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Over half of U.S. phone users want music

November 7, 2006

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Cingular Wireless estimates that over half of U.S. cell phone users want to listen to portable digital music, as the service provider launched options aimed at courting the demand.

Cingular, owned by AT&T Inc and BellSouth Corp., is offering alternatives to portable music leader Apple Computer Inc, by supporting rival music services such as Yahoo Inc. and Napster Inc.

The No. 1 U.S. mobile service sees new music services as a way to boost revenue by winning new customers and enticing current ones to stay.

Cingular and its rivals seek to encourage users to subscribe to wireless data services such as music and video features as prices for phone calls keep falling.

Jim Ryan, Cingular’s vice president of data services said that offering more music options to its 58.7 million subscribers could provoke more of them to start listening to music on the go.

“Of the people interested in listening to music (on the go) about five percent are actually doing it,” Ryan told Reuters in an interview, citing U.S. market research statistics. He added that more than 50 percent of people with cell phones today show some level of interest in music.

Music could turn out to be big opportunity for the wireless industry. There are more than 200 million cellular customers in the United States alone.

“How soon they adopt and what they adopt, we can’t say,” the executive said, noting that some music lovers would continue to favour dedicated music devices such as Apple’s popular iPod over music-playing cell phones.

Apple, which dominates the market for portable digital music players, is widely expected to start selling a music playing cell phone in 2007.

Ryan did not say whether Cingular, which currently sells three phone models that run Apple’s iTunes music software, would sell a cell phone from Apple. The companies’ relationship would evolve, he said.

Cingular customers will be able to put music from these services onto their cellphones by transferring the songs from their computer. Next year, customers will be able to download songs wirelessly directly to their handsets.

Ryan said Cingular customers would be able to access the music options on the Nokia N75 phone and one from Samsung Electronics Co Ltd.

Customers will be able to play music from any Web service including Yahoo and Napster that uses the Microsoft Corp music copy protection software.

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