The days of charging consumers $3 for a 30-second ringtone may be coming to an end. But for carriers, record labels, artists and software developers, there is still plenty of money to be made in mobile music “personalization.”
Analysts long have predicted the demise of the once-booming market for traditional ringtones, which are generally defined as 30-second clips of hit songs or classic ditties. Figures from M:Metrics seem to support those forecasts, indicating that ringtone sales have generally remained flat during the last year, and are down significantly from earlier usage. More than 22.3 million U.S. subscribers downloaded a ringtone in January 2005, for instance, while only 18.4 percent reported buying a ringtone in January of this year.
“The traditional ringtone market as we know it-which is a carrier deck-distribution market-plateaued last year,” according to Bob Lang, president of Avanquest Mobility Software. “It’s in decline.”
Ironically, much of that decline can be traced to full-track digital download services offered by some wireless operators. Sprint Nextel Corp. and Verizon Wireless each charge about as much-or less-for an over-the-air download of a full song than for a 30-second ringtone clip, leaving subscribers to question the value proposition.
The Internet provides a wealth of information for tech-savvy users looking to create ringtones on the cheap. Several sites offer tips on creating free ringtones from digital music, and at least a half dozen developers offer software downloads for about $20 that can build ringtones from home music libraries.
But such offerings can be cumbersome, especially for casual consumers who aren’t interested in investing the time and money to create a ringtone of a familiar tune on a computer and then deliver the clip to the phone.
“There is an apparent threat to the market from software programs that enable consumers to create their own ringtones from music that they already own,” Juniper Research Ltd. wrote last month. “However, Juniper does not consider this to be a significant market threat.”
Instead, a handful of developers are working to allow users to create custom ringtones, coupling licensed content or familiar melodies with their own beats and stylings. Sonic Branding Solutions Inc. claims it has found success with an on-deck, subscription-based offering that features hit songs and voice tones from performers including hip-hop artist Method Man and Gnarls Barkley’s Cee-Lo Green.
Roughly 1.5 million users have signed on to pay $5 a month to access ToneMaker DJ, as the application is called, according to Sonic Chief Executive Officer David Danon. The community-based offering is available via Sprint Nextel and is slated to launch on Verizon Wireless next week and Cingular Wireless L.L.C. in early September. Subscribers can create up to 10 ringtones a month; users can post ringtones on their own home pages and allow others to tweak the clips to create their own ringtones.
“It’s far and away the most surprising hit we’ve had so far,” Danon said of ToneMaker DJ. “It’s very exciting getting record labels to see how valuable this application is; I think the carriers are realizing that, too.”
Avanquest is looking to gain traction, also, with an upgraded version of its Ringtone Media Studio application. The developer has sold 100,000 units of the offering in the last year, according to Lang, and has added a “content locker” allowing users to store as much as 5 megabytes of information online that can be accessed via over-the-air downloads.
While Avanquest doesn’t offer Sonic’s star power or familiar, licensed tunes, Ringtone Media Studio includes access to an online media library of 10,000 ringtones and other pieces of content. The company hopes to expand its reach with new distribution agreements, moving beyond software retailers and into cell-phone stores and music chains including Tower Records.
“We originally thought all the tweens out there were going to run out and (buy our product) and save billions of dollars, and the ringtone market was going to collapse,” said Lang. “It turns out (our customers) were the same people buying PC software. … I think that’s going to change in the coming year.”
