Mobile content providers that sign exclusive deals to provide certain content are killing the goose before it lays the golden egg, says Greg Brophy, CEO of iTouch SA.
"How do you grow a market? By providing quality content to a wide audience that will then come back time and again, and who will create huge support for the service through positive word of mouth," he says.
"The short-sighted strategy of signing exclusive deals actually retards the growth of the market to the detriment of all would-be developers in that specific market."
He says the mobile market should learn its lesson from the Internet industry, as Internet providers also signed similar exclusivity agreements, but instead of driving consumers to their sites, it actually ended up restricting their markets.
"International trends - gleaned from iTouch`s global operations - show that the free flow of information and non-exclusivity on mobile content is the best way for all providers to make money in the industry," says Brophy.
"It is better for customers to be exposed to a wide range of quality content than to a limited amount of quality content, mixed among a lot of poor to mediocre stuff, which is then dispersed across too many providers."
He claims that media and advertising is expensive and the out payments from the networks in general are modest, therefore it would be better for all wireless application service providers (WASPs) to be able to offer as much quality as possible in every advertisement.
"The problem with signing exclusive deals for international content - and then spending huge amounts on advertising and promoting it as being exclusive to one particular service - is that financially, it does not add up.
"The information market is a low margin - high volume one and it is amazing that some of the service providers don`t seem to realise that rands and cents all add up," he says.
He believes the best way for WASPs to make money is to open up the environment, as signing exclusivity deals and demanding high royalties will only be to the detriment of the entire industry.
"The best way to get content exposed to the whole market is to give rights to all ethical and financially stable companies and let them sell as much as they are skilled to handle," says Brophy.
"I believe that we need to get all the WASPs working together to ensure the growth and sustainability of the market and in the process best serve the interests of the customer."
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