Just why are ringtones so expensive? Don’t get me wrong here: I hate them, but there is a huge discrepancy between the cost of downloading a music track and downloading a new ringtone for that phone that’s you’ll probably only own for a month. Often the ringtone will cost more than the entire original song it is based upon.
Consultancy firm Informa have published a report on the state of the ringtone market, and it looks like it’s all the music companies’ fault.
A ringtone based on a sample from a track can set you back up to four times the cost of downloading the whole song from iTunes – the cost is inflated because record labels require royalties of between 25 and 55% of the cost of the ringtone.
For example a track off iTunes will cost you about €1.50 (US$1.82 – nearly twice as much as the US store. I’m sure that’s justified) when the site appears suddenly next month, yet downloading a ringtone can cost a staggering €6 (US$7.30). And thank you T-Mobile UK, for that confident pricing. How much pocket money do kids get paid these days anyway?
“The reseller is really between a rock and a hard place,” said Simon Dyson, a co-author of the report. “They are torn between raising the price or keeping it steady in the hopes of establishing a market. Demanding such high percentage rates by the record companies could certainly lead to the market being depressed.”
Depressed? That’s nothing compared to what will happen when phones are released that can just play an MP3 file as the ringtone – then commuter-bothering phone owners won’t have to buy anything at all. Then the US$3 billion (€3.6 billion) market will vanish over night – instead of growing to the US$5 billion (€8.5 billion) monster it’s expected to be by 2007.
Incidentally, I know some pandas who have a really good ringtone album out.