Mobile gaming is forecast to be the biggest non-SMS data service earner for UK operators in 2007.

According to market research firm GfK, the UK’s annual spend on mobile content is set to reach £1bn for the first time next year, an increase of over £100m on last year’s figure.

Not surprisingly, the lion’s share of that data revenue will come from SMS, but the gaming segment is set to be worth £83m.

Not far behind are ringtones, which the firm says will be worth £76m in 2007, while music, videos and wallpapers are trailing by some distance with £23m, £11m and £10m respectively.

Aaron Rattue, business group director at GfK said: “Mobile content has been predicted to be the next big revenue stream for the telecommunications industry for some time. Our research shows that this is set to be a reality in 2007. It’s interesting to see how mobile gaming has really caught the imagination of the UK consumer, with more spent on games than ringtones in the last year.”

The firm reports that consumers are increasingly downloading content straight to their phones, rather than from traditional internet sites. Twice as much money is spent on mobile entertainment bought via a WAP site (55 per cent) than over the internet (25 per cent).

Driving the boom in mobile content is the availability of technology. In the UK, 90 per cent of phones now have Java functionality, 45 per cent have a memory card slot and nearly half have USB compatibility. In addition, nearly 25 per cent of all phones sold in the UK were 3G, up from 15 per cent last year.

The firm estimates that the UK mobile telephony market is worth £15bn.