Satellite Radio Firms Don't Realize Mobile Phones Are Simply Pocket Computers

from the how-dare-you-make-our-product-more-valuable dept

Fri, Mar 24th 2006 2:36pm — Mike Masnick

There's been a recent obsession over mobile content, from both the mobile operators and content providers. For the most part, this obsession was due to the unsustainable success of the ringtone market. Mobile operators who were desperate for more revenue from each subscriber suddenly thought mobile content was their ticket to big money. Content companies scared silly by the internet looked at mobile phones as basically a better internet -- because it's closed. However, that makes one huge assumption: that it always remains closed -- something that anyone with a sense of tech trends should have realized wasn't going to last. Mobile phones are quickly becoming just small computers -- and will have access to anything that's available online. Trying to block off and charge extra for mobile content doesn't work, because users are smart enough to recognize that they can just access what they want.

This issue is just now hitting the satellite radio business, apparently. As the satellite radio firms start desperately looking for new revenue streams, one area they've latched onto is the mobile channel. Both XM and Sirius say they have plans to offer a mobile offering (Sirius already has a small offering via Sprint which they expect to expand) -- which, no doubt, will involve some additional charge. There's just one (big) problem with that. Both offer up some of their content online -- and newer mobile phones have fairly open web access. With just a bit of tweaking, in fact, a few enterprising satellite radio fans have figured out how to listen to the streams via their Windows Mobile smartphones. This should be perfectly legal. They have a subscription, and they have a device that accesses the approved web stream -- but the satellite radio firms are having none of that and have sent out the lawyers to stop people from actually listening to the satellite feeds on their mobile phones. In many ways, this is reminiscent to a couple years back when XM got upset at people for writing software to make it easier to record XM. All of these actions seem like fair use ways of listening to content that the user has a legitimate subscription to. In fact, they make subscribing more valuable. Eventually people are going to realize that trying to get people to pay fifty different times for the same content isn't going to make your product appealing -- it's going to make people go elsewhere. In the meantime, though, expect to see the lawyers come out and the mobile operators talk about blocking such content -- and then wonder why no one wants to pay for it.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

23 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

Andrew Schmitt, 24 Mar 2006 @ 3:09pm

Satellite Radio is a niche
The whole reason there is a problem here is the sat radio guys built a parallel infrastructure with mobile data and now are running into the problem that the doppelganger can do the job equally well in many applications. In a few years mobile data infrastructure will provide a superior mechanizsm for distributing something as low bandwidth as audio.

The satellite guys are now stuck with a massive capex and marketing investment, and it turns out the marginal cost of using mobile data is a lot less.

If the best strategy of the sat radio players os a DJ that asks strippers on a daily basis what type of intercourse they like they are in trouble.

Once the blood in on the floor and these companies go through the typical cycle heavy cap ex innovators experience (ie they go broke at least once) I wouldn't be surprised if sat radio has commercials and is free... just like radio today!
[ link to this | view in chronology ]
- doubleh, 26 Mar 2006 @ 5:39pm
  
  Re: Satellite Radio is a niche
  Of course.. Just like cable companies.. Their free too.. oh wait.. I just paid my 140 dollar cable bill. hmm.. And lets not forget that blanketing the ENTIRE continental US with 3G is also free and not a huge capex either..
  [ link to this | view in chronology ]
Sea Man, 24 Mar 2006 @ 3:45pm

I dropped them (Sirius) as soon as I found out that they limited the online channels DRAMATICALLY to just some music and very little talk. I work in the middle of a large building with no access to windows for an external antenna and I like talk and education channels. What a joke their online offering is. Why even bother.
[ link to this | view in chronology ]
- jeff, 24 Mar 2006 @ 8:26pm
  
  Re:
  XM Raido Mobile reception is verry spotty.
  All of the XL channels have to much advertising on them
  to enjoy.Comedy channels repeat the same shows all day long "SAVE YOUR MONEY DONT GO TO THE SHOW"
  [ link to this | view in chronology ]
- doubleh, 26 Mar 2006 @ 5:35pm
  
  Re: lack of online content
  both sat companies are limited to their own content online.. they cannot distribute licensed content (espn/fox/disney etc) without additional cost.
  
  But i do agree with you dropping sirius.. I love my XM
  [ link to this | view in chronology ]
- Anonymous Coward, 9 Jan 2007 @ 5:45am
  
  Re: channel availability
  every channel with the exception of the numerous weather channels from across the country all channel that have continuing programs (stern, comedy, talk, all music) is available over the internet
  [ link to this | view in chronology ]
Mark Farkell, 24 Mar 2006 @ 3:55pm

To Sea Man
Sirius puts 100% of the music channels online and many other channels as well. Sirius has to rebroadcast per terms of the agreement set forth in the Content providers contract. Sirius would be happy to put everything online but cant. I for one have to pay per kbyte for my Internet use on my phone and listening to music would cost me more than a fortune.
[ link to this | view in chronology ]
Michael, 24 Mar 2006 @ 5:44pm

Ahhhh!! The disillusionment! Between DRM, the DMCA, the patent silliness, and crap like this... I just come here now to get pissed off. My boycott list over the last year has grown to the point where I actually have to keep a written list.

Part of me just hopes that I'm completely ignorant and wrong, and the direction things are heading in is for the best. But the cynic in me knows we're WAY off the path...
[ link to this | view in chronology ]
Anon, 24 Mar 2006 @ 7:08pm

Trends...
Speaking of trends, I think the big trend will be toward Web radio on mobile devices. Web radio is decentralized, free of capex expenditures (or the expenditures happened decades ago), and democratic. Web radio on mobile devices will eventually kill satellite radio. When 3G devices are in your car and your
[ link to this | view in chronology ]
- Chris Maresca, 24 Mar 2006 @ 7:58pm
  
  Re: Trends...
  You can already do this to a certain extent using TCPMP, at least on some mobile platforms.
  
  See http://www.tcpmp.org/ for more detail.
  [ link to this | view in chronology ]
Apaxmez, 24 Mar 2006 @ 7:55pm

between a rock and a hard place
"Eventually people are going to realize that trying to get people to pay fifty different times for the same content isn't going to make your product appealing -- it's going to make people go elsewhere."

The problem is, if all providers are trying to charge fifty times for the same content, where else do we go?
[ link to this | view in chronology ]
Rickler, 25 Mar 2006 @ 5:37pm

Freedom
Mike you cannot seriously believe the mobile phone internet is becoming more free (as in freedom). I still can't find a phone that will allow me to play mp3 ring-tones I have made. In america you can't just buy a phone then buy any mobile service you want to use the phone with. We're forced to buy phones were half the recearch was put into function and the other half restriction the phone. Phone manufactures and mobile telcos work together to maximize profits on the unexpecting consumer.
[ link to this | view in chronology ]
- Bigfoot, 25 Mar 2006 @ 9:21pm
  
  Re: Freedom
  I have a Motorola V3 Razor and use Mobile Phone Tools ( A program I got form Motorola) I t allows me to use mp3 rings I have created form my own music or sounds and upload it to my Razor. It works great, it also will allow me to do many other functions that can be rather difficult when you have to do it only using the phone. (updating phone book, updating calendar.)
  [ link to this | view in chronology ]
- Chief Elf (profile), 25 Mar 2006 @ 10:39pm
  
  Re: Freedom
  Treo 650 I love it. Reason #53: Any audio you want as a ringtone.
  My ringtone is a recording I made of myself saying, "Answer the telephone!"
  [ link to this | view in chronology ]
- wh64, 26 Mar 2006 @ 1:21pm
  
  Re: Freedom
  you can play mp3 ringtones on any phone that gives you some memory and let's you upload to it.. you are probally not compressing the files small anuff... do some research.. there is plenty of freeware out there.. I have a nextel(motorola i-730) phone,, Wich is of 1 of the least interactive phones out there even thou 512Mb of memory wich I found waqys to do things that they say can't be done!!!!!!!!!!!
  [ link to this | view in chronology ]
- Josh, 29 Mar 2006 @ 11:11am
  
  Re: Freedom
  Motorola razr has allowed me to upload my own mp3s onto the phone. I have edited mp3s using Adobe Audition, saved the files onto my comp and through my usb I can put them on my phone. Another method is via bluetooth. If you have bluetooth capable PDA or computer peripheral, you can set your phone to accept files (personally created mp3s). This should remain true for any bluetooth enabled phone, or phones which sync with your desktop.
  [ link to this | view in chronology ]
mark, 25 Mar 2006 @ 9:05pm

If the satellite radio providers want to quash innovative ways to listen to paid subjscriptions, they're going to reap the rewards: fewer paid subscriptions by people unwilling to put up with a nitpicking provider. Paid is paid.
[ link to this | view in chronology ]
Anonymous Coward, 26 Mar 2006 @ 3:47am

Re:Freedom
Hell, my Motorola v400 lets me use mp3 ringtones I built, uploaded, and then downloaded to my phone. I have no cable from pc to phone, so I have to go the long way.
[ link to this | view in chronology ]
- Allen, 26 Mar 2006 @ 5:40am
  
  Re: Re:Freedom
  keep in mind any data device will allow mp3,midi,or wav formats. also any windows based device has media player, which allows streaming content now. my verizon 6700 is amazing and has averag speeds between 400 - 800 k
  [ link to this | view in chronology ]
Jason, 26 Mar 2006 @ 7:03am

Sattelite Content
I have been extremely impressed with the content of XM Sattelite radio. I live 75 miles from where I work and most of the terrestrial radio stations lose signal. I can listen to my Talk radio, MLB, Opie and Anthony, and any number of music channels without worrying about loosing signal or hearing static.

As far as listening to the content through my cell phone. I have a phone through Verizon. Their EVDO service is very limited in that I can only listen to it when I'm in the city where I work (Jacksonville, FL). Once I get to the weigh station 2 miles south of the Georgia Border, I lose all verizon coverage and about 6 miles down the road it comes back with 1x RTT coverage. Until the Cell Phone providers come out with better coverage, I can't see the Sattelite Radio companies having to worry about this.

The article mentions paying 50 times for the same content... I pay about $9.95/mo and I get unlimited internet streaming, my MyFi gets a signal everywhere I go (even without an external antenna), and unlike Tivo; I don't have to pay extra to record and play back the content. I can hear my content even when I'm not docked (except in the car). Through Directv I get about 30-40 XM channels that are great for listening to while cleaning the house, etc.

I could understand why cell providers would want to do something similar to the XM/Directv & Sirius/Dish Network setup. I just don't think that XM / Sirius should try to do something to prevent listening to the content through a cell phone if you are already subscribing to a service they provide. If I'm paying Verizon $70/mo for unlimited Data; Verizon shouldn't have any say either.
[ link to this | view in chronology ]
John Scott, 26 Mar 2006 @ 7:06am

Satellite radio going broke
Xm and Sirius have both spent too much money on content! They have done this to attract more subscribers. Unfortunately, the extra subscribers they have added has not made up for the added costs! People like me who embrassed it at first have lost interest because they cram so much into their bandwidth that the music suffers. With so many pay music and video services. The most satellite radio service can ever hope for is to be a niche player.Paying huge amounts of money to sports,talk show hosts and such. Will just bankrupt a perfectly good
media.
[ link to this | view in chronology ]
Ericandcarla, 26 Mar 2006 @ 3:22pm

anuff?
"You are probally not compressing the files small anuff... do some research.."

You mean enough don't you. Research your dictionary
[ link to this | view in chronology ]
Technopundit, 26 Mar 2006 @ 8:40pm

Music, music, musiic
There's enough music online to choke a horse. Try StreamRipper for a little fun. MP3 players are so miniscule in size as to fit even the bulkiest pockets. Eventually they'll include MP3 players into most mobile phones, anyhow.

XM and Sirius are both just a waste of money. The way they're losing money, soon they'll be as commercial - laden and crappy as any Clear Channel content.
[ link to this | view in chronology ]