19 April 2006

Internet Video Going Mainstream

Internet video services are becoming a mainstream phenomenon in the United States. Much of this growth will be fueled by a surge in the amount of premium content made available online.

According to a new report by IDC, revenues for Internet video services will increase to $1.7+ billion by 2010. This is an increase of $1.5+ billion from 2005.

Concerned by piracy and illegal file sharing, content owners began experimenting with digital distribution to retain market share. In fact, the decision by television networks to offer new episodes of popular shows for immediate download has engaged a significant interest in Internet video.

IDC expects content owners will migrate toward three basic service types:
Advertising-based services will ... decline as a la carte services, buoyed by consumer familiarity with iTunes, grow... home networking solutions that make subscriptions more appealing to consumers.
Content owners and service providers have many challenges to overcome, such as licensing issues, inadequacies of video search, competitive challenges, how to move content beyond the PC, and remaining flexible through strategic partnerships.

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