The carrier and content divide

They own the network, have the most direct access to consumers’ pocketbooks, and they decide who gets valuable real estate on their decks. For these reasons and more, wireless carriers have long been the focal point of CTIA shows. At this week’s CTIA Wireless IT & Entertainment fall show in San Francisco, however, carriers will have to share — if not forego — the spotlight. As the focus turns to content, Web apps and software, many vendors might even be asking the question, just how necessary are the carriers today?

While Sprint, T-Mobile and Verizon do have keynoters opening the show tomorrow and Thursday, not a single executive from a major carrier addressed the Mobile Entertainment Live audience at today’s pre-conference, highlighting the fact that the need for a carrier relationship to push entertainment services and apps may be growing less certain. As David Danon, CEO of Sonic Boom, which launched a ringtone-making app for the iPhone this week and is co-promoting a mobile Facebook app called Tattoo Shop with AT&T, put it: The way you view the carrier depends on where you fall in the wireless ecosystem.

“If you’re a mobile company, it’s important like having oxygen and blood in your system,” he said. “If you are a Web company, it’s just another distribution company you may or may not want to deal with due to the sheer cost involved with mobile.”

It just so happens that an increasing amount of CTIA Wireless IT’s attendees this week will be these Web and app companies. With the mobile Web providing a convenient way to circumvent the carrier’s deck and phenomena such as Apple’s iTunes paving another route, carriers will be exploring ways to avoid becoming dumb pipes — and fast, too.

The manufacturers aren’t immune from the pressure, either. Cell phone sales have been suffering on a global basis for most mobile handset-makers, including Motorola, Nokia and Sony Ericsson. Conversely, consumers are spending more than ever on the handsets they do buy, as well as the apps and services they expect from their cell phones. Manufacturers at CTIA Wireless IT will respond to this with new handsets focused on the smartphone category. We’ve already heard rumors of the Palm Treo Pro and HTC Touch Diamond, and who knows, maybe we’ll even get to take a look at T-Mobile’s Android phone, supposedly hitting the market in the fourth quarter.