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Industry executives say the demographic is relatively untapped for companies that sell ringtones. And at $1.50 to $1.99 for each tune, wireless companies and record labels stand to build rapidly on a $3 billion industry.

"It's off the hook," said Frank Gonzalez, a business development executive at Miami-based Wireless Latin Entertainment. "There's an important demographic out there that is not properly represented. And while we don't have the penetration of other companies, we're carving out a piece of the market in places like Los Angeles, San Antonio, south Florida and Jersey."

Ringtones are resonating with just about every wireless company these days. Billboard magazine announced it will add a "Top 20" ringtone chart in two weeks to help quantify the mobile music market.

The United States accounts for roughly 10 percent of the $3 billion ringtone industry. Mexico and South America account for a fraction of that now, but present a potential treasure trove for ringtone retailers.

Though Verizon wouldn't disclose how much revenue it generated from ringtones in the first half of 2004, spokesman Ken Muche said the technology lends itself to "seamless billing."

Whether it's tropical, salsa, ranchero or bachata - a form of music that originated in the neighborhoods of the Dominican Republic - computer programmers are synthesizing cell phones so that consumers can talk and tango.

Known as polyphonic ringtones, the sounds that emanate from cell phones are rather primitive when compared with a conventional stereo system. But that's changing, and in several months the quality of cell- phone jingles will rival transistor radios. Verizon, Cingular (formally AT&T Wireless), Sprint and other telecommunications companies are poised to release cell phones that sing with clarity.

Record labels are particularly keen on the new technology - often referred to as true tones or sound-alikes - with a new source of revenue a sweet prospect in the days of rampant piracy.

"They are looking at this technology as a good revenue stream. But I don't think it will be the panacea for everything that's gone bad for them," said Mark Frieser, chief executive officer of Consect LLC, a New York-based company that will provide Billboard with data for the ringtone chart.

Hispanic media group Univision Movil is anticipating the trend, hoping to bring more of its artists to cell phones nationwide. "We are in the process of licensing our content to different wireless services, but for now it's mainly for polyphonic tones," said Jorge Pelayo, new-media manager at Woodland Hills-based Univision Movil, a subsidiary of Hispanic media conglomerate Univision. "But soon we will be entering agreements for true tones. We've been getting a lot of requests for groups like Jennifer Pena, Akwid and Los Tigres Del Norte."

But hipper ringtones don't always generate more revenue. After a ringtone is downloaded for $1.50 to $1.99, the revenue is shared by four different entities: the wireless operator, the label, the ringtone manufacturer and the publisher. If the latter two are fortunate, they will receive about 10 percent each.

"We don't usually work for less than 20 percent," said Gonzalez from Wireless Latin Entertainment, a ringtone manufacturer. "So we're looking to more independent groups for business."

Tapping independent talent has become more lucrative in the realm of ringtones as it keeps the behemoth labels out of the equation. Such is the case with acts such as Banda Gorda, whose music has been a big seller for Wireless Latin Entertainment.

For Verizon and Cingular, programming a phone to play an independent Latin tune versus Ricky Martin isn't important. Instead, wireless operators are counting on access to Hispanic content. A typical cell phone can now pull tunes from more than half a dozen ringtone providers. Among those is Latin Garage, a popular destination for pulsating salsa renditions. Cingular is also ramping up its Latin ringtones, adding more than 400 song titles specific to the Hispanic market in the past year.

Source: (C) 2004 Los Angeles Daily News. via ProQuest Information and Learning Company; All Rights Reserved