A survey by QPass, has shown that the ringtone industry has lost $40 million since Q1 2004 and will loose a further $123 million by 2007.

The problem is that many pesky kids are saving the (free) preview tones and putting them on their mobiles.

While this does certainly happen, I suspect it’s dwarfed by the same pesky kids sharing their ringtones with their pesky pals - whether they obtained the original legitimately or not. Ask any 12 - 16 year old about their tone collection and it becomes pretty apparent that they don’t pay for many of them.

But, back to the QPass survey. The point of the research is to prove that there’s a problem in the first place, as QPass want ringtone vendors to use a digital rights management system to protect their tones from such nefarious piracy. Like their very own Qpass Content Delivery Platform, as plugged in the original press release.

So they ran some tests:

The Websites tested included 42 mobile carrier portals and 58 online
entertainment and music stores offering full track music downloads. Out of the
sites tested, 40 percent of carrier sites and 31 percent of other portals such
as online music stores and entertainment sites were unsecured.

So what they’ve proved so far is that some sites are vulnerable to preview piracy, which is an interesting fact, but one that’s certainly known to anyone who studies the young mobile phone users.

But they couldn’t let it rest there - they wanted an eye-catching headline, which means quantifying losses. So, as far as I can see, they made up some big numbers, doubled them, divided by 3 and multiplied the resulting figures by the Marketing Director’s birthday to come up with their $40 million.

Unless I’m very much mistaken, they can’t possibly quantify losses any more scientifically than this, as they’re trying to measure something which is, de facto, unmeasurable and undetectable.

In fairness to QPass, their little PR sally does seem to have worked, with even even the good old BBC rushing to help plug their DRM system. While at the same time managing to convert dollars into pounds by using the Euro exchange rate, according to James at Moco News. Oh well, we can’t always get everything right.

The ringtone business does have immense problems on the horizon, which includes P2P sharing and self-created tones. These will make this little problem appear as no more significant than the middle name of your great, great grandmother.

Story via Moco News. Pic of the original pesky kids via Classic TV.

I’m not real happy to revisit this topic, but after examining how mobile phones played into media coverage of the earlier London attacks, I was interested to see the Metropolitan Police make an appeal for cameraphone images and other footage taken in the four relevant areas before or at the time of the incidents today. People can submit via the www.police.co.uk Web site, or via MMS to 07734 282 288 (is an operator or messaging provider going to stump up and support this for free?).

Looks like sousveillance is playing out — and this instance will only bring it further into the mainstream. It’s hard not to see phrases along the lines of "This guy was creepy, so I took his picture with my phone — just in case," becoming commonplace.

Justin Pearse over at NMA reports on the division in the UK marketing industry over Bluetooth, with no clear mandate on the legality of sending unsolicited marketing messages using the technology. Evidently the “Electronic Communications Regulations” say explicit consumer consent is needed for marketing messages, and that’s a chicken-or-egg problem for marketers that don’t have any other point of contact with consumers than their Bluetooth bots.

Accordingly, many people using Bluetooth marketing have decided to interpret a phone with Bluetooth set to discoverable as opting in to their messages, which seems a bit like a spammer justifying what they do by saying they only send messages to people with email addresses. One marketing agency person says “Operators need to advise people how to put Bluetooth protection on.” I’m not sure exactly how he means that, but it sure sounds like he’s saying that it’s the receiver’s responsibility to do something to prevent being hit with the messages. Again, seems an awful lot like spammers.

Some agencies are trying to figure out a better way, using clearly defined Bluetooth “zones”, like a corner of a club or a floor mat. I’m not sure those will work too well, after all, how do you make sure a Bluetooth signal doesn’t spill over the mat, but it’s a start — and far more responsible. Email marketing has been made ever the more difficult because of spam, and spamming mobiles — whether from a legitimate business over Bluetooth or a shady ringtone seller via SMS — will only dent mobile marketing’s prospects in general.

It’s unclear how long it’s going to take people to understand that interruption marketing isn’t too effective anymore, regardless of how new and technologically advanced the medium is which it’s delivered is. Consumers the world over use different means to avoid these messages, whether it’s skipping ads on a TiVo, blocking pop-ups and stripping out ads in Firefox, or using spam blockers. It’s unclear what part of that makes some marketers think intruding on peoples’ mobiles will be well-received, even if their Bluetooth is on.

Just wanted to put the word out to our readers (if any) here in Austin, like me — a Mobile Monday group is starting up, with the first meeting August 1.

Visit mobilemondayaustin.com for more info and to RSVP. Hope to meet some of you there.

Let’s assume you’re free and single and in a bar looking for some action with a member of the opposite sex (or same sex actually as we’re not homophobic here. Oh no, many of our readers seem to come from a certain gay chat room according to our logs, and very welcome they are too).

There’s a choice of 2 candidates you can choose from. You know that one of them will be open-minded to your approach and you have a pretty good chance of success. But the other one will slap you in the face, scream "looser" and stomp off and tell their friends how you harassed them.

What person in their right mind wouldn’t want to know that information, before making their approach?

Well, a very similar situation is happening in response to BT’s latest initiative - BT Privacy. (BT is the UK’s largest and incumbent fixed landline operator, by the way). BT Privacy offers to sign its customers up to the Telephone Preference Scheme (TPS), which bars telemarketing people from calling them anymore.

This is being greeted with howls of indignation among the telemarketing industry. But you’d think that they’d welcome it wouldn’t you? The call centres wouldn’t be pissing people off and they’d have a higher conversion rate to boot, as they wouldn’t have to talk to people who definitely weren’t going to buy their products and services.

But no. These traditionalist marketers are so wedded to an interruptive model (and it’s hard to know what could be more interruptive that a phone calls when you’re eating supper) that they can’t see that this model is deader than a dead thing on Planet Dead. Idiots!

As for BT, they should be applauded. This initiative could really be a result of listening to what their customers want. On the other hand, it would be a canny way of preventing their competitors from poaching their customers.

Either way, it’s a smart move.

Last week, I looked at the share of the SmartPhone market held between the two operating system leaders, Symbian and Microsoft. In that battle, Microsoft was being battered and outsold by 8 to 1.

I didn’t examine too closely the Linux position as it was very much a niche play according to the stats I had at the time, though I did predict that this might change.

But latest Gartner stats show that Linux is now bigger than Microsoft, accounting for 14% of shipments in Q1 2005 vs Microsoft’s meager 4.5% share.

SmartPhones are the fastest growing sector of the market and is forecast to account for 200 million handsets in 2008. But, there’s more to this sector than just raw numbers. The real power-users and opinion leaders in mobile all have SmartPhones. I do. You probably do too - and if you don’t, my guess is that you’re unusual among readers of MobHappy. Drop me a comment if I’m wildly wrong here

This means that Microsoft are loosing the battle for the hearts and minds in the SmartPhone sector, if they haven’t already lost it already anyway.

This puts Microsoft in an incredibly bleak position in the mobile world, which will become bleaker still when they finally realise that the mobile will do to them, what they did to the mainframe - accessing the digital world by PC in 10 years (maybe less) will be a minor eccentricity, like hand writing a letter now if you’re under 20.

So what can they do? With plenty of cash, I think they’ll have to buy a handset manufacturer and lever their way into the market that way. The current strategy clearly isn’t working and there’s no real future for them in sticking to the PC. It would be like a buggy whip maker doggedly continuing to turn out buggy whips in the early years of the last century in the face of a market about to embrace the motor car.

Who will it be? Motorola or Sony Ericsson would be my bets, but what do I know?

Image from projects.Linux.Wine

Jupiter analyst Julie Ask (she of the ringback tone trial saga) pointed out a new prepaid data card offering from Vodafone UK, saying the pricing model might help it compete with hotspots for business users’ access — if for no other reason than there aren’t many people that can justify the high monthly cost of mobile data access to their employer.

But the new offer doesn’t escape a typical pitfall of prepaid data in the consumer arena — the ridiculous price premium over contract tariffs. The Vodafone card costs 200 pounds, with data at 3 pounds per meg in the UK and 9 pounds per meg when roaming. That price isn’t likely to win over many hotspot users.

So, then, if operators feel like hotspots are costing them mobile data customers, how to move forward? The current plan seems to be to open up hotspots of their own, then charge exorbitant fees. Perhaps the only benefit of those is you don’t need a $350 card before you can even get started. But why not just make cut prices? I’m not saying to give things away, but at least make them reasonable.

Part of the reason people don’t want to use mobile data is because so many tariffs take the worst part of voice tariffs — overage charges — and implement them on a grander scale via an unclear metering method. Say your first MB costs $5, then it’s $3 per MB after that: it’s pretty easy to tell when I’ve been talking on the phone for an hour, but what the hell constitutes a megabyte? And my example data charges are pretty low, particularly for some European carriers. It’s an issue for business users as well as consumers — how do you explain to your boss that getting Rick’s bloated Powerpoint presentation, with all its nifty animations, cost you $50? Reasonable flat-rate pricing makes sense here: if a company knows they’re going to pay X per month for mobile data for each employee, regardless of use, it’s much easier to go for than something with a cost that can skyrocket very easily.

Proponents of metered pricing build their argument on a couple red herrings. First, they assume that with flat-rate, unlimited pricing comes abuse by users sharing connections and so forth. That’s not the case: if prices drop to a reasonable level, operators can lessen the incentive to “steal” service. Second, they assume that on flat-rate plans, usage will leap up and cause network issues. This, too, isn’t necessarily true. Revenues and usage are two separate metrics that aren’t necessarily related. For example, I pay T-Mobile $20 per month for an unlimited Wi-Fi subscription I rarely use. I don’t really need it, but it’s come in handy quite a bit, and the $20 per month rate is low enough that I don’t mind paying every month so when I do use it, I’m not hit with the 10 cents a minute or $10 per day fee. Bringing mobile data pricing down to this level will catch a lot more users, but won’t necessarily deliver an equal uptick in usage.

Price elasticity of demand is an interesting thing — and it’s hard to believe that operators haven’t heard of it. It’s similarly hard to believe that $80 per month is the spot where they think they can maximize their revenues.

Picture from Wikipedia.

I’m happy to report that the archives of TheFeature.com are now available at thefeaturearchives.com. I’m still waiting for Google to index the pages, so the search box isn’t much help yet, but you can browse by topic, though I know that’s not too elegant either.

But, after spending the bulk of the day messing with mod_rewrite, I’m glad to say all the existing links out there to TF articles should still work. That’s all the content I’ve got, though, so links to anything else on the site (journal entries or user pages, for example) won’t work.

In any case, enjoy. I’m glad that I’ve been able to resurrect all this great material. Thanks to Nokia for letting me host it, as well as Dennis Yang and Matt Croydon for their technical support.

Rather than feature our HUGE BlogRoll on the home page of MobHappy, we thought it would be altogether more managable to post it here and then provide a link from the home page.

This way you get to find all the excellent blogs we like to follow, without having it rammed down your throat on every visit.

We hope you find some great new bloggers here. But if you’re not on the list or feel we’ve missed someone out, feel free to add a comment or drop us a line, pointing out the error of our ways.

Russell’s BlogRoll

Carlo’s BlogRoll (OPML file)

Got an email from Gartner just now saying they’ve upped their handset sales estimate for 2005 to 779 million units. Their initial estimate for the year was 720 million, which got bumped up in May to 750 million. Gartner also adds its prediction that handset sales will break the 1 billion per year barrier in 2009, when it says there will be 2.6 billion mobiles in use.

This comes as another analyst said last week it sees sales growth slowing to just 6 percent this year, whereas Gartner’s 779 million prediction would show about 15% growth — though that’s still off from the 30% growth from 2003 to 2004. Gartner adds that sales remain strong around the world, with growth in emerging markets outpacing mature ones, but replacement sales in those mature markets continue.

My initial take on this is to lean towards Gartner’s view, but like many other people, I’d like to wait for Nokia’s announcement of its second-quarter results before committing to anything. Gartner says average selling prices are on the way down, too — a development that’s less harmful to the bigger, high-volume vendors. This looks to be playing out in second-quarter earnings reports already: number-four global vendor LG said falling prices and increased competition were behind its quarterly loss, while number three Samsung and number five Sony Ericsson both saw margins fall in the quarter.

Meanwhile, Motorola reported a very strong quarter, shipping a record number of handsets and gaining 3 points of share, which likely came from smaller competitors. Moto execs’ comments also seem to echo Gartner’s view that demand remains pretty high across various locations and demographics. There’s a lot of expectation that Nokia will also report market share gains on Thursday, and strong, growing results from these two market leaders — which together sell more than half the devices in the world — would seem to indicate sales across the board remain solid.