Ringing in the cash

The Grocer Magazine revealed last month that sales of chocolate had fallen for the first time in the UK for 50 years. Unfortunately for those in charge of the nations health, kids aren't spending their weekly stipend on fruit and veg. Nope, instead of biting into Twixes and Twirls they are simply blasting all their pocket money on mobile phone ringtones, games, and text messages.

This trend, coupled with the increasing spread of camera-phones (12 per cent penetration in western Europe) and the slow march of multifunction 3G handsets, is making the niche mobile phone content sector a very valuable area.

If you're not convinced, consider this: mobile data is expected to represent 50 per cent of industry revenue growth in 2004 and 70 per cent in 2005. Ringtones now account for ten per cent of the $32.3 billion worldwide music market and the global market for ringtones is forecast to grow to $5.2 billion by 2006. Gaming is predicted to grow to £8.3 billion from $2.4 billion in 2004.

And there's more: 25 per cent of seven-to-ten year olds and 90 per cent of 15-24 year olds have mobile phones. In 2004, the 'yoof' of Western Europe will spend no less than $426 million on ringtones alone. Not a bit of wonder the likes of iTouch and Stream — two Aim-listed mobile content suppliers – are growing like topsy.