Let the music play: wireless carriers hear a sound they just can't resist

America's Network, Sept 1, 2004 by John Tanner

Apple Computer's iTunes Music Store registered its 100 millionth MP3 download in July--not bad for a business that just two years ago the music industry was convinced would spell its imminent doom.

Indeed, the success of iTunes indicates pretty strongly that there is in fact a paying market for music downloads, and that's just in the U.S. In another promising sign, the European version of iTunes, which made its debut in Britain, France and Germany in June, sold over 800,000 tracks in its first week.

Now that the business model has legs, the next big move seems to be migrating this to the wireless telecom space. Mobile operators are already on the case. Carriers like T-Mobile and NTT DoCoMo in Japan have already launched music download services. Others are developing similar strategies.

IN THE GROOVE

It's not hard to see why wireless carriers want in on the music download scene. We've known music could be mobile since Sony invented the Walkman. And for all the hype over video being the big play for 3G, it doesn't translate nearly as well into a portable handheld format as music. We also know now that mobile users will pay for music-based content like ringtones, music video clips and even karaoke.

However, mobile's suitability for music content doesn't automatically guarantee success. DoCoMo has already learned this the hard way: its mobile download service will reportedly be discontinued later this year. The reason? It's just too expensive, especially in a market like Japan where fans can rent entire CDs for about a dollar.

Digital rights management, of course, is at the top of the list of problems. Ironically, thanks to the Open Mobile Alliance's work on developing a DRM standard, now in its second version, DRM at this stage is probably the least of mobile music's technical hurdles.

SPEED BUMPS

A potentially bigger issue is link speeds. Downloading a 3-MB MP3 file is fine for Wi-Fi. Anything else is going to be miserably slow and measured in minutes, especially if it's GPRS or CDMA-1x.

Wireless carriers might do better to develop other ways to help users get music onto their phones. For example, multimedia kiosks in parts of Asia sell ringtones and music files that can be downloaded directly to your device via a USB cable, or to various storage devices, including CompactFlash, MMC, Memory Stick, and SD Card. Bluetooth can't be far behind.

Another issue is the device itself. As music players go, today's mobile phones can't hold a candle to the iPod. They don't have the storage capability or the battery life. Newfangled handsets like Motorola's E398, which features an integrated MP3 player, vibrating stereo speakers, and rhythmic flashing lights, are brave efforts to change that. But for my money, it makes more sense to stick a Centrino chip in an MP3 player.

As usual, such issues are temporary. Storage and battery issues, for example, could be solved via removable flash memory and fuel cells. Until then, however, carriers hoping to cash in on mobile music should think outside the box, because there's likely going to be more to mobile music than just download services.

The possibilities range from uploading services for local music artists and distributors to nifty value-added ideas like IVR-based music recognition systems (hear a tune in a restaurant and want to know what it is? Dial a number, hold your phone up to the source and receive an SMS with details about the song and the artist) to barcodes in music magazine articles, adverts, or concert posters that can be scanned with camera-phones to access info on the artist and buy CDs and concert tickets.

The technology for such services already exists. Let it rock.

John Tanner is global technology editor for America's Network