Mobile Music's Moving Revenue Numbers

• Posted: Thursday, May 24, 2007
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• Author: pradhana
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• Filed under: Apple, iPod, Mobile Content, Mobile Market, Mobile Services, White Space

Got that mobi mojo working now.

Competing interests between the music, consumer technology and mobile industries have created a virtual battlefield in the entertainment sector.

"The entertainment sectors are being rocked by online and mobile distribution," says John du Pre Gauntt, eMarketer Senior Analyst and the author of the new Mobile Music: Mixing It Up report. "Unless the three major industries involved change some of their fundamental assumptions about their roles and rewards in the value chain, it's not likely that mobile music will grow as fast, or as predictably, as they need it to."

eMarketer estimates that music labels earned $1 billion from global mobile music in 2006, and predicts that that figure will rise to $7.3 billion in 2011.

"As far as the music industry is concerned, mobile music revenues need to climb because online music distribution still hasn't made up for the decline in CD sales," says Mr. Gauntt. "Mobile network operators will also have significant problems if music doesn't scale — given their need to offset pure price competition."

The consumer electronics industry is not neutral on growth, either.

"Apple's iPod may have ignited a portable music revolution in a few countries," says Mr. Gauntt. "But compared to the volume of music-capable phones shipping worldwide, Apple needs to get into mobile sooner rather than later lest iPod go the way of PDAs."

While marketers should understand that currently no single industry player can "deliver" the mobile music market to them, they do have options.

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