Feeds

IDC forecasts internet video surge

$1.7bn industry by 2010

Top 5 reasons to deploy VMware with Tegile

The US is on the verge of a boom in internet video services, fuelled by an increase in the amount of premium content made available online, according to a new report from IDC. The analysts predict that the services will generate over $1.7bn in revenue by 2010.

According to IDC, the market for internet video services began its dramatic acceleration in 2005 as content owners, once unwilling to offer their products online, started to experiment with digital distribution as a way to complement and enhance their existing business models and to stem illegal P2P file-sharing and piracy.

It highlights the television networks' decision to offer episodes from new shows as well as old as significant in sparking interest in internet video. Television content is expected to be an integral component to revenue growth throughout the forecast period.

"The internet video market has huge upside. With that upside, however, comes the risk to content owners of cannibalising existing revenue streams," IDC associate research analyst Josh Martin said. "In order to properly take advantage of this emerging market, content owners to aggregators to consumer electronics manufacturers must understand the challenges the market faces and how to overcome them."

Key drivers for the adoption of internet video include the expansion of premium content offerings online and the emergence of home networking solutions that allow consumers to more easily view internet content on their televisions. As services become increasingly common, content owners will leverage internet video to complement their existing revenue streams and to generate additional revenue from archived content and new content created specifically for the service, according to IDC.

The firm expects that content owners will migrate toward three basic service types. Advertising-based services will remain the dominant type of internet video service, although its share of total market revenue will decline as a la carte services, buoyed by consumer familiarity with iTunes, grow dramatically over the next two to three years.

Subscription-based services, on the other hand, will experience steady growth throughout the forecast period, enhanced somewhat by the emergence of home networking solutions that make subscriptions more appealing to consumers.

But the firm warns that in order to sustain the momentum gathered in 2005 and maximise opportunities for success, content owners and service providers will need to overcome several important problems, including licensing issues, inadequate video search, competitive challenges, and the issue of how to move content beyond the PC.

IDC believes companies involved from the creation to distribution of content will have to partner with others across the value chain to create appealing, flexible services that will evolve into viable businesses.

Copyright © 2006, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

Choosing a cloud hosting partner with confidence

More from The Register

next story
FCC, Google cast eye over millimetre wireless
The smaller the wave, the bigger 5G's chances of success
It's even GRIMMER up North after MEGA SKY BROADBAND OUTAGE
By 'eck! Eccles cake production thrown into jeopardy
Mobile coverage on trains really is pants
You thought it was just *insert your provider here*, but now we have numbers
Don't mess with Texas ('cos it's getting Google Fiber and you're not)
A bit late, but company says 1Gbps Austin network almost ready to compete with AT&T
HBO shocks US pay TV world: We're down with OTT. Netflix says, 'Gee'
This affects every broadcaster, every cable guy
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.