Commentary

'It's a Free Concert from Now On'

If you are old enough to remember those famous lines by Woodstock announcer John Morris, then you probably also understand its profound historical irony. Woodstock may have been the exact moment when rock and roll became anything but free. The musical industrial complex truly ramped up in the 1970s, cashing in big on rock's popularity and complex meanings for that generation. Thirty-five years later, the music industry's reputation for cynicism and greed is such an article of American faith that the Recording Industry Association of America doesn't worry anymore about a PR backlash from suing consumers over piracy. At this point, even the record labels know they have no public reputation to protect, let alone salvage.

I bring up Woodstock because that period in our cultural history is not unlike the current state in mobile media. Like America in 1969, mobile in 2006 is going through what cultural anthropologists call a "liminal moment." In periods of historic transition and uncertainty, old categories and ways of thinking lose their authority and it becomes possible to imagine radically new ways of moving forward. Some of these new models, like the utopianism of 1969, are doomed, of course. But the musings are almost always interesting because they register our frustrations with the way things are.

This is a long-winded, egghead warm-up to introducing one of the most intriguing new models for mobile content I have heard lately...but one that almost certainly will not work. Ad-supported downloadable music is an idea being floated by SixtySeven Kilohertz, Inc. an Evanston company that just patented technology for slipping audio ad spots between music tracks that a user has already downloaded to his mobile phone. Unlike the $1.99 and $2.50 Verizon and Sprint subscribers now pay per over-air download, this system would offer free, fully sponsored music you keep.

And the technology is not that complicated. This simply requires an MP3 player on the handset that runs the stored songs and reaches out to the network on occasion to pull down ads dynamically. "The real art in all of this is determining when to insert message breaks," says Marc Cohen, who started the company in 2000. The technology also allows for contextual placements, matching ad to music type. "We can use musical preferences as a detailed target variable," he says. Even more interesting is that the same approach to dynamically serving ads into digital tracks could be applied to standalone MP3 players, too. When Apple finally does issue its inevitable WiFi iPod, for instance, users could get free songs in exchange for letting the player talk to the nearest hot spot and grab relevant and timely ads.

SixtySeven's idea is yet another example of what we have been seeing all year: new ideas for advertising to subsidize and help proliferate mobile data. But in the case of mobile news and weather or even mobile TV, ad support on handsets simply extends a familiar model from other platforms. SixtySeven's idea leverages mobile to introduce a new revenue stream, advertising, into music distribution. This is not radio, because users really would be picking and choosing their tracks just as if they were buying them. Consumers would have the same total control they have in many other fee-based media, but sponsors would pick up the tab.

Of course the first question is, what record executive in his right mind would buy into this model? Despite ups and downs in CD sales, is the transactional model really broken here? Even in mobile music, Sprint claims that over 2 million people downloaded tunes from its full-track service in just the first couple of months. Research firm eMarketers just issued a prediction that mobile music sales alone would be worth $7.7 billion by 2010. Is SixtySeven's technology a solution in search of a problem?

Cohen's answer is interesting. He argues that whatever its current profitability, the music industry does not get its money's worth out of a sale, considering the amount of media mind share purchased music enjoys. Bitch and moan as we do about the price of CDs, on a time-spent basis, consumers are getting a lot for their 99 cents at iTunes or even for that $15 disc. "We are offering a whole new revenue stream to the music industry that looks at the time people spend with music and monetizes that," Cohen says.

In fact, he insists that the SixtySeven system would even monetize pirated music. Theoretically, music ID technology could identify even pirated or ripped tracks that users sideload onto their handsets. Play any track from any source, and the ad network can ID the music, serve an ad around it, and credit some of the revenue to the label.

The thing that makes this model even remotely feasible is the platform itself. Whether users really will embrace using phones as MP3 players and e-shops is very questionable in my mind. I have reviewed both Sprint and Verizon's music system, and there is no comparison to my iPod in terms of convenience, navigability, storage, and sound quality. Mobile is a good platform for an impulse buy of the latest hot track you want to sample or share. It is not a platform for extended and deep musical enjoyment, let alone browsing and buying. And that may be what Cohen is counting on. His model makes especially good sense if the phone becomes more of a music sampling device than a robust vehicle for digital music distribution.

In that scenario, mobile users might still purchase a CD or a digital track; the transactional model won't go away. But the mobile piece could be leveraged more as a promotional device. Since people probably are never going to treat their phones like an iPod, why not try an ad-supported model that could ultimately expand the market for mobile music?

My guess is that, like free concerts and getting closer to God through sheep farming and peyote popping, ad-sponsored mobile music will be a path not taken. Not that it wouldn't be worth trying, but getting music moguls, handset makers, and carriers all on board this model could be more difficult than that thwarted attempt to levitate the Pentagon via the good thoughts of protesters. But like the utopian dreams of '69, this idea effectively plucks at some of the inadequacies and dissatisfaction in the current status quo. Mobile music is way overpriced, and everyone in the chain seems to expect more from the platform than I think the consumer will expect.

Whether the scheme flies or not, SixtySeven's neat idea is precisely what is right about mobile this year. We are in that "liminal moment" when tossing out old models become imaginable and inventing new ones possible. You can't count any model out when it comes to mobile, for one very big reason: there is a fat, unresolved X factor in this market. We still don't know whether, when and how Americans will embrace their handsets as media. That leaves everything in play and an open field for experimentation. Just like the old days.

Now, did someone say something about staying away from the "brown acid?"

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