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Have ringtones jumped the shark?

BMI, one of the three major performing rights organizations in the U.S., announced today that consumers appear to have regained their senses about ringtones. The group estimated that U.S. ringtone revenue will drop to $550 million in 2007, down $50 million from 2006. "The ringtone market matured in 2006.... The novelty phase has ended," BMI new-media exec Richard Conlon said. In addition to the novelty wearing off, a growing number of phones and software programs are letting users create and load their own tones.

Happily for songwriters and music publishers (more than 300,000 of whom BMI represents), as well as record companies, the fading ringtone fad could be offset by irrational exuberance over ringback tones -- music that callers hear in lieu of a ringer when they dial your cellphone. BMI estimated that $65 million worth of ringback tones will be sold this year. But how long is that fad going to last? As BMI's Conlon suggested, the next big growth area for mobile music probably lies in streaming media.


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Times editorial writer Jon Healey pens opinion pieces about a variety of business issues, and blogs about technologies that are changing the entertainment industry's business model.

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