Ringing in the money

2 Mar 2005

The increasing popularity of real tones, full-track downloads and the emerging trend of ring-back tones will help to push mobile music revenues to more than US$9.3bn by 2009, claimed Juniper Research.

Whilst the downloading of mobile ringtones and real tones will comprise the bulk of revenues at around US$4.8bn, the market for full-track downloads is expected to increase from just US$20m in 2004 to nearly US$1.8bn in 2009.

Meanwhile the emerging trend of ring-back tones, already generating substantial revenues in Asia, should be worth US$2.7bn by the end of the decade. Ring-back tones have become a hit in South Korea and are being introduced in other Asian countries. They let users replace the typical ‘ring’ or busy sounds callers hear when they dial a users number – for instance, instead of hearing a typical ‘ring ring’ before someone picks up their phone, a caller might hear the latest pop hit or an old Frank Sinatra tune. According to reports more than a third of South Korea Telecom’s 16 million subscribers have signed up for the service, paying an average of more than US$2 per month for it.

The Juniper report’s author Dr Windsor Holden commented: “Last year we saw the major network operators and players taking the first tentative steps towards the mass distribution of master recordings via mobile handsets. This year the operators are substantially increasing their catalogues as more labels come on board, while the vendors are producing more handsets with integrated music players.”

Holden added that it was likely that ring-back tones would generate the majority of their revenues amongst fashion-conscious teenagers and young adults.

“By subscribing, they can demonstrate to their callers (usually their peer group) that they are keeping up with the musical times by having the latest number one on their ring-back tone as well as their ringtone,” he said.

According to Juniper, the total value of the global mobile music market looks set to rise by 39pc in 2005 to nearly US$5bn. Europe is expected to lead revenue growth in the short term, but will be surpassed by growth in Asian revenues.

Juniper argues that European ringtone price levels are unsustainable and are expected to fall by more than 46pc over the next five years; while North American prices are expected to fall by 33pc over the same period.

The report claims that there will be some 60 million ring-back tone subscribers worldwide in 2005, rising to more than 300 million in 2009. The annual number of full-track downloads is predicted to reach one billion by 2008.

By John Kennedy