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October, 1997 |
  
Interactive Publishing To Explode |
Research Findings....Interactive Publishing To ExplodeAccording to research firm InfoTech, consumer market revenues for the interactive publishing industry will go from $15.8 billion worldwide in 1997 to $26 billion by 2001. "The InfoTech Report: Optical Publishing Industry Assessment, Ninth Edition" says that the demand is "buoyed by strong sales of 32-bit and 64-bit console games," and that the forecast "spans interactive media across all TV and PC delivery platforms." Ted Pine, spokesman for InfoTech, said results are based on "supply-side research." The company identifies sectors within each category that it polls — such as distribution, manufacturing, and software publishers. The report says the fastest growth is expected to be in the online segment and will be driven by Internet multiplayer games and "other premium subscription content." The company is predicting a compound annual growth rate (CAGR) in excess of 70 percent over the forecast period, resulting in total online publishing revenues of $3.7 billion in 2001. That said, however, packaged interactive media sales, are expected to dwarf online revenue, totaling an estimated $22.3 billion in 2001. New digital video disk (DVD) technology is going to play its part too, says the report, with the move from CD-ROM packaged goods to DVD-ROM titles accounting for nearly 85 percent of total retail revenue by 2001. Licensing fees are expected to account for a sizable chunk of consumer publishers’ online revenue by 2001 — as much as 30 percent. Said InfoTech chairman and chief executive officer (CEO), Julie B. Schwerin, "Special interest sites may find that licensing and carriage deals are the most immediate and consistent way to generate online revenue." (Contact: InfoTech, Ted Pine, 802-763-2097) TopRetailers Making Few Online SalesTake all the talk about online retailing with a grain of salt. The boom will probably come, but it is not here yet and probably is not just around the corner, suggests a study by the Centre for the Study of Commercial Activity at Ryerson Polytechnical University. The center contacted 160 international retailers who operate their own sites on the World Wide Web, and got 40 responses, said Dr. Ken Jones, center director. Those who responded to the survey said they have seen little payoff so far from their investments in online retailing, which have averaged about $25,000 each. The study found that of every 1,000 visits to a retailer’s Web site, two to five result in purchases. That "conversion rate" of less than half of one percent compares to a rate of about 25 to 30 percent for visits to fashion retail stores and rates approaching 100 percent for some retailers such as supermarkets and gas stations. Web sites could be profitable with much lower conversion rates than retail storefronts, Jones said, but the rates will probably need to reach at least one or two percent. Consumers will determine how fast online retailing grows, Jones said, and a key issue is age. "Most consumers above a certain age are very reluctant to adopt any new technology." Until typical middle-aged consumers are comfortable about buying on the Web, online sales will remain low, the study concluded. (Contact: Ken Jones, Centre for the Study of Commercial Activity, 416-979-5000 ext. 7612) TopSurfers Over 50 Rich, Active, Likely To Buy OnlineHowever, according to Excite Inc., a new study of Internet users over age 50 shows the older crowd is just as active online as younger users, though with different interests. Users over 50 are both more affluent and more inclined to buy products online than their younger counterparts. The study, "Third Age Online," was co-sponsored by Excite, a huge Internet search engine site that hosted the study, and Third Age Media, a start-up company targeted for older adults. The title’s "Third Age" users are defined as those 50 and over who sign onto the Internet. According to Excite, the study is the first to seek detailed data on the psychographics, or psychological profiles, of Internet users on a detailed demographic basis of age. The study analyzed attitudes, motivations and preferences of online users who logged onto the Excited search engine and included demographics like age, gender and income. The study was actually conducted by Mindshare, a San Francisco-based Internet research firm. When asked how the findings will influence his business, Brian Preston, Communications Director at Third Age, replied: "First of all, we now know the over-50s are spending more time online than people thought, comparable to the younger folks. Those who are on, mirror the younger crowd in many ways, but they actually spend more time online. They have more disposable time than people who are still on the career ladder. So their usage profile looks more like that of a teenager or a college student. But their interests are somewhat different." Asked what his firm would now do with the new information, he said it already plans to "bump up the content" in areas of special interest to those over 50, such as news, investing, and travel. He said the site would also start featuring forums and discussion groups in those areas of interest. The Excite search engine site is on the World Wide Web at http://www.excite.com and the Third Age site is at http://www.thirdage.com (Contact: Melissa Walia, Excite, 650-569-2213, or Bryan Preston, Third Age Media, 415-08-6906).
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