Tuesday, June 26, 2007

Hollywood scrambles to get a handle on media for the iPhone

It looks like everyone is trying to figure out how to capitalize on the soon-to-be-released Apple iPhone. From a consumer perspective, though, I wonder if the pricing structure is going to be more accommodating. At present I think it is ridiculous to have to pay something like an additional $40 more a month to receive internet content on a cell phone service already commanding $40 per month. I think $40 per month ought to be all inclusive, especially considering that studios are also raking in PPV fees as well.

"For years, mobile phone carriers like AT&T, Verizon Wireless and Sprint have closely controlled what cellphone users watch, when they watch it, and on what kind of screen they watch it — much the way the networks did with television before new technologies loosened their grip. Many in Hollywood and Silicon Valley hope the iPhone’s multimedia features will make it easier for any mobile-crazed consumer to do the same things they do on the Web: watch their favorite television shows, download maps, send e-mail messages to friends and swap videos.

In what is the beginning of many attempts to make the cellphone more Web friendly, Apple has designed its own application so consumers can receive YouTube videos through a Wi-Fi network. Industry executives predict that as it becomes easier to get information via Wi-Fi networks, more consumers will bypass traditional wireless networks altogether. That prospect, while helpful for phone makers and media concerns, is frightening for service providers if consumers begin to regard them as irrelevant.

“Video, particularly, has largely been behind a wall,” said John Smelzer, the general manager of mobile operations for Fox Interactive Media, referring to the limited and clumsy access most consumers have to news, sports and entertainment on traditional cellphones. “It’s the antithesis of what’s happening on the Web. Any device that replicates the experience online is good for the entire industry. It will help us reach a mass audience,” he said.

Even Mr. Jobs’s competitors, who are quick to point out that the iPhone has limitations, like its sole availability through AT&T, say that it will nudge resistant wireless carriers to pay more attention to their customers’ wishes. “The iPhone is a fantastic device, but they don’t control the network,” said Craig Shapiro, head of content strategy and acquisition for Helio, the mobile phone maker and service company. “For these things to work, though, everyone has to get with the program.”

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