Panel: Ringtone Market Needs Reform

The rapid development of the ringtones market is creating industry problems that need to be resolved soon, panelists concluded yesterday (June 2) at the Mobile Entertainment Market conference in Londo

The rapid development of the ringtones market is creating industry problems that need to be resolved soon, panelists concluded yesterday (June 2) at the Mobile Entertainment Market conference in London.

In a session titled "Is the Pure Ringtone Business Sustainable on Its Own?," speakers urged mobile operators to create a realistic pricing structure and called for greater accountability to ensure that rights holders get paid from the growing ringtones business.

"Ringtones could be seen as the biggest single culture thrusting the music industry into a new dimension and saving it," said David Simmons, chairman of the U.K. music licensing company Songseekers and the Mobile Entertainment Forum (MEF) member responsible for compiling the world's first official ringtones sales chart, in the United Kingdom.

"But the music industry, especially publishers, hasn't received the money it should have," he added. "Unless this is regulated, the music industry will make huge upfront demands [for rights clearance] or sell the ringtones themselves."

For Seamus McAteer, lead analyst at San Francisco-based research company Zelos Group, the problem lies with handset makers installing open software systems that will enable hackers to burn illegal music from the Internet and create their own ringtones.

Soundalike recordings also pose a threat for the emerging true-tone formats, which are ringtones based on original master recordings. Some ringtone creators obtain original-recording licenses by acts that sound exactly like popular hitmakers and then market them as the genuine article.

"People want to buy good quality content, but they will not pay the earth for it," observed Ian James, managing director of Chrysalis Mobile. "Given the opportunity, consumers will choose the cheaper soundalike."
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