Audio, video downloads to touch $2.6 billion

MUMBAI: Subscription streaming and download media (audio and video) is forecast to rise 39 per cent in 2007, reaching $2.6 billion in revenue according to the latest research report by AccuStream iMedia Research.

The report, Streaming Subscription and Download Media 2003 – 2008 provides historical and present day subscribers for Internet audio and video services. Streaming music, sports, news and entertainment, plus download, music movies and television content yield total market value.

Music is forecast to capture 85 per cent of total revenue. Movies is estimated at 2.2 per cent entertainment (including TV show downloads) 3.4 per cent and Real Networks’ SuperPass video service 4.1 per cent. Sports and news is estimated at 5.4 per cent and 1.2 per cent respectively.

Music download and subscription revenue is forecast to grow at approximately 48.5 per cent in 2007 to $2.2 billion, a considerable leap from 2003, when $90.2 million was generated from online sales.

The music category is dominated by purchases, with 82 per cent of total revenue generated from paid downloads compared to subscriptions.

Download movies, forecast at $60 million in 2007, is up 133.4 per cent over 2006, and on track to break the $100 million threshold in 2008.

Movie revenue growth has been hampered by limited availability of both front line titles and catalog depth.

In addition, the report’s CDN analysis shows larger movie files (particularly HD) push up distribution costs considerably. By contrast, music downloads are much smaller and online libraries far larger creating better bottom line economics.

“Music has soared to early market dominance, similar to music share in the early days of Internet video. But, demand for premium content from studios and broadcast networks will boost revenue and share as offerings expand over a three – seven year period,” said AccuStream research director Paul A. Palumbo.