Too many startup ideas are rather boring combinations of trendy concepts — say, a social network for hedge fund mangers. But I ran into one today that seems interesting; it’s something like YouTube for ringtones. The site, which officially launches Tuesday, is called Cellware, and it was founded by John Ferber, who started Advertising.com with his brother Scott.
There are a couple of nifty bits to what Mr. Ferber is doing. First, the site offers free ringtones, in a world where most ringtones are either sold for as much as $2.49 in conjunction with major labels, or through various subscription services that pitch themselves through rather garish ads on social networks with their prices in hard-to-read print.
The business model is advertising: banner ads on the Web site you use to pick the ringtones to download, and on the SMS message you need to receive in order to get the ring tones on the phone. In addition to ringtones, the site also offers images for use as wallpaper, downloadable games and video clips, also supported by ads.
There is some oddball professional content, a library of sound effects, and some indie rock. But the main point is for people to upload and create their own ringtones. Indeed, there are some simple Flash tools that let you upload whole MP3 tracks, edit them into clips and even mix several tracks together into a mashup. These can be tagged, rated, searched and shared in a way that any user of YouTube would recognize.
The site also offers anyone who uploads ringtones or other content a share of the advertising revenue they generate.
Uploading and sharing MP3 files? Isn’t there a bit of a copyright issue there?
Mr. Ferber has a rather interesting take on this. Unlike most user-generated sites which post all content and wait for copyright owners to complain, Cellware has someone listen to every ringtone before it is put up on the site for others to hear, so copyrighted songs can be blocked.
On the other hand, the site makes it incredibly easy for people to upload MP3 files of songs and then send 20 second clips of them to their own cellphones to use as ringtones. Mr. Ferber said Cellware does not filter out copyrighted content for this aspect of the service because it deems that this falls within the fair use doctrine — the rights of someone who buys a copyrighted work to use it in certain ways, such as to make backup copies of software. Of course, Cellware does not verify that you have actually paid for the song you are converting.
Using an MP3 file as a ringtone is certainly not new. Some phones make it easy, and there is a lot of software available to help people do this. Still, the music industry would like to preserve its extra revenue from ringtones as much as possible. Apple, for example, charges an extra 99 cents, above the price of a song itself, to use a song as a ringtone for the iPhone.
Not surprisingly, the iPhone is one of the few phones capable of playing MP3s that will not work with Cellware’s service.
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