Major revenue gains for online TV by 2013


LONDON -- Legitimate online television and video services will generate global revenues of $7.9 billion over the next five years, with the U.S., the U.K. and Japan leading the way, according to a forecast published Friday by Informa Telecoms & Media.

Advertising-based services will outperform both subscription-based services and a la carte offerings, generating about 63% of the total by 2013.

Online television and video -- the so called over-the-top services -- are set to be a crucial element of the television market going forward, report author Adam Thomas said.

"The Writers Guild strike brought much of Hollywood to a standstill for several months," he said. "The fact that revenues derived from online TV and video were at the heart of the dispute indicate just how important this sector has become."

The report predicts that U.S. over-the-top revenues will grow to $4.7 billion in 2013, compared with just over $1 billion last year, while in the U.K., the $119 million market in 2007 will grow more than sevenfold to $842 million in 2013.

But the biggest growth rates are predicted to be in Japan, where the $57 million in 2007 revenue is forecast to hit $605 million in five years time.

The biggest potential negative for broadcasters and content suppliers is the impact that online TV and video will have on their business models, but the report predicts those companies that lead the online market will be "best-placed to avoid any harmful effects."