Mobile Music Adoption Revenues Set to Reach $17.5bn by 2012

Hampshire, UK -- Juniper Research reports global ringtone revenues heading for a decline while the global mobile music market is expected to continue to rise. The total value of the global mobile music market is expected to rise to more than $17.5bn by 2012, driven by rental music services and full-track downloads, according to a new report by Juniper Research.

According to report author Dr Windsor Holden, "I think it's fair to say that 2007 marked the tipping point as far as mobile music adoption was concerned. Far more subscribers began downloading and subscribing to music content in developed markets, and it must be said that that the publicity surrounding the iPhone launch undoubtedly contributed to consumer awareness of mobile music services per se."

However, the Juniper report also argues that current prices for ringtones are unsustainable and that the market for such services may already have peaked in a number of developed markets, arguing that competitive pricing allied to a steady migration to ad-funded and/or self-generated ringtones will lead to a gradual decline in global ringtone revenues.

"With some operators now offering full-track downloads at a comparable price to iTunes, there is little justification for a ringtone retail price point that is in many cases two or even three times this level," said Holden. "Furthermore, those aggregators whose portfolios are largely dependent upon the polyphonic ringtone will be unable to survive in the medium term unless they both rethink their pricing strategies and substantially diversify their product portfolios."

Other findings from the Juniper report include:

The China/Far East region will remain the largest regional marketplace for mobile music services, accounting for around 43% of sales per annum over the next five years

Ringtones, which accounted for 62% of the mobile music market in 2007, will account for just 38% by 2012

The report argues that more operators should emulate the Vodafone model and introduce similar subscription-based music rental services