Nokia has bowed out of the ringtone market following poor sales from its Club Nokia website. Its exit should also smooth relationships with mobile network operators which think that their hardware providers should not try to sell content to their customers..
The global ringtone market is worth between $1.5bn and $3.5bn a year, but Nokia never made much of an impression on the market. It says it was never after market share, and merely regarded the site as a way of showcasing the capabilities of its hardware. It said: "The intention was to be a market maker to show Nokia owners what they could get for their new colour and java phones."
However, the operators did see it as a potential competitor, and its decision to withdraw from the market will go down well with Vodafone, T-Mobile et al. The decision to back out of the ringtone market is the latest sign that Nokia is willing to work more co-operatively with the operators.
Nokia is still the biggest mobile phone maker by far, but it is recovering from a series of missteps. It misjudged customers' appetite for mobile photography, and produced a range of handsets with significant gaps in terms of mid-range camera phones, but also lacking in clamshell style handsets.
Gartner analyst Ben Wood told the FT that the balance of power is shifting very much in favour of the operators, and that Nokia's decision to scale back on Club Nokia is another indication of that trend.
Meanwhile, as Nokia bows out, Sony Ericsson makes its entrance in partnership with the Financial Times. The companies announced a €5 or $5 per month news delivery service for users of Sony Ericsson handsets. ®