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Australia - Digital Media - Online Interactive Services

This annual report offers a wealth of information on the key market segments that are evolving in the interactive online media market. It provides on overview of the developments within each of these sectors. The report includes analyses, statistics, forecasts and trends. It provides a comprehensive insight into the progress of the Online Interactive Services market and examines the key issues and opportunities.

  Subjects covered include:

  •          Covering: Google/YouTube, Yahoo, eBay/Skype, AOL, Microsoft, News Ltd/MySpace;
  •          Overview and analysis of the digital media and entertainment market;
  •          Key trends in digital media;
  •          Overview of file sharing networks and a discussion on these activities;
  •          Brief overview of global online services developments;
  •          Overview of social network, virtual worlds and user generated content markets;
  •          Australian online music, MP3 and podcasting developments, forecasts, overview key players;
  •          Overview of the Australian online gambling and gaming market;
  •          Overview of the mobile gaming market;
  •          The Mobile Media overview of products and services;
  •          The early mobile media drivers: ringtones and wallpaper;
  •          Mobile fraud issues.

BuddeComm’s annual publication Australia - Digital Media - Online Interactive Services profiles the market sectors in the online interactive services market. The report provides market statistics and analysis on the services and companies involved in the online music market, online gaming, virtual worlds, social networking and the products and services of the mobile media market.

  In the next few years the global entertainment and publishing industry is expected to be worth more than $2 trillion - driven in particular by a wave of growth in online video games/gambling, music, social networking/UGC, online video, etc. Online video consumption is also beginning to produce promising results and advertisers have begun to give it serious attention. Pay-to-own downloading is particularly popular and new business models in this area are expected to emerge over the next few years. Travel, gambling, gaming, adult content and health services are also in demand, with more growth expected.  

The market is led by Internet media companies such as Google/YouTube, Yahoo, eBay/Skype, AOL, Microsoft, News Ltd/MySpace. They have been at the forefront in shaping the developments in digital media for the last five years. Despite being challenged by the telcos they maintained the upper hand. In future the battle will be between the traditional media and the Internet media companies, and this will continue for some time.  

The music market

Music has been the key driver behind the early developments in the digital media, both in mobile and fixed networks. In recent times sales of digital music, mostly via the Internet, have increased by more than 30%. Sales of CD and DVDs, on the other hand, continue to decline.  

While mobile is the preferred technology for listening to music, the business models are not conducive to helping people become accustomed to using these networks for music delivery. Most will use free or cheap Internet sites to gain access to music.

  A totally unprepared music industry has suffered greatly from the switch to e-music, and it is only now beginning to recover. MP3, or podcasting, has gone well beyond the music application, and millions of podcasts (some in video format) are downloaded daily. All this is also a fair indication of the future direction of the video entertainment and wireless broadband (mobility) market.

  Online games and gambling

The global online gambling industry continues to grow, despite regulatory restraints and the economic downturn. Online gambling operations are cheaper to operate than traditional establishments and so are better placed to weather an economic downturn. In addition, the number of Internet users around the world continues to grow, resulting in an ever-expanding customer base. Online games also remain popular and in-game advertisers are taking note, especially as there is evidence that free online games are becoming more popular in the current economic environment.  

As speed and capacity increase, a whole new range of applications will be entering the market over the next decade. Console games have changed dramatically, with games, music and movies all merging and integrating. Growing penetration of broadband and mobile 3G networks will also promote growth in online gaming. A record growth year for video game sales in Australia in 2008 saw Australia’s video game industry produce $1.5 billion in sales.  

  Social networks and UGC

It is natural for people to want to communicate and the Internet has always provided a forum for user generated content, from the early bulletin boards to today’s video blogs that allow for new levels of interaction. In recent times social networking has been dominated by industry leaders MySpace and, in particular, Facebook.

  Other competitors are now scrambling to capture market share and social network services are evolving and looking at further innovations to maintain users’ attention. Mobile social networking services are being developed also. In 2009 the economic downturn is expected to impact upon advertising spend in this sector.

  Virtual worlds

Virtual worlds are just one example of the developments occurring as part of the Web 2.0. The most high profile of these is Second Life; the popularity of this virtual world has exploded over the past couple of years from around 1.5 million users reported in 2006, to nearly 13 million registered users in 2008. However the departure of some high-profile companies in 2007 and 2008 has left the industry wondering whether its growth will continue unabated, and attention is turning towards its competitors such as

  Mobile media market

Business models for content providers utilising the portals of the mobile operators remain shaky, with operators still charging a hefty 30-50% of revenues. With capped data access, services will move ‘off deck.’

  By 2009 over a million users were bypassing the portals. Ringtones and wallpaper still dominate the portal market followed by music and games. ‘Off deck’ will see increased use of Internet-based services and email instead of SMS. However, mobile operators still hold the key to a powerful tool - mobile billing.

  Key highlights:

  • In the next few years the global online industry is expected to be worth more than $2 trillion.
  • Global P2P Internet traffic will continue to grow almost 400% - up from 1.6 petabytes to almost 8 petabytes per month by 2012.
  • The global adult entertainment industry is worth around $2 billion a year.
  • Annual revenue growth in the overall music industry has declined by 35% per annum.
  • Online music sales for 2008 amounted to $25 million, but this doesn’t compensate for the losses.
  • A record growth year for video game sales in Australia in 2008 saw the industry grow to $1.5 billion.
  • By 2009 over a million users were bypassing the mobile operator’s portals.
  • Tabcorp Internet betting revenues top $1 billion.
  • In 2008 the number of mobile games units purchased increased by 50%.
  • The value of ringtone and wallpaper services market declined to around $65 million in 2008.
  • Cloud computing has become a key area of focus for Internet media companies.
  • Google’s search engine market share is 62% in 2009.
  • The economic downturn is expected to impact upon advertising spend in social networks.  
  • Data in this report is the latest available at the time of preparation and may not be for the current year.

1. Internet & Entertainment Services
1.1 Digital media and entertainment
1.1.1 Digital media and entertainment services
1.1.2 Demand for faster networks
1.1.3 Consumer pricing expectations
1.1.4 Areas of growth through to 2012
1.2 Digital media trends
1.3 Peer-to-Peer (P2P) networks
1.3.1 File sharing networks
1.3.2 Influence on Internet resources
1.3.3 Commercialisation of P2P services
1.3.4 P2P statistics
1.4 Online content and services
1.4.1 Adult services
1.4.2 Online dating
1.4.3 E-education
1.4.4 Financial services
1.4.5 E-government
1.4.6 E-health
1.4.7 Mapping and tracking
2. Internet Media Companies
2.1 Introduction and analyses
2.2 Internet media companies
2.3 Key areas for Internet media companies
2.3.1 Cloud computing
2.3.2 Search services
2.3.3 Digital media advertising
2.4 Case study - Google, the leader
2.4.1 Google’s vision for content on mobile devices
2.4.2 New advertising and software product models
2.4.3 Google’s significant activities Q1 2009
2.4.4 Google’s significant activities 2008
2.5 Brief case study: eBay/Skype
2.5.1 The Skype phenomenon
2.5.2 Skype enters corporate market
2.6 Other key developments/analysis
2.6.1 Google/Yahoo online ad deal aborted
2.6.2 Microsoft Yahoo bid abandoned
2.6.3 Apple and Google - hijacking the mobile operators - analysis
2.6.4 Copyright becomes as issue
2.6.5 Internet media bypassing the telcos
2.6.6 White spaces
3. Music, MP3 & Podcasting
3.1 Statistical overviews
3.1.1 Online music statistics
3.1.2 PwC survey to 2012 shows online music will surge
3.1.3 Album sales drop as music download sales increase
3.1.4 Survey on online music searching
3.1.5 Australian digital music downloads to grow to $200m a year
3.1.6 Ericsson Consumer Lab survey
3.2 Key players
3.2.1 Apple
3.2.2 ninemsn assault on the online music market
3.2.3 Telstra BigPond Music
3.2.4 Vodafone
3.2.5 Hutchison
3.2.6 Nokia
3.2.7 Motorola
4. Gaming & Gambling
4.1 Global overview
4.1.1 Introduction
4.1.2 Online gambling
4.1.3 Online gaming
4.1.4 Mobile gaming
4.2 Australian market
4.2.1 Online gambling
4.2.2 Casinos
4.2.3 Online gaming
4.2.4 Mobile gaming
5. Social Networks & UGC
5.1 User Generated Content (UGC)
5.1.1 UGC and the economy - OECD study
5.2 The ‘thinking society’
5.3 Social networking
5.3.1 Social networking leaders
5.4 Blogging and web publishing
5.4.1 Wikipedia
5.4.2 Mediacracy - analysis
5.4.3 Affecting traditional news media
5.4.4 Vlogging/video media
5.5 Is the initial craze stabilising?
5.5.1 A popularity contest
5.5.2 Every site needs its own YouTube
5.5.3 Consumer-led era
5.5.4 Types of consumers
5.5.5 Business opportunities
5.6 Other developments
5.6.1 Could greed take hold of the Web 2.0 industry?
5.6.2 The rise of Twitter
5.6.3 Vodafone buys ZYB
5.6.4 Mobile social networking
5.6.5 AOL buys Bebo
5.6.6 Open Social Foundation
5.6.7 Crowdsourcing
5.6.8 Photosynth and Seadragon
5.6.9 Creating social networks
5.7 Social networking advertising statistics
6. Virtual Worlds
6.1 Virtual worlds for younger users
6.2 Virtual worlds for education
6.3 Virtual malls for shopping
6.4 Risks of business in a virtual world
6.5 Virtual World statistics
6.6 Brief case study: Second Life
7. Mobile Media
7.1 Off deck content
7.1.1 The start of the mobile revolution?
7.1.2 Concept has been around for years
7.1.3 Reinventing the wheel
7.1.4 Billing remains key problem area
7.1.5 Video services require different solutions
7.1.6 Future predictions
7.2 Mobile fraud
7.2.1 The pitfalls of off deck mobile services
7.3 Ringtones and wallpaper
7.3.1 Market has peaked
7.3.2 Royalties issues
7.3.3 Ring tones and mobile phone distribution - PwC survey
7.4 Mobile email
7.5 Voting
7.6 Advertising
7.7 Mobile music
7.7.1 Made-for-mobile music program via BigPond TV
7.7.2 Nokia’s launch into the mobile music market
8. Glossary of Abbreviations
Table 1 - Worldwide Internet users - 1990 - 2009
Table 2 - Worldwide broadband subscribers - 2003 - 2009
Table 3 - Top 5 dating websites in the US - February 2008
Table 4 - Worldwide E-learning market value - 2005; 2008; 2010
Table 5 - Number of consumers using health monitoring - North America, W Europe - 2008; 2012
Table 6 - Spending on IT in healthcare sector - W Europe - 2006; 2012
Table 7 - Visitors to top web properties worldwide - 2008
Table 8 - Search engine worldwide market share - 2009
Table 9 - Worldwide online advertising spending - 2007 - 2008; 2011
Table 10 - USA online advertising spending - 2000 - 2009
Table 11 - US online advertising revenues - top 4 portals - 2006 - 2008
Table 12 - Australian Internet distribution recorded music market sales - 2007 - 2012
Table 13 - Australian mobile phone recorded music market sales - 2007 - 2012
Table 14 - Listening to music - 2006
Table 15 - Getting/buy music habits - 2006
Table 16 - Worldwide online gambling revenue - 1997; 2001; 2004; 2006; 2008
Table 17 - Worldwide revenue from all forms of gambling - 2005; 2007; 2012
Table 18 - Regional revenue from all forms of gambling - 2006 - 2007; 2012
Table 19 - Total value of bets placed via mobile gambling worldwide - 2006; 2009; 2010
Table 20 - PartyGaming revenue - 2006 - 2008
Table 21 - PartyGaming daily users - 2006 - 2007
Table 22 - Online poker players worldwide - 2005 - 2006; 2009
Table 23 - Worldwide online poker revenue - 2004; 2007
Table 24 - Worldwide online gaming revenue and annual change - 2000 - 2008; 2012
Table 25 - Online gaming revenue market share - leading regions - 2012
Table 26 - US video game revenue for console, PC, online and wireless - 2008
Table 27 - Worldwide mobile gaming revenue - 2004 - 2009; 2013
Table 28 - Worldwide mobile game users - global monthly averages - 2005; 2010
Table 29 - Top 10 mobile game publishers worldwide - market share - May 2006
Table 30 - Gambling as a portion of hotels/licensed clubs & total retail (seasonally adjusted) - 2004 - 2007
Table 31 - Gambling in the retail trade (seasonally adjusted) - 2004 - 2007
Table 32 - Contribution of gambling to total turnover, by state (seasonally adjusted) - 2004 - 2007
Table 33 - Worldwide market share of mobile social network users - 2008; 2013
Table 34 - Worldwide social networking advertising spend - 2008; 2011
Table 35 - USA social networking advertising spend - 2008 - 2009
Table 36 - Number of virtual worlds worldwide - 2007; 2009
Table 37 - Second Life subscribers - 2006 - 2008
Table 38 - Market share of Second Life active users by country - 2007
Exhibit 1 - United Nations e-government readiness ranking - top 35 countries - 2008
Exhibit 2 - Popular health-related websites in the US
Exhibit 3 - Applications of Microsoft’s Virtual Earth
Exhibit 4 - Examples of leading Internet media companies
Exhibit 5 - Key areas of focus for Internet media companies
Exhibit 6 - Definition: Cloud computing
Exhibit 7 - Examples of alternative search engines
Exhibit 8 - Interesting items sold on eBay
Exhibit 9 - Key players in gaming industry sectors worldwide
Exhibit 10 - Examples of top online games sites in the US - 2008
Exhibit 11 - Examples of popular mobile games
Exhibit 12 - Definition: social network and community
Exhibit 13 - User generated content - key success factors
Exhibit 14 - Examples of social networking websites
Exhibit 15 - Top 15 social networks worldwide - 2008
Exhibit 16 - Major regional user base of popular social networks - mid-2007
Exhibit 17 - Wikipedia
Exhibit 18 - Examples of virtual worlds for younger users
Exhibit 19 - Linden Labs ban on gambling
Exhibit 20 - Second Life financials - 2007 - 2008
Exhibit 21 - Key applications from data pack users

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