The Customer Owns The Customer
By Mike Masnick, Wed Mar 16 21:45:00 GMT 2005
Traditionally, the battle for customer ownership in the mobile space was between the operators and the handset makers. The battle is about to get a lot more crowded.
The pendulum constantly seems to swing back and forth between handset makers and mobile operators on customer ownership, keeping things in some semblance of balance. While some have tried to dominate the battle, there's always been an uneasy balance which (for the most part) has been good for customers. Still, the two sides often team up and work together against consumer wishes, leading to continued walled gardens and other consumer unfriendly offerings.
The battle for the customer, though, is about to get much more complex. Thanks to things like smartphones and wireless broadband, the mobile space is increasingly merging with the overall technology and consumer electronics spaces -- and that means more players who all hope they can own the customer.
Witness, for example, the rumors from last week that the delay behind the Motorola iTunes phone was due to operators being worried they would get cut out of the transaction. While Motorola is now denying this story, and saying it has more to do with Apple's marketing plans, it was certainly a very believable story for many. In fact, such battles were predicted almost as soon as Motorola and Apple announced the deal to work together.
However, this battle for customer ownership over music on phones is just one example of a new party entering the mobile customer ownership battle field. There will be other content providers, other service providers and other application providers -- all of whom want ownership. There will even be other device manufacturers beyond traditional handset makers. With mobile broadband standards and VoIP, the entire space becomes open to ever more competition. This means that partnerships and alliances will be formed and those that try to resist are likely to get squeezed out entirely.
While the initial battles may be ugly, the end result will be much better for customers. Instead of reaching uneasy truces that block the customer out, having more players means that some of them will recognize the way to win customers away from others is to actually offer them what they want -- rather than keep it away. That means, eventually, they will have to realize that it's the customer that owns the customer, not any device, service, content or application provider.