Paid-For Online Content Set to Take Off, But Consumers Wary

27 March 2002

Total global revenues from paid-for online content are set to quadruple from $1.4 billion (€1.6bn; £1bn) this year to $5.8bn in 2006, according to new research from Jupiter MMXI.

The report predicts that general content revenues will increase from $700 million in 2002 to $2.3bn in four years’ time; online games revenues will rise from $260m to $1.8bn; and those from digital music will leap from $30m to $1.7bn.

However, consumers are not wholly convinced about paying for internet content: 70% of adults with internet access surveyed by Jupiter did not know why anyone would want to in the first place, while just 42% expected to do so in the future – down from 45% in August 2000.

“While there is money to be made in the online content business…the mass market still largely shuns anything that smells like a subscription online,” warned Jupiter vice president and senior analyst David Card.

The success of paid-for content will also vary by category. Of the $2.3bn general content revenues forecast for 2006, $600m will come from audio/video entertainment, $400m from ‘adult’ sites and $350m from business/financial news, while faring less well will be kids content ($95m), shopping aids ($85m) and sports ($95m).

Nevertheless, Jupiter added that media properties face a lot less competition from start-ups giving away content for free than they did a few years ago.

Continued Card: “Established portals will emerge as networks that aggregate premium content and services in packages – both those that portals determine and those that users customise. This will pave the way for content providers to resell premium content through numerous partners.”

Data sourced from: Daily Research News Online; additional content by WARC staff