Deloitte Issues 2009 Media Predictions

NEW YORK: The rising cost of hosting user-generated content online is among the key issues the media industry will be grappling with this year, according to forecasts from Deloitte.

Storing content online is becoming increasingly expensive, Deloitte notes; the largest sites, the firm says, could be spending more than $100 million per year on hosting user-generated content. "But the ability to realize revenue from that content remains a challenge," the forecast states. "Advertisers are generally reluctant to place ads next to any content that could damage a client’s brand." As such, sites may need to start charging people to upload or share content.

Mobile advertising is an arena to watch this year, the forecast continues. "More able than ever before to carry advertising, mobile phones are at their most ubiquitous—and there is a more mature understanding of what mobile can and cannot deliver in advertising…Mobile advertising will really take off when advertising can be sent to the entire mobile community with a single click."

3D is also a trend to keep an eye on, Deloitte notes: "In 2009, the 3D movie is on course to have its first billion-dollar year at the box office." While directors are keen to utilize the technology, there is still a limited number of venues for 3D movies. "But the better 3D movies perform, the better the prospects for investment across a number of entertainment genres."

Phil Asmundson, the vice chairman of Deloitte and national managing partner for Technology, Media and Telecommunications, said 2009 would be a "year of significant opportunities and challenges in an industry that has already seen its fair share of disruption. Economic conditions, media consumption preferences and digital technology advancements will impact both consumer spending and business investments in the year ahead."