YOUNG, MOBILE, Def

American Demographics, Nov 1, 2004

"There's tons of ringtone providers, tons of wallpaper providers, tons of news and information - content like crazy. But we bring powerful brands that end users can recognize," says Nick Montes, AGmobile's vice president of marketing and the former director of multicultural marketing and international services at Verizon Wireless. "From a carrier perspective, putting brands like Univision or Def Jam on your deck will definitely increase your revenue and downloads. Consumers are familiar with what kind of content these brands have delivered in the past, and know the content they're gonna deliver by mobile is just as good."

But what most sets AGmobile apart from other content developers and aggregators is its retail presence. American Greetings has agreements with over 115,000 different retail outlets in the U.S., including exclusive deals with Target and Kmart as well as partnerships with Wal-Mart, Rite Aid, CVS and others.

Is the partnership a business slam dunk? "Russell has a great brand - it's in music, television, comedy and fashion," says Mark Levy, vice president of content for wireless content provider and publisher InfoSpace Mobile. "But at the moment, it's so difficult to explain to somebody how they find content on a phone, or where they're going to get it. The evolution of this industry will be toward companies like Def Jam that want to use their brands to drive sales, but I don't know if the market's ready for that."

However, certain segments of the consumer population seem more ready than others. Youth-focused Virgin Mobile USA has enjoyed a successful relationship with another longtime bastion of teen culture, MTV, delivering to subscribers exclusive MTV-branded news alerts, audio voting, ringtones and interactive voting for the network's hit Total Request Live music video countdown.

"There's increasing sophistication and significant uptake in these types of things," says Howard Handler, chief marketing officer for Virgin Mobile USA. "Everyone's hearing the clarion call. MTV got in early with us, and for Russell to step up is fantastic."

But there are no guarantees. Perhaps the biggest question is whether Def Jam - at 20, now older than many hip-hop artists and their fans - can still connect with the 18- to 25-year-olds who account for the core of the mobile multimedia audience. The label is no longer the sole monolith on the hip-hop landscape: both Bad Boy Entertainment and Roc-A-Fella (owned by rap superstars Sean "P. Diddy" Combs and Jay-Z, respectively, both avowed admirers of Simmons) now rival Def Jam for star power, audience share and cultural influence.

"I see Def Jam as a very strong musical brand and voice of expression," Levy says. "I think with Russell's extension into Def Poetry Jam on HBO, he's got an extended audience there, but is it the target audience of 14 to 25 that's buying all this stuff? I don't know. Russell's done a good job of reinventing himself every few years - at a business level, people know who he is, and in the music industry people know who he is, but how far that extends to the buyers of the content we're talking about, I don't know."