ANALYSIS: Microsoft Snaps Up Musiwave; Should Operators Be Wary Of Web Brands Extending Their Mobile Offers? » mobilegroove

We finally and formally welcome Paul Skeldon. Paul currently edits the leading interactive media title, Telemedia magazine. He also expertly tracks mobile content services and social media as a senior analyst for Juniper Research. In his space time, Paul writes and produces electronic music in his home studio. He’s kindly offered to create music for the MSG podcast series and may even surprise us with a ringtone (!)

While attention has been on Google and its moves to become a network operator/handset maker/mobile industry disruptor, Microsoft has quietly purchased Openwave’s music business, Musiwave, for $46 million. While this is half what Openwave paid for the company just two years ago, largely because of the maturation of the ringtone market, the move stealthily adds a much needed music capability to Microsoft’s mobile roster, giving it a mobile OS, messaging, games, mobile search, and the capabilitities to encourage content discovery and now music.

This positions Microsoft neatly between Apple and Google in the race for online companies to capitalize on mobile. Specifically, Musiwave, with its close ties to labels, gives Microsoft the clout to start to negotiate with record companies, which could see Microsoft make some headway in developing a mobile music service that could perhaps eventually erode iTunes dominance of the portable music space.

Its other offerings, most notably its well established OS, could also allow it to steal a march on Google, which in unveiling Android and its 30-plus company developer community, has signaled that the internet search company is looking to up the ante in third party mobile application and service development.

This all makes the mobile industry landscape look a whole lot more foreign than it did a month or so ago. Until now, mobile centered around a small number of network operators in each country controlling access to services and content through their own portals, and a growing number of third party content providers starting to offer their own, often hard to find, services off-portal. Now these three Internet giants, whose portals and offers are effectively one-way trips away from any mobile operator offerings, are resolved to build a similar power base to the one they have in the mobile Web.

Connecting the dots: Apple has rolled out a cutting edge handset in the iPhone that raises the device bar and, by dint of using Apple’s browser technology and free wi-fi, also raises the mobile web access bar. Google’s open development platform, and possible plans to become a broadband network operator, offers to change the whole business model of mobile from a fee based to an ad-funded model. Microsoft’s addition of music means that it too can start to play in the mobile space with more conviction. Together, these three giants of the fixed internet could really shake things up.

If consumers start to use Google, Apple and MS as they do online, then before you know it the network operators have gone the way of the online portal providers (remember having to dial up through AOL’, anyone?) and have become transport pipes, rather than access portals, content providers and de facto mobile record labels and TV stations.

The MNOs have a lot to lose, so it will be hard to see them letting Google, Apple, MS and anyone else who crosses the online-mobile divide, getting away with it. That said, if someone can offer a better, cheaper, more flexible and rewarding mobile web experience, then users will vote with their feet.

This entry was posted on Tuesday, November 20th, 2007 at 7:36 pm and is filed under Mobile Search. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.