MMW-22 -- A Survey of Japanese I-mode Ringtone Sites

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J@pan Inc Magazine Presents:
M U S I C M E D I A W A T C H
Commentary on the week's music technology news
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Issue No. 22
Thursday, June 20, 2002
Tokyo

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CONTENTS

++ FEATURE: A Survey of Japanese I-mode Ringtone Sites

++ NOTEWORTHY NEWS:
- Audiogalaxy to Settle With RIAA
- StreamCast Delays Launch of Morpheus 2.0

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++ FEATURE: A Survey of Japanese I-mode Ringtone Sites

Since ringtone download services are now widely recognized as one of
the leading money-makers in the mobile industry, I am increasingly
asked about the major ringtone providers here and the types of
services that are currently offered. In particular, many people seem
eager to know which providers are most successful and why. Earlier in
the year, I touched on some of the trends appearing in the Japanese
ringtone market. For this week's feature, I've decided to go a little
deeper and examine some of the major ringtone services in the general
ringtone section of DoCoMo's official i-mode menu.

First, here are the 'Top 9' i-mode ringtone sites as of June 18:

1. Pokemelo Joysound (XING)
2. Chakushin Melody GIGA (Giga Networks)
3. Melo DAM (Daiichi Kosho)
4. Sega Kara i-Melody (Sega Music Networks)
5. Yamaha Meroccha! (Yamaha)
6. 40 Melo Mix (40 Melo Mix)
7. Roland Sound Gallery (Roland)
8. CoolSound (Cybird)
9. N Melody 20-300 Yen (NEC)

The menu order is determined by number of subscribers and updated
every few months, but in actual practice, there have not been many
major changes in menu order. The sites appearing near the top
(especially the top four, which appear on the first page) tend to
attract the most new users, allowing them to stay at the top and
widen their margin over the other services. However, one major
exception to this rule occurred last year when XING overtook Giga
Networks for the top position in the menu.

Note that most of these companies had already established strong
karaoke-related businesses prior to starting ringtone services.
Notable exceptions include 40 Melo Mix and Cybird, who were quick
enough to be among the first content providers, and NEC, which wields
tremendous clout by virtue of being (among other things) the dominant
i-mode handset manufacturer.

XING is rumored to have well over 5 million subscribers for its
Pokemelo Joysound service, and it's a pretty safe bet that even the
services at the bottom of this list have at least 1.5 million
subscribers each. In general, these services offer a massive catalog
of ringtones in many different genres.

A quick comparison of the top services reveals that each is trying to
distinguish itself based on:

1) sound quality of the ringtones
2) size of the song catalog
3) extras such as i-appli games and artist information
4) support for the 40-voice 504i series of handsets

It appears that several of the major services are also structuring
their sites in a 'portal' fashion and are continually opening
genre-specific sub-sites within their main service. Yamaha's
Meroccha! service, for example, includes a separate site for
guitarists (Guitar Hearts), as well as one for enthusiasts of 'club'
music (Melodic Lover).

Among the remaining 26 services found in the official i-mode menu,
the majority are devoted to a single musical niche. In some cases,
these sites are limited to a specific instrument or genre of music,
while others provide a hook such as allowing customers to 'mix and
match' different songs into medley forms or to download an unlimited
number of songs for 100 yen per month. Here are some of the more
interesting 'boutique' services:

1. Half Note Jazz -- This site contains many surprisingly convincing
ringtone renditions of jazz standards.

2. Pokebras -- From Digital Bridge Communications, this one is
devoted to Latin music.

3. Tokyo Phil-Classic -- Offers the largest selection of classical
ringtones.

4. Uwasa no Indie Melo -- A site focused on ringtones from
up-and-coming independent label artists('indies'). Produced by
For-side.com.

5. Arrange Tengoku -- Loosely translated as "Arrangement Heaven,"
customers of this site can change tempo, volume and instrumentation
of the various parts for each song.

Obviously, as large general providers such as XING and Yamaha start
to offer their own specialty sites within the bigger scope of their
main services, many of the smaller sites will find themselves
struggling to stay alive. While there is quite a bit of debate at the
moment over just how long ringtone services will continue to make
money in Japan, nearly everyone agrees that existing services can
expect strong revenues for at least another year or so. Although the
rate of new Japanese ringtone subscribers has begun to level out
recently, there is still enough money coming in from this business to
ensure that significant new services and applications will continue
to appear on the ringtone sites over the coming months.

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++ NOTEWORTHY NEWS

** Audiogalaxy to Settle With RIAA

Extract: On June 17, Audiogalaxy agreed to a legal settlement with
the RIAA which will require the popular file-sharing service to
obtain permission from a songwriter, publisher or recording company
before using copyrighted songs. In addition, Audiogalaxy will pay an
undisclosed sum to music publishers and recording industry
organizations as part of the agreement.

Source:
http://news.com.com/2100-1023-936932.html?tag=cd_mh

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** StreamCast Delays Launch of Morpheus 2.0

Extract: Last week, StreamCast Networks announced that the release of
Morpheus 2.0 would be delayed, citing the need to further tune the
software and insisting that the delay is unrelated to the company's
pending court case. Steve Griffin, the CEO of StreamCast, said the
company is optimistic that version 2.0 will launch this month.
StreamCast recently switched its network technology from Kazaa's
FastTrack to the open source Gnutella protocol.

Source:
http://news.com.com/2100-1023-934581.html?tag=cd_mh

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STAFF
Written by: Steve Myers (steve.myers@l8tech.com)
Steve Myers heads the Theta Group at Layer-8 Technologies,
which specializes in the development of music-related
software applications.

Edited by J@pan Inc editors: (editors@japaninc.com)

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