Last summer, we wrote about the pending crisis in the ringtone market
, which both music execs and mobile operator execs were so bullish about. The problem, it appeared, was that due to a little bit of success, both industries seemed to think that mobile content defied the basic economics that applied to all other content. It wasn't hard to see that this couldn't last -- and it appears that some are finally recognizing this
, as questions abound about how to make money on mobile content. MocoNews has two interesting stories today that highlight this issue. First
, is a column discussing the simple fact that mobile content is too expensive
. This isn't a new argument, but the industries involved became so enamored with the price they could sell ringtones, that they thought it would last forever. Of course, they then misunderstood their own market -- believing that ringtones were the equivalent of "mobile music" rather than a personal expression
. That is, consumers view ringtones not as "content" to be consumed, but as a fashion accessory to be spread around -- and thus are willing to pay differently for it. Most other mobile content, however, is
content, and needs to be priced accordingly -- meaning recognizing the competition. Most people are used to accessing content mostly free online. If companies think they can charge for the same content on a mobile device, there certainly needs to be a very good reason for it, and an additional value for users (and just being "mobile" usually isn't enough).
The second piece may be even more important. It talks about how the line between mobile content and mobile advertising is blurring -- and posits this is a bad thing. There are two things wrong with this statement: It's not a new thing and it's the natural state of the market. We've said it before, but apparently it bears repeating: content is advertising, and advertising is content. That's always been true -- even if it wasn't always clear what the content was advertising or if the advertising was really bad content. None of this changes on the mobile device -- and the fact that anyone should be surprised by this revelation suggests the industry has a long way to go before figuring out how to really make mobile content (and mobile advertising) work. However, when you embrace the relationship between content and advertising, it becomes much easier to recognize what business models are likely to work, and which are likely to struggle.