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* Revenue from online and downloadable mobile games will increase
more than tenfold to EUR3 billion in 2005

* Games and other mobile content and entertainment services will be boosted
by new devices with colour screens and Java capabilities

* Interoperability and standards for digital rights management will be
crucial for success


CAMBRIDGE, UK, December 5, 2002 - Downloadable games will replace ringtones as the service that drives Western Europe's growth in mobile content and entertainment service revenue over the next three years, according to a new report released this week by Analysys, the global advisers on telecoms and
new media http://www.analysys.com


The report, Mobile Content and Entertainment Services: forecasting the market for games and other wireless content, concludes that among mobile content and entertainment services, mobile games offer the greatest prospects in the short term. Analysys forecasts a more than tenfold increase in mobile service revenue from games, from EUR255 million in 2002 to over EUR3 billion in 2005. (Chart available to journalists on request.)


"Ringtones, logos and other personalisation services have formed the backbone of mobile content and entertainment services to date, with an estimated market value of EUR1.2 billion across Western Europe in 2002," notes principal analyst Katrina Bond, author of the report. "But growth in the personalisation market is slowing rapidly, while downloadable games, a logical extension of personalisation services, are just taking off."

Most mobile games today are either embedded in the handset, like the 'Snake' game on Nokia handsets, or are simple text-based games, such as quizzes like Who Wants to be a Millionaire?. Operators across Western Europe are now introducing arcade-type games that can be downloaded to mobile handsets. O2 UK, for example, offers a range of Atari games for EUR2.50 per download,
with each game having a lifespan of one month.

The introduction of mobile handsets such as the Nokia 7650 and 7210, Samsung S100 and the Sony Ericsson T68i, which have colour screens and Java capabilities, enable graphical games and other rich content to be downloaded to phones. Such handsets have only been launched in Western Europe during the past six months, but are expected to penetrate the market quickly, with 60% of all handsets in circulation in Western Europe being Java-enabled by the end of 2005.


In Japan, NTT DoCoMo launched its Java-based games and information services in January 2001, and by the end of October 2002, 43% of its 35.2 million i-mode subscribers were also using the service.

Other services that will contribute to the growth in mobile content and entertainment services over the next few years include content messaging based on recently launched multimedia messaging services (MMS) and cross-media services such as submitting votes to TV programmes or radio
stations.


The report points out that several factors must come together to enable the
potential growth in the market for mobile content and entertainment services
- which Analysys forecasts could give rise to a market size of EUR11
billion in 2005 (from just over EUR2 billion in 2002) - to be realised.


Two of the biggest factors currently constraining growth are lack of
interoperability, and the absense of a common standard for digital rights
management (DRM). Operators have been launching MMS for picture messaging
across Western Europe over the past six months, but there is still no
guarantee that customers will be able to send messages to their friends who
use other networks. "Most MMS interoperability and interworking issues are
likely to be sorted out during the first quarter of 2003," says Bond, "but
DRM issues are going to take longer to resolve."


Contractual and technical solutions are required to ensure that downloaded
content cannot be freely distributed, otherwise intellectual property will
not be protected and operators and content owners will miss out on valuable
revenue streams. In the absense of common standards for DRM, some content
providers have taken a gamble that the benefits of viral marketing will
outweigh the lost revenue associated with having their content freely
distributed. But owners of the most valuable content brands have slowed
their entry into the mobile market, or have restricted the distribution of
their content to handsets that do not allow content to be forwarded to other
users.


The report analyses the factors that will determine the rate of growth in
the mobile content market, presenting estimates of market size for 2002 and
forecasts through to 2008. The detailed forecasts cover France, Germany,
Italy, Sweden and the UK, as well as Western Europe as a whole, and are
broken down by market segment and technology generation.


The report is available to purchase online at
http://research.analysys.com/store

Prices start from EUR1445. For more
information, telephone Analysys on +44 (0) 1223 460600 or email
research@analysys.com.


About Analysys (www.analysys.com)


Analysys, the global advisers in telecoms, IT and new media, works at the forefront of the communications revolution, delivering advice and insight to established and new entrant players. From offices in Cambridge, London, Glasgow, Madrid, Milan, Paris, San Francisco and Washington DC, Analysys staff provide strategy and systems consultancy, information services and
start-up support to the companies that are creating the networked economy. Analysys Research reports and market intelligence services provide authoritative coverage of this convergent industry, based on an unrivalled ability to fuse real-world experience, rigorous research and forward-looking
analysis.

Recent and forthcoming reports include:


* The Future for Fixed-Mobile Substitution: options for fixed and mobile operators (December 2002)

* Competition in Corporate Networking: the challenge from systems integrators and strategies for operators (December 2002)

* Business Data Services: growth opportunities and forecasts 2002-2007 (December 2002)

* Strategies for Mobile Device Evolution: meeting and creating market demand
(October 2002)

* Western European Mobile Forecasts and Analysis 2002-2007 (September 2002)

* Cable TV Market Scenarios to 2007: prospects for cable TV operators in Germany, the Netherlands and the UK (September 2002)

* IP Voice Services: the return on investment for European service providers (September 2002)

* The Future for Telecoms Incumbents: the impact of competition, regulation and customer demand
(July 2002)

* Charging and Revenue Sharing for Mobile Content and Entertainment (July 2002)

* Enabling Prepaid Mobile Content and Data Services: strategies for
operators and vendors (June 2002)

* IP Voice Services: European corporate market forecasts 2002-2007 (May 2002)

* Scenarios for the European Telecoms Market 2002-2007: forecasts and analysis (May 2002)

* Benchmarks and Key Performance Indicators: lessons from the European
telecoms market (April 2002)

* The Reality of GPRS in Europe: subscribers and revenue (April 2002)

* Western European Mobile Forecasts and Analysis 2002-2007 (March 2002)

* Session Initiation Protocol: SIP-related European revenue forecasts
2002-2007 (February 2002)

* Public Wireless LAN Access: US Market Forecasts 2002-2007 (January 2002)

* Video Streaming for Enterprises: forecast revenues for service providers
(December 2001)

* GPRS Roaming: technical options and strategic implications (December 2001)

* Storage Area Networks: New Revenues for Optical Carriers? (November 2001)

* Public Wireless LAN Access: Market Forecasts (November 2001)

* Pricing GPRS Services (October 2001)

* FRIACO: how capacity-based interconnection strengthens the Internet market
(October 2001)

* Meeting the Challenges of GPRS Billing (September 2001)

* The Bandwidth Exchange: Herald of a New Carrier Age (August 2001)

* Public Wireless LAN Access: A Threat to Mobile Operators? (August 2001)

* Controlling the 3G Value Chain (July 2001)

* Successfully Marketing Mobile Data Services to SMEs (July 2001)

* Gigabit Ethernet: the solution to the MAN bandwidth bottleneck? (July 2001)

* Market Realities of IP-VPNs (July 2001)




Media contacts (for author photography, executive summaries and interviews)

Martin Brooke

Martin Brooke Associates

Tel: +44 (0)1223 264050

Email: martin.brooke@dial.pipex.com


Natalie Dargan

Analysys Research

Tel: +44 (0)1223 460600

Email: natalie.dargan@analysys.com


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