Who Will Provide Content for Your Phone?
By Eric Lin, Mon Nov 03 23:00:00 GMT 2003
Last week yet another report came out saying that 95% of mobile revenue still comes from voice charges. And that, especially in the US, users want cheap, high quality voice service on their mobile phone, with virtually no desire for data. This week The Register takes a look at the hurdles that operators world-wide will face in order to generate mobile data demand from subscribers.
The Register has a lengthy editorial on the mobile data conundrum explored in an even lengthier article in strategy + business (kindly available as a PDF). The problem, simplified, is does a carrier opt to be a bit pipe and make money by allowing its subscribers access to as much data as possible, or should carriers become content providers (or at least aggregators) luring users and their money with strong media brands? Orange are doing well with the former while Vodafone and DoCoMo are the most notorious successes of the latter approach.
Besides the risk of competing with content services, or partnering with the right ones, other hurdles are starting to pop up. Manufacturers (or OS owners) such as Microsoft, Qualcomm, and Nokia are entering the content game with applications, services and downloads that increase competition and dilute users' carrier loyalty. Plus manufacturers, broadcasters (and even carriers) are all trying to get their piece of the emerging mobile TV market. The possible competition (or even confusion?) between handset as broadcast receiver versus handset as communication tool could dilute operators' control and profits even further.
Operators, even Vodafone and DoCoMo, are not experts at providing content. Their success comes from developing excellent relationships with content partners, and expert knowledge of mobile devices and services.. Others entering the fray such as Microsoft (thanks to its MSN properties) or TV broadcasters have content experience but certainly don't have the mobile expertise of carriers. It should come as no surprise that (as the Register points out) everyone will try to do everything at first. Then if the pattern continues, it's also likely that some point winning technologies and services will emerge and some consolidation will follow.