Hi, I’m David Wood and welcome to my blog about Monstermob, the mobile entertainment content company I was involved with between 2000 and 2005.
My Monstermob journey started back in December 1999 at a Christmas party thrown by Martin Higginson [founder of Monstermob] who mentioned that his new venture was going to be a business involved with mobile phone entertainment content like ringtones, wallpapers, and games. I knew immediately that I wanted to be involved as it sounded exciting and I knew Martin could pull off anything he set out to do.
What I didn’t expect was over the next few years, the ringtone catalogue my collaborator [Neil Gowland] and I built became one of the largest ringtone catalogues in Europe. My early ringtone work came at a price though, because over the next few years, I was ridiculed in the record industry as ‘Lord of the Ringtones’ which was a painful experience.
Even though the early 2000’s were good to the little record label I co-founded with Neil Claxton in 1997 [Faith & Hope Records], the chart hits we achieved did nothing to appease the dismissive record label executives who saw my ringtone work as an embarrassment. What these label executives didn’t anticipate was – in time – their companies would be wanting to do deals with Monstermob.
So by the Christmas party of 1999, I’d known Martin for many years, liked him, trusted him, loved his family, and we’d been friends a long time. He’d proven himself to be a true entrepreneur, had an unbelievable work ethic, was one of the brightest people I knew, and we’d never had a wrong word… and still haven’t to this day.
As a teenager, Martin played drums – but I don’t think he ever really fancied himself as a drummer – and had a part time job in a local music shop in Lancaster called Hobbs Music. He loved art and creativity, did a photography course which led him to work as a photo-journalist for a specialist off road motorcycling paper called ‘Trials and Motocross News’ that was operated by Morecambe Press.
After Morecambe Press started their new publication called ‘BMX Weekly’ in the early 1980’s, Martin worked on the paper and when Morecambe Press dropped the title, he saw the future potential of BMX, gained some investment from his father Arnold, and seized the opportunity by running the paper himself.
After changing the frequency of BMX Weekly to a fortnightly publication – and making it a colour magazine – within no time, ‘BMX Bi-Weekly’ was selling over 100,000 copies per issue and Martin eventually sold it to IPC Magazines where he continued working for a while.
By the mid-late 1980’s, I’d started a small recording business in Morecambe and Martin was on my radar as he’d established a publishing and telecoms company called ‘Megafone’ – a premium rate telecoms business based around competition prizes – located in offices above the Battery Hotel in Morecambe.
In time, I got involved with Megafone as a creator of their voice over productions – recording voice, music, and sound effects – that they used for their telephone responses. I was able to supply Martin with excellent quality work, on time, and at a price that worked for us both.
For the early days of the Megafone work, I initially teamed up with Mike Croft – who left the project after a few years to concentrate on his songwriting – and my future long-term collaborator in recording projects Neil Gowland began working with me on the Megafone work.
Martin eventually sold Megafone to Scottish Power Plc – the parent company of Scottish Telecom, which eventually became Thus Plc – and he went on to become the Managing Director of their internet and interactive division which included ‘Demon Internet’.
My personal adventure with monophonic ringtones began in mid-1999 after I bought myself a Nokia 3210 phone. It had Nokia’s new monophonic monotone ‘ringtone composer’ that allowed me to make ringtones via the phones screen, but adjusting notes of the scale, different octaves, and length of notes – via a simple mathematical music quantizing system – was slow and laborious.
The ringtone composer was fine for an individual to create ringtones for themselves, but certainly couldn’t be used for the mass production of thousands of ringtones that I would need to be creating the year later.
By early 2000, I was getting ready for Martin’s new ringtone venture (the wallpaper and games never really interested me) – and he seemed happy for me to head up the supply of ringtones on a freelance basis. As I had other plates spinning with Promenade Music and Faith & Hope Records, he was happy for me to bring Neil Gowland into the fold as he had done the Megafone work.
I never really knew why Martin allowed me to get so deeply involved with Monstermob. Maybe it was because I’d worked for him in the past and had never let him down? Maybe because I was into technology, could deliver recording projects, and I’d had a modicum of success with Faith & Hope’s initial chart hits. Who knows, maybe it was a combination of them all.
Martin headquartered Monstermob at 76 Church Street in Lancaster. The building was originally built as a Jacobean mansion by Thomas Rippon in 1637 and converted into a Georgian town house by Oliver Marton sometime in the early 1720’s. It has links to Bonnie Prince Charlie – as it’s believed he lodged there in 1745 – and there’s a heritage plaque on the front of the building referring to this.
So, throughout 2000, I got stuck into the task in-hand and the most difficult part of the project was to work out how we could create ringtones on an industrial scale that worked on every phone in the market. There’s no doubt that this was trickier than we first thought.
The biggest problem was there wasn’t a standard language for ringtones so we had to develop a system that needed to future-proof our ringtones as they had to work on all brands and models that were currently in the market, and would be released into the market in the future. Making the ringtones compatible with all the brands was the crucial cog in the wheel and why Monstermob was so successful in the early ringtone market.
We built a brilliant team of ringtone writers and as well as myself and Neil Gowland, our little production team included Graham Simpson, Eddie Waring, Steven Wren, Adam Gowland and others.
Although this will be hard to believe for Gen Z, in 2000, monophonic ringtones in the UK were delivered by 2G technology which supported limited data services via GPRS and EDGE. Although 3G for mobile had been launched commercially in Japan by NTT Docomo in 2001, and in South Korea by SK Telecom in 2002, it wasn’t available in the UK until early 2003 when Hutchison launched their ‘3’ brand.
Let’s not also forget, this was the early days of mobile phones and the game changing Apple iPhone was not released until June 2007, eighteen months after I’d left Monstermob.
The early days of Monstermob were exciting and Martin was a brilliant leader. Although I can’t remember why, the company had a different name at the beginning and we were called Telezones, but by the end of January 2000, Monstermob Limited was incorporated as a private limited company and we were well and truly on our way by then.
Martin quickly built a fantastic team and we all shared the feeling that we wanted to do our best for him, our colleagues, and the company. We all believed in him, loved his concept and vision, and embraced the 2G technology.. even though it had limitations.
Although I can’t remember everyone involved in those early days of Monstermob [sorry if I miss anyone out], the early team members I remember include: Emma Stanyon, Martin’s PA and HR lady; Louise Goddard, my wonderful day to day contact who looked after all the ringtone content; Jon Hill, our incredibly talented software architect, programmer, and developer who was an expert in systems and operations; and Mike Watt, our fantastic creative director, but I can’t quite remember when Mike joined because he had worked with Martin for years and the timelines have merged into one.
Martin’s wife Maggie Higginson was also a director and Kenneth Baker [Lord Baker of Dorking] was our first Non-executive Chairman.
The other early team members I remember were Sarah Mason in marketing; John Freeman in web editing; Alan Denyer in sales; Gavin Whyte in strategy and operations; Isaac Allison in design; and Peter Armer in finance.
As time moved on, others joined, including: Lee Dudack in finance; Chris Tomic in tech; Steve Worsnip in B2B relations; Mick Mcvey in web design; Eamonn Watson in multimedia; Adrian Hardy in development; Dan Wortley in accounts; Adam Yendle in graphic design; Steve Longbottom in content management; Chris Mayne in product management; Graham Binns in software development; Pete Kewley in our group accounts, Jan Walker in communications; and David Marks in group finance.
Monstermob grew at a dramatic rate in those first few years and everyone within the company had high hopes for the future. I still find it unbelievable that for the 27 month period [1st October 2000 to 31st December 2002] our turnover was around £19 million ex VAT; and for the following 12 month period [1st January 2003 to 31st December 2003] our turnover was just less than £14 million ex VAT, with a retained profit of just over £1 million, from a headcount of 39 employees.
Martin is a fantastic marketeer and decided that the company should be in the public spotlight as much as possible and part of his marketing vision was to have a British Superbike team run by Paul Bird Motorsport. Over the next few years, the ‘Monstermob Ducati’ team competed in the British Superbike Championships and our rider for the 2001 and 2002 seasons was Steve Hislop, who won the championship for us in 2002.
Monstermob Group PLC was incorporated in September 2003, and in the November we joined the London Stock Exchange’s growth market [which was known as the ‘Alternative Investment Market’ and is now known as ‘AIM’] via a placing under the ticker MOB, at 135p per share, which valued the company at circa £32 million market capitalisation. The feeling in the company was euphoric after we floated, and Martin seemed excited by the prospect of acquisitions. The floatation gave us the funds to acquire companies who had built profitable operations through new and successful products which would accelerate the process of migrating their customers to our subscription-based services, delivering us recurring revenues.
Monstermob Group acquired 100% of the shares in Monstermob Limited and as high profile investors came on board, our share price would often have a positive gain. As an example, after acquiring less than a 10% stake, our share price rose by around 30% in the week after the Barclay brothers bought in. The Barclay brothers are the British billionaire twins who are known for their vast business empire that included The Daily Telegraph, Littlewoods, and The Ritz Hotel.
Things felt great at the company and the ‘Monstermob Ducati’ team competed again in the 2003 British Superbike Championships, and our rider for the season was Shane ‘Shakey’ Byrne who won the championship for us.
By 2004, the industry norm of creating revenue from mobile entertainment had started to be subscription-based billing services. This is where the target audience of 16 to 30 year olds were able to subscribe to a monthly-fee service which often gave them access to unlimited content, but not ‘all’ content.
Monstermob Group started acquiring UK companies and we saw Mediaprom join us in the March [2004], Phunky Phones join us in the June, and the USA based company 9 Squared – which was our first non-UK acquisition – join us in the August.
I had a feeling that the mood in the company began to change negatively in 2004 when a few friends ‘retired’ as directors of Monstermob Limited. It started with Alan Denyer in the June, then Mike Watt and Lee Dudack in the August, and finally Gavin Whyte in the October.
By the end of 2004, as well as Martin as Chief Executive Officer and Kenneth Baker as Non-executive Chairman, we’d had new directors join the group board including: Niccolo de Masi as Chief Operating Officer; David Marks as interim Finance Director; James Eberhard as Managing Director of Network Services; Brian Casazza as Operations Director of Network Services; and Richard Faber as a Non-executive director.
For many reasons, our content offering which by this time included Mob Club, our unlimited subscription service; See Mee, our mobile chat service; and Jet Set Club, our mobile subscription quiz had pushed expenses up through higher development, promotion, and procurement costs.
By Christmas 2004, we had over 400,000 subscribers in the UK alone [up from 120,000 in 2003] and everything was moving so quickly. Our consolidated profit for the year – which was expected to be around £3 million – came in at around £2.2 million and although our profit before tax had increased by over 70%, there was definitely an underlying tension in the air.
In May 2005, Lord Baker stood down as our Non-executive Chairman and was replaced by Hans Snook, the co-founder of the mobile company Orange and former Chairman of Carphone Warehouse.
I knew I needed help with the Monstermob Music channel, as 3G was becoming more widely available and our customers had moved from monophonic ringtones to our offering of polyphonic ringtones, and our next journey was going to be artist ringtones and soundalikes.
We now needed a top music industry lawyer to go out and sign up all the major and independent labels. Martin and I discussed possible people for the job and the person we wanted David Bloomfield, who is without question one of the very best music lawyers in the UK music industry.
David’s career began at Granada TV in 1996, before joining Decca Records in 1998. By 1999, he was head of legal and business affairs at Ministry of Sound, before becoming senior manager of legal and business affairs for Sony.
At Sony, amongst other things, he looked after some of their dance labels and it was through a joint venture my label had with them that I met him and immediately realised how talented he was.
David became our ‘Head of Music Content’ and his role was massive and over the next 12 months, he hit every target that was set for him and did a brilliant job of negotiating both the commercial and legal terms for our music licensing agreements with record labels, publishers, and collection societies.
Problems in the mobile entertainment industry were brewing outside of Monstermob throughout 2005 and these problems would eventually impact us. There was little doubt that we were going to have a rocky time moving forward and the ringtone industry saw the premium rate telephone service regulator Icstis intervene in the market.
By the summer of 2005, ringtones had become a lucrative money spinner for mobile entertainment companies and full artist audio ringtones were well and truly on the way. These artist ringtones would go on to dominate the market in the future.
Throughout the summer of 2005, Icstis were looking to intervene in the industry because of complaints from customers – often about children – who had signed up to subscription services when they thought they were only buying a single product.
‘Crazy Frog’ had a #1 hit with its version of ‘Axel F’ in the late May of 2005 and towards the end of the year, the company that supplied Crazy Frog was fined £40k by Icstis and told to pay back consumers who were allegedly unaware that they had signed up for a subscription service and thought they had just bought a one-off ringtone. The UK ringtone industry was in shock and things were changing.
By the late summer of 2005, I didn’t like the way a couple of people within Monstermob were trying to build an anti-Martin sentiment. There was a feeling brewing (wrongly, in my opinion) that Martin was too “UK-centric” for a business that had high hopes of international dominance. What mustn’t be forgotten is Martin made lots of international acquisitions around this time including those 2004 acquisitions Phunky Phones, Mediaprom, and 9 Squared.
2005 saw the acquisition of the Philippines based company Upper Mobile in the March; Malaysia based Unrealmind Interactive in the May; China based ATOP Century in the September, Russia based Mobikon in the December. The final negotiations were in place to acquire the China based mobile games developer M-dream [completed January 2006] and the China based service provider W-Infinity [completed April 2006].
We had operations in Bangladesh, Indonesia, Singapore, Thailand and Vietnam; and there were also talks of acquisitions in South America, India, and other parts of Asia. Now that doesn’t sound “UK-centric” to me!
Of all those acquisitions, the biggest financially – from what I can remember – was ATOP Century, at around £55 million. All the China acquisitions [ATOP Century, M-Dream, and W-Infinity] made me nervous because I never believed for one minute that the Chinese authorities would allow their citizens to be subject to the same business models that were happening in Europe, i.e. a subscription model.
Sure enough, the Chinese mobile market saw some regulatory changes that would affect the mobile ringtone industry, and a few years after, the ‘Ministry of Industry and Information Technology’ [MIIT] was created in China to regulate areas like internet, wireless, broadcasting, communications, and software.
By now, we had launched Mob Music and although our share price reached 460p in the September of 2005. By the December, everything was beginning to feel a little out of control and we seemed to be playing a high-risk strategy.
The ‘anti-Martin’ sentiment was now a ‘real thing’ and I hated it and realised that this would undoubtedly undermine him going forward. I respect Martin so much, he wasn’t just the founder and CEO, he was my friend and had done an amazing job of building the company from nothing to what it had become.
Throughout the December of 2005, Martin didn’t seem to be in the office as much – as he was so busy – and I tried to make my opinion known to a group board member about how I felt we would be so heavily exposed in China and the risk that the authorities there would inevitably change their rules regarding mobile content and distribution which would impact us massively. At best, it fell on deaf ears; and at worst, it was totally disregarded.
By the end of 2005 – due to how Martin was being undermined and the continued China acquisition spree – I’d had enough! After a lot of personal deliberation – which was mentally agonising – I sold my shareholding and ended my involvement with Monstermob on the 31st of December 2005.
What a journey it had been. I learned loads, worked with the dearest of friends, made new friends, had some wonderful social times – especially those British Superbike days out – and made some money along the way. I am incredibly proud of the small contribution I made to the company’s success and with hindsight, it was right time to leave.
By the time I left, we had just less than 250 employees worldwide, our content was reaching over 10 million monthly subscribers in 25 countries, and we were selling over 20 million downloads a month. Our turnover – including the companies we’d acquired – had reached around £58 million, our profit for the year was around £5.8 million, our share price was still a very respectable circa 350p a share, our market cap was somewhere around £190 million, and we had around £4 million in the bank.
It’s funny how quickly I fell out of the company news loop. Monstermob – along with the likes of Jamdat, iTouch, Jamster – had led the way in mobile content, but after I left, 2006 proved a difficult year for the company [which was in no way to do with me leaving] and investors saw a decline in the share price.
Around the June of 2006, I was shocked to hear that Martin had been ousted out of his own company. Remember, he was the founder, CEO, and still had the largest shareholding of around 17%. The share price was around 200p per share and the company still had a healthy market cap of around £110 million.
Although I’d felt those Machiavellian moves against Martin since mid-2005, I couldn’t believe how badly he’d been betrayed by some in the company. The broadsheet business pages reported a disagreement over strategy and poor share price performance; but personally, I felt his ousting was about power, control, and I hated how public it was for him.
In my opinion, Martin had the strategy correct. He had a better understanding of the company than anyone else. He had a balanced view of the world market, where others seemed hell-bent on operations and interests in China only. As I said earlier, I never believed for one minute that the communist party of China would go easy on western mobile entertainment companies and their subscription services, and they didn’t.
At the time, China Mobile – China’s largest mobile phone company by subscribers – changed its policy on mobile content subscriptions in response to regulatory concerns about monthly contracts when the user only agreed to buy a single product.
As predicted, the Chinese government wasn’t going to stand for Western companies with their loose subscription models, and China became a disaster for Monstermob. The board had to reduce the book value of the China based businesses to around 8% of what they had been acquired for and the change in Chinese policy added to Monstermob’s share price going down even further.
Keeping abreast of the legislation changes in all the countries we operated in had always been tricky in itself, but with rules constantly changing, this was now trickier than ever before and even Monstermob got into difficulties when our Malayasian subsidiary [UnrealMind] had three SMS-based services suspended for three months over confusion around new SMS regulations and competition rules.
The new top brass – who took over after Martin was ousted – had a torrid time in 2006 and they had to issue three profit warnings throughout the year. By the end of the year, there were rumours that a takeover could be in the pipeline by Elaine LaRoche’s Linktone, but it wasn’t Linktone who finally took over Monstermob, it was the Spanish company LaNetro Zed who took a majority shareholding and installed Javier Perez Dolset as the new boss.
Although I was no longer a shareholder, it was painful to see what had happened to Monstermob after Martin had been ousted, and the decline in company profits had been awful to witness for shareholders. Although the turnover for 2006 had risen to just over £106 million, the loss for the year was just over £108 million.
On the 23rd of February of 2007, I was delighted when Martin returned to the company and was given a place on the new LaNetro Zed led Monstermob Group board as a non-executive director. On the same day, the previous board members: Hans Snook, Niccolo De Masi, David Marks, and Richard Faber resigned.
By now, the share price was down at less than 50p per share and the reason I mention this is because just nine months earlier – when Martin was ousted – the share price was around 200p per share.
As well as Martin, as a Non-executive Director; Javier Perez Dolset, as the interim CEO; and Brian Casazza, as Managing Director of Americas; Juan de las Llanderas was appointed as Non-executive Chairman, and the other directors appointed were Alvaro Cambronero, Santiago Jack, Daniel Garcia, Isabel Jimenez, and Oscar Delicado.
Although this “strategic investment” by LaNetro Zed seemed good for them, the best bit for me was that Martin was back involved with the company he founded.
Post Monstermob
– Martin Higginson went on to be the Founder and CEO of NetPlayTV; Non-executive director of Cupid Plc; Co-founder and CEO of Immotion Group Plc; Director of IDE Group; Founder and Non-executive Director of Digitalbox plc; Chairman of M Capital Investment Partners, and Executive Chairman of Huddled Group Plc.
– David Bloomfield went on to be the Senior Manager of Legal and Business Affairs of Universal Music Publishing Group; Head of Legal and Business Affairs of Imagem Music [now Concord Music Group]; Media and Entertainment Lawyer at SSB Solicitors, and Senior Vice President of Legal and Business Affairs at Kobalt Music.
– Monstermob Limited went into administration in August 2007 and was dissolved in April 2010.
– Monstermob Group Plc went into administration in May 2017 and was dissolved in August 2018.