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Space 1990
A new trip to the space is ready to launch. Let's go outside by downloading this ringtone. You gotta have fun.
Download It

Submitted by:  krumpett
Total Downloads:  1626
Release Date:  Jul 12th, 2007
File Size:  486KB
Rating:  Excellent | 2 rate(s)

Tags: capsule  sound  space 
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Real tones.(Industry Overview)

A lot has been written about how the mobile operators and record labels missed the boat on ringtones the first time around, seeing their revenues slipping through the cracks. Now some claim that third generation tones are the Holy Grail that will make up for all that lost cash.

Many companies in the mobile space hope that the emergence of real music ringtones will revitalise the market and start a new goldrush.

The record industry is certainly forecasting big things for real music ringtones. But a closer look at the industry shows it's not quite so black and white. While it's true that many record labels missed out on the first wave of monophonic ringtone sales, most managed to win some sales of their own by tying in an 'official' ringtone offer with the release of the CD single or album. Most of the majors have had great success with several of their artists using this method.

Yet it's the advent of real tones, the third generation of tones which, under various names (true tones, real tones, hi-fi tones, Musitones) and using real music clips from artists, that really excites the record companies because they'll finally be able to get definite revenue from their catalogues and investments in artists via this route.

It's also an exciting prospect for the mobile operators. Vodafone Live! has already had some success with real music tones, without any marketing, just by making them available on its portal. Head of music Ed Kershaw is certain of the opportunities in this space, having sold 2m second-generation polyphonic tones.

"We're extremely pleased with the way the sales of master recording tones have gone so far," he says.

Paying the piper

As noted before, operators, like the record companies, missed out on a chunk of the early ringtone revenues, as they were sold mainly by third party aggregators. Now, with the spectre of the 23.5bn [pounds sterling] 3G debt looming, operators also need to answer the mobile data question satisfactorily. None can afford to let this chance slip by.

Vodafone has been working with French company Musiwave over the last few years developing services. Musiwave was one of the first to develop real tones with its trademark Musitones a year ago and naturally champions the technology.

Musiwave founder Gilles Babinet says although he doesn't believe real ringtones will replace singles--as has been mooted in some quarters--he does think they'll be popular with the target audience.

"We did a survey recently which showed teenagers were more ready to spend their money on ringtones than on cinema," he says. "The response has been big in Europe. The operators have been astonished at how well it's done."

But other aggregators are a lot less certain that third generation ringtones will necessarily be the answer to the respective problems of the mobile or the music industry.

Del Dias, MD of Art Empire Industries, has already seen great success with first and second generation ringtones through his firm's dance Web site, Drum 'n' Bass Arena. He thinks that the record labels will simply add another link to an already very crowded value chain.

"The reason there are no true tones is that for every track you will have to go to the record company's business affairs department to negotiate a deal," he says. He believes that this will simply waste time and add to both operational and administrative costs.

Another sceptic is Simon Buckingham, CEO of Phonefurniture, which owns He argues that consumers are evolving at a far slower rate than the products. "There's no viable market for real tones for at least 24 months," he says.

Given the lack of available repertoire, the cost of buying licences and the additional royalty charges from record labels, he thinks this is a conservative estimate. "The key to all this really is that there are no phones that do this," he adds.

Paul Reilly, general manager at ringtone aggregator MMS3, agrees that there aren't enough suitable phones on the market and can see a few other problems ahead. But he still thinks it's worth getting involved early on. "It's not a market you can ignore," he says. "Operators and record labels like it because it gives them more control of the market."

Some experts estimate only 40%-50% of ringtones are sold through operators' shop windows, as opposed to third party advertising in newspapers and magazines, for example. This is expected to increase significantly with the growing popularity of WAP-based polyphonic and real tones.

But Chris Cass, operations director at interactive mobile services specialist Buongiorno Vitaminic UK, says the labels need to work more closely together. "We're taking it very seriously but there's a sense of deja vu, with each label offering different models; some with very stringent DRM requirements and some not."

Slipped discs

There's no doubt that the record labels think this is a great opportunity. Speaking to New Media Age last month, Barney Wragg, VP of Universal Music International's e-Labs was very enthusiastic about strong sales of real music tones in Japan. "It's really important for us to get real music tones right. Anything that benefits us as a business and the artist is good."

Buckingham is scathing about the opportunism of the record labels. "They haven't realised how long it's going to take for real tones to work," he says. "Once you strip out all the costs you realise it's a low margin business."

But Buckingham saves his harshest words for some of the aggregators. "What happened is some commercially naive vendors have spent so much on licences that they've set a level of expectation at the record companies that's unrealistic."

Both Buckingham and Art Industries' Dins say they'll now adopt a wait and see strategy before plunging into this area, in the belief that there will be an expensive shakeout of third party players as the scale of the business grows. This remains to be seen in the short term, but like most things in the mobile music space, it could evolve suddenly and very rapidly.    

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