Skip to main content

Hollywood Shifts to Online Video for Growth

As DVD revenues begin to slow, Hollywood studios are looking to online video as a platform for incremental growth. Though currently in its infancy, by 2011 the online video market will have a retail value in excess of $3.8 billion worldwide, according to entertainment analyst firm Understanding & Solutions.

Despite a raft of activity within the sector -- ranging from new service launches, key content partnerships and continued experimentation with business models -- online video has, to date, taken off much slower than the industry anticipated. The USA leads the way, yet is only expected to generate revenues of $280 million in 2007, just 1 percent of the total home video market.

"The market is currently under-performing for a variety of reasons," says Mai Hoang, Analyst with Understanding & Solutions, "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 percent of total home entertainment revenues, with Western Europe close behind at 7 percent.

"What's more, multiple formats will coexist in the future, and no one format will control the home entertainment landscape, quite unlike the domination of DVD since the demise of VHS," continues Hoang. "The new generation of High Definition video formats will also help to shore up packaged media's presence within home entertainment revenue streams."

At present the U.S. online video market is predominantly driven by two services, Apple iTunes -- using the Electronic Sell-Through (EST) model -- and Xbox Live Video Marketplace -- using online VoD.

iTunes has sold in excess of 2 million movies and 95 million TV shows to date. Its competitive pricing structure, user-friendly interface and the iPod's ubiquitous nature have allowed it to gain traction quickly.

Similarly, Microsoft's Xbox Live Video Marketplace has boosted the online VoD movie market, bridging the gap between PC and TV, and providing easily accessible High Definition content to consumers. Though many other players operate within this marketplace, so far no provider has been able to build comparable scale.

Going forward, online video must continue to reach out to the living room to ensure mass market penetration. 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.

Popular posts from this blog

Mobile Device Market Still Awaiting Recovery

The mobile devices market has experienced three years of unpredictable demand. The global pandemic, geopolitical pressures, supply chain issues, and macroeconomic headwinds have hindered the sector's consistent growth potential. This extremely challenging environment has dramatically affected both demand and supply chains. It has led to subsequent inflationary pressures, leading to a worsening global cost of living crisis suppressing growth and confidence in the sector. In tandem, mobile device industry stakeholders have become more cautious triggering market uncertainties. Mobile Device Market Development Operating under such a backdrop, the development of mobile device ecosystems and vendor landscapes have been impacted severely. Many of these market pressures persisted throughout 2022 and now into 2023, borne chiefly by the smartphone market. According to the latest worldwide market study by ABI Research, worldwide smartphone shipments in 2022 declined 9.6 percent Year-over-Year

Global Digital Business and IT Consulting Outlook

Across the globe, CEOs and their leadership teams continue to seek information and guidance about planned Digital Transformation initiatives and the most effective enterprise organization change management practices. Worldwide IT and Business Services revenue will grow from $1.13 trillion in 2022 to $1.2 trillion in 2023 -- that's a 5.7 percent year-over-year growth, according to the latest market study by International Data Corporation (IDC). The mid-term to long-term outlook for the market has also increased -- the five-year CAGR is forecast at 5.2 percent, compared to the previous 4.9 percent. Digital Sevices & Consulting Market Development IDC has raised the growth projection despite a weak economic outlook, because of vendor performances across 2022, growth indicators from adjacent markets, increased government funding, and inflation impacts. The actual 2022 market growth was 6.7 percent (in constant currency), which was 87 basis points higher than forecast last year, alth

Digital Talent Demand Exceeds Supply in Asia-Pac

Even the savviest CEO's desire for a digital transformation advantage has to face the global market reality -- there simply isn't enough skilled and experienced talent available to meet demand. According to the latest market study by IDC, around 60-80 percent of Asia-Pacific (AP) organizations find it "difficult" or "extremely difficult" to fill many IT roles -- including cybersecurity, software development, and data insight professionals. Major consequences of the skills shortage are increased workload on remaining digital business and IT employees, increased security risks, and loss of "hard-to-replace" critical transformation knowledge. Digital Business Talent Market Development Although big tech companies' layoffs are making headlines, they are not representative of the overall global marketplace. Ongoing difficulty to fill key practitioner vacancies is still among the top issues faced by leaders across industries. "Skills are difficul