The clash over content delivery

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Comedy Central launched its Motherload.com Web site earlier this month. Technology developers for the company say they are already working on a mobile strategy. So far, MTV has announced it is working with Sprint Nextel to develop special music, comedy and other TV segments for mobile users. The programming will consist of short segments from numerous MTV channels, including Comedy Central, VH1 and Nickelodeon, MTV said. It also plans to air content exclusive to mobile phone viewers. But the brand could also develop its own mobile site, which it markets directly to consumers.

Some carriers, such as Cingular, have already started opening their networks. Content providers advertise short codes in newspapers, on Internet sites or on TV that subscribers use to download the content directly from the content wireless sites.

But some want to avoid problems that have arisen from direct marketing campaigns, such as Jamster's Crazy Frog, which has stirred quite a bit of controversy. Earlier this year the Advertising Standards Authority in the U.K. received complaints from viewers who not only objected to the frog's visible genitalia in the advertisements, but also the frequency of the television spots. Consumers have also complained that Jamster's advertisements are misleading and lure consumers into paying subscription fees for what have been advertised as "free ringtones."

A class-action lawsuit was filed earlier this year in California against Jamster alleging the company conducted fraudulent and deceptive advertising practices. The suit also names VeriSign, which owns Jamster, as well as carriers T-Mobile, AT&T Wireless (now a part of Cingular Wireless), and Cingular for allowing direct billing of the ringtone service, absorbing some of the profits, and charging their standard text messaging fees even though the messages were unwanted.

But some carriers are much more hesitant to give up control of their network. They're afraid that mobile Web surfers could inadvertently download worms or viruses that could wreak havoc on the network. They also don't want poor-quality mobile Web sites ruining the experience for their customers.

Currently, Verizon Wireless does not allow subscribers to access content that is not on its portal, although it is considering opening the door to its walled garden a crack.

"More recently, we have begun the process of looking at content providers who want to offer services directly to customers."

--Jeffrey Nelson, spokesman, Verizon Wireless

Unlike Cingular, which allows its subscribers to go to any WAP-enabled site, Verizon doesn't plan on giving consumers free reign to surf for mobile content in the way they are accustomed to doing on the Net. Instead it will allow access only to content it has certified.

"We protect the network at all costs," said Jeffery Nelson, a spokesman for Verizon Wireless. "What that has meant in the recent past is customers could only buy content that we allowed up on our different menus. More recently, we have begun the process of looking at content providers who want to offer services directly to customers. But we will require them to abide by some really important guidelines."

This means that content providers will have to ensure that they have the rights to distribute the content they're delivering. The carrier also will only allow access to content it deems appropriate for all ages. And it will ensure that the sites that can be accessed are free of viruses and worms so they don't infect mobile devices. If any of these conditions are violated, Verizon will simply pull the plug, Nelson said.

The billing hitch
Even if all mobile operators opened their networks, content providers would still have a difficult time cutting carriers out of the loop entirely. The biggest problem they face is billing. Without a relationship between the content provider and the carrier, consumers are forced to either enter credit card information on the mobile Web site or a regular Web site, or use a pay system like PayPal.

"It's not easy to create a separate billing system," said Lin. "The cell phone operators already own that, and they have the direct relationship with customers. Micro billing systems such as PayPal aren't that efficient when compared to direct monthly billing."

For now, carriers and content providers seem to be working together to strike a balance.

"We view the carriers as important partners," said Olivier Griot, director of mobile service for Hearst Magazines, which is currently developing a strategy to market its content direct to consumers. "The industry may evolve where customers don't access content through the carriers' portals, but we'll still need to integrate with their billing systems. As they continue to add great value to the relationship with customers, I'm happy to partner with them."

But many believe it's only a matter of time before the mobile Internet starts looking more like the traditional Internet. As new dual-mode cellular-to-Wi-Fi phones come on the market, people will be able to enter a Wi-Fi hotspot and download whatever they want directly from the Internet.

Today's mobile market could develop like the Internet service provider market did starting in the 1990s. Back then companies like America Online and Prodigy offered closed portals and search capabilities to their Internet access subscribers. But the development of the Web browser and a more sophisticated customer base changed the market drastically, diminishing the value of these portals.

"Mobile operators will eventually lose their grip on content, just like AOL did," said Ray Anderson, CEO of Bango, a U.K.-based company that helps content providers integrate into carriers' billing systems. "They're teaching people how to download ringtones and other content on their phones. But once they've laid the groundwork, content providers will be able to bypass the portals and interact directly with the brands."

[rrajiv]

Getting free ringtones....

I dont know about USA but the phones in SE Asia come uncrippled when you get them. So bluetooth/infra red all work.

Nokia(not sure about others) allows you to download their free software for phone management, transfering stuff to and from the phone etc.

Most phones these days can play midi and wav files.

If i want a ringtone, all i have to do get it in either midi or wav. midi files are free, while wav files are converted from my mp3s

I fail to see why someone needs to pay 3 bucks for a ringtone.

[clara222004]

Get Verizon content from several places

try www.ringingphone.com for ringtones, they even support
Verizon, better than buying them direct. Verizon needs to realize
that people want to do interesting things with their phones and
that doesn't always mean using the carrier supplied system to get it
done.

Mr. Strigl, bring down the wall!