Taipanway’s Weblog

Cingular and Verizon have decided to formally regulate morality for mobile phone content.  It is as if they are deciding that they do not want to be in the business of mobile content.  Hip Hop is by its nature ‘profane or obscene’ and now they won’t sell them?

They are pushing users AND content owners to go off carrier.  That is good for Xingtone of course, good for the market - off carrier will prove to be much bigger over time (even in the US) and even good for the carrier.

My question is the mixed messages the carriers send.  Either be in the content business or don’t, but this straddling the line bullshit is crazy!

This does not even begin dealing with the isue of censorship, choice and all the macro indicators of the market that suggest this makes no strategic sense.  When I see things I wonder who makes these decisions?

Some recent press talks about The major labels selling 4 second diddies to play when you get an sms message on your phone.  Of course you can already do this with Xingtone (and many people have and do) but I was just wondering what the economics will be:

Song = 3 minutes - $.99 (real number)

Ringtone = 30 seconds $3 (real number)

Text tone = 4 seconds $21(my best guess)

Where is the merchandising?  How abut 2.50 for all three products?  Something - any creative thought behind this at all?  Someone?

Please read this - borrowed from Digital Media Wire:

Senate Bill Would Limit Satellite Radio Recording Capabilities

Washington - A bipartisan bill introduced in the U.S. Senate would limit the recording capabilities of satellite radio receivers, and compel satellite radio firms to further compensate record labels. The “Perform Act,” backed by Senators Dianne Feinstein (D-CA), Lindsey Graham (R-S.C.) and Bill Frist (R-Tenn.), in addition to the Recording Industry Association of America and other copyright holders, targets satellite radios from XM and Sirius that let users record copies of songs and other programming. “Digital sales are finally replacing physical losses,” RIAA CEO Mitch Bainwol told Reuters. “If someone gets a distribution right without paying for it, that blows a hole in the digital marketplace.” The Consumer Electronics Association (CEA) is opposed to the measure, as is a splinter group called the Home Recording Rights Coalition (HRRC). “The legislation would take away the longstanding rights of consumers to enjoy the benefits and flexibility of digital technology,” said Gary Shapiro, president and CEO of the CEA and chairman of the HRRC. “Indeed, it would undo decades of progress. If the bill were enacted, recording onto digital memory chips would be less useful to consumers than recording onto magnetic tape was 40 years ago.”
http://tinyurl.com/obafm (Hollywood Reporter)
http://www.tmcnet.com/usubmit/2006/04/26/1611603.htm

Notice, Mr. Bainwol is not saying that this is illegal - just that it is bad for business. Are you fucking kidding me? The Senate is now going to try to enforce and fight this battle. I was going to blog about Sirius paying the music industry for their mp3 recorder but end up not having the time. Sirius paid not because they were worried about losing a law-suit, rather then just did not want to fight it. This is called extortion. for the government to get involved in this is an embarrassment and a waste of time and tax payers dollars. THERE IS NOTHING ILLEGAL ABOUT RECORDING SATELITE RADIO. The music industry does not have to license their content to satellite radio, it is a choice. And now that they choose to go for the money with satellite they want to rule it from the outside. Disgusting. Feinstein and the rest of those clowns should be embarrassed for cow-towing. They have nothing better to do then protect the music industry?

Moves like this put the US Economy and our position as a leader in the world at jeopardy. Read my earlier blogs on my position on IP Terrorism and the like. ARGH!!!

I wish I could give credit to the person who summarized this concept so well for me – but unfortunately I forgot who said this to me (if you are reading this, please feel free to take credit for it)…… We were speaking about myspace in particular but the point was that it is applicable across the board.  “Web-sites are like sit-coms, they have a 24-36 month lifespan.”  I love this concept – well I don’t love the reality of it but love the succinctness of the concept. 

For whatever reason we believe that a web presence last for life.  And this is after the nuclear winter of the bubble days…  Why is this taken for granted?  Of course we have success that are ‘lifers’ like google, yahoo, ebay – but of course we have many more failures.  Maybe myspace is in the former category, maybe it isn’t, time will tell – but what if we change our view and start looking at domains and sites as transitory.  A site is hot for 2 or 3 years and then it is gone.  Would we develop different models?  Different businesses? 

I am not sure how this plays out but I think it is a great concept to ponder.  LA Law was a hit for years – and then it was gone.

There is a seldomly discussed fact that we in the industry either do not see, refuse to admit or are hiding from; how much disposable time and money does each individual have to consume content?  Obviously the overall pie and opportunity increases but how can each medium possibly sustain itself.

When I was at IDJ I used to argue that our competition is not other music companies (though of course they are), but rather anything that competes with for a users time or money.  Go back in time 50-60 years when Newspapers and Radio were the only media forms.  Let’s assume 100% penetration of each with an hour of time and $1 spent per user for EACH (I am making this up).  Then you add TV, an because TV is so cool people spend an additional hour and an additional dollar (through direct fees or advertising - irrelevant).  So now we have $3 and 3 hours a day.  Now add cable, movie theateres, malls, video games, records, tapes, CDs, books, Internet, VOD, video sharing, social networks, mobile phones, etc.. etc.. Is there not a point of diminshing returns?

If I spend 2 hours a day on myspace, does my time not get pulled directly from other media forms?  The interesting thing is that internet (and mobile internet) is the only media that can really be measured.  There is little passive involvement with your PC (though that is of course changing).  With a user listening to music, playing with the internet, and watching TV at the same time, each of these mediums claim that person as an active participant - this is misleading.

Over the course of time I believe strongly that each of these media sources are in direct competition with one another. Who is to say that the slow down in video game sales has anything to do with a delay in PS3 - MAYBE the key demographic is spending its time on myspace, or with their iPod.

Daily I have the issue of not only finding what is relevant to me but more importantly there just is not enough time to consume all the content I want. I would love to use audible.com, but I have no time.  I would love to watch more movies, more TV, play more video games, but I can’t.  The only thing I seem to be doing more of is listening to music (because I can multitask - like right now).  The reality though is that I have about 3 hours of disposable time a day (including when I work out in the morning) to use stuff.  There is nothing I can do about expanding that window.  Thankfully disposable income is not an issue for me (I am not rich by any stretch but I can afford the extra video game, movie or CD).  With the long tail concept (www.longtail.com) this gets harder and harder. 

It used to be that we had built in filters (not judging - just fact). CBS, NBC, ABC for TV, Krock, NPR, BBC for Radio, etc.. With the democratization of distribution, the ability to self produce, self publish, this becomes harder and harder to manage for the individual.  Myspace is a great example of this - with aprox 450K bands trying to promote themselves on the site how can I the user contemplate getting exposed to their music in any real way.  Friends are a great filter but it is a slow process and one that will only scratch the surface.  Which means that the ease of creation and making available is only half the battle.

I am not advocating an exclusionary filter system but I am advocating filters.  I think a great, and I hate to use the word, Web 2.0 business, is tailor made filtering.  We are beginning to see this but these systems are silo based - i.e. for music - but as an individual I have wide spread needs that cross platforms. I need a filter for everything.  Right now, with the silo based approach, I need a filter for my filters.  I could go to pitchfork for music, ESPN for sports, etc.. But I want one place that knows me, knows what I want and makes recommendations that are relevant.  Whoever can o this will offer HUGE Value to the marketplace.  Just please hurry up!

Numbers just came out of the UK.  iTunes has a 44% market share, allofmp3.com has 14% and Napster 8%.  So 14% of the UK market are willing to pay a little bit, about $1 a CD to allofmp3.com.  The interesting aspect of these numbers that we do not know the answer to:

1) Do people know allofmp3.com is illegal?

2) Are people buying content that is not available on iTunes (beatles, Zep, Doors)?

3) Is it price only or service?

The answers to those questions probably won’t be known for quite some time, but allofmp3.com and others like it, will be a force to be dealt with, SOON!