Ged Carroll

Month: May 2005

  • Jamster & consumption

    Jamster

    Jamster the ringtone, logos and java games company most famous for its crazy frog ringtone TV adverts has been all over the media this week with the success in the UK charts of a single based on the ringtone.According to the Financial Times on Saturday the company has sold about 11 million Crazy Frog ringtones across Europe at about 3GBP a time. Lets be generous and allow them a cost of transcation of about 0.15GBP, giving a potential pre-tax profit of about 31.5 million GBP. This doesn’t take into account the cost of making the ads, online advertising, business infrastructure etc.

    Now in the UK according to anonymous sources quoted by media gossip newsletter Holy Moly, they have spent about 30 million GBP on TV advertising. Given the amount of times that I see the adverts when I go to the gym, I suspect that this number is not far off the mark. So, the frog is not as profitable as it would first seem. In addition, the adverts do not drive traffic to the Jamster website where they can cross promote other products, but flash up a short code number that you SMS for your ringtone.

    Where it gets really interesting according to the same sources is that from the a TV advertising point of view is that the ringtone adverts are apparently driving down the cost of TV ads. Understandably advertisers generally don’t want to appear in the slot after a Crazy Frog ad as a large proportion of the audience will have channel surfed off until the programme is back on, this means that the TV channels finding it harder to sell on these slots. The big mystery is why they haven’t told Jamster to get lost yet? More wireless related posts here.

    Class and consumption

    The New York Times has run a very interesting article on class and consumption in the US. When the Jones’ wear jeans talks about how technology, low inflation and consumer credit has levelled the playing field for the consumption of luxury goods and that the rich are more likely to be diffferentiated by the personal services they consume like plastic surgery, a nanny and a personal chef.

    Key take outs:

    • With the demise of the community and the rise of mass media, people are less likely to be bothered about keeping up the Jones’ (ie their local community) and more bothered about getting their fair share of what the rich have
    • Consumption is patchy, people may shop for discount brands but still like Starbucks coffee, iPods and designer jeans
    • About half of Americans now have a cell phone (there is about 176 million cellphones in the US), the cost of a cellphone has fallen to about an eighth of what it was a decade ago
    • Department store prices have fallen by about 10 per cent in the last decade
    • The new hot segment in the car market is ‘sub-luxury’ cars (like the BMW 1 series and the Audi A3)
    • American consumer debt is about 750 billion USD, up about six-fold over the past 20 years
    • I found it interesting that the article made a big play about how marketers are having to move from income and gender (socio demographic) segmentation to lifestyle and interests. (Are US marketers way behind the UK in this respect? I would have thought that the likes of P&G would have led the way rather than followed?)

    Finally a quote from a spokesperson from Godiva – the chocolate firm: “People want to participate in our brand because we are an affordable luxury,” said Gene Dunkin, president of Godiva North America, a unit of the Campbell Soup Company. “For under $1 to $350, with an incredible luxury package, we give the perception of a very expensive product.”

    renaissance chambara says that it goes to show the old maxim that perception is reality.

  • Inflection Point

    Over at his weekly column for PBS, Bob Cringely has written about four developments that he feels will have a major impact on the way that technology will develop over time, creating an inflection point in their respective spaces.

    The inflection point

    Yahoo!’s new music service is seen by Cringely as a statement of intent to push forward music by subscription and defeat all current players. Indeed, its 6.99 USD subcription rate hand an immediate effect on Wall Street, adversely affecting the share prices of Apple, Napster and Real Networks.

    Microsoft’s forthcoming XBox 360 was seen as a statement of intent against some of its closest PC partners (Dell, HP etc) by providing a home computing device that can surf the web, pick up mail, do VoIP, potentially provide a platform for video on demand and play games. Given that the margins are so tight in the PC industry anyway and Dell is the only one that consistently makes money selling Windows PCs this could proved to be very interesting.

    Cringely, returned to an area of previous speculation on Apple providing a film by download model similar to the iTMS model.

    Finally he speculated that Google’s Web Accelerator was an audious land grab that would shake the industry to its foundations creating an inflection point. Speeding up web pages would mean that every ISP and web page creator would be a content provider or customer for Google. That the service would turn PCs into thin-clients lengthening the useful life of the home PC and reducing sales. Further that it would be a staggering tour-de-force of technology. What surprised me about the Google part of his article is that Cringely thought an improvement of only double what consumers have now would be enough to shift the balance of power. In his book Accidential Empires and similar works by other authors, a 10x factor is usually required to differentate the killer products from the ‘better mouse traps’. I guess time will tell.

  • PSP + more news

    PSP

    The PSP has fired the imagination of grass roots developers already, which bodes well for its competition from Gizmondo – the Tiger and Microsoft-backed alternative. Nintendo’s DS doesn’t make claims to be any form of ‘convergence device’, but an honest mobile games console which focuses on playability rather than speeds and feeds. iPSP allows you to synch music with iTunes, carry your iPhoto library around with you and back up game data on to your Macintosh. Whilst Sony would probably not approve of this close linkage between the PSP and Apple’s iLife suite, it will not harm sales of the device amongst generation iPod.

    Expect sales of PSP movies and Sony Connect sales to be on the low side as PSP early adopters rip from their DVD and MP3 collections instead. Sony’s best option as with games is to go for exclusive movie and music content for the PSP.

    Folksonomy

    Folksonomy seems to have caught the imagination of both News.com and Charles Arthur’s contribution of netimperative. Yahoo’s purchase of Flickr is seen not only as a way of getting hold of a great info-imaging service, but also of harnessing a grassroots approach to creating true contextual searching.

    Mobile TV

    According to the Global Telecoms Business top five stories newsletter that NTL and O2 have announced which TV channels will be available to the 350 test subjects during their six month-long trial in Oxford. The 16 channels involved come from BSkyB, Chart Show TV, Discovery Networks Europe, Shorts International and Turner Broadcasting.

    Customised Nike sneakers

    In New York, Nike has extended their design your own trainer programme to billboard signs that you can manipulate via phoning a free phone number. Your specification can be shared via an SMS message. There is still no option to allow people like Jonah Peretti have Sweat Shop sewn on his set of trainers.

    8vo: On The Outside

    Finally ‘8vo: On the Outside’ is going to be launched. Written and designed by Mark Holt and Hamish Muir, based on their work designing for the likes of the famous Hacienda nightclub and changing and its influence in the emergent typographically-led design movement in the UK during the late 80s and through the 90s.