A ringtone earns tens of millions of dollars a month, exceeding the annual sales of records

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A ringtone earns tens of millions of dollars a month, exceeding the annual sales of records [Copy link]

　　 At present, the three major "money-making" industries of the Internet are online advertising, online games and wireless value-added services . These three gold mines created revenues of 2 billion yuan, 4 billion yuan and 10 billion yuan respectively last year . The Hurun "Rich List" for 2005 released not long ago shows that 6 of the top 10 youngest rich people in China come from the above industries.

　　In particular, wireless value-added services will continue to be one of the most promising areas in the future, and wireless music accounts for 30% to 40% of the revenue, which has overwhelmed the traditional record industry that was once prosperous, and created many myths of getting rich overnight...

　　Current situation: Monthly revenue exceeds annual record sales.

　　This newspaper reporter contacted and interviewed two Internet companies, TOM Online and Hurray Century. These two companies are the largest SPs (wireless value-added service providers) under China Mobile and China Unicom respectively, and are also the biggest beneficiaries of the wireless music industry.

　　Among the major portals, TOM Online is now a value-added service provider with digital entertainment as its "soul", and wireless music occupies a crucial position in the company. "600 million yuan of our second quarter revenue came from digital music, including ringtone downloads, ringtones, song requests, etc., accounting for 40% of the total revenue," said Wang Leilei, CEO of TOM Online, in an interview with this newspaper. He also said that the company's net revenue from ringtones alone in the second quarter of 2005 was RMB 27.06 million, up 21.9% from the previous quarter, accounting for 8% of TOM Online's total revenue.

　　Wang Leilei took the ringtone single "Mouse Loves Rice" as an example: the number of downloads in a single month reached more than 5 million times, and at an average of 2 yuan per song, the single income was 10 million yuan (information fee), which is equivalent to the sales of 600,000 records. The record company earned 0.8 yuan per song, and the total income of the record company was 4 million yuan, equivalent to the income from the sale of 1.6 million records.

　　Reasons: Changes in consumer habits

　　. Facing the rise of wireless music, Wu Jiaai, Asia president of EMI Music Ltd., lamented, "Traditional music will never be our business opportunity again!" According to relevant data, in February this year, the domestic wireless music market reached 360 million yuan in one month, exceeding the total sales of 320 million yuan of genuine records last year.

　　The industry believes that the main reason for this situation is the rapid increase in the number of mobile phone, broadband Internet and mobile music player users in China. Although the cost of a user downloading a song is only 2 yuan, China has 377 million mobile phone users and over 100 million Internet users. The income brought by this huge number of users is considerable.

　　From the perspective of consumption habits, most of China's music consumers are teenagers who only have the ability to pay small amounts. This small amount and high frequency consumption method is very suitable for their needs. They don't have to pay for a dozen songs on a whole album as in the past.

　　For singers, they don't have to accumulate more than a dozen songs before releasing an album as in the past, but can let mobile phone users listen to a new song immediately. For record companies, the copyright of records used to be the main source of profit, but now, wireless value-added services such as ringtones have become an important source of profit for record companies.

　　Many risks are hidden behind the high profits

　　Many SPs also admit that the industry also hides many risks behind the high profits, the first of which is the issue of content, that is, copyright. In the past, most songs in the hands of small and medium-sized SPs did not purchase copyrights, and record companies took Internet companies to court one after another. Mobile operators and traditional record companies also stepped up their pursuit of copyright issues. Now, many SPs are forced to adjust, either cooperating with record companies or developing original online songs themselves.

　　However, record companies also realize that dissemination through the Internet and mobile phones is actually helpful for record sales, and have begun to actively cooperate with SPs. But according to Wang Leilei, when signing an agreement, record companies will divide SPs into different levels. The first category is large SPs such as TOM, Sina, and Tencent, and the two parties generally split the profits 50-50. The second category is pure SPs such as Kongzhong.com and Lingtong.com, and record companies require SPs to pay a guaranteed deposit. The third category is to charge a one-time fee, which is generally for small SPs.

　　Secondly, in terms of channels, the industry is facing the risk of direct intervention from record companies and mobile operators, who may provide content themselves and leave the SPs aside. However, Wang Leilei believes that record companies do not have the content integration capabilities of Internet companies, and operators also lack the ability to integrate content and conduct secondary integration, so this threat is not great at present.

　　It is reported that there are currently about 2,000 SPs in the Chinese SMS market. The homogeneity of content and channels will cause a large number of complaints and vicious competition, and many SPs without content and channel resources will be eliminated. Wang Leilei said that of these more than 2,000 SPs, there may only be a few dozen left in the end, and the trend must be to raise the entry threshold and reduce costs.