. The partnership would generally make sense, as O2's small size has seen it left in the shadows of Vodafone's Live! content system, as well as Orange, T-Mobile and Telefonica's Freemove alliance.

But Tom Hume asks an interesting question: why bother? The important aspects of adopting i-mode aren't the access to the technical standards or DoCoMo-influenced handsets, it's changes to the ways carriers are accustomed to doing business -- and those changes have been heavily studied and analyzed, and the lessons well published.

Probably the single most important change is in the cut of content revenues carriers take -- DoCoMo keeps just 9 percent, passing the rest on to the content provider -- a strategy that's not difficult to devise, but also one European carriers aren't likely to completely emulate. Tilting the table heavily back into content providers' and developers' favor would do more than anything else to encourage them to fill the service with content and applications, though DoCoMo could also provide insights on how to further create a thriving ecosystem.

But the technical aspects aren't all that important. Telefonica's i-mode offering, for instance, is its e-mocion WAP service, rather than a cHTML-based system. Like other carriers, O2 already has significant investments into its WAP portal, O2 Active, and other systems it wouldn't like to throw away (and perhaps it isn't planning to, as the Guardian article says mmO2 execs were impressed by Telefonica's implementation). And the handsets aren't such a big deal either. In addition to some Japanese models, European i-mode carriers have used many of the same popular brands of devices as their rivals, with KPN launching i-mode over UMTS this week on the Sony Ericsson Z1010.

Hume makes a good point -- what, really, would O2 be investing in that they couldn't figure out on their own for free?