Live from RoadShow Hollywood: Ringtones Dip, Mobile Music Soars

Mobile music is on pace to break new ground in the music industry and is giving marketers a variety of options to reach younger consumers. The trend was one of several highlighted yesterday at RoadShow Hollywood's Music Day.

While ringtones are still a hot commodity, full track mobile downloads is where the money is heading, Tamara Conniff, executive editor/associate publisher for Billboard, told attendees. Mobile music revenue from full track downloads is projected to hit $14 billion by 2011, according to Forrester Research. By 2010, mobile downloads are expected to account for 20% of the business, Conniff said.

"It's not just CDs anymore," Conniff said.

Ringtones, themselves, which now make up 81% of mobile music sales, are expected to drop, making up only 51% of the industry by 2011, per IDC. While the outlook appears bleak for the ringtones business, the industry is ripe for brands wanting to capture a piece of the mobile space itself. For marketers, mobile music gives brands a "lifestyle association" to tout their products, she said.

The sale of music via the Internet and mobile phones generated $1.1 billion for record companies in 2005, up from $380 million in 2004. "There is a lot of opportunity on the mobile front," Conniff said.

Outside of mobile music, the touring market is exploding. Concert tours bring in about $3 billion each year in North American ticket sales. For example, the band Counting Crows typically has a weak performance on CD sales, but is raking in the money via tours, Conniff said. "It is about branding," she added. With a tour, "you have a captive audience."

For marketers looking to attach themselves to an artist, Conniff told attendees to partner with a musician early, and not to be afraid to "roll the dice on which you think will be great."

RoadShow Hollywood is a four-day event on entertainment marketing featuring sessions on music, gaming, television and the film industry. The event runs through Thursday.

For more coverage on entertainment marketing