Rich Fiscus
17 Dec 2007 16:09
According to research firm Understanding & Solutions online video revenue is expected to increase to more than 500% over the next four years.
The study indicates a number of factors that are holding back the online video market, including pricing and technology. “The market is currently underperforming for a variety of reasons,” said Mai Hoang, an Understanding & Solutions analyst. “Online video services and Title availability are Limited, pricing strategies are embryonic and the technology infrastructure has yet to catch up. However, momentum is building, and by 2011, online video in the U.S. will represent 8% of total home entertainment revenue, with Western Europe close behind at 7%.”
The report goes on to talk about two successful services, iTunes and Xbox Live, and attempts to dissect why they've done as well as they have. In the case of iTunes they attribute it, as do most analysts, to the success of the iPod. Xbox Live's success, on the other hand, they point to its approach of essentially connecting a computer to the television.
"The rise of home networking will be a major driver in developing its presence, and media extender solutions such as Apple TV are already available to consumers," the report concludes.
Source: Video Business