Technology | Media | Telecommunications

Monday, September 07, 2015

Digital Entertainment Revenue will Reach $300 Billion

Digital entertainment now encompasses the inclusive aspect of services found on many smartphones, media tablets and connected TV sets. According to the latest market study by Juniper Research, the mobile and online entertainment industry will reach revenues in excess of $300 billion annually by 2019 -- that's up from $195 billion this year.

The research observed that growth in the market would be driven by increased adoption of online television and video entertainment services, with the industry accounting for more than 60 percent of the net increase in market value over the next 5 years.

The new study also found that Over-the-Top (OTT) video service providers -- such as Netflix and Hulu -- offer an attractive combination of third-party and home-grown content, with a subscription-based model that is supplanting the legacy on-demand pay-per-view approach.


The research also found that while video game revenue will capture the lion's share of the digital entertainment market opportunity in 2015, the gaming sector is comparatively mature.

Furthermore, with the continued migration from games on CD-ROM to the online digital format, growth will slow markedly over the forecast period.

Besides, while OTT services pose an increasing threat to traditional TV broadcasters and pay-TV providers, Juniper believes that mobile network operators have the opportunity to monetize content through the provision of carrier billing solutions.

The research found that where carrier billing was offered as an alternative to credit card billing, there was a dramatic rise in conversion rates.

With smartphone adoption spreading rapidly in developing markets, carrier billing offered the prospect of monetizing the usage of un-banked and under-banked subscribers for the first time.

Other key findings from the study include:
  • The digital adult industry is forecast to see over 182 billion video views by 2019, but as a proportion of entertainment revenues, it will fall to just 2 percent by that time.
  • Gambling will retain its position as the third largest source of entertainment revenue throughout the forecast period, with ongoing legislative changes seen as a key to greater service adoption.