A new frontier of cellular greed

News reports in the last week claimed that both Verizon Wireless and Cingular expect to make money on advertising sent to cell phones.  This represents a new frontier of greed because it means that the operators expect to get away with charging three times for 3G cellular data access.

First, Cingular and Verizon (and, for that matter, Sprint) already (over)charge for 3G access.  Second, much of the access on cell phones (as opposed to the 3G access you can buy for a laptop using an add-in card) provides, primarily, walled garden content.  By that I mean that most of the content is from content providers that have signed agreements with -- and presumably paid -- the cellular operators for the privilege.

So if, for instance, you're a Verizon V CAST subscriber, the walled garden approach means you are paying through the nose for limited access to content from a handful of content providers that paid Verizon. Now, the cellular operators expect you to put up with advertising.

It's clear that the cellular operators see the writing on the wall.   Revenues from voice service have been flat or declining for several years due to increased competition among the carriers themselves.  And that doesn't take into account the fact that the carriers will eventually face new types of competition from mobile voice-over-IP vendors.  

That explains why they've been throwing new data services against the wall to see what sticks.  Some might stick while others, like mobile TV, are dubious propositions, at best.  Now, the cellcos are hopping on the mobile advertising bandwagon.

The problem, of course, is that browsing the Web on a small-screened mobile device is, by its nature, not the most satisfying experience.  Add advertising and it will become even less satisfying, particularly given the high cost of cellular data plans.  

This reminds me of the hare-brained schemes of five years ago by those who wanted to provide location-based advertising.  Walk by a pizza parlor and a text message appears offering a dollar off a pepperoni pie.  Venture capitalists went wild funding companies developing such services.  Of course, the venture capitalists and vendors forgot to ask actual users, who rejected -- and continue to reject -- such schemes that only serve the vendors and merchants.  

And that's the crux of the issue now.  If the cellular operators lowered prices for access because of advertising, they might convince people that advertising is a good thing.  But they seem hellbent on charging three times for access and content without providing any additional benefit to subscribers.