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`Downloading market' is turning into a cash cow

The craze in Asia for downloading personalized ringtones, games and top 40 pop hits on to mobile phones has rapidly developed into a multi-billion-dollar industry with the boom expected to sky-rocket as technology improves over the next five years, analysts said.

From little more than an insignificant fad five years ago, the Asian downloading market is now worth US$1.3 billion, according to communication analysts Pyramid Research.

With the combined effects of more mobile-phone users and improving technology offering more attractive downloading options, Pyramid telecommunications analyst Connie Hsu said the industry would be worth US$3.6 billion by 2008.

"We expect the mobile data market to grow robustly in Asia," Hsu said.

"In markets like [South] Korea and Japan, we see the adoption of more sophisticated content and application already happening.

"In most of Southeast Asia and China, SMS-based content downloads have been extremely popular and we expect this segment of the market to continue growing in the medium term," she said.

The foundation behind the boom is simply the increase in the numbers of mobile-phone users in Asia. Just 3.8 percent of the region's population had a mobile phone in 1998, compared with 18 percent this year, according to Pyramid.

And with Japan and South Korea leading the way, 55 percent of mobile-phone users in Asia now download.

The growing range of content on offer includes Java games, wallpaper designs, animated greetings, ringtones, the latest pop songs and pictures of celebrities.

But it is the new generation of downloads that analysts believe will fuel the expected tripling of the market by 2008.

The Nokia 3300, billed as the first mobile phone for GSM markets that can support ringtones with real music and sounds, is a pointer to the future.

The phone allows users to have songs, and nature and engine sounds, among other effects, to alert them of an incoming call.

The industry is also looking to Singapore, where 80 percent of the population has a mobile phone and downloading advertisements dominate the classifieds pages of the city's tabloid newspapers, as another sign of things to come.

Nearly 20 independent operators, on top of telecommunications service providers and phone manufacturers, offer downloading services for between US$0.17 and US$1.14 in the high-tech city-state.

"Asians are willing to accept an increase of 10 [percent] to 15 percent in their mobile-phone bill for content like ringtones, games and other applications," the general manager of Singapore-based MobileWay Asia-Pacific, Cyrille Even, said.

Singapore student Isabel Chng, 18, confirmed Even's analysis, saying she was willing to spend 10 percent of her mobile-phone bill on downloading.

"Not all phones can compose ringtones and I like different ringtones all the time, especially new English pop songs that I like," Chng said.

Although ringtones and logos are still the most popular downloads, a Singapore Telecommunications spokesman said demand for games, which are more expensive, was growing.
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