Consumers are increasingly using their mobile phones to play music and games, gamble and access adult content, opening up lucrative new revenue  streams for the mobile and content industries, according to a  major strategic research report, Mobile Entertainment to be published next month by Informa Telecoms & Media. The report predicts that the global market for mobile entertainment will be worth  US$42.8bn by 2010. The report explores the entertainment sectors that are driving growth – including music, gambling, games video and TV, and adult content – and identifies the opportunities, challenges  and threats the industry faces if the mobile entertainment  market is to reach its full potential. Emerging new markets such as mobile TV, user generated services and personalisation (graphics and visual themes) are forecast to contribute a further US$11bn in revenues by 2010 as the market develops and expands.

The value of audio-based mobile music services is set to double in the five years to 2010, by which time they will exceed US$11bn, according to the report. Although the majority of  revenue will still come from ringtones, the forecast growth in the ring-back tone and full track download sectors confirms that the mobile phone is becoming a credible music device. A large sector of both the mobile and the music industries have galvanised around mobile music and for the last year have been helping to progress this sector. Handset manufacturers are devoting significant energy into creating sophisticated music devices and operators have been busy rolling out advanced music download services. The idea of the mobile phone as an ‘iPod Killer’ has gained momentum recently, spurred on by the release of handsets with MP3 functionality and high capacity hard drives. Yet, just as camera phones did not suddenly destroy the digital camera  business, the report finds that MP3-enabled phones will not seriously damage the digital music player market in the immediate future.

Total global revenues from mobile games are forecast to increase from US$2.6bn this year to US$11.2bn by 2010. Downloads will account for around two-thirds of total global revenues through 2010, but online multiplayer traffic will  start to generate significant income for mobile operators, as cellcos launch more multiplayer games and introduce community features that will encourage user uptake. By 2010, online multiplayer games will generate 20.5% of total global revenues. Meanwhile the mobile games industry still has work to do to encourage mass-market adoption of mobile games. This year, just 6.7% of all mobile subscribers globally will download and play a mobile game, rising to 15.2% by 2010.

The market for mobile gambling content is predicted to rise from US$1.2bn of annual revenues in 2005 to US$7.6bn by 2010, by which time there will be more than 200 million consumers gambling using their mobiles. However, to reach this goal, operators and the companies who run mobile gambling services  will have to negotiate legislative, technological and  cultural hurdles. Europe is likely to remain the largest market for mobile  gambling, generating US$3.2bn of annual revenues by 2010. However, it will be closely followed by Asia-Pacific, which is forecast to generate US$2.7bn by 2010. North America is the great unknown, as the size of the market there depends first on mobile gambling being legalized in the U.S., and then on which restrictions are placed upon it. Nevertheless, the report predicts US$979mn of annual revenues for the region by 2010.

The market for erotic content for mobile devices is predicted to be worth US$2.3bn by 2010, but realisation of this is highly dependent on mobile phone carriers and content providers working with regulators in order to determine solid controls and age verification procedures. The report estimates that by 2010, there will be over 114 million regular users of mobile adult content globally.
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