July 8, 2004
Music firms warned over ringtones
Mobile ringtones have become a surprise money-spinner for music companies but firms must not become too greedy, analysts have warned, reports the BBC.
"A report published by analysts Baskerville/Informa Media forecast that ringtones would account for 12% of total music sales by 2008.
But music labels must rein in ambitions for unrealistically high royalties. And it added that piracy, which has yet to hit the ringtone market, could also spoil the party."
Some mobile operators have argued that the music labels have become "over-enthusiastic" about the share of revenues they deserve for sample ringtones, with figures ranging between 25% and 55% of the price paid by end users.
There are also worries that ringtones could become the target of pirates.
Numerous websites are offering ringtones from artists without having the necessary licenses to do so, said the report.
Downloading ringtones has become hugely popular. In 2003 the market was worth £1.6 billion and by 2008 it will rise to £2.5 billion, according to the report.
Youngsters like to constantly update their mobile ringtones. One single - Round Round by the Sugababes - sold more ringtones than singles when it was released last summer."
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