Music players are losing out in popularity to phones that pull double-duty, according to a market research report released Monday.
More than 500 million music phones were shipped worldwide in 2007, which puts that category of device 300 million units ahead of regular old portable music players, according to the report released Monday by MultiMedia Intelligence. The company is forecasting that by 2011, of the 941 million handsets that will ship worldwide, more than half will be music phones. (The report defines a music phone as a handset that plays music files, and has a memory card slot.)
The Walkman-branded W980 phone from Sony Ericsson is a phone but looks like a music player. Phones that play music are quickly outpacing standalone portable music players.
(Credit: Sony Ericsson)As the developed world begins to be saturated with cell phones, handset manufacturers and wireless operators are forced to look elsewhere to keep their profits up. For leading handset maker Nokia, its secret to staying on top of the competition is its growing business in emerging markets, like China, India, the Middle East, and Africa, according to my CNET News.com colleague Maggie Reardon.
The operators of wireless networks also need ways to increase revenue. So, though not everyone has a need for a data plan if they don't want e-mail on their phone, music is something almost everyone can relate to. Right now the most promising driver of profits on cell phones is music-playing capability.
"Music has been the first 'killer app' for the operators to drive the consumption of premium content on the handset," said Frank Dickson, chief research officer for MultiMedia Intelligence. To that end, MMI predicts the mobile music market will be worth $6 billion by the end of this year. "With such significant revenue and customer demand at stake, the operators' and handset providers' concerted efforts (will) use music as a central part of their handset strategies," the report says.
Update 1:55 p.m. PDT: As several commenters have pointed out below, buying a music phone doesn't necessarily mean it's used for playing music. (Case in point: my own Verizon enV has a 2GB microSD slot, and I've never transferred MP3 files to it. But that's mostly because my iPod earbuds don't work with the enV and I refuse to buy a separate set.) Music-playing ability was formerly a feature reserved for high-end phones, but as the technology gets cheaper, that means that those features will start to filter down to more inexpensive phones, which have always been the majority of the market.
If you haven't heard of Zingspot.com yet, you soon might.
It was recently registered by none other than Dell, which also applied for a trademark on the name. (Thanks to the Trademork blog for pointing to it.)
Zingspot is likely related to Zing Systems, a company that Dell acquired in August. Zingspot.com is described in the document filed with the U.S. Patent and Trademark Office as "an online consumer portal for digital entertainment content acquisition and distribution." Being a hardware maker, it would make more sense to expect Dell to make a device rather than a service. Especially since the PC maker officially pulled out of the portable media player market in August 2006, at the time citing a need to focus more on PCs, TVs, and printers for consumers.
Dell had little to say when it acquired the tiny, Mountain View, Calif., company that makes streaming audio software. But almost four months later and with CES fast approaching, it's interesting to look at what Dell might be doing.
The company has had a tough year, but it seems to be turning things around. (We'll know better tomorrow when Dell is due to report third-quarter earnings.) In an effort to show that it's hip and relevant, the Texas PC maker has definitely been ratcheting up the emphasis on design--see the XPS M1330 and M1530 notebooks, and XPS One desktop--and on online communities with its IdeaStorm and Direct2Dell blogs.
An online portal for entertainment seems to fit in there somewhere. But does it make sense to build another iTunes Store or Rhapsody, or a Zune store for that matter? Negotiating all those content relationships is a headache very few people want. And after all, Dell is a hardware company before anything else. Dell, by the way, declined to comment on any of its future plans for Zing or Zingspot.com.
But Zing makes a pretty nifty technology, one that SanDisk licensed for use in its Sansa Connect. It's software for real-time audio streaming--meaning you can get music wirelessly from an online source and from other portable devices. SanDisk, however, uses Yahoo's music service as its content source. So, either Dell will create its own portal or will partner with an already established online store if it does end up making a device that utilizes this software.
It's also worth noting that Zing is a pretty snappy-sounding brand name, and could lend that fresh, relevant tone to whatever they're cooking up down in Round Rock. Will we see a Zing brand on a forthcoming media player from Dell, or on a whole new family of devices? Stay tuned.
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