Emerging handsets mimic iPods
Published: 02 Jul 2004 15:40 BST
Wireless phone carriers have a very different business. For the most part, they're used to having their services and content subsidise the hardware, the exact reverse of Apple's current model.
Moreover, they're already making considerable money by selling ring tones -- essentially 15-second to 30-second snippets of songs that substitute for a traditional ring -- for as much as $2.50 apiece. That could look less appealing next to a 99-cent version of the entire song.
At the same time, music services are emerging quickly for cellphones, particularly in Europe. On Monday, German wireless carrier T-Mobile unveiled a music service on the heels of similar efforts by British rival Vodafone and Europe-based online music retailer On Demand Distribution, or OD2. T-Mobile's service will sell abbreviated versions of songs, averaging about 90 seconds apiece, to customers for about $1.80.
That's expensive, compared with Apple's iTunes Music Store and other Internet music retailers. But industry insiders say European consumers are less tied to their computers and therefore make a more natural audience for music on cellphones -- despite the cost.
"Most multipurpose handset users in Europe want to listen to music, sync their addresses and make calls from one single device," said Michael Bornhausser, chief executive of SDC, a mobile digital rights management company. "In the US, the opposite is true. The iPod's market is far more developed, while the multifunctional handset industry is less developed than what we see in other parts of the world."
Mobile ambitions
The speed and character of the development of music services in both the cell phone and PC markets -- and by extension, the role of cellphones as music players -- will probably be strongly influenced by the desire of wireless phone carriers and record labels to keep mobile music a separate business as long as possible.
A song ripped from a CD or purchased from iTunes could, in theory, be transferred to a cellphone as simply as to an iPod. But some wireless companies and labels see mobile music as a different format altogether -- and therefore an opportunity for more money.
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