That ringbacks dont sell in Europe is one of the great clichés of the content business. Is it true?
A very astute man (actually it was Suds Sarronwala from Soundbuzz) once told me that all this talk of mobile personalisation products is a bit ill-conceived.
Personalisation is what we do when we decide what shortcuts to put on our home screens. What we’re really doing when we buy a ringtone or a wallpaper is not personalisation, but self-expression. ‘This is who I am,’ our phones cry out. ‘Please identify with me’.
He’s right, of course. And the ultimate in self-expression has to be the ringback tone. Here’s a product that you, the consumer, never even consume yourself. Only your friends and acquaintances get to enjoy it. Although, if your chosen tune is Ronan Keating or Dido, I hesitate to use the word ‘enjoy’.
Ringbacks have been around since 2002 when the Korean carrier SK Telecom rolled out the world’s first service. Within nine months it had six million customers.
Today, ringbacks have been launched all over the world and a thriving ‘new’ market segment has been established. According to IDC, the inherent advantages of the ringback tone will take its market value past the ringtone in 2010. So what are these inherent advantages?
Here are the four big ones:
- No storage issues
A ringback is network-centric so the user doesn’t have to worry about the storage capacity of a phone.
- No piracy
For the same reasons of network-centricity, operators don’t have to worry about users making their own tones or nicking them.
- No handset de-fragmentation
Unlike so many other mobile content products, ringbacks can be offered by and heard on any device.
- Personalisation options
Customers can change their tones for different times of day and even tweak them for individual callers.
What an opportunity. But, as with most mobile services, it’s not that simple. A ringback requires a service provider to hijack the network, intercept a call, inject the tone and cut it as soon as the call is connected.
That said, providers like Comverse, WiderThan and others should have the process nailed by now. Trickier, perhaps, are business models. A simple subscription can work, but viable alternatives include paying for a minimum number of tracks and so on.
Then there’s the hairy old marketing issue. After all these years, many end-users still don’t know what a ringback is, and the industry doesn’t help by calling them callertunes, color rings, answertones and so on.
So how do you explain what the offer is? IMI Mobile, which supplies ringbacks for Indian operator BSNL among others, says it has had great success with simple outbound SMS marketing. It also promotes from within the service itself, providing users with the option to acquire the ringback they’re listening to by pressing ‘*’.
Vish Alluri, CEO of IMI Mobile, says: “It’s a very good way of marketing the service and generating new subscribers, but you do have to be careful. We’ve found that some users get confused and press star anyway, then are shocked to find that they’ve paid for something. So not every operator wants this option.”
Of course, ringbacks are no longer just about entertainment. The captive audience element has also alerted advertisers to the space. Also in India, local provider OnMobile recently launched Ad RingBack (AdRBT) Tones. They present callers with audio ads, personalised to their profile. Intriguingly, the platform allows users to respond to the ad with a key press, although one wonders who would interrupt a call to do so.
Arvind Rao, CEO of OnMobile, says: “AdRBT is a disruptive evolution in mobile advertising which so far has been limited to SMS or WAP banners. With users receiving an average of ten calls per day, advertisers can reach a large and diverse audience”.
Although the market’s powerhouse remains in Asia, there have been some successes in the West too. Virgin Mobile USA recently confirmed that its service, powered by LiveWire Mobile, quickly gathered over 100,000 subscribers paying $1.49 a month for access. Critically, the service was made flexible so users can designate individual tracks for friends. In August, LiveWire added the ability to purchase ringback bundles that play in rotation, charging $3.50 per month on top of the monthly fee.
Despite these isolated successes, the anecdotal evidence suggests that ringbacks are yet to take off fully in the West. Observers suggest average Euro penetration is two per cent, against up to 45 per cent in Korea.
Why? Richard Jackson, business development director of Muzicall, has some ideas. “It’s not cultural, for a start” he says, dismissing a commonly held belief that Europeans and Americans have some anthropological resistance. “It’s more to do with our fragmented market – lots of networks, lots of languages, operators that switch between building local then global services then back again.”
Jackson believes the market will never flourish while operators and service providers remain in charge of the store. What’s needed, he contends, is an intermediary that can take different cross-network offerings to expert consumer-facing brands, be they D2C firms like Zed and Buongiorno or even enterprises.
Jackson adds: “Operators are good at tariffs; they’re not so good at services. Despite their efforts, 70 per cent of content sold in Europe is off-deck. Operators need to start working with off-portal specialists.”
Muzicall plans to help them. It already works with Vodafone, and claims to have more deals imminent. Its strategy appears to be part of a shift that already has momentum. Earlier this year, Jamba launched a service called Fun Broker, powered by ringback powerhouse Comverse, and offered via T-Mobile Germany.
Just a few years ago it seemed counter-intuitive that D2C companies could ever offering ringbacks. Now, it looks inevitable.
Ringback Fact:
The biggest selling ringback in Western markets is Alicia Keys’ No One, which sold 500,000 in the US alone. Much of its success was due to the imaginative retailing of Verizon, which uniquely bundles music services. When users buy a ringtone they’re offered the ringback tone too. Service provider RealNetworks/WiderThan says this kind of bundling can boost sales by ...
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