Video Streaming Services To Flourish, Says Report
Global revenues from consumer online subscription video streaming services will rise from $991 million during 2003 to more than $4.5 billion in 2007, according to a new report from In-Stat/MDR.
“The world of online content is undergoing a three-way metamorphosis, creating opportunities for major media companies and large service providers to finally get their fingers into the internet revenue pie,” said Gerry Kaufhold, a principal analyst with In-Stat/MDR.
Growth factors The growth in video streaming has been made possible by the rising penetration of broadband. In-Stat/MDR estimates that over 30 million households already have high-speed internet connections and this is expected to increase to more than 130 million by the end of 2007.
After initial uncertainty, people finally seem willing to pay for premium content. During the war in Iraq, RealNetworks saw a spike in demand for its video streaming services and MSN, AOL and Yahoo! are all set to launch premium online video streaming subscription services by the end of the year.
High-speed connection providers are also keen to form partnerships with content sources. The result is branded premium services that attract new customers and reduce churn among existing subscribers.
The likes of Italy’s FastWeb, MSN, AOL and Yahoo! Broadband have all teamed up with DSL and cable modem operators and provide brand name services that have raised the profile of video streaming.
In-Stat/MDR predicts that four categories of subscription services will succeed. These are sports related services, movie and TV related sites, general interest sites from major portals and video communication services.