Click here to close now.

Welcome!

Wireless Authors: Pat Romanski, Liz McMillan, Elizabeth White, Carmen Gonzalez, Tim Hinds

Related Topics: Wireless

Wireless: Article

Ringback Tones

Revenue at our doorstep

The search for "the next ringtones" has another contender, and this time everything seems to add up.

Question: Name a service that launched with only a handful of compatible handsets, provided AM-radio sound quality, was barely marketed, but still managed to become a multibillion-dollar industry in three years.

The answer: ringtones. In 2000, few people knew that phones were capable of more than just R2-D2 beeps, let alone sounds capable of creating a multibillion-dollar industry. But two years later, the UK ringtone market was already driving $71 million in revenue, according to the Mobile Data Association. Today, the worldwide ringtone market is worth more than $2.5 billion, according to an April 2004 Yankee Group study.

That success begs a question: Are ringtones as good as it gets?

What's a Ringback Tone?
Ringback tones replace the standard ringing sound heard when a call is connected and you're waiting for the other person to answer. Rings are replaced with content such as music, jokes, or funny quips that entertain waiting callers. One way to understand ringback tones is that, like ringtones, they replace a run-of-the-mill sound with something fun and creative. Ringback tones are selected and controlled by the person being called.

A common trait is that ringtones and ringback tones both represent ways for service providers to tap new revenue streams. With ringback tones, service providers can leverage the things that helped make ringtones a hit, such as the ability to personalize and liven up something otherwise mundane. However, ringback tones provide a new twist: they allow users to express themselves to the people who matter most - the people who are calling. From an operations perspective, carriers can utilize many of the same ringtone management tools and content relationships. The difference is that ringback tones offer a much more lucrative business model.

Why Ringback Tones?
Why do ringback tones have a brighter future than ringtones? One reason is that they work with any phone, old or new, wired or wireless, because the service resides on the network rather than on the phone. By comparison, only wireless subscribers can use ringtones, and even they're limited by factors such as the phone's audio quality and memory - assuming that their phone can handle ringtones at all. Everyone who calls a ringback tone subscriber will be exposed to this service, unlike the case with ringtones, which are heard only by the called party.

A key upshot is that a ringback tone service can immediately tap a service provider's entire customer base. It's conceivable that a customer could also have multiple ringback tones, such as one for their home number, one for their wireless phone, and one for their office number, regardless of whether those services are delivered by disparate networks.

A ringback tone service has the potential to generate more revenue per subscriber than a ringtone service. One reason is that with ringtones, revenue is earned only when a user makes the effort to download one. Aside from a handful of demographics, such as teens, few users tend to change their ringtones on a regular basis. Carriers are lacking the tools to encourage customers to consume additional content.

This is not the case with ringback tones, which empower carriers to be much more proactive in motivating customers to consume more content. Ringback tones are controlled and managed from the network, not from the user's device. The intelligence and control provided by the network creates a richer service that allows for unique content to be directed to individuals and groups, made specific for time of day, or customized for unique events. The ability to influence and motivate the purchase of content moves the carrier from back-seat passenger status to a driver of new revenue-generating services.

A network-based system with personalized Web pages enables easy customization and maintenance of multiple ringback tones. Unique content can be provisioned for specific people - such as classical music for dad or disco for mom. Time of day or one-time events, such as birthdays, can also be provisioned, or a mix of content can be assigned randomly. Intuitive Web portals encourage users to sample and then provision multiple selections of content. Downloadable clients such as BREW or J2ME, or IVR systems, provide other ways for users to adjust the ringback tones that they've selected for their family and friends without the need to go back to their Web provisioning page.

Users can also avoid "slamdowns," where first-time callers hang up because they're surprised to hear something other than a ring. For example, they can record a brief voice message before the music or other content starts, such as: "This is Sam. Hold on while I answer the phone." This feature has a side benefit - callers immediately know that they've reached the right person, something that a standard ring doesn't provide.

From a pricing perspective, ringback tones provide users with a better value proposition than a one-time download of a ringtone or MP3 file:

  • Flexibility: Customers have the right to use the content multiple times at their discretion. For example, they can specify for whom, when, and how often the content will be used. The carrier is the secure middleman ensuring that the content owners are duly compensated.
  • Service: The network provides a simple and highly customized service for every call made to your number. The carrier provides a continuous service by matching each caller to the correct content and then playing the unique content for each call, versus the generic ring from the network switch.
  • Storage: The carrier holds and maintains each customer's collection of ringback tones, so all customers receive their own space on the network for content storage. This is for all of their ringback tones, not just those that are active.
  • No limitations: Unlike ringtones, ringback tones aren't limited by users' devices. Ringback tones reside on the network, so they'll work with any wired or wireless phone. As a result, users know that all of their callers can enjoy the service. Ringback tones are not a niche play.
These benefits highlight another reason why ringback tones differ from ringtones. Users are buying more than content: they're buying a customized service and storage. However, users may not immediately recognize these benefits. That's why a carrier's marketing messages must educate the end user so it's impossible to miss the bang-for-the-buck benefits of ringback tones.

Creating Bundled Offerings
One obvious benefit of self-provisioning is that giving users multiple ways to tailor the service improves the chances they'll use it regularly, which, in turn, drives more revenue. Less obvious is the fact that self-provisioning tightens the relationship between carrier and customer. By driving traffic to, say, a carrier-owned portal, there's a better chance that users will be exposed to additional services that they otherwise would have missed if marketed through traditional channels, such as billing inserts.

For example, while provisioning ringback tones, subscribers may be enticed to select a themed bundle that includes a movie theme song as the ringback tone, a sound bite from the film as a dedication, and a character's voice for a fun voicemail greeting. Wireless carriers may also include wallpaper and ringtones in their bundles. By providing a one-stop shop with a compelling value proposition, carriers can defend the ringtone revenue stream from online competitors that completely bypass them by delivering content directly to users' handsets.

Deploying Ringback Tones
Many carriers view ringback tones as a must-have from a competitive standpoint. For example, once one carrier launched the service in a Pacific Rim country, others quickly followed, largely because calls met with a standard ring now seemed ho-hum to users. In Israel, when anyone calls an Orange customer they can be entertained with Funtone, a ringback tone service provided by Comverse and offered under Orange's Funtone name. This service offers a personalized greeting and custom content from a wide variety of recording artists, from Avril Lavigne to Dido to local Israeli music. In Europe, at least one global carrier subsidiary has launched a ringback tone service. These are just the first seeds and by the end of 2004 there will be many more live services launched across Europe and the U.S.

Yet enterprises may prove to be the sleeper segment. According to Uri Admon, who is responsible for product marketing for Orange Israel: "We are very pleased with the take-up of Funtone. We've had so much interest from corporate customers, who see the value of the service for their business, that we plan to offer a version of Funtone specifically for them." Companies can use ringback tones to influence the mood and perceptions of incoming callers, or they can create customized ringback tones for specific customers. Companies can also create outdial ringback tones that play a corporate theme song, music for a new product launch, or other company-specific content whenever an employee dials out from a wired or wireless company phone.

What's more, carriers with older switches or multivendor networks aren't locked out of this market.

The first step in deploying a ringback tone service is to tweak the switch to allow for the interruption of the call flow so that instead of playing a generic ring, it connects to the ringback tone system. Intelligent network switches can be easily reconfigured to have the calling party receive the customized ringback tone. Here the advantage falls to the wireline carriers who long ago invested in upgrading their networks in order to supply a slew of smart or intelligent services (e.g., 800 number services).

Intelligent switches are not as prevalent for wireless carriers, who can choose to implement either a service node or a switch-based solution. Service nodes route the entire call through the ringback tone platform, but this circuitous path requires additional ports and trunks for each call, which can be an inefficient use of network resources. A few switches can mitigate the incremental costs if they have the ability to release the call from the ringback tone platform once the call has been completed. This is known as release link trunking.

A switch-based solution requires potentially expensive software upgrades to the switch. This solution is identical to the change a carrier would make in an intelligent network switch. However, a software change to a switch requires this capability to be added to the software release cycle of each switch vendor and then scheduled into the release verification testing in the network.

Getting Started
Once the initial investment is made, carriers and their partners have the ability to add features and services whenever they want, without requiring additional changes to the switch. A basic offering can first be deployed to build usage. Next, carriers can add additional personalization and customization features that help drive content consumption and use.

The success of ringtones and fun voicemail greetings has created an ecosystem of content suppliers that can be leveraged by ringback tone services. Unlike in the early days of ringtones, the content management tools have evolved to support revenue reporting, to import content from multiple sources, and to quickly generate the multiple file formats required for each user interface (Web sampling, IVR, handset clients). Carriers can now easily aggregate content from unique promotional events, local flavor, or new or existing relationships with the music industry. A few music providers estimate that almost one-third of their revenues in the near future will come from ringback tones and true tunes, actual music clips for ringtones. Content owners and creators are eager for carriers to nurture these fruitful distribution avenues, especially a carrier-controlled service that helps ensure that their revenue stream does not get circumvented.

Last Word
Ringback tones have the potential to be a much greater revenue generator than ringtones because it's a service for the entire customer base that offers carriers more control and features to drive content consumption. Like ringtones, ringback tones highlight the revenue opportunities created by taking something that was once one-dimensional - the plain old telephone ring - and making it a dynamic and personalized part of the communication process.

More Stories By Steven Borne

Steven Borne is product marketing director for Converse, Inc., a solutions provider to wire-line and wireless carriers worldwide. His responsibilities include defining the strategic
marketing activities and overall product launch of Comverse's branded Instant Messaging offering in the North and Latin American markets.

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


@ThingsExpo Stories
From telemedicine to smart cars, digital homes and industrial monitoring, the explosive growth of IoT has created exciting new business opportunities for real time calls and messaging. In his session at @ThingsExpo, Ivelin Ivanov, CEO and Co-Founder of Telestax, shared some of the new revenue sources that IoT created for Restcomm – the open source telephony platform from Telestax. Ivelin Ivanov is a technology entrepreneur who founded Mobicents, an Open Source VoIP Platform, to help create, deploy, and manage applications integrating voice, video and data. He is the co-founder of TeleStax, a...
The Internet of Things (IoT) promises to evolve the way the world does business; however, understanding how to apply it to your company can be a mystery. Most people struggle with understanding the potential business uses or tend to get caught up in the technology, resulting in solutions that fail to meet even minimum business goals. In his session at @ThingsExpo, Jesse Shiah, CEO / President / Co-Founder of AgilePoint Inc., showed what is needed to leverage the IoT to transform your business. He discussed opportunities and challenges ahead for the IoT from a market and technical point of vie...
Sensor-enabled things are becoming more commonplace, precursors to a larger and more complex framework that most consider the ultimate promise of the IoT: things connecting, interacting, sharing, storing, and over time perhaps learning and predicting based on habits, behaviors, location, preferences, purchases and more. In his session at @ThingsExpo, Tom Wesselman, Director of Communications Ecosystem Architecture at Plantronics, will examine the still nascent IoT as it is coalescing, including what it is today, what it might ultimately be, the role of wearable tech, and technology gaps stil...
DevOps tends to focus on the relationship between Dev and Ops, putting an emphasis on the ops and application infrastructure. But that’s changing with microservices architectures. In her session at DevOps Summit, Lori MacVittie, Evangelist for F5 Networks, will focus on how microservices are changing the underlying architectures needed to scale, secure and deliver applications based on highly distributed (micro) services and why that means an expansion into “the network” for DevOps.
Grow your business with enterprise wearable apps using SAP Platforms and Google Glass. SAP and Google just launched the SAP and Google Glass Challenge, an opportunity for you to innovate and develop the best Enterprise Wearable App using SAP Platforms and Google Glass and gain valuable market exposure. In his session at @ThingsExpo, Brian McPhail, Senior Director of Business Development, ISVs & Digital Commerce at SAP, outlined the timeline of the SAP Google Glass Challenge and the opportunity for developers, start-ups, and companies of all sizes to engage with SAP today.
The 3rd International @ThingsExpo, co-located with the 16th International Cloud Expo – to be held June 9-11, 2015, at the Javits Center in New York City, NY – is now accepting Hackathon proposals. Hackathon sponsorship benefits include general brand exposure and increasing engagement with the developer ecosystem. At Cloud Expo 2014 Silicon Valley, IBM held the Bluemix Developer Playground on November 5 and ElasticBox held the DevOps Hackathon on November 6. Both events took place on the expo floor. The Bluemix Developer Playground, for developers of all levels, highlighted the ease of use of...
We’re no longer looking to the future for the IoT wave. It’s no longer a distant dream but a reality that has arrived. It’s now time to make sure the industry is in alignment to meet the IoT growing pains – cooperate and collaborate as well as innovate. In his session at @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, will examine the key ingredients to IoT success and identify solutions to challenges the industry is facing. The deep industry expertise behind this presentation will provide attendees with a leading edge view of rapidly emerging IoT oppor...
For years, we’ve relied too heavily on individual network functions or simplistic cloud controllers. However, they are no longer enough for today’s modern cloud data center. Businesses need a comprehensive platform architecture in order to deliver a complete networking suite for IoT environment based on OpenStack. In his session at @ThingsExpo, Dhiraj Sehgal from PLUMgrid will discuss what a holistic networking solution should really entail, and how to build a complete platform that is scalable, secure, agile and automated.
SYS-CON Events announced today that Gridstore™, the leader in hyper-converged infrastructure purpose-built to optimize Microsoft workloads, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Gridstore™ is the leader in hyper-converged infrastructure purpose-built for Microsoft workloads and designed to accelerate applications in virtualized environments. Gridstore’s hyper-converged infrastructure is the industry’s first all flash version of HyperConverged Appliances that include both compute and storag...
The industrial software market has treated data with the mentality of “collect everything now, worry about how to use it later.” We now find ourselves buried in data, with the pervasive connectivity of the (Industrial) Internet of Things only piling on more numbers. There’s too much data and not enough information. In his session at @ThingsExpo, Bob Gates, Global Marketing Director, GE’s Intelligent Platforms business, to discuss how realizing the power of IoT, software developers are now focused on understanding how industrial data can create intelligence for industrial operations. Imagine ...
Hadoop as a Service (as offered by handful of niche vendors now) is a cloud computing solution that makes medium and large-scale data processing accessible, easy, fast and inexpensive. In his session at Big Data Expo, Kumar Ramamurthy, Vice President and Chief Technologist, EIM & Big Data, at Virtusa, will discuss how this is achieved by eliminating the operational challenges of running Hadoop, so one can focus on business growth. The fragmented Hadoop distribution world and various PaaS solutions that provide a Hadoop flavor either make choices for customers very flexible in the name of opti...
In the consumer IoT, everything is new, and the IT world of bits and bytes holds sway. But industrial and commercial realms encompass operational technology (OT) that has been around for 25 or 50 years. This grittier, pre-IP, more hands-on world has much to gain from Industrial IoT (IIoT) applications and principles. But adding sensors and wireless connectivity won’t work in environments that demand unwavering reliability and performance. In his session at @ThingsExpo, Ron Sege, CEO of Echelon, will discuss how as enterprise IT embraces other IoT-related technology trends, enterprises with i...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo in Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The Internet of Things (IoT) is the most profound change in personal an...
Cultural, regulatory, environmental, political and economic (CREPE) conditions over the past decade are creating cross-industry solution spaces that require processes and technologies from both the Internet of Things (IoT), and Data Management and Analytics (DMA). These solution spaces are evolving into Sensor Analytics Ecosystems (SAE) that represent significant new opportunities for organizations of all types. Public Utilities throughout the world, providing electricity, natural gas and water, are pursuing SmartGrid initiatives that represent one of the more mature examples of SAE. We have s...
All major researchers estimate there will be tens of billions devices - computers, smartphones, tablets, and sensors - connected to the Internet by 2020. This number will continue to grow at a rapid pace for the next several decades. With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo, June 9-11, 2015, at the Javits Center in New York City. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrategies, will examine why IT must finally fulfill its role in support of its SBUs or face a new round of...
Wearable devices have come of age. The primary applications of wearables so far have been "the Quantified Self" or the tracking of one's fitness and health status. We propose the evolution of wearables into social and emotional communication devices. Our BE(tm) sensor uses light to visualize the skin conductance response. Our sensors are very inexpensive and can be massively distributed to audiences or groups of any size, in order to gauge reactions to performances, video, or any kind of presentation. In her session at @ThingsExpo, Jocelyn Scheirer, CEO & Founder of Bionolux, will discuss ho...
The true value of the Internet of Things (IoT) lies not just in the data, but through the services that protect the data, perform the analysis and present findings in a usable way. With many IoT elements rooted in traditional IT components, Big Data and IoT isn’t just a play for enterprise. In fact, the IoT presents SMBs with the prospect of launching entirely new activities and exploring innovative areas. CompTIA research identifies several areas where IoT is expected to have the greatest impact.
Can call centers hang up the phones for good? Intuitive Solutions did. WebRTC enabled this contact center provider to eliminate antiquated telephony and desktop phone infrastructure with a pure web-based solution, allowing them to expand beyond brick-and-mortar confines to a home-based agent model. It also ensured scalability and better service for customers, including MUY! Companies, one of the country's largest franchise restaurant companies with 232 Pizza Hut locations. This is one example of WebRTC adoption today, but the potential is limitless when powered by IoT.
One of the biggest challenges when developing connected devices is identifying user value and delivering it through successful user experiences. In his session at Internet of @ThingsExpo, Mike Kuniavsky, Principal Scientist, Innovation Services at PARC, described an IoT-specific approach to user experience design that combines approaches from interaction design, industrial design and service design to create experiences that go beyond simple connected gadgets to create lasting, multi-device experiences grounded in people's real needs and desires.