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The success of ringtones has given operators the confidence to push digital music even further. U.S. players are moving into downloads of complete songs, radio-like services with stations for hip-hop and indie rock, and much more. A startup called Single Touch Interactive Inc., based in Encinitas, Calif., is even peddling a Hilary Duff phone packed with the teen pop sensation's music clips and plastered with her image. "Downloading music to phones is the Next Big Thing," says Duff. "I think it's so cool."
Work is under way to make it even cooler. One major focus is a simpler way to move songs from one device to another. The initial downloading services have locked tunes onto the phone partly because, unlike Internet music services, early technology didn't provide a way to prevent multiple copies from being released to file-sharing networks. Now, Microsoft, digital media specialist Loudeye, and mobile music startup Melodeo are developing systems that provide better copy protection so tracks can be moved around easily and safely.
The first iterations are crude. Nokia, in partnership with Microsoft and Loudeye Corp., provides operators with technology to send customers two copies of a track. One goes to the phone and can't be moved, and the other, a copy-protected version, goes to the PC. By yearend, Nokia will do away with this clunky workaround so a customer can buy copy-protected downloads over the air and move them freely. Operator O2 Germany, a unit of Britain's O2 PLC, will use the Nokia solution in its wireless music offering, launching this summer, and Vodafone may adopt it. "Consumers are in charge here," says Vodafone's Ferguson. "They want the freedom to do what they want with songs."
Telecom operators also are working on new ways to market digital tunes. Inside Sprint, which looks like the most music-savvy operator so far, execs talk about the mobile phone as if it were a modern-day jukebox. The company is offering wireless customers Music Choice, the same 24/7 service offered by satellite and cable-TV operators. Sprint's service lets a subscriber tune in to six different channels of music -- rock, hip-hop, '70s, '80s, current hits, and country -- for $5.95 a month. Customers can't pick individual songs yet. But Sprint is working on imitating SK Telecom by providing users with hundreds of thousands of songs. It's even considering development of a mobile-phone cradle, attached to top-notch speakers, for home use.
Creative thinking inside cellular and music companies is leading to ways to tap into the social appeal of music, too. Right now, a kid sprawled on a college lawn can use his or her phone to let friends hear the latest Green Day song. With the next generation of wireless music technology, called superdistribution, that song could be zipped off to the phone of a friend, who could listen to it one or two times or buy it directly from a wireless carrier's service on the spot. "There are lots of exciting things you can do that bring in the social dimension," says Hal R. Varian, a professor at the Haas School of Business at the University of California at Berkeley. "Labels need a platform where they can experiment more, and they can do that with wireless."
Who would have thought the cell phone would evolve from a brick-sized talking device to a pocket-sized jukebox? In early April, 1973, to much fanfare, a Motorola researcher made the first reported call using a handheld wireless phone. Now, Jason Smikle and his buddies not only can talk on one, they can dance to stereo-quality tunes booming from the little gadgets. Music on phones is coming of age. Watch out, Apple.
By Roger O. Crockett, with Heather Green and Tom Lowry in New York, Moon Ihlwan in Seoul, Andy Reinhardt in Paris, and Peter Burrows in San Mateo, Calif.
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