Taipanway’s Weblog

This is not going to be an exhaustive list, there are just too many, but I wanted to comment on the rush of MVNOs hitting the market.

First off, a comment on the space in general.  Why do people feel that they have to be an MVNO?  Is being a wireless carrier that good a business?  Its an interesting question and one that is for another time.

ESPN – is this a joke?  No seriously, can someone please tell me why they would do this (besides a) it’s the thing to do and b) stock price/playing to the street.  Best case scenario – and this is BEST CASE – 5 million out of 207 million US mobile subscribers get ESPN on their mobile phone.  Why not build an application based strategy and target all 207 million us subscribers.  I love ESPN, would love to pay them for a valuable service, but use them for my service – WHY?  I would pay 3, 4, 5 dollars for an interactive pointcast experience (isn’t that the pitch anyway).  It truly makes no sense to me.  The one good answers I heard about how ESPN succeeds – gamblers.  They need all this information so badly that it is worth them carrying.  Likelihood of success 10%

Disney – I am not even going to go into the future debacle this will be – see above and then multiply by 100 – likelihood of success 0%

AMP’D – this is a hard one.  I maintain that tying up with Viacom and Universal was a terrible idea.  From what I hear Verizon does not want them on their network and wish they could end it.  They do not have enough money, will need to continue to raise more, they do not have enough distribution, management keeps turning over, etc.. The only reason I think there is hope is that they have a good voice.  Liklihood of success 20%

Helio – a real challenge for me.  Their pricing is off, but their service is pretty hot.  They have the right MO and the right backing – plenty of money and they seem to be making the right moves.  Concern for moe on this one is that though I am pretty close to the target market I would never get the service – why?  Because I need my blackberry.  The market they are going after now and certainly in the future, needs a device that converges between work and play.  If they come out with a blackberry compatible (or even MSFT compatible) I am in.  Other points, rumor says they will have the Apple iPhone – GREAT move if it’s true (though a terrible move for Apple – more about that below).  The myspace tie-up was great and should help a lot – it was worth every penny (reportedly 10 million for exclusivity through August).  The last piece that no one is talking about is a korean language version of the service to go after the Korean ex-pat market.  This is tremendous and could really do some damage. Likelihood of success (though not sure how define success when you start with 440 million dollars) 75%

Kajeet – I don’t have much of a vibe for them though I think they are going after the right market – tweeners.  This is very different from Disney in that Disney has a brand that skews young and as kids get to 12 they have aspirations to be older.  As soon as a kid hit’s 7^th grade they need to get away from Disney which is for kids.  Kajeet, is going after that market hard.  They will need a lot more money but it is interesting. Likelihood of success to hard to tell

Voce – Not a chance. Unless it is tied into AMEX black type service and given away for free to valued customers this makes sense.  Even rich people, sometimes especially rich people like to know they are getting value for something.  For this type of money I should be getting things that are not legal in this country.  Likelihood of success 1%

XEmobile – I know the founder of XE so I am a little bias.  XE focuses on college kids, prepaid and have strong distribution.  They have managed to keep the team small, have taken only a small amount of money and have realistic expectations and plans.  Likelihood of success 60%

Apple – though not an MVNO, they should be.  We are hearing about the iPhone on Helio, we are hearing about Apple+Softbank to launch on Vodafone Japan.  Here is my plan.  Go unlocked GSM, sell the phone as an unlocked consumer electronics device – therefore it will be unsubsidized.  Get significant market penetration – which will be EASY for Apple.  They could do a million phones in 3 months at 299-399 (assuming it was hot).  Let their financial people look at the numbers and if it makes sense, offer to swap out their users SIM chips with an Apple branded one – assuming service and price in line with reality, within 6 months or so they would have 80% of their users on an MVNO.  Likelihood of success if using my strategy is 95%.

For all of my loyal readers (all two of you), you know my take on DRM in general.  But when I see a number that says 3.5 BILLION Euros are being lost to piracy, it sickens me.  It is patently untrue.  Let’s even assume that people ACTUALLY stole 3.5 Billion Euros of content, does that mean that if there was better protection those people would have bought that same value in content?

People steal things for lots of reason - they think it’s fun, they think they are sticking it to the man, they have a right, they can’t afford it, etc.. What are the other drivers?  Are there any drivers that make us believe that if they could no longer get what they want for free that they would pay for it?  Of course there would be a couple (like 2), but as a general rule?

P2P is still obscenely popular but yet digital music sales are booming (relatively).  In the begining (i.e. Napster) the party line was how can we (the industry compete with free), If only we can shut down Napster/P2P all would be right in the world.  But alas, they have not shut down P2P and the numbers are up. 

If people really are stealing 3.5 Billion Euros of content, I think the industry is missing out on somewhere between 1-2% of the total.  Yes I made up that number, but so did whoever published this report.

Just some additional information.  Spoke to someone at a leading mobile search company.  They maintain that mobile search for porn is UNDER 1% if not under 1/2%.  Not sure where people get their numbers but I have to imagine +/- 5% all search firms would see the same type of numbers.  I am assuming the initial numbers are much exagerated.

I don’t think this story is getting enough press.  The reality (if you read previous postings) is that music as a standalone is tough, but using music to build other aspects of a business is a goldmine (MTV, Apple, Wal-mart, etc..).

I though Yahoo would be the first to the table in building this out.  To be honest, I did not think Napster had the balls or the ability to pull this off.  This is a GREAT move for them.  They should buy a social networking company (technology not users) and build a REAL community around music.  Look for Yahoo to follow suit soon - not to mention a whole lost of other companies in the space.

New numbers claim that mobile porn is 20% of all the searches done from mobile phones.  This is compared to 10% online (through google.com for example).  Besides the fact that this number seems to be huge, the amazing part is you can not get (in any real way) mobile porn.  The reason you can not get mobile porn is because the carriers don’t want to give it to you.  They are scared about associating themselves with porn - with, as Linda Barrbaree of the Yankee Group, says "I think they [the carriers] have a lot to lose, quite frankly.  They want to make sure they don’t make the evening news allowing a 12 year old boy [to access porn].

Does anyone else think this is odd?  First off, when did Verizon (insert any carrier instead) become my mommy?  Second, Verizon DSL does not block access to porn.  Third, when I was 12 I had a least a couple of playboys stuffed under my bed.

This mock Puritanism is nauseating.  I am not advocating porn, I am advocating freedom; Freedom of choice, freedom to do what I want and freedom from other people being the arbiter of my taste.  (to be clear - I am against smoking bans - not that I am for smoking - but what ever happened to capitalism - build a bar, the owner can make it smoke free, and if he has enough customers, he is in business.  Build a bar, make it for ’smokers’ and if nobody comes, it will shut down.  If a bartender does not want to work at a bar where there is smoke, great, higher someone else).

I do not want to sound like Larry Flyn here but the concept that Verizon limits my ability to get to anything at all is something that we consumers should rally against.  Porn is our right!  What is even more insane is that carriers are leaving millions (if not 100s of millions of dollars on the table), for what reason?

I would love to be a fly on the wall in the meetings between the FCC and the carriers and at carrier board meetings.  Are these decisions coming from the Carriers, are they being strong armed?  It amazes me in a world where user generated is king, and successful sites are ones that support and excel on user desires, the carrier world says, nope, we know better.  Who is in charge here?