"Streaming Content to Generate $70 Billion By 2013" - An Unrealistic Claim

Insight Research is forecasting that streaming content will generate almost $70 billion in the U.S. by 2013. I don't know how they come up with that number as I have not seen the full report, but $70 billion?

They say the revenue prediction comes from audio and video files transmitted over the Internet, via an IPTV network or to mobile phones. They say that advertising revenue will fuel this growth and that "Questions surrounding consumers’ willingness to pay for content have been dispelled by the popularity of satellite radio and iTunes."

I would disagree. Customers are willing to pay for music via iTunes, but so far, not videos on a mass-market scale. Over time, yes, more video specific content via iTunes will be purchased but you have to back up the $70 billion number with more than just iTunes as an example. And what does satellite radio have to do with streaming?

They also say that if pre-stream costs drop faster than expected, or IPTV or 3G takes off faster than expected "it could blow the doors off of our forecasts, propelling this industry into explosive growth."

I am all up for reports that show growth and make predication based on accurate data, but $70 billion is just so far away from reality. If someone has a copy of the full report, I'd love to see how the $70 billion number is calculated.

Comments

[JustChecking]

So, you have not seen the report but feel compelled to negatively comment on it anyway.

I wonder what's the rush?

[Dan Rayburn]

I have seen enough of the data from the report to know that the number is completely out of line. The rush is to not have people in the industry now quote this number as the "market opportunity" and set false expectations.

[Jed Stafford]

The link to satellite radio is a large % of subscribers are listening via their computers during the work day online using their Sirius / XM accounts vs only when they are in the car.

[Dan Rayburn]

Yes, many satellite subscribers are, but they are not buying that content online. So for the report to give iTunes and satellite radio as examples of consumer willing to pay for content, satellite is not relevant when most of those consuming it online are not paying for it and get it as part of their satellite subscription package.

[Jed Stafford]

I do agree I think the numbers are very small (based on my opinion not facts) but do want to point out people like Sirius are collecting money for higher quality streams on top of your regular satellite fees. Services such as Rhapsody all seem to small with slow growth to make a large market impact.

[i stink]

In your article, you use iTunes as an example. iTunes is not a streaming audio or video provider. A more appropriate example would be a paid internet radio service.