MEF report identifies steps to successful ad-funded mobile entertainment (AFME) industry in India

Media News

Mumbai, June 19, 2008

The Mobile Entertainment Forum (MEF) believes the Indian mobile entertainment market is creating the foundation for a successful ad-funded mobile entertainment environment. With a burgeoning mobile content market driven by personalisation and ringback tones, the introduction of 3G will pave the way for rich-media mobile entertainment services to be delivered to the mass market and encourage spend in the market's nascent mobile advertising industry to shift from banners ads and messaging onto music and games.

Recognised as the second biggest mobile growth market after China with over 261 million subscribers, the potential for ad-funded mobile entertainment in India is significant. Research firm Direct2 Mobile forecasts that India's mobile entertainment market will be worth US$403.13 million in 2008 and US$2.24 billion by 2013.

The MEF Report highlights that piracy is having a devastating impact on the ringtone market and is expected to continue to do so, with revenues forecast to continue to decline over the forecast period. However, the demise of the ringtone market is being offset by the continued success of ringback tones which is driving India's mobile entertainment market, and will generate US$120.4 million in 2008 and US$440.5 million in 2013. AFME is also very dependent on the launch of 3G to deliver rich media to customers - without this, AFME largely remains confined to being at an embryonic level.

MEF found that, unlike in developed mobile markets, the mobile games market in India remains a marginalized service. Mr. Neeraj Roy, MD & CEO of Hungama Mobile and MEF Asia Vice Chairman said, "The average cost for games varies in India and in most cases is far higher than the amount consumers are willing to pay. As a result, mobile games are perfect for ad-funding where the cost of the games can be offset or greatly reduced by advertising. When pricing is addressed and coupled with AFME, mobile games will generate the most revenues for the Indian mobile entertainment market by 2013."

Stefan Rust, MEF Asia Chairman added, "The audience matters. Without the audience the ad-space is worthless. The industry is collaborating to address the issues and remove the barriers to further mobile growth and data service adoption. Advertising funded mobile services make entertainment more affordable thereby bringing mobile services to the hands of a much broader demographic. This is the first of a number of initiatives that we will be bringing to the various countries across Asia."

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Arwa Kaka

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