Mobile Music Gets Louder
By Carlo Longino, Wed Mar 02 00:30:00 GMT 2005

3GSM reinforced the idea that the mobile industry is making music its focus for 2005, and the momentum of announcements keeps building. But are these announcements being mistaken for genuine user interest?

It's hard to turn around without seeing another story about mobile music. This week, there's Vodafone announcing it's expanding the library of its mobile-download service to 500,000 tracks, an analyst is making big predictions about the value of the mobile music market and SonyEricsson took the wraps off its Walkman phone. But behind these announcements are, of course, a few points of contention.

Along with Vodafone's news it was expanding its library, it also said its users had downloaded 1 million tracks since the service launched in November. An impressive number given the small number of users, but the cynical will point out that Apple sells more tracks than that every day, and sold 800,000 in its European store's first week last June. But perhaps a more relevant question would be how many of those downloads were part of a free promotion, such as in the UK where Vodafone 3G subscribers could get three free songs per month. While a million downloads is nothing to sniff at, there's a big difference if a significant chunk of them were free, and not the 1.50-euro normal charge.

One research firm also said this week it sees the mobile music business as being worth $9.3 billion by 2009. Apart from the healthy level of skepticism with which one should always view these reports, but this one -- or the press release advertising the GBP 1250 report -- leaves several questions unanswered. It includes ringtones as a part of the overall mobile music market, and says they'll account for $4.9 billion of that 2009 total. That's up from $3.5 billion in 2003. All of that, though, as the same report predicts average European ringtone prices will fall 46%, with North American prices falling by a third.

In terms of full-track downloads, the report says they'll hit 1 billion per year in 2008, generating $1.9 billion -- indicating they won't see the same price pressure as ringtones, which seems a bit odd.

The announcement of Sony Ericsson's Walkman phone has generated some buzz, but the inclusion of a 2-megapixel autofocus camera is attracting as much attention as the music capabilities. Perhaps Sony's poor stewardship of the Walkman brand through the Discman and digital ages has dulled its attraction, or maybe the W800 isn't enough of a dedicated music phone.

Radio's getting in on the act, too, and the announcement from Virgin Radio in the UK that it will offer software for 3G users to stream its broadcast (registration required) to their handsets might be the most interesting. For the radio station, it's all about extending its reach: it only has an FM license covering London, and transmits on AM throughout the rest of the country, so the streaming connection could offer many users better reception. Virgin's also being smart enough not to charge for the service, since it realizes in most cases users will be paying carriers for the data connection fees. What's interesting is the company also realizes high data charges will keep listeners away, so it's meeting with UK operators in hopes of getting them to offer flat-rate packages.

A content provider looking to save users money? Now that's news.