Ringback Tones Whitepaper Aug07

Ringback Tone Solution & Service

1 RealNetworks 2007

Ringback Tones Fully Personalized Ringback Tone Services

Whitepaper August 2007


2 RealNetworks 2007

Table of Contents Ringback Tone Services............................................... 3

Innovation ...................................................... 3 Growth Opportunity .......................................... 3

Ringback Tone Market Adoption .................................... 4

Service Success Factors ...................................... 5 Personalization and Control Features...................... 6

Solution and Service Overview...................................... 7

RBT System Overview......................................... 7 Ringback Tone Service Features ............................ 9 Deployment Options ......................................... 11 Technical Benefits............................................ 13

An Optimized Solution: ASP Model ................................ 14 About RealNetworks ................................................. 15


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Innovation WiderThan, a leading South Korean wireless services provider, invented ringback tones to exploit and extend the enormous success of ringtones. The developers were inspired to reverse the basic idea of the ringtone—why should callers listen to the traditional “ring-ring” sound while waiting for a call to be answered, when subscribers can personalize that sound with music, voice, or sound clips instead? The new service, called COLORing® was premiered by SK Telecom in April 2002 and took off like a shot — gaining a 30% adoption rate within the first year of launching the service. A number of Asian communications service providers deployed the WiderThan service over the following years and the Asian market boasts the world’s highest levels of Ringback Tone service adoption. Ringback tones were launched in Europe and North America in 2003 and 2004 respectively where they were offered as a new, yet proven approach to retaining subscribers while attracting new users of mobile value-added services. Ringback tone services have gained acceptance more slowly in the West than in Asia, but forecasts of growth and adoption are optimistic and the opportunity is large.

Growth Opportunity Ringback tone services have been validated by millions of subscribers around the world and recent growth has been healthy. M:Metrics reported 8.4 million ringback tone subscribers in the U.S. at the end of March 2007, up from 2.3 million at the end of December 2005.1 For communications service providers in Europe and North America, ringback tones are an unexploited opportunity to enhance their service offerings and earn additional revenues. The Ringback Tone Service from RealNetworks provides a complete end-to-end solution ready for deployment in an operator’s service network and supported by ongoing service operations and consultation. Designed to deliver a superior customer experience, our Ringback Tone Service offers an easy interface for discovery and download of a diverse range of true tone music, sound effects, and voice clips that will satisfy many different tastes. This document aims to describe the general service concept and provide information concerning the RealNetworks Ringback Tone Service. For mobile communications service providers and content providers who are seeking new opportunities to build mobile data service revenues, our Ringback Tone Service offers you and your subscribers an exciting new personalized service option.

1 Sue Marek, “Editor’s Corner”, Fierce MobileContent, July 10, 2007, www.fiercemobilecontent.com

©2006 Jupiter Research

Ringback Tone Revenue ForecastWestern Europe

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Ringback Tone Market Adoption As mobile data applications have become a focus for growth, communications service providers are seeking solutions that will increase the profitability of their business while providing personalized entertainment options for subscribers. In a recent report, Gartner predicts that global consumer spending on mobile music will surpass US$32 billion by 2010.2 And IDC concluded that “Ringback tones are emerging as an important element of the broader wireless music marketplace.” The broad popularity of ringback tone services in Asia drew the attention of savvy mobile communications service providers worldwide who were hoping to replicate that success. Ringback tones were introduced in Europe in 2003 and the U.S. in 2004. Today, RealNetworks Ringback Tone Services are available to more than 220 million mobile subscribers. Our Ringback Tone Service was designed to encourage subscriber adoption and use with an easy interface and compelling, up-to-date content. Based on a foundation of expertise working closely with mobile communications service providers, our services help increase revenue in a number of ways:

• Adding a profitable service with proven market acceptance for subscription fees

• Encouraging phone use and voice revenues by enhancing the phone call experience

• Expanding the communication services provider’s overall mobile entertainment portfolio

Given that personalized ringback tones have been validated with proven revenue generation capabilities and millions of subscribers enjoying the service — they are a good option for communication services providers seeking to expand service portfolios. However, to bring ringback tone services to market quickly and effectively, those communication services providers need access to a proven application running on stable infrastructure and an experienced service operations team to manage the solution. As illustrated in the chart at right, our Ringback Tone Service is a global leader in revenue generation with higher adoption rates than the respective regional averages and much higher than the rates experienced by our competitors.3 Our higher rates are a credit to the core consumer benefits of our service, such as reliable services, ease of use and enhanced features.

2 Gartner, “The Outlook for the Global Mobile Music Market 2005-2010” © 2007 3 The global adoption rates for the regional averages have removed three statistically significant markets to give a better average: Korea- SK Telecom RBT adoption rate is 40%, China- Overall country adoption rate is 20.8%, Spain- Movistar RBT adoption rate is 10%.

1.3%2.3%

3.7%

6.7%

9.9%

14.5%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Europ e US APAC

Global Ringback Tone Adopt ion Rat es, YE2006

Coun t ry AverageRealNet w orks/Wid erThan


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The chart also illustrates the discrepancy in adoption rates between global regions. With our unmatched experience enabling RBT services around the world, Real Networks has learned that the variations in service adoption are mainly due to influences such as market characteristics, pricing models, and the level of marketing promotion. In this light, we believe that our ongoing service operations and consulting expertise have proven to be a significant factor in higher subscriber adoption rates. RealNetworks supports the operator in delivering the best service possible by providing experienced service and marketing consultation.

Service Success Factors There are several factors that come into play for delivery of a successful ringback tone service, the key factors being Content Management, Promotion Effectiveness, and Personalization.

Content Management With our experience in personalizing the mobile experience, we understand the importance of content to the success of a service. Our content management system includes frequent updates so the mobile communications service providers can offer a compelling catalog of current and diverse tones. Our services also support the popular use of sound effects and voice tones such as jokes or movie lines. Our ringback tone catalogs average over 35,000 items in a variety of genres (see table) produced by 24 content providers. This allows the operator to target and appeal to more consumer segments. Content is kept fresh with twice-daily updates and rapid delivery of new titles. Through our cost-effective ASP model, RealNetworks provides services for content sourcing, optimization, screening and ingestion, programming, as well as license fee settlement and reporting.

Promotion Effectiveness RealNetworks has unmatched experience launching RBT services around the world. In our experience, we have seen the evidence that effective promotional programs are essential to encouraging adoption of ringback Tones. Due to the importance of this service element, RealNetworks provides marketing consultation as part of our service operations. Successful campaigns to market ringback tone services have included free trials, artist or event promotions, bundled promotions, enterprise campaigns, and discounts. Some communications service providers take advantage of existing customer communications via bill inserts or SMS campaigns—and these efforts consistently raise usage of the service and prove their effectiveness. The most impressive results have come from TV advertising to a targeted mass market which raises the knowledge and perception of Ringback Tones as a method of personalizing one’s phone.

EVENT

MOVIE LINES

PROMOTIONAL MESSAGES

MUSICAL/ANIMATION

JAZZ/ROCK/COUNTRY

ALTERNATIVE

RELIGION/SOUNDTRACKS

POP/BALLAD/BLUES/METAL

DANCE/HIPHOP/R&B/RAP

HUMOR/HORROR COMMENTARY

CLASSIC

VOICE & SOUND EFFECT

MUSIC

EVENT

MOVIE LINES

PROMOTIONAL MESSAGES

MUSICAL/ANIMATION

JAZZ/ROCK/COUNTRY

ALTERNATIVE

RELIGION/SOUNDTRACKS

POP/BALLAD/BLUES/METAL

DANCE/HIPHOP/R&B/RAP

HUMOR/HORROR COMMENTARY

CLASSIC

VOICE & SOUND EFFECT

MUSIC


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Personalization According to Gartner, two distinct factors are driving the use of mobile music: personalization and entertainment. The use of ringtones and ringback tones is part of the trend to personalize mobile phones as a form of self-expression.4 Above all, the desire for distinctive personalization has been the key driver in the popularity of ringback tone services. With this in mind, our Ringback Tone service has been developed to provide subscribers with an easy, familiar method of discovering and downloading ringback tones that will express their personality. Our Ringback Tone service also allows the subscriber to control the delivery of their ringback tones by caller, time of day, or event through an easy interface—making the service truly personal and customized. Fig. 1. RBT Summary Screen

Personalization and Control Features The RealNetworks application for Ringback Tones is highly flexible, allowing easy customized integration to support the communication services provider’s requirements. We enable a number of innovative features designed to increase the level of personalization and control that your subscribers enjoy. A few of the most popular features include:

Caller/Group-based – different music clips can be assigned to groups categorized by the subscriber such as family, friends, or business associates

Time-based – different ringback tones can be played depending on the time of day or day of the week

Event-based – special occasion music can be played on specific days such as Christmas, wedding anniversary, or birthdays

4 © 2007, “The Outlook for the Global Mobile Music Market 2005-2010” Gartner Dataquest


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Fig. 2. Assign ringback tone to caller

In addition, our Ringback Tone service offers optional features which can be supported and customized according to mobile communication services provider’s requirements, such as:

Copy & Buy – Caller can copy an RBT clip while simultaneously listening to it Juke Box & Music Box – Randomly plays RBT clips from Juke Box that stores clips,

or pre-selected Music Box

Solution and Services Overview In order to replace the conventional “ring-ring” call connection tone that is sent to the calling party’s phone, the MSC (Mobile Switching Center) must be connected to the RealNetworks Ringback Tone system. The system provides the infrastructure for both the service management operation and the network elements necessary to play the Ringback Tone sound clips when the call is connected, so that the caller can hear the specific sound file that the subscriber has set up.

RBT System Overview Our RBT platform is largely divided into network and service platforms to allow for optimized service function and performance, as well as enhanced service reliability and flexibility. The primary role of the Network Platform is to playback the RBT sound while the Service Platform takes care of service registration, feature settings by subscribers, and management of the RBT service.


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Network Platform The Network Platform is comprised of two subsystems: RBT Player (RP) and RBT Profile Server (RPS). RBT sound files are stored in the RP and service feature information controlled by subscribers is stored in the RPS, so the system can pick out the exact sound based on service features and deliver it without any delay via the communication service provider’s voice network. The RP in the network platform has a very flexible structure that can support various network interface requirements depending on the operator’s existing network infrastructure. The service logic for the initiation of the Ringback Tone service can be implemented with either a switch modification, a service node, or preferably, via an Intelligent Networking (IN) approach. Service Platform The Service Platform is comprised of hardware and software that provide RBT service environments for subscribers, content providers and administrators. Subscribers can select and set their desired RBT feature via the User Interface while the content provider can upload/manage RBT sound files, and the administrator can manage the RBT service via the Service Platform. Fig. 3. Ringback Tone System Architecture

RP RBT PlayerRPS RBT Profile ServerRCD RBT Content DistributorRGW RBT GatewayCPS Content Provision ServerRSS RBT Storefront ServerRAS RBT Application ServerRDS RBT DB Server

RAS

RCD

T_MSCCalled party

Calling party

HLR

(G)MSC

SCP

RDS

RSS (web,wap)

CPS

Ringback Tone users & CPs

RGW

RP

RPS

Network Platform Service Platform

BillingSystem

ProvisioningSystem

Legacy Systems

CustomerCareSMSC NMS

RP RBT PlayerRPS RBT Profile ServerRCD RBT Content DistributorRGW RBT GatewayCPS Content Provision ServerRSS RBT Storefront ServerRAS RBT Application ServerRDS RBT DB Server

RAS

RCD

T_MSCCalled party

Calling party

HLR

(G)MSC

SCP

RDS

RSS (web,wap)

CPS

Ringback Tone users & CPs

RGW

RP

RPS

Network Platform Service Platform

BillingSystem

ProvisioningSystem

Legacy Systems

CustomerCareSMSC NMS

The components of each platform are further described in the table below:

Platform Subsystem Description RP RBT Player, when connected to the MSC, checks the pre-configured RBT clip

information from RPS and plays RBT clip from its storage through the operator’s voice network.

Network Platform

RPS RBT Profile Server is a database server which stores subscriber information and service feature settings.


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Platform Subsystem Description RCD RBT Content Distributor distributes RBT clips uploaded from the CPS to the RPs,

and functions as a backup storage for RBT clips

RGW RBT Gateway is the centralized manager for the RPS. It distributes subscriber’s profile and settings to the RPS. It also provides the interfaces with communication service provider’s legacy systems such as provisioning, billing and customer care.

CPS Content Provision Server provides the overall environments necessary for RBT Content Providers to register and manage the RBT content

RAS RBT Application Server manages and controls of RBT operation for all RBT subsystems.

RSS RBT Storefront Server provides Web, WAP storefront where users can subscribe, search, pre-listen, purchase and change profile and settings.

Service Platform

RDS RBT Database Server is the main database that stores service and content information

Ringback Tone Service Features

RBT Playback The innovative RBT Playback enables the configuration and setting functions for system default, user default, callers, and group-based. Subscribers can set the RBT based on events such as birthdays or anniversaries. They can also control their RBT based on time zones by hour or days of the week. Also available, and more common in markets where RBT’s are newer, are pre-announcements by operator or personal introductions to the RBT. Optional features include the Juke Box which features random play of multiple RBT clips, and the Music Box which features pre-selected Juke Box content. The Storefront Via Web, WAP and IVR, the Storefront enables user-friendly features to subscribe or unsubscribe from the service, and to change MSISDN for a new device. For shopping, subscribers can search by artist or title, browse categories, and listen to the ringback tone before they buy. Optional Storefront features include short-code subscription and multi-language support


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Fig. 4. RBT Catalog: Top 25 Downloads

Purchasing To encourage use and add a fun, interactive element to the service, subscribers have the options to buy or gift ringback tones. Premium options are also available and include short-code purchase, Copy & Buy, and vouchers for gifts or promotions. Personalization The RBT service allows the subscriber to control their service via a screen titled, “My Settings” or “My Profile” where they can select and change the settings for the service. Another screen called “My Ringback Tones” or “My Album” allows them to easily control the behavior of their service by assigning default, times, callers, etc. Overlay Overlays pre-configured RBT clip with conventional call connection tone that is made by the MSC. Or two clips can be mixed and simultaneously played by the RP. For example, music with a voice clip, or music with conventional ringing sound. Biz RBT Ringback tones can be used to extend the company brand or message to all callers. This application assigns a Business RBT clip to multiple subscribers. The Business RBT clip could be information, announcements, or advertisement of a company.



Deployment Options Solution deployment methods can be different based on RBT service scale, service reliability and operator preferences. However, in most cases, the optimal method should be selected based on the mobile operator’s current network environment. Generally, there are three different network implementation approaches to connecting the MSC to the RP: Switch Modification, Intelligent Network, and Service Node. Switch Modification Approach This approach requires modification of the call flow of the MSC to implement service control logic for replacing the normal call connection tone with the RBT clip. This places the MSC in control of (a) the connection to the RP (which plays the RBT clip), (b) the disconnection of the RP when the called party answers, and (c) the connection of the calling party when the RP is disconnected. This is essentially the same as a normal call connection tone process. Service Node Approach This approach uses the basic call routing functionality of the MSC to connect the RP. The RP then plays the RBT clip and controls both the connecting and disconnecting of the MSCs. Thus, the major call control logic for RBT service resides in the RP, which functions just like a service node in the network. While the SN approach has the advantage of easy implementation, it is not widely used as it carries the issues of service reliability and capacity restriction. By contrast, the Switch Modification and IN approaches are widely adopted for commercial services. Intelligent Network Approach The Intelligent Network deployment is highly recommended and is optimal for multi-tenant network environment. In this case, the call control logic for the RBT service is implemented inside an SCP (Service Control Point)—which is one of the IN components—so that SCP commands the MSC to connect/disconnect RP and to replace the conventional call connection tone. In this straightforward scenario, when the called party is a Ringback Tone subscriber, the call connection request is routed to an IN entity (SCP), then the SCP requests Ringback Tone Player to play the Ringback Tone.

User Interfaces and Service Scenarios The RBT User Interface was designed to provide an easy-to-use and intuitive customer interface. A user can request the RBT service through a self-service registration process available through Web, WAP, or IVR. Upon acceptance, a service provision request creates the subscriber profile and RBT library, which then enables the caller to listen to the selected ringback tone music, voice, or sound effect. (1) Web - Upon selecting the RBT service with the appropriate user ID and password, the subscriber is presented with a “hit-list” of RBT clips, a side menu of RBT genre (e.g. movie soundtrack, local pop, classical etc.), and “My Album” options. The pre-listening function enables the subscriber to listen to the selected sample before purchasing. Upon purchasing, the subscriber is given options (a) to set the RBT clip as default, (b) to program for a specific caller or group of callers, or (c) to play at certain hours or on specified dates. The subscriber then



selects the “My Ringback Tones” button to view selections and to change any RBT settings as required. Fig. 5. Assign Ringback Tones Screen for Web

(2) WAP - The functionalities of WAP are almost the same as the Web except for music pre-listening. In a WAP session, the user selects a preview, the system finishes the WAP session and immediately opens the voice channel to connect the user with the IVR. WAP service procedures are as follows: 1. User authentication 2. View Content list or Search Content 3. Select Content 4. Confirm content update (3) IVR - The functionalities of the IVR are similar to Web and WAP. IVR service procedures are described below: 1. User authentication 2. Choose genre (Category) 3. Choose RBT content 4. Pre-listening in IVR 5. Select RBT content (4) SMS - Generally, handsets have the capability to recognize specialized SMS messages containing a call-back number, which can be the IVR access channel and a WAP access page for easy access to the RBT system. Therefore, we also provide an SMS interface for subscribers to access the service via a predefined SMS number, text-message, or menu in



accordance with the communication services provider’s API/specification. The SMS feature interacts with the SMS Center to provide convenient of service accessibility for subscribers.

Technical Benefits RealNetworks provides activation services, 24/7 support, administrative training, along with integrated, end-to-end solution documentation. All of this combines to ensure a solid, stable, highly personalizable solution that minimizes the risk to service providers while maximizing revenues. End-to-End Integrated Solution

Network and service platforms that provide a complete RBT service environment from telephony and signaling interfaces to service management tools.

A broad suite of professional services, including proven network integration expertise, overall customization and system integration of the solution, and worldwide tier one & two maintenance and services support.

Flexible Price Management Our Ringback Tone service systematically allows communication services providers to design various price models for the service. Content prices are generally managed by codes and categories, so all sound clips have a price code which is managed through a service administration interface. This feature gives the provider control over their service pricing and the ability to respond quickly to the competitive environment, promotions, new content or catalog offers, and other pricing pressures or opportunities. High Quality Our Ringback Tone solution is market-driven based on successful commercial experiences. Highly optimized for efficient interactions among systems, the service guarantees reliability and convenient operation.

• Reliability – High Availability (HA) configuration failover to ensure recovery from sudden system failures.

• Performance – The RBT service integrates carrier-grade computing hardware with our service expertise and operational knowledge of service features and quality enhancement. The solution architecture is very flexible and can be deployed in a distributed or centralized fashion depending on the communications service provider’s specific requirements.

Full Support The solution is backed by a broad suite of professional services:

• proven network integration expertise

• overall customization and system integration of the solution

• worldwide first- and second-tier maintenance and support services Our Services Consulting and Integration team can design the architecture, as well as manage



and deliver the development, integration, and market trial of the entire deployment. This includes bringing together all of the hardware, software and network components.

An Optimized Solution: ASP Model The WiderThan ASP Services team at RealNetworks created the world’s first Ringback Tone service. The service was developed as an end-to-end solution with a clustered architecture to improve reliability, scalability, and performance. This approach means that instead of working with multiple suppliers for system integration, hardware, service operations, and maintenance, our customers rely on a single trusted partner for the system, service, operations, and consultation. The benefits of this streamlined solution extend to the subscriber who has a seamless experience and fewer service issues. Through our ASP model, RealNetworks provides collaborative service to our customers, not just technology. We invest in our customers’ success with well managed services that are continuously enhanced and optimized to meet the changing needs and desires of this fast-paced market. There are four key areas where RealNetworks delivers superior service to help communications service providers achieve their goals: Solution Upgrades

• Tailored feature enhancement

• User experience modification and improvement

• Promotional/seasonal feature development

Content Management

• Sourcing

• Optimization

• Screening and ingestion

• Programming

• License fee settlement and reporting

Service Management

• Feature improvement consulting

• Continuous tailored feature roadmap

• Marketing and promotion counsel

Service and Data Analysis

• Daily reports

• Monthly service analysis reports

• Special service analysis with promotions

• Ad-hoc reports for service operation strategy



About RealNetworks RealNetworks is a digital pioneer with a history of delivering exciting entertainment services to consumers—from the first introduction of sound on the Internet, to the first mainstream Internet video, to the first ringback tones. Delivered through our WiderThan ASP Services, our Ringback Tone Service is a proven, scalable solution with high adoption rates and a record of superior quality service delivery. Designed and developed to meet the needs of communications service providers and the desires of consumers, the service is easy to implement and simple for subscribers to set up and use. Our innovative Content Management system features a varied and compelling content catalog with updates twice each day to ensure delivery of the latest, most compelling content. For this comprehensive solution, RealNetworks becomes a trusted collaborator to the communications service provider with ongoing support for effective service operations and marketing consultation. Today, the service is operating with 17 communications service providers around the world with over 25 million active subscribers. Mobile service providers seeking to engage their subscribers with new services and increase revenues will find an effective partner in RealNetworks with our market-leading Ringback Tone Service. For more information, please contact [email protected].

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Ringback Tones Whitepaper Aug07