Pump Up the Volume
By Peggy Anne Salz, Wed Nov 27 07:30:00 GMT 2002
Combine music with lifestyle services, viral marketing and a new twist on an old technology and you've got a real showstopper. Starting this year mobile music is not only going to rock the industry, it's going to send tremors through the mobile value chain.
Experience shows that the most
successful mobile services are actually based on what users do in their
"fixed" lives. Users read newspapers and magazines - and so
they are comfortable with scanning news and sports snippets on their
handsets. They communicate by email - and so they have eagerly embraced
SMS, and given the mobile industry its first, and so far only,
"killer app." But consumers, youth in particular, also like to
listen to, talk about, look like and dream about music artists. Music
isn't just about songs; it's a billion-dollar lifestyle
industry ranging from fan magazines to fashion. More important,
it's a passionate and personal interest around which communities
congregate. So why isn't mobile music a hit?
could be the industry's preoccupation with gadgets. Despite all the
lip service paid to criteria such as simplicity and usability, the
industry still isn't quite over its love affair with technology.
The temptation to create an "all-in-one" dedicated device is
great, but many observers suggest that this new breed of mobile devices
will be too clunky and costly to compete with existing technology and
methods such as CD burners and file-sharing.
matters, the ability to download and playback music files over a mobile
phone is an embryonic and uncertain market. Against this backdrop,
it's best to build services with the technology and tools that
exist. As Dario Betti, an analyst with Ovum in the UK, puts it:
"The new devices aren't the market opportunity. The money is
in harnessing the power of music to enhance existing services."
Express Yourself, Baby
advent of polyphonic ringtones, which incorporate 16 tones rather than
one, will drive revenues and allow operators to build new business
models around musical content, according to Ovum. It estimates that the
market for personalization through ringtones, logos and screensavers in
Italy, Germany and the UK alone will be worth $673 million in 2002, and
receive a considerable boost when more handset makers can support them.
One company in this space is Musiwave, Europe's leading provider
of mobile music services and the first to enable downloadable ringtones
with original music.
The company, which distributes its music
services and platform through customers including T-Mobile in the UK
and Germany, Orange in France and Optimus in Portugal, recently teamed
up with Telefonica Moviles to launch a similar service in Spain. In
addition to ringtones, the company supplies a turnkey solution that
includes games, contests, SMS alerts and an assortment of other
value-added services focussed on music artists. It also offers
"Musimail," a dedication service allowing users to text a
tune to a friend together with their own recorded message.
Musiwave, which has a partnership with handset manufacturer
Sagem, is close to Nokia and "expects to announce relationships
with at least two other manufacturers by the end of 2003,"according
to Guillaume Decugis, Musiwave VP, Technology & Operations.
"Music and mobile are a perfect fit. But software modifications are
necessary so that the user can just turn on the phone and use [these]
music services." Musiwave also cooperates with music labels to
reduce some of the red tape around digital rights issues. To this end
Musiwave recently sealed a deal with BMG to make its music catalogue
available through Musiwave's services. BMG, which belongs to German
media giant Bertelsmann, owns more than 200 record labels
The Power of Love
Tj.net, a Bertelsmann wholly-owned subsidiary
based in Italy, is determined to be the wireless equivalent of MTV.
Rather than focus on technology, tj.net has quietly and quickly built up
an interactive music service based on simple IVR (interactive voice
response) that counts over 1.6 million registered users in Italy making
it Europe's largest mobile music service. "We want users to
play with the music rather than just play music," says Paolo
Roatta, tj.net CEO.
The service, which works like a remote
control, allows users to interact with music by pressing a number on the
keypad. They can send a song to a friend by pressing 8; they can buy the
CD of the artist they are listening to by pressing 3; they can vote for
the music by pressing 9. And so on... "Kids don't only want to
listen to music, they want to share it, they want to send it to a
boyfriend or girlfriend and say 'hey, I'm thinking about
you,' or 'hey, I know you're having a bad day so
here's something to cheer you up,'" Roatta says.
"It's just another way to call and say 'I love you.'
An "unexpected success" is the community that
has grown up around a new service users can access by pressing 7. The
idea was to allow users a chance to not only comment on the music, but
also reply to other user's comments about music. When this happens,
the user who left the original message gets an SMS alert and can call in
to hear what others are saying. The service, which is growing virally,
is "more like a talk show than a chat room," Raotta explains.
Tj.net, which launches a new service every two weeks, plans to extend
its reach to other countries and operators across
They're Playing our
A new kid on the block is Shazam
Entertainment, a UK company with a unique proposition. It's
developed the world's first-ever ubiquitous song identification
service available to mobile operators. "We thought it would be
great if there were a service that could identify a song at the exact
moment you hear it," notes Chris Barton, Shazam Business
Development Director. "Since there wasn't one we decided to
Shazam's technology is able to match a
noisy audio sample (15 seconds in length) captured over a mobile phone
against a database of more than two million songs in a fraction of a
second. The search works even with background noise such as people
talking or street noise. When a user hears a song he likes, he dials a
four-digit number from the mobile and holds hold up the phone to capture
15 seconds of music. The service then compares this
"fingerprint" against Shazam's own database. Once the
matching segment of the matching song is found the service responds with
an SMS to the user's phone that not only identifies the song, but
the artist and the CD as well. The user can then interact with the song
in three ways.
The so-called "Tag" feature allows
users to identify a song and tag it, both through an SMS and via a
personalized web site with a list of identified songs. This web site
allows the user to track the songs he has requested and purchase the CDs
via the Internet through affiliates such as Amazon.com. The
service's "Send" feature let users forward a song clip to
a friend. This is sent via a free text message with a link to the IVR
short dial, which is charged at a premium rate. Finally, the
"Buy" feature allows user to purchase the CD - a transaction
involving Shazam partner on the site.
Looking ahead, Barton
envisions a service that will "be a bit like instant
messaging." The service would link users to their buddies with the
best taste in music. "It would allow you to get the same cool song
your buddy gets or recommends - and the 'follow-me' aspect of
the service means it would market itself." The service could also
be expanded to let users get the picks and tips that their favorite club
and radio DJs recommend.
Last Friday, Shazam officially
launched with four UK operators. The company is also "in
conversations" with three German operators and involved in more
"concrete negotiations" with Japan's three mobile
operators as well as "one of the major trading houses in
Japan," Barton reveals. Other players in the mobile space,
including tj.net, have also confided that they would be interested in
partnering with Shazam to complete their music offerings. "We like
the technology a lot, and music recognition is definitely a service that
music lovers would appreciate, but we wouldn't want to invest the
money to develop it (the technology) on our own," Roatta
While mobile music has what it takes to be a
killer app, it's important to remember that it's an emerging
market where many players risk being sidelined. Unlike most other
wireless content, operators and providers actually have little ownership
and control over music content. This lies in the hands of record
companies and a handful of rebels who create and distribute their own
music compositions. Music is also not the kind of content that
operators can tuck their own rather dull and mainstream branding
campaigns and logos. The user is loyal to the artist - not the operator.
And, while music companies are all aware they should harness
the mobile channel to market their stockpile of content, they are also
know they deserve top billing. Indeed, EMI recently drew the line and
told ringtone providers some of its biggest chart hits were off-limits.
This has sparked speculation that it plans to launch its own ringtone
service. To further complicate matters, the issue of digital rights
management (DRM), licensing and copyright will require the value chain
to make plenty of room for a slew of content aggregators and legal
middlemen who will also want their share of the revenues.
that shouldn't intimidate providers. Mobile music is not a new
market, but it does require a totally new approach that builds on
personalization, community and communication. Companies in this space
shouldn't dwell on tough topics such as devices, downloads and DRM.
They should get down to the business of testing and developing music
services that integrate existing technologies and applications. They
should also start partnering with content owners and teaming up with the
artists for access to exclusive content. Otherwise, providers may find
themselves peddling, the cheap seats, the bootleg CDs and the
(un)official memorabilia. And that's an offer music fans can
Salz is a freelance author who likes to go beyond the day-to-day
developments in the mobile space to grapple with the toughest issue:
where the industry is going.Her work has appeared in a number of
publications including Time, Fortune and The Wall Street Journal
Europe, as well as Communications Week International, where she is one
of the editors.