(12 July 2006 3:00 pm)

MUMBAI: With wireless over-the-air (OTA) music services offering mobile phone users a convenient way to buy music and providing an exciting new distribution channel to the music industry, an IDC survey has predicted that despite low adoption, the 'US wireless music services will have over 50 million users and generate more than a billion dollars in revenue in 2010, just 5 years after appearing in late 2005'.

"Wireless music services are still in their infancy in the US, but are expected to quickly gain traction during the forecast period. By the end of this year, the number of US OTA customers will be approximately half that of online music service users, but may surpass them by the end of the forecast period," says Consumer Markets: Audio programme manager Susan Kevorkian.

According to an IDC survey, a total of 22 per cent of respondents indicated that they would buy at least one track from their service provider within the first three months of availability, assuming they had an appropriate handset. Eight percent of respondents age 25 to 44 indicated they would buy four or more tracks. It’s this age group that IDC analysts believe could be the core base of wireless over-the-air service users, in particular those who may be new to digital music services.

In order for wireless music services to reach critical mass, a variety of music-enabled devices need to first find their way into the hands of wireless subscribers. This has not happened so far due in part to limited offerings from the handset vendors. However, the shift towards a greater variety of music-enabled mobile phones at various price points is already in motion. IDC expects music-enabled mobile phone shipments to reach nearly 60 per cent of all handsets shipped in the US by 2010.

"OTA mobile music storefronts are emerging as one of the most important new channels for fans to discover, purchase, and enjoy full-track music and related content. Key drivers for future growth include music-enabled handset penetration, deployment of broadband wireless networks, increased marketing efforts, bundling and cross-promotion of various music-related services, and driving flat-rate pricing schemes. IDC expects that OTA tracks at about $2.00 each will emerge as a sustainable price point as long as mobile storefronts are well-designed and offer a wide selection of music, and the music listening experience on the device is comparable to MP3 players," says Wireless and Mobile Communications: Entertainment research manager Lewis Ward.

IDC is a subsidiary of IDG, the world's leading technology media, research, and events company.