Monday, October 31, 2005

Sprint Launches Music Service, Fast Network

Two more articles on the Sprint news. While the new OTA music download service is getting a lot of play, in my opinion the bigger news is Sprint's very aggressive pricing plans for their EV-DO data network.

In Reuters, Ovum analyst Roger Entner said, "Music could certainly be much bigger if pricing was more in line with what you find on the Internet." The article cites Ovum's forecast that "the U.S. wireless music download market to be worth $1.5 billion in five years, compared with $104 billion for the total U.S. mobile services market in 2004."

Over at Technology News, Lewis Ward at IDC noted "the Sprint Music Store is an industry first in terms of over-the-air full track downloads and it really showcases what's possible with state-of-the-art networks."

Ward said, "The new high-speed entertainment services offered via the Sprint Power Vision Network represents another key milestone in the development of consumer wireless services. Sprint already enjoys the highest revenue per retail subscriber in data-oriented services in the industry and will likely woo many more customers with these new, innovative services."

Inside Digital Media analyst Phil Leigh was a bit more negative towards Sprint's pricing scheme for music downloads. He said, "The price of $2.50 per track is too high. I suspect that's because the labels are demanding higher prices. The labels are indicating that they are not happy with price of items sold on iTunes. That's the principal reason Sprint is charging so much. But because of the price I don't think there will be must interest."

Leigh added, "I think the labels will hold the line until they realize that digital downloads are not going to take off without lower pricing. There is no justification for these higher prices. It doesn't cost them anymore. It actually costs them less to produce an MP3 file."

Have to agree with Leigh. The music service news is really just noise. The big news is Sprint's EV-DO pricing plans from "$15 to $25 a month for unlimited use of data services such as video and digital radio, with more video clips included in higher-priced plans."

Sprint has significantly dropped the barrier to entry for 3G data networks and Verizon and Cingular will have to take note. Now there really is nothing holding back consumer adoption other than the price of a new handset. In my case, I pay $25 a month for Cingular's poky all-you-can-eat GPRS service so I'm just itching to get my hands on Sprint's PPC-6700 (HTC Apache), which offers EV-DO and Wi-Fi....