Online TV Revenues in U.K. to Reach £181 Million by 2011

LONDON, September 24: A new Screen Digest report predicts that the online TV market in the U.K. will generate annual revenues of £181 million by 2011.

Screen Digest also notes that while there are only a few online TV options to choose from, as more services become available, consumers will increasingly adopt online TV to catch up on soaps, dramas and reality TV shows and to preview their favorite shows. The result is that the British online TV market will be increasingly fragmented, with the new entrants trapping considerable market share. The report warns that traditional broadcast networks and pay-TV platforms must adapt their online strategies quickly and efficiently, whether it is focusing on maximizing the potential of video offered through their own websites and online outlets, or cooperating with the new platforms to syndicate as widely as possible in order to tap into significant additional revenue.

Arash Amel, a senior analyst at Screen Digest, commented: “Broadcasters and pay-TV operators will come under increasing pressure from many major ‘virtual networks’, such as YouTube and Joost, who will be competing for viewers’ time and attention. This will be exacerbated by hardware manufacturers, such as Apple, Microsoft and Sony, who will be far more adept at selling TV shows because of their existing device relationships with the consumer.”

According to Screen Digest, music will lead the market for online distribution, with revenues in the U.K. standing at £45 million in 2006. By 2011, Screen Digest predicts that 191 million single tracks and 21 million albums will be downloaded, with U.K. revenue to reach £285.6 million.

However, the online movie market will experience the slowest growth, compared to music and TV. Screen Digest believes that consumers will be reluctant to watch three-hour long films on their PC, preferring to view them on their plasma screens and home entertainment systems.