News Corp pays £100m for 'Crazy Frog' group

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Rupert Murdoch's News Corp has splashed out $188m (£100m) for a majority stake in the company behind the Crazy Frog ring-tone sensation.

The Crazy Frog character is based on an animation named The Annoying Thing, created to accompany a sound effect that tried to imitate the noise of a two-stroke moped engine.

The popularity of the ring tone spawned a worldwide hit single, a remix of "Axel F", featuring a video of the Crazy Frog riding a flying bike. It was the most commercially successful ring tone of all time and propelled sales at Jamba, the German-based company that released it, from $40m in 2003 to $500m last year.

According to industry analysts Ovum, the market for ring tones and other content for mobile phones, will be worth some £480m in the UK alone this year or over £10bn worldwide.

Mr Murdoch has invested heavily in the internet since the start of last year but the purchase of a 51 per cent stake in Jamba represents his first major move into content for mobile phones. Selling clips from TV shows, songs and other content for mobile phones is becoming a lucrative market for media companies but with the Jamba move, News Corp has become the only major media company to focus on selling content directly to consumers. Rival media businesses tend to license their content to specialist mobile operators.

John Delaney, principal analyst at Ovum, said: "The reason why ring tones, logos and other content for phones is so popular is that people tend to see the mobile phone as an extension of, and an advertisement of, their personality. This is particularly the case for adolescents and young adults. They want others to know what they like."

News Corp, which owns BSkyB and newspapers including The Sun and The Times, already sells short video clips of TV programmes including 24 to mobile users. The company said it will now create special clips and other content from The Simpsons, including wallpapers, screensavers and ring tones. It will also offer users of MySpace, the social networking website that News Corp bought last year, ring tones, graphics and animations to download for their phones.

"Wireless technology gives us an enormous opportunity to reach billions of mobile phone users with our content," said Peter Chernin, chief operating officer of News Corp.

Analysts said that while the demand for ring tones was proven, it was yet to be seen whether more sophisticated content would take off. Media companies also see mobile phone screens as a great place to put advertisements and are set to emerge as a major source of advertising revenues.