The latest technologies and digital services are shaking up the media market, with major players like Apple and telcos taking advantage of new technologies to expand their product offerings and increase their competitiveness, according to “Media Trends 2007,” a study from SNL Kagan.Â
“Content owners and distributors are using digital to reach new audiences and boost revenues, while cable MSOs have made significant gains in the phone and high speed data arenas,” said Deana Myers, SNL Kagan senior analyst.
At the same time, multichannel providers have jumped headfirst into the race for customers by offering on-demand and high-definition games.
The race to provide “supply” is in sync with entertainment demand, with consumers now spending a record amount on media – about 1.85% of the average US annual income, according to SNL Kagan:
- TV broadcasters enjoyed higher-than-expected political advertising revenues and gains from all top 10 TV ad categories in 2006. Online and retransmission could prove to be lucrative growth areas over the next decade.
- SNL Kagan estimates the pay-per-view and video-on-demand industry at about $2.8 billion in 2006 and expects it to grow to $8.9 billion by 2017. The most growth is expected from the VOD segment, projected to reach nearly $5.5 billion by 2017 from $1 billion in 2007.
- Basic cable commanded an impressive 63.5% viewing share in 2006 versus 39% for the broadcast networks.
- US wireless subscriptions grew more than 12% in 2006, reaching 233 million at year-end. Total industry ARPU is expected to grow at an inflation-paced CAGR of 1.5% over the next 10 years.
About the study: “Media Trends” is an annual survey and compendium of key facts, figures and viewpoints for media segments, including broadcast TV and radio stations, cable MSOs, cable networks, consumer entertainment, DBS, internet, motion pictures, newspapers, pay networks, PPV/VOD/DVRs, telco video, TV programming, home video, and wireless.