August 13, 2008
Consumers to Spend Billions on Internet Video Services
By Eve Sullivan, TMCnet Editor
A new report says that U.S. consumers will spend more than $6 billion for Internet video services in the next five years, with direct-to-TV videos accounting for 75 percent of that revenue.
The report, “Internet Video: Direct-to-Consumer Services,” by Parks Associates, finds that greater ownership of connected game consoles, networked TVs and alternative video-on-demand set-top receivers is generating significant growth in user-paid revenues.
“Consumption of premium Internet video content to date has been low,” said Kurt Scherf, vice president and principal analyst, Parks Associates. “Services have been available only on less-than-optimal screens – PCs and portable multimedia players. But new connected products that link to premium Internet video services are emerging at a rapid pace, moving the Internet video viewing experience into the living room. This shift will help grow revenues considerably.”
According to Parks Associates, U.S. broadband households are spending about $1 billion on TV-based and non-TV Internet video this year, with that number steadily climbing in the coming years to reach about $6 billion in 2013. TV-based Internet video is expected to remain the higher percentage of Internet video revenues.
The Internet video market is maturing as portals, aggregators, broadcasters and other content creators and publishers are developing go-to-TV approaches and ad-supported premium video services, Scherf said. Future areas to watch include ad-supported movie streams, new targeted advertising approaches and Hollywood’s efforts to offer more electronically distributed content through download-to-burn kiosks and other manufacturing-on-demand outlets.
The report examines the business of premium Internet video delivery and includes the latest primary consumer research on Internet video consumption and interest in new Internet video services and products.
Parks Associates will make a presentation on Internet video and other digital-lifestyle topics at CONNECTIONS Europe Summit, Aug. 29, in Berlin.
Parks Associates is an internationally recognized market research and consulting company, specializing in emerging consumer technology products and services. Parks creates research capital for companies ranging from Fortune 500 to small start-ups through market reports, primary studies, consumer research, custom research, workshops, conferences and subscriptions.
The company’s expertise includes new media, digital entertainment and gaming, home networks, Internet and television services, digital health, mobile applications and services, consumer electronics, and home control systems and security. For more information on this report: Internet Video: Direct-to-Consumer Services (Second Edition) .
Eve Sullivan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Eve's articles, please visit her columnist page.