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Take the Slow Train to MMS

Multimedia messaging services (MMS) isn't going to be the cash cow that some operators had hoped, according to David Kerr, vice president of the wireless practice at research firm Strategy Analytics Inc., because of a dearth of compatible devices and security fears among content providers.

Strategy Analytics' report reckons that by 2007 global MMS revenues will reach $675 million, with average revenue per user (ARPU) levels for the services at $3 per month. The firm says that 60 million users in North America will be using the services by that time.

Kerr says that in Europe it will be two-and-a-half to three years before the majority of devices are MMS-capable. "In the U.S., it'll probably take an additional year to get to that.

However, Kerr says that, given the example of initial picture messaging services like J-Phone Co. Ltd., operators are going to have to be canny about the MMS services they offer to drive usage.

"Less than half of the [initial] user base are still taking pictures," he notes. Basically, the novelty of sending blurry pictures of yourself in a bar to all and sundry wears off quicker than a shot of cheap tequila.

One way around this problem, Kerr suggests, is for carriers to offer more branded content -- entertainment and sports-related pictures -- that the operator can charge users for when they download it.

However, Kerr says that 80 percent of the MMS traffic on a network in 2007 will still be peer-to-peer messaging traffic [translation: more gormless photos], with only the remaining 20 percent being branded content.

The reason for this, Kerr says, is the lack of an industry-standard digital rights management system (DRM) for MMS. Entertainment content producers, already leery of peer-to-peer file-sharing apps on the desktop because of the now-defunct Napster, are unlikely to allow the same thing to happen to wireless content without protection in place, Kerr says.

There are, of course, firms that are working on wireless DRM systems -- like Nokia Corp. (NYSE: NOK) with its Series 60 smartphone operating system. However, there is no sign yet of an industry-wide standard.

— Dan Jones, Senior Editor, Unstrung www.unstrung.com
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