Saturday, May 10, 2008

Losses widen for WMG as mobile revenues slacken !

Losses widen for WMG as mobile revenues slacken !

This is time for the boys up top to take note from the leaner and meaner digital labels.

Warner Music Group has announced revenues of $800 million for the first quarter of 2008, up 2% from Q1 2007. However, the company's losses grew to $34 million from $27 million year-on-year. Digital revenues were up by 47.6% to $155 million for the latest quarter, and are now accounting for 23.8% of WMG's total music revenues. 65% of WMG's digital sales are in the US, with 35% international. However, WMG described mobile music revenues as "soft", with ringtone sales on the slide, and full-track mobile downloads failing to make up for it.

In Q1, WMG's mobile music revenues were $46.5 million, down from the $56.4 million in Q4 last year.

To me this all means opportunity. WMG will continue to struggle until they stick to a set strategy. At the moment the top is being led by the market and scrambling to adapt, move to its demands as opposed to tapping into the rich veins of digital business that exist in the market by forming strong alliances with the Telco and mobile handset makers.

Damien Reilly

Source: Musically
Source: PaidContent
Source: MocoNews

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