IPods Shunned in Favour of Mobile Phones with Music Players

Next generation iPods are set to lose out to mobile phones incorporating digital music players, reveals a study from Entertainment Media Research, in association with law firm Olswang. The findings strongly suggest that the mobile industry is winning the battle for affections in the strategic contest for command of the developing integrated phone market.

The 2006 Digital Music Survey, currently in its third year, is an independent survey of 3,000 UK consumers. It reveals that music lovers are 2:1 in favour of a mobile handset incorporating an iPod/MP3 player over a music player with mobile phone; 46% and 21% respectively. The preference amongst teenagers is even stronger, with 52% preferring an integrated mobile phone.

Interestingly, even amongst current iPod owners there is a surprisingly strong preference towards the concept of mobile handsets incorporating music players rather than vice versa, with 40% selecting a mobile compared to just 27% choosing an iPod.

Is the Mobile Downloading market growing?

With the concept of integrated mobile phones proving so popular the results further reveal growth in the mobile downloading market. Half of all respondents who expressed an interest in downloading to mobiles a year ago are now doing so; 11% currently purchase and download to a mobile, which represents 52% of those who stated a potential interest 12 months ago.

However, despite the industry's very significant investment in raising consumer awareness, early interest in the mobile downloading market has started to stall. The proportion of people who claim to be interested in this activity has only risen from 21% to 25% over the last 12 months and currently just 4% of music consumers consider themselves very likely to start mobile downloading in the future.

The results highlight that the mobile industry has done a good job educating early adopters on the downloading process but the second wave of consumers is just not keen on downloading music; 44% claim not to be interested and 36% prefer to download music using their home computer.

Mobile industry needs to maximise downloading opportunities

According to the survey, the mobile industry needs to do more to convince consumers, even savvy Internet downloaders, of the benefits of mobile downloading to stimulate interest and, ultimately, demand.

So far the failure of the mobile industry to create a mass market is down to a perception that consumers find mobile downloading an unattractive option. On the appeal of using a mobile to buy a song just heard on the radio the survey found:

• Very appealing 11%
• Appealing 25%
• Unappealing 31%
• Very unappealing 32%

Indeed, consumers appear far more attracted to the idea of purchasing downloads through a radio. The concept of a "Buy Now" function on a radio appealed to 19% of music consumers surveyed compared to only 11% who found mobile downloading very appealing.

Even though the popularity of mobile downloading has stalled, the survey discovered there are still opportunities as consumers are keen on purchasing music downloads, just not from their network operator. The typical behavioural response of only three out of 10 mobile downloaders on hearing a song they wanted to buy and download to their mobile, is to purchase it immediately from their network operator.

Commenting upon the research findings Russell Hart, Chief Executive of Entertainment Media Research, says, "The consumer preference for a mobile phone that incorporates a music player rather than a mobile-enabled iPod/MP3 player gives the hand-set manufacturers a powerful early advantage in the forthcoming titanic battle for control of the integrated mobile and music player market."

He adds, "Although the mobile downloading market is still very young it appears to be in danger of stalling having failed so far to generate mass appeal."

John Enser, partner and head of music at Olswang, says, "The mobile industry, with support from the music industry, must look for more ways to excite the public about accessing music wirelessly. The concept of an integrated mobile handset is proving popular but people still want to acquire their music on physical discs or by fixed line downloads. While early adopters are exploring these gadgets, the industry needs to create new ways to drag the mass market away from downloading on their home computers and burning CDs, to ensure they are reaching and influencing the second wave of consumers in this young market."

You can download the full report (106 pages, pdf format) from http://www.entertainmentmediaresearch.com/digitalmusicsurvey_2006.pdf"

Posted to the site on 5th September 2006