Mobile phones are proving the saviour of the struggling music industry and could be the vital springboard needed to propel the business finally into digital sales, industry experts have said.

"I believe a lot of the new revenues for the music industry will definitely come through mobile phones," said Dominque Leguern, director of MIDEM, the premier trade fair for the world's music industry that closes its doors on Thursday.

With the number of cellphone users predicted to hit the three billion mark in 2007, and 90 percent of the world's population expected to have mobile access by 2010, this could prove a powerful shot in the arm for the music industry.

With CD sales falling and digital sales accounting for 11 percent of the current global market -- expected to rise to 25 percent by 2010 -- interest in what was happening in the mobile phone sector therefore ran high at this week's trade fair.

Sales of the Sony Ericsson music-enabled Walkman are soaring and topped the 60-million-mark in 2006, far outstripping the 39 million iPod players sold by Apple, according to Sony Ericsson CEO Miles Flint.

This growth sparked predictions that new music-rich cellphones could outstrip MP3 players in the United States within two years, lending fresh hopes to the record industry, which is reeling from plummeting CD sales and illegal online music file-sharing.

But while giant record labels such as EMI have been badly hurt by the purchase of music from online music stores, others in the industry are benefiting.Quick to spot the opportunities presented by cellphones, the Internet and video games, scores of small record labels this week announced a groundbreaking agreement to set up Merlin, a one-stop licensing shop to cut deals and download sites and mobile services on behalf of all the independents.

This could transform the record world's minnows into a powerful grouping.

Meanwhile this year's MIDEM mart indicated that the music industry was finally embracing the digital age.

The number of participants and companies at this year's MIDEM, at 9,452 and 4,606, respectively, were a record given the current state of the industry, Leguern emphasised at a press conference.

"Technology will fulfill all of our hopes though it might be later than we thought," Leguern said. "But it will happen."

"The cellphone and Internet worlds are already moving closer," Mobile Entertainment Forum's Patrick Parodi told AFP. And this trend will increase in the future now that advertising funding is starting to find a place in the online and music worlds, he said.

Mobile phone users too will be major contributors to the fast growing video and music social networking websites like YouTube and MySpace, said speakers at the packed MidemNet new technology conferences that prequeled MIDEM.

The coming 12 to 18 months could see do-it-yourself user-generated content on mobile phones in Europe as big as it is on the YouTubes of the Internet, panellists predicted.

But outside of Asia, where subscriptions are readily available, the current cost of dialling up music and music video content on phones is hindering take-up.

"In Hong Kong, the most popular applications are subscription-based streaming models. Mobile gives Asian kids the chance to reach outside traditional family structures and there's a huge demand for that," said Hong Kong-based David Loiterton of mobile music service provider Omnifone.

Another message at this year's MIDEM was that music for the images business is thriving across the film, television and gaming worlds.

Video games are a space for development, legendary US music figure Nile Rodgers, the onetime star who went on to produce hit albums for the likes of David Bowie before going into video games, told a MIDEM conference.

Expectations are high that as the games industry moves forward, people will be able to buy tracks online on the gaming machines, Joseph Stopps of the UK-based dance music independent label MofoHifi told AFP.

MIDEM winner of the Sony Computer Entertainment Listening Session-sponsored competition here, South Korea's Jyoon Lim, demonstrated how the music world is changing.

Lim, sound director and composer for South Korean game developer WeMade Entertainment's winning track, made it at very little cost on her own computer.

"I make spectacular tracks with big orchestrations", Lim told AFP, "but I do it all with my computer. It costs nothing like a real orchestra but sounds like big budget music!" .

Provided by AFP.