Shocker: People Realize That Mobile Carriers Won't Make Money From Music

from the gee,-who-would've-thunk-it? dept

For quite some time, a bunch of folks have been pointing out that the mobile phone operators are being somewhat idiotic in their belief that they they can be music and media moguls. They got this idea in their head once ringtones started to take off, and rather than thinking they might just be a fad, both the music industry and the mobile operators start drooling over how much money they think they’re going to make — when neither of them seem to actually understand the other’s business very much. While the theme of the last few months in the mobile world seemed to be unquestioned acceptance that “content is king” it appears the backlash is starting, as even the folks at Business Week are realizing the mobile operators will never make much money by selling music directly. The article points out what everyone always seems to forget. Even for Apple, the clear leader in selling music online, selling music is a loss leader. In other words, the carriers would do better to team up with someone (such as Apple) to handle selling music, and they should just be happy with the increased usage. Of course, instead of that, the operators are complaining that iTunes on phones will take revenue away from them. And, of course, this doesn’t even touch on issues like network over-capacity and the fact that people don’t want different music services on their phones and on their computers. Between the recording industry and the mobile operators, about the only thing you can bet on is that both industries’ short term greed, and total lack of understanding of what users want, is likely to screw up any offerings for quite a few years.

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