Press Release PR9.NET
Home Submit Press Release Search Archives
Press Release
Advanced Search

Business Business
Associations, Trade
Business Services
Human Resources
Publishing & Printing
Marketing & Advertising
E-Commerce, Financial
Real Estate

Computers Computers
Entertainment Entertainment
Games Games
Health Health
Home Home
Science Science
Sports Sports
Society Society
Teens Teens
Press Release Category Business - Telecommunications - visiongain Release Date: January 01, 2004

visiongain estimates that £90 million ($163m) was spent in the UK on Ringtones

By visiongain
January 01, 2004
Send SEND Print PRINT Download PDF Version PDF Contact visiongain CONTACT

According to the latest visiongain report "Mobile Music Downloads: Analysis and forecasts, 2004-2009", Mobile music, in the basic and limited form of ringtones, has been a key application and one of the most successful revenue generators in the wireless internet world. However now more sophisticated music applications, such as downloading music files, will be greeted with the same enthusiasm and willingness to pay.

PR9.NET January 01, 2004 - San Francisco, CA and London, UK; 15 November 2004 - 'True' mobile music is divided into two segments: downloading and streaming, both of which are still in early stages of development in the mobile space. Visiongain believes that while streaming music has limited potential, particularly over GPRS networks, the ability to download full audio tracks represents a significantly more viable long-term revenue opportunity.

With full track audio downloads, operators are not just in the Personalisation business, they are also entering the music distribution business. With master tapes, an operator would have to pay 40% of gross revenue to the record label and (in the UK) 15% to the licensing copyright organisation. A further 17.5% in VAT taxes leaves the operator with a 40% share, which it will have to use for hosting, customer service and marketing costs. In the face of such slim margins, compromise between operators and record label will be essential.

In the UK for instance, where a ringtone costs almost $5 to download, the value of CD single sales fell by 33.6% to £64.4 million ($116.7m) in 2003, while estimates indicate that £90 million
($163m) was spent in the UK over the same period on ringtones. Such has been the success of the ringtones that there are rumours that sales of ringtones will soon be included in the singles chart.

Other factors, including revenue sharing models, revenue expectations and digital rights management, will need to be addressed before music downloads can be positioned as an attractive, viable and profitable service. “There is also the question of user demand and acceptance. Through a targeted, focused approach, mobile music downloads will help facilitate a market worth nearly $1 billion by the end of this decade”, comments Goran Nastic, Telecoms report analysis.

The issue of revenue share will represent a major obstacle between the mobile and the music industries. The established ringtones value chain rarely involves music labels. “Numerous independent service providers sell ringtones to operators, who generally take a 30-40% cut. Once the collection society has taken its 7-15%, 45-60% remains for the mobile operator to share between itself and its content or technology partners”, adds Nastic.

For mobile music downloads to succeed, a number of issues need to be resolved and hurdles overcome. Music phones will have to compete against dedicated MP3 players that offer superior experience and performance. Furthermore, these portable MP3 players in conjunction with iTunes and other online music services are defining the music space, limiting mobile operator’s pricing options for mobile music downloads. Pricing full track downloads via the cellular channel in a way that is both profitable and attractive to the end-user is a major challenge.

# # #

Download PDF Version Download PDF Version:
visiongain estimates that £90 million ($163m) was spent in the UK on Ringtones

Contact Information of visiongain Contact Information of visiongain
Phone +44 020 8767 6711
E-Mail E-mail Address Protected

About visiongain

Visiongain is one of the fastest growing and most innovative independent media companies in Europe today. visiongain produce a host of business-2-business conferences, newsletters, management reports and e-zines focusing on the Financial markets, the Pharmaceutical, Telecoms industries and the Defence sector.

Recent News Headlines
  • Oxford Floor Care Formally Announce the Launch of their Pioneering New Website
    Oxford Floor Care look to set new standards with the launch of their informative new website which offers the opportunity of viewing evidence of their skilled craftsmanship when cleaning, sanding and restoring wood floors. Audiences are being captivated by their pioneering approach. ...

  • New Video Creation Software Taking Businesses By Storm
    Video Maker FX has become the new standard in creating videos for businesses, both small and large. Video is the best method of promoting any type of business, and it helps your website to get higher positions in the search engines. ...

  • Sharit: Funding Campaign to Build the Best Social App Ever
    Sharit aims to be the best social/business/productivity tool available on all platforms; to integrate all data from your accounts and make it much more useful and easier to consume, search and relate. ...

  • Taking the beauty industry by storm!
    Virginia entrepreneur Marcella Ellis continues to triumph with her innovative concept, The Mane Vendor, providing investors the opportunity to earn residual income whilst supporting our neighborhoods and economy. Ellis' hair vending machine concept is taking the beauty industry by storm and empowering our community to take on the billion dollar hair extension industry.
    Black hair care is a nine billion dollar industry within the United States, which is set to increase year after year for the foreseeable future. Whilst the industry continues to flourish, the way in which hair is supplied remains in the dark ages. ...

  • Israel Will Not Be Destroyed By Her Enemies
    Texas Baptist Minister, Jesse Prewitt, weighs in on the attacks on The Nation of Israel. ...

More Press Releases
Industry Category of Current Press Release
    Copyright © 2004 - 2013 PR9.NET - All rights reserved RSS Feeds Submit Press Release Terms of Service Privacy Policy