China Mobile, the larger of the country's two cellular operators, yesterday launched a wireless music club as part of a drive to increase its presence in a lucrative emerging market.

 

The club, M.Music, offers a one-stop service to China Mobile subscribers, including copyrighted music downloads and sharing, and could help lift the struggling record industry.

 

M.Music also offers members access to the latest labels, downloads of music videos, singers' photos and ringtones as well as magazines in SMS (short messaging service) format.

 

China Mobile Vice-President Lu Xiangdong said the club's launch marked a big step for China Mobile as it seeks a greater role in the fast-growing mobile music market.

 

"Our wireless music club will soon become a new tool for record companies to release new labels," he said.

 

"We are ready to work with our partners to form a complete industry chain ranging from payment, operating platform, customer relations, marketing and promotions," Lu said.

 

Hong Kong-listed China Mobile Ltd has 269 million mobile subscribers.

 

The world's major record companies, including Universal, EMI, Warner and Sony BMG, welcomed news of the music club.

 

"Record companies are having a tough time due to piracy brought by new technologies such as the Internet," said Hung Tik, managing director of Universal Music China.

 

Hung estimated the traditional music market in the first half of this year shrank 30-40 percent in terms of revenue. The market was worth 1.65 billion yuan (US$209 million) last year, according to Beijing-based research firm Analysys International.

 

Shanghai-based iResearch estimated the mobile music market was worth 2.6 billion yuan (US$329 million) last year, compared to 1.58 billion yuan (US$200 million) in 2004.

 

And the well-established billing system for mobile phones means the mobile music market is largely free of piracy.

 

Song Ke, managing director of Taihe Rye Music Co Ltd, a domestic record firm, said wireless music publishing last year accounted for 40 percent of the company's annual revenue and the figure is expected to grow to 50 percent.

 

But record firms are not the only beneficiaries, China Mobile's increasing penetration of the mobile music market will also help boost sales of music phones for manufacturers such as Sony Ericsson, Nokia and Motorola.

 

Sony Ericsson will be the first handset maker to offer a customized mobile phone for China Mobile's wireless music club, said Gunilla Nordstrom, president of Sony Ericsson China.

 

(China Daily July 19, 2006)