BMI says ringtone market to tone down

The U.S. ringtone market will dip 8 percent this year as the novelty fades and users learn to create their own mobile music clips, according to Broadcast Music Inc.
BMI predicted that ringtones will generate $550 million in retail sales in 2007, down $50 million from last year’s sales. The market had climbed dramatically since 2003, when ringtones rang up $68 million in revenues.
Analysts agree that $3 ringtone downloads are an increasingly tough sell in a market where over-the-air full-track downloads can be had as cheaply as $1. And ringtone providers are scrambling to cope with the declining market, moving beyond simple mobile music clips into voicetones, ringbacks and other products and services.
Also, while ringtone revenues decline, other kinds of mobile entertainment will surge, according to BMI. Ringbacks will generate $65 million in revenue, the performing rights organization said, and the firm forecasted “increased revenue opportunity in the streaming sectors of the mobile entertainment market, ranging from ringtones to audiovisual cellular phone TV-style offerings.”