Sales of mobile music downloads and music ringtones are on the rise— but not fast enough to make up for the decline in CD sales, a new study reports. And competing interests between the music, consumer technology and mobile industries have created a virtual battlefield in the entertainment sector, says “Mobile Music: Mixing It Up” from research firm eMarketer.
“The entertainment sectors are being rocked by online and mobile distribution,” says John du Pre Gauntt, eMarketer senior analyst and the author of the study. “Unless the three major industries involved change some of their fundamental assumptions about their roles and rewards in the value chain, it’s not likely that mobile music will grow as fast, or as predictably, as they need it to.”
While there currently is no single industry player that can deliver the mobile music market, marketers do have options.
“An increasingly plausible scenario is that the mobile handset, long considered to be a personal cash register for paid downloads, might instead evolve into a marketing channel for brands and artists,” Gauntt says. “In that sense, the future business model of mobile music might start looking a lot like the radio model.”
In 2006, sales of songs downloaded to mobile phones and other handhelds hit $390 million; sales of ringtones and ringback tones hit almost $1.7 billion, according to the study. It goes on to predict sales of song downloads in 2007 will reach $850 million while ringtone and ringback tones sales will reach more than $2.5 billion.
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