Conflicting Reports on the Ringtone Market
By Eric Lin, Wed Jan 14 23:15:00 GMT 2004

Within 24 hours, two reports about ringtones were released that contradict each other in numbers as well as outlook. The Arc Group says ringtones were very strong and are still on the rise, though they may drop off in the future. Juniper Research puts a lower value on the past year's sales and says the market has already peaked. They also predict a 50% decline in ringtone sales over the next four years.

When the Juniper Research study was released on Monday, it was difficult to determine what the report was really about. They start by claiming the ringtone market was worth $1 billion in 2003, and that they expect it to decline to about half that by 2008. However the rest of the report is about digital music distribution via mobile devices- which they predict will grow to be worth $500 million or so in 2008. The stats about ringtones sound like a set-up for the digital music punchline.

It was easy to ignore Juniper's report until Techdirt pointed out that a new report from the Arc Group contradicted it. The Arc Group evaluates last year's ringtone sales at three times that of the Juniper Research report- $3.2 billion. Although the Arc Group report predicts that ringtones are still on the rise, they warn that unauthorized ringtones as well as more appealing downloads such as new games or even video, may thin out the ringtone industry's earnings over time.