John Delaney
Vodafone hauls MySpace, YouTube and eBay on board
This week, Vodafone announced agreement with three of the Internet's leading brands, to make their services available via mobile phones. Vodafone's customers will have access to the social networking service MySpace, to the video sharing service YouTube and to the e-commerce marketplace eBay. In the case of eBay, Vodafone says it will be the exclusive mobile partner in all European markets except for the UK.Comment: The mobile operators are getting less reluctant to let the big Internet brands onto their customers' phones. We can argue about whether they are embracing an opportunity or making a virtue of necessity. Either way, though, the operators are now definitely working with the fact that many of their customers have strong loyalities to some of the big names on the Internet. Vodafone has had agreements in place with MSN (now Windows Live) Messenger and Google for some time. This week it has added to its portfolio another three of the Internet's leading brands. MySpace and YouTube are two of the hottest Internet brands around at the moment, by virtue of their stellar growth over the past couple of years. eBay, although a veteran by comparison, can also offer significant extra benefits by making its services available on mobile phones - it is already one of the most popular services among O2's i-mode customers, for example. Vodafone has so far taken a somewhat different approach from most other mobile operators, in its relationships with branded Internet services. Rather than simply providing access to them, Vodafone offers them as services within its mobile portal, Vodafone live! This may or may not be the way Vodafone's customers would prefer things - but so long as the services are easy to access and offer all the functionality they are looking for, most customers will probably not concern themselves much with the on-portal versus off-portal issue. One area in which customers' preferences are becoming clear, however, is the pricing of applications on mobile phones. The most successful pricing model so far has been a fixed monthly subscription for each service. This is borne out by Vodafone's own experience. For example, its Sky TV service is priced that way, and has seen very good take-up. By contrast, its MSN Messenger service is priced on a per-message basis, and take-up has been low. We don't yet have any information about retail pricing for the MySpace and eBay services: this is one area of detail which will have a big effect on their prospects for success. And although Vodafone is certainly moving ahead with its Internet brand partnerships, we don't always get the impression it is very cheerful about it. The Google partnership was announced a year ago, but no resulting subscriber service has reached the market yet. The press has speculated that negotiations have been difficult; if so, this would not be surprising. The stakes are high, for the Internet brands and for the mobile operators: getting it wrong could have a huge impact on their future strategies.
