Motorola’s New iRadio Service Is Up Against Tough Competition

Authored by Jay Baage on August 8, 2006 - 6:34pm.

Motorola is going to launch its new 700 channel iRadio service with some still undisclosed U.S. wireless carriers this fall. The company hopes that providing a complete offering for music on cell phones, multimedia cell phones will gradually take over from the iPod as everyone’s favorite gadget in time for Christmas.

Motorola already has a music partnership with Apple and some handsets are sold with iTunes software on it. But it has not been the success the company had hoped. So is it a smart move from Motorola to try to speed things up by getting into the content business themselves? The simple answer is that it depends. Motorola executives certainly hope that they can sell more high-end cell phones this way.

So, what is Motorola iRadio? Basically it is an online radio subscription service that is operated by Motorola and sold and branded to the carriers. Regrettably, the service is not truly wireless. You only get music onto your phone by connecting the handset to the computer and downloading it to six linear channels at the present time. Once on your phone, you can’t rewind or fast forward through the channels. You can just play and stop.

After seeing a demonstration this week put on by the Motorola people, it seems to me that this service in its current state is too little too late. Why? Motorola hopes that this service will make music cell phones a must-have on connected teens’ Christmas wish list, but by then new cool WiFi-enabled music players will have entered the market. Portable devices like Microsoft’s newly announced “Zune” music player will let users get updated music on the go without connecting to a computer. What is more, there are already new portable satellite radio receivers out there that will let you fast forward, rewind, mix and do whatever you want with the music. In the light of all this, the iRadio service just does not seem appealing enough.

It seems like the real advantage of getting Motorola’s iRadio is that at a predicted end-user cost of $6-9 per month, it is a priced below satellite radio and most of the subscription services out there like Rhapsody and Napster (who normally charge $15 for their on-the-go service). So unless the quality of the Motorola iRadio content just blows all of the competition away (superior suggestion engine, celebrity playlists, original programming, etc.), I think that the company will have to make some major improvements for this service to really take off. Competing solely on price is not a lasting competitive advantage.

In the end, I don’t know about you, but I have not seen any product from Motorola so far that makes me want to toss away my iPod anytime soon for the convenience of just carrying around one super-device with limited music functionality. And what about battery time? No, if I want to stick some songs on my cell phone this fall, I’ll probably buy one of Sony Ericsson’s new Walkman music phones and then just stick a few good hit songs on there for whenever I don’t have my iPod around.

Related Links:
http://broadband.motorola.com/iradio