The Absence of Mobility
Russ and I sat down with Charlie Schick and Christian Lindholm while we were over in Helsinki. It was a great conversation, most of which I spent just trying to get a word in edgewise around the sparring that Christian and Russ were doing regarding some of the new Nokia handset designs. That’s a post for another time though. One of the topics we spent a while on was from a post Charlie has called Mobile was nowhere at Les Blogs - why? The question boils down to the use of mobility in cutting edge innovative applications. Mobility is obviously an area that can deliver a lot of benefit if merged into an application offering, why aren’t the folks in the innovative startup environments doing it more? I don’t think it’s because there are few people out there who can bridge mobile and web environments. I’ve done a ton of work in both, and I still run into people at every single MoMo meeting who follow the trends more closely and know the details better than I do. The folks are out there who can bridge, they’re just not doing it. For good reason.
The primary issue is that carriers are not innovators. They actually fear change. They’ve grown an immune system to defend their working system from outside forces. They have a profitable model as it is, providing mostly voice services. They might be able to expand out into other services - but that would mean ramping up support and sales for those new services, figuring out what the impact on the already overloaded networks would be, and risking an investment for an uncertain return. Normally the market system in the US takes care of that kinda crap. The technology company who sits still gets rolled over the the nimble startup who provides the users with a new valuable product or service. Unfortunately not just anyone can startup a cellular service provider. With all the spectrum owned by the existing players there’s no one to come in and compete to act as the disruptor. So even if the startup folks wanted to deploy a new service or set of features that could be making the carrier a ton of money it can still be hell dealing with the carriers.
“Screw that!” you might say, “just go around the carriers! Put a service out on the Internet and let the users find it. If you have something compelling enough you don’t have to go through the carriers to get to the users. Just like back in the early days of the Internet.” Great idea, but the carriers thought of that already, and unfortunately even that can be prevented. Leaving aside the issues of starting a viral marketing campaign for a new product using mobile devices, it can still be technically infeasible to attempt to deploy an application. Some kinds of systems, like BREW, will keep users from getting your content or application unless the carrier approves it (read: “unless the carrier profits from it”). In order to provide messaging from one world to the other (mobile to Internet or Internet to mobile) requires explicitly going through gateways, which is a pain in the ass for the service provider and frequently cripplingly complex for the end user. They remain different worlds because the carriers like to keep them that way.
If there was a way to hack on applications that bridged the worlds I’m sure there would be a ton of it going on. But right now the only way to get an application up is to prove to the carrier that it’ll make money and then cut them in on some of it. Or pay a ton of money so that you can use a gateway to message into and out of the mobile world. These are all disincentives to experimentation, hacking, and innovation. The advances aren’t going to spring full formed from the head of some Draper Fisher Jurvetson supplicant. They’re going to come from experts who understand the technology trying out new combinations and scratching their own itches. Not many are experimenting because of the onerous environment. Provide a more inviting ecosystem and the merger of web and mobile will kick right off.
May 12th, 2005 at 1:28 am
yes. Yes. YES!
May 13th, 2005 at 7:23 am
Hey Mike - congrats on your new blog - I’m already enjoying it after only 3 posts. I’m with you 100% on this one - especially here in the US where the carriers defer to publishers who could care less or are too busy selling their own games to think about mobile apps that actually do something. I’ve had a much better experience with publishers in Europe who seemed to be more open to new things. But carriers? Forget it.
May 14th, 2005 at 12:46 am
Mike, you’re right: the carriers are holding mobility back. At least in the Western world. In Japan, DoCoMo opened up their value chain to any content and application provider, and everyone reaped tremendous profit. It’s too bad that other carriers don’t get it. They can increase their ARPU (average revenue per user) by at least 20% if they “let a hundred flowers bloom.”
We at Berkeley did a research project for a major MVNO to devise a mobile music distribution strategy. They were adamant that they get at least 50% of revenue for providing infrastructure and marketing. That leaves no margin for content owners and technology suppliers to build mobility applications.
Let’s say the user pays $1 per track. Fifty cents goes to the carrier. Fifty cents goes to the copyright holders. And nothing is left for the application developer.
May 14th, 2005 at 10:53 pm
so true, perhaps phones with WiFi like the Nokia N91 will start the end run around the mobile carriers who are slowing down the mobile revolution
December 11th, 2005 at 4:03 pm
In a study reported on CBS News, 15% of Americans with internet access have visited an internet dating site. 27% of them were 18-29 years old. Obviously online dating service is a popular pastime. In another study reported by BBC News, online dating was seen as a way for women to feel empowered in relationships. The conventional inhibitions that they had in face-to-face relationships were replaced by a more upfront and in-control attitude when given the anonymity of the internet. Could this improve their chances at finding a perfect relationship?