Consumers Very Pleased with Mobile Music and Would Accept Ads, Says MEF


More than three-fourths of US consumers
surveyed are pleased with their experience downloading and listening to
songs on their mobile phone, and almost a third are willing to accept
advertising on their mobile phones in exchange for free music
downloads, according to results of a KPMG Survey announced today by
KPMG LLP and the Mobile Entertainment Forum (MEF).

These results were among the findings of KPMG's third annual Global
Consumers and Convergence survey of more than 4,000 people in 19
countries worldwide to understand trends in the use of mobile

According to the study by the audit, tax and advisory firm, 21
percent of the U.S. respondents, and 30 percent globally, have
purchased songs at least once on their mobile phones in the past 12
months. An overwhelming majority of the US (84 percent) and global (66
percent) purchasers said they were satisfied with the downloading and
listening experience. A similar US survey conducted by MEF in 2007
found that only 26 percent were satisfied.

KPMG's study also identified a promising new finding for mobile
advertisers, where 29 percent of the mobile phone users surveyed in the
US said they were willing to see advertising in return for free songs.
And globally, 49 percent of consumers will accept ads on their mobile
phones in return for songs.

With the significant rise in mobile music customer satisfaction
rates, we may be seeing a new window of opportunity that advertisers
have been seeking for so long," said Carl Geppert, partner and U.S.
Industry Sector Leader in KPMG's Communications & Media Practice.
"We are seeing sizeable segments of the mobile marketplace that are
willing to pay to download songs or accept advertising in return for
free songs, and carriers as well as advertisers may need to examine
their business models to accommodate those new growth opportunities."

Consumers also say they are more satisfied with their experience
downloading and viewing video clips on their mobile phones. About 11
percent of the consumers canvassed said that they have watched video
clips on their mobile phone in the past year, while 38 percent of users
globally have watched video clips during the same time. In both the
U.S. and globally, more than half of those who watched mobile video
clips were pleased with the experience. In the 2007 MEF survey, only 28
percent of the US respondents said they were satisfied with the mobile
video clips service.

"The results of the survey show a rapid and rising awareness by
consumers of the types of mobile content available to them and the
different ways they can access and acquire that content. The higher
levels of consumer adoption and the greater usability of the services
on offer have directly contributed to increasing the global mobile
entertainment industry from $25 billion last year to a predicted $32
billion this year," said Jim Beddows, Chair of MEF Americas. "The MEF
Mobile Video Initiative will help the industry further capitalize on
the clear consumer willingness to engage with the services -- whether
it is paid for content or ad supported."

KPMG and the MEF also will be sharing the findings of the KPMG
survey with attendees in booth 1400Q in the M-Tertainment Pavilion at
International CTIA Wireless 2009(R), April 1 - 3 at the Las Vegas
Convention Center.

Among additional mobile music findings in KPMG's survey, the four
items most often identified as influencing the purchase of songs are,
in order of priority:

  • in the US, privacy of personal information, clear pricing information, the cost of the service and the download speed.
  • globally, clear pricing information, the cost of the service, the
    ability to save music on the mobile phone and high-quality customer

Today's announcement of the convergence and consumer survey results
is the latest in a series of collaborations between KPMG and MEF on
trends in mobile entertainment. Last month, the two organizations
announced the creation of the quarterly MEF Business Confidence Index,
the results of a survey gauging the confidence of the $32 billion
mobile entertainment industry. The first MEF BCI revealed that MEF
members predict an average increase in revenue of 27 percent in the
next year, in spite of the economic downturn.

More information on KPMG's 2008 Consumers and Convergence study will be presented during a webcast in late April.