AccuStream Research: Streaming Subscription and Download Media Forecast at $2.6 Bil. in ’07

SALINAS, Calif.--(BUSINESS WIRE)--Subscription streaming and download media (audio and video) is forecast to rise 39% in 2007, reaching $2.6 billion in revenue according to the latest research report by AccuStream iMedia Research.

“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 3 – 7 year period”

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% of total revenue. Sports is estimated at 5.4%, movies 2.2%, news 1.2%, entertainment (including TV show downloads) 3.4% and Real Networks’ SuperPass video service 4.1%.

Music download and subscription revenue is forecast to grow at approximately 48.5% 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% of total revenue generated from paid downloads compared to subscriptions.

Download movies, forecast at $60 million in 2007, is up 133.4% 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.

With CNN Pipeline now ad supported, the news segment is forecast to register a slight dip in 2007 subscription revenue.

NASCAR and PGATour moved video out from their subscription services in ‘07, and the NFL dropped its domestic subscription video in 2006, leaving MLB the dominant league online. With more sports content chasing ad dollars, the subscription area is forecast to grow at 2.2% in 2007 compared to 2006.

“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 3 – 7 year period,” commented Paul A. Palumbo, research director at AccuStream.

AccuStream iMedia Research (http://www.accustreamresearch.com) is a streaming, download, subscription and broadband advertising research firm, with consulting and primary market research expertise.