Consider that online advertising accounted for approximately eight times as much revenue last year, which means there’s no single business model for content as much as content plays an important role, whether you’re charging for information or hoping to make your money on advertising….
U.S. consumers spent $1.8 billion for online content in 2004; this represents an increase of 13.7% compared to 2003 and was driven largely by the Entertainment/Lifestyles category
Entertainment/Lifestyles surges to overtake Business/Investment content as second largest paid content category
* Consumer spending on Entertainment/Lifestyles content reached $413.5 million in 2004, surpassing Business/Investment content to rank second among all paid content categories
* Entertainment/Lifestyles also registered the largest year-over-year growth (90%), fueled by growth in online music sales
* Sports and Games also showed strong annual gains of 38% and 21.8%, respectively
* The Personals/Dating category remains the largest paid content category, with Business/Investment now at No. 3 behind Entertainment/ Lifestyles
* The top three categories – Personals/Dating, Entertainment/Lifestyles and Business/Investment – accounted for just over two-thirds (67.3%) of online content spending in 2004, up from 64% in 2003
Single purchase share of paid content sales reaches highest point yet
* In 2004, single purchase sales hit a record high of $274.7 million, up 59.2% from 2003, driven by single purchases of music downloads
* The growth in digital music track/album sales shifted the overall single purchase versus subscription mix, with single purchases accounting for 15.4% of sales in 2004 versus only 11% in 2003 – the largest change in the three years we have been analyzing year-over-year trends.
* Single purchase sales in the Entertainment/Lifestyles category accounted for $125.7 million in revenue in 2004, nearly eight times the $15.9 million it accounted for in 2003.
* Among single payments, mid-range payments (between $5 and $50) accounted for 70% of single payment revenue for 2004
* Monthly subscriptions accounted for 58.4% of total subscription revenues in Q4 2004 versus 52.4% Q4 2003, an increase of 11.5% over the same period last year