MSPOT OPTIMIZES RADIO SERVICE FOR MOBILE NETWORK OFFERING

The elation that MSpot CEO Daren Tsui felt from winning his first major operator for MSpot's streaming music service a few months ago now increasingly is being tempered by the fact that it sits on an awfully crowded music deck. Sprint's PCS Vision menu of music offerings is growing larger by the week, and in the streaming music category, MSpot Radio has two large, much more well-known competitors: Sirius Satellite Radio and RealNetwork's Rhapsody service, both of which have teamed with Sprint within the last month.

But Tsui is unperturbed. MSpot's service is the only one that has been specifically optimized for mobile networks. While it doesn't have the brand recognition yet, Tsui said he plans to build it by offering a superior and differentiated music offering that can bring customers features that Sirius and Rhapsody don't offer.

MSpot's mobile strategy uses streaming as its starting point, from which MSpot plans to incorporate predictive song play, programmable play lists, customizable radio stations, sports programming and live broadcasts. Once Sprint launches its consumer 3G service, MSpot plans to enhance its bitstream for high-capacity networks, which would bring the audio quality up to iPod level. By far the most ambitious project on the list is a plan for feature-film downloads, breaking a movie into multiple chapters — corresponding to the scenes on a DVD — which customers could have streamed to them serially.

But, for right now, MSpot is starting with something simple: a fast-forward button.

The critical difference between MSpot's streaming service and its competitors is that MSpot is offering a unicast service over its eight music channels, meaning customers can tailor their audio streams. Sirius' service hooks into its satellite multi-cast radio feed, and although Rhapsody Radio allows customers to customize programming on their PCs, so far the six music channels are static streams. Currently, MSpot has only used its unicast capabilities to allow customers to jump ahead in the song queue, but Tsui said the company has plans to use them to a much fuller extent in the near future.

MSpot is working on predictive software for its service that will track what songs a customer likes versus those that he or she doesn't. The server will excise songs that a customer routinely skips over from the user's play list. Next, MSpot plans to upgrade its client software — which is already modeled on Apple's iTunes client — to allow users to create their own play lists, moving out of the realm of programmed content.

Ovum analyst Roger Entner said the industry can expect that these types of predictable and interactive features are in the plans of all streaming music providers. The problem is that they have to be delivered over unicast. With everyone listening to their own tailored radio streams, they require their own dedicated chunk of bandwidth to access those streams.

“Unicast is a good idea if there aren't too many users on the network,” Entner said. “If half of your customers are listening, though, it brings the network to its knees.”

That's why many carriers are looking into multicast technologies, which, while not interactive, stream the same broadcast to multiple users or full-track download services that keep the data isolated to the phone. The launch of Motorola's iTunes-powered Rokr for the Cingular network is seen as the seed of what will eventually be over-the-air downloads offered by the carrier. While Tsui said he sees the market for those types of services, he believes streamed content still has a big role to play in wireless networks.

“Streaming complements download,” Tsui said. “There are users who want to control every song they listen to. But there are a lot of passive users who like programming. We can serve both.”