When I used to live in NYC (for 2 yrs in 01), I didn’t really know anything about finance. Well, when living in NYC, you learn pretty quickly and I realized that a big part of a bankers job is coming up with these fancy “instruments”, basically new ways to trade (lose) money, ha! (ie instead of buying currency, buy futures on the currency or options on the currency, the list goes on).
Anyways, how does this relate to mobile? The mobile content industry is in some pain. It’s still, w/o a doubt, the majority of data revs (sans SMS), over 10B last yr as compared to sub-1B in mobile advertising (although the buzz is in the latter); however, the revenues have gone flat and growth has really stalled. This can be attributed to a number of things:
1. Std’ization of content formats (ie MP3 as a ringtone format)
2. iPhone teaching people they can sideload (install from the computer) content
3. Growth of smartphones enabling more sideloading
4. More storage meaning full MP3s or large images can be installed w/o concern
5. Proliferation of laptops meaning more Bluetooth making it even easier to sideload
I know this first-hand since I used to run ToneThis which enabled ringtone creation.
In any case, if less people are buying premium and more are side-loading, what does the mobile content industry need to do? I think the key is in recycling – it’s not about the music itself, it’s about developing new and clever ways to personalize your phone. For example, push ringtones, ringbacks, push vibetones, 3D vibetones… the list goes on.
The nice thing about many of these new emerging content types is they require carrier infrastructure / buy-in – normally, I’d say that’s not a good thing but from a publisher stdpt, this means, the user can’t sideload the content, so the risk of “leakage” becomes nullified and the bonus is you can likely charge a subscription meaning recurring revs.
Fewer unique customers but significantly great revs per customer. Bankers, we can use your help in coming up with some more creative personalization types (ie “instruments” 🙂