Ringtones Up? Ringtones Down? No One Knows

If years of false predictions haven’t taught you to have a skeptical eye when it comes to studies, perhaps this set of stories will help. The folks over at Arc Group got some press today for a study saying that the ringtone business is booming, and only expected to get bigger and bigger. Meanwhile, Juniper Research is saying that the ringtone market has peaked and is already in decline. They also give vastly different numbers for market size. Arc Group says that it hit $3.5 billion in 2003, while Juniper says that it’s peaked at just over $1 billion. The press release versions of these studies don’t give much detail into how these conclusions were formed. We’ve always held that ringtones, while lucrative in the short term, are a risky business, as there’s a looming “Napster-style” threat to them. However, it’s unclear if the market has truly peaked yet.Addedum from Derek: We’re split on this one, because I thing the Ringtone market is still growing globally, and especially in the US. I think free ringtones will also grow, but not enough to cause net shrinkage in revenues. (As Mike said: Up. Down. No one knows.)

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