A report published by the Mobile Entertainment Forum (MEF) today (Feb. 11) concludes that U.K. ad-funded mobile entertainment will generate £145 million ($282 million) in revenues by 2012.

However, Billboard.biz has learned that music will generate only a small fraction of MEF's predicted total as the industry continues to examine how to insert advertising without disrupting consumers' enjoyment of music.

According to Suhail Bhat, the MEF's policies and initiatives director, the report indicates that mobile videos and games will be the biggest drivers of wireless entertainment that is free or subsidized for end users thanks to advertising.

"By 2012, ad-funded mobile entertainment will be contributing £41 million ($80 million) to the mobile games industry in the U.K.," said Rimma Perelmuter, the MEF's executive director, in a statement.

Bhat tells Billboard.biz: "This could increase the total mobile games market (including paid-for) by 15%. And ads could also help increase the still developing mobile video market by 50%."

But he adds: "There is still a considerable amount of work to be done for (mobile music), which has not taken off as people expected and will be a very small part of the ad revenues we forecast."

While the industry is able to insert ads at the start of a mobile video, at the end, or within the video, "music is something you want to take with you without any interruptions," Bhat explains. "How does that work in practise? That is what we need to explore."

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