LONDON-Mobile music on demand (MMOD) services will be a $2 billion industry by 2009, but carriers will struggle to cash in on the market, according to a report from Strategy Analytics, Inc.
The report indicates that while downloading songs via handsets may become a niche market, sales will pale in comparison to computer downloads.
“Although mobile ringtone sales and online music services are both booming, Strategy Analytics concludes that online music stores based solely around cellular downloading capabilities cannot hope to compete with the lower costs, better interfaces, larger catalogs and faster transmission speeds of online sites offering music downloads over fixed broadband connections,” the consultancy said.
The report urges carriers looking to compete in the music download business to integrate their offerings with subscription-based computer services such as iTunes.
“We do not believe that technophile music lovers who currently purchase music through physical points of sale (as CDs) or online will migrate to cellular distribution,” said David Kerr, vice president of Strategy Analytics’ Global Wireless Practice. “Given the slim margins afforded by music downloads, we view the low likelihood of achieving scale as a serious barrier to the longevity of mobile music on-demand services.”
