Movies on demand to be coming attraction for broadband. (Market Intelligence).(Video-on-Demand services over IP networks)

As deployments of cable modems and DSL services continue to increase throughout the world, VOD services over Internet Protocol (IP) networks will grow to a total of more than 17 million users, generating over $1.9 Billion (US) in subscription and pay-per-view revenue during 2006, according to InStat/MDR. The high-tech market research firm reports, that as consumer-oriented VOD services over IP become more pervasive, revenue generated by family-oriented VOD services will eventually surpass those of adult content sites, which currently dominate the VOD-over-IP market.

"Consumers who have broadband Internet connections represent a strong growth market for VOD services," says Gerry Kaufhold, a Principal Analyst with In-Stat/MDR.

"Adult content Internet VOD services are way ahead of cable TV VOD deployments in terms of total subscribers and revenues. However, four new family-oriented VOD-over-IP service efforts are underway: CinemaNow, Intertainer, MovieLink, and Movies.com." CinemaNow has deployments in North America, Taiwan, and Singapore, with more to come. Intertainer is rolling out their service in 35 major US cities that have strong broadband deployments in place and the other two services will launch later this year.

"Several million movie streams per month are currently being served up for free, but as the major movie studios enter the fray, with premium movie titles, pay-per-view and subscription services will gain traction, helping Hollywood figure out what the market is for 'on demand' content, and help engineers and software programmers to develop efficient delivery systems and workable Digital Rights Management solutions," says Kaufhold. Slated to generate approximately $460 million worldwide in 2002, the adult content segment of the market (representing over 98% of revenues) will serve as a barometer for the future success of the market as a whole. By the end of 2004, the number of subscribers and pay-per-view participants, regularly using family oriented "on demand" IP services, will outnumber the users of adult content services, and, by 2006, family oriented "on demand" services will overtake the adult content sites in terms of annual revenues.

In-Stat/MDR has also found that:

- By 2006, about 40% of worldwide consumers who have high-speed Internet connections to their residences will be using 'on demand' services for which they pay monthly fees, bringing $1.9 Billion to Hollywood.

- The North American market has the lion's share of consumer broadband connections deployed, and, by 2006, will represent over 7.6 million VOD users, generating over $820 million in revenues.

- Asia, especially South Korea, Taiwan, Singapore, and others, will represent about 37% of worldwide VOD-over-IP subscribers by 2006, producing over $700 million for movie studios. Europe will provide about 15% of worldwide VOD-over-IP revenues in 2006, and the Rest-of-the-World will bring in about 4.7%.

- Blockbuster Video rental stores won't go away, but VOD services from Cable TV, Satellite TV services, and digital terrestrial datacasting services, will all add momentum to the 'on demand' market.

The report, Consumer Oriented Video-On-Demand Via IP Networks, includes descriptions of the four key movie 'on demand' services, profiles of four equipment companies that serve as leading indicators for this important emerging market, and regional forecasts for number of subscribers and annual dollar values of each market segment To purchase this report, or for more information, please visit http://www.instat.com/catalog/cat-dt.htm or contact Courtney McEuen at 916-984-1179; cmceuen@instat.com. The report price is $2,495 USD.