IDC latest study describes content as digitized information - regardless
of media type - made available over networks, such as text, music, pictures,
or video. The individual consumer is often the first market that comes to
mind when thinking of content service providers (CSPs). But although individuals
represent almost 100% of spending on content services, the money for CSPs
isn't coming from the consumer.
forecast that the worldwide CSP market, including both business and consumer
content, would increase to $108 billion by 2006. This represents a 20%
compound annual growth rate (CAGR) from 2001.
The vast majority of revenue comes from an industry that is more than
30 years old. Network delivery of content has been in business almost
as long (if not perhaps a bit longer) than email. One percent of content
buyers are the business volume buyers - the corporate buyers - and they
account for well into the majority of spending.
While the consumer segment of digital content is exciting and tumultuous,
its full potential continues to face the same barriers as always.
First and foremost, there are still warring factions of content owners,
publishers, middlemen, and the entire process of developing and delivering
content to the consumer that must be resolved for legal digital distribution.
Content is not being delivered because the creators and distributors of
said content disagree on the best way to distribute the wealth from digital
distribution. Sure, there are technological challenges, but those will
be surmounted once the decision has been made to do so.
Second, content is free! George Lucas's new movie Star Wars: Episode
2 Attack of the Clones is the perfect example for exactly why content
owners must come forward with better solutions for digital distribution.
The new Star Wars movie hasn't even been released to theaters and a bootleg
copy is already on the Internet, free for download. The freebooters didn't
waste any time on this one. Content owners and creators must learn to
outfox them, and encryption isn't the answer.
Those looking to CSPs for revenue should look to forge relationships
with the business content providers. Those wanting to deliver consumer
content should get in the mix to help the entertainment industry evolve
its thinking and replace a system of royalty distribution that is beyond
repair. Otherwise, the stalemate will continue.