Online Entertainment Industry Is Poised for Growth, Finds a Gemini Consulting and Honkworm International Survey
February 15, 2000
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NEW YORK--(BUSINESS WIRE)--Feb. 15, 2000 via NewsEdge Corporation -
More than 75% of American Internet Users Have Already Tuned in to Online Entertainment
Mainstream entertainment with content specifically designed for the Internet will proliferate substantially in the next year, according to the results of a jointly conducted online poll of web viewers by Gemini Consulting and Honkworm International. These so-called "webisodes" (which exclude games, Internet TV and adult entertainment) will be viewed by a larger base of web users on a more regular basis, for longer periods of time.
More than three-quarters of U.S. Internet users have already watched entertainment on the Internet, a figure that will grow to a penetration of more than 90% by the end of 2000. The size of the online entertainment market will grow 64% to $1.8 billion by the end of 2000, up from $1.1 billion in 1999.
Approximately 29% of viewers who have tuned into "webisodes" have actively sought out such programming. Most viewers, 64%, come across online entertainment programming through random surfing.
"This tells us that on-line entertainment is already significant but that the market is still fragmented and not yet mature enough to represent repeat traffic," says Johan Liedgren, CEO, founder and chairman of Honkworm International. "But the market is quickly establishing destination sites to make content more accessible. Viewers will make shorter format entertainment part of their daily routine in the office-- like a coffee break, where they have access to higher bandwidth. We will see explosive growth fuelling fundamental changes in a very traditional industry."
Web users who watch online entertainment programming so far have not stayed tuned-in for long. Approximately 60% have tuned-in for 1-3 minutes, and, on average, one in five watch "webisodes" for more than three minutes.
"This shows that it's not TV on your PC- on-line entertainment is consumed very differently from broadcast content," comments Liedgren.
"This billion-dollar market is trying to find its forms," says David Ridemar, head of Gemini Consulting's strategic research group. "Think about the impact on the online entertainment marketplace when marketing kicks in, and random viewers start coming back for repeat visits. Then this market will experience three-digit growth."
Today, almost 90% of online entertainment viewers watch from home. Fewer than 8% tune-in from the office, although the segment of viewers watching from the office is expected to grow the fastest in the coming years.
"There is a market forming in front of our eyes," says Ridemar. "Online entertainment is becoming increasingly mainstream, but industry players are struggling to find a business model."
"The demise of the ad banner paves the way for more creative sponsorship models where content providers and advertisers work closely together," says Liedgren. "The entrenched network and advertising players have been put on notice that the Internet is changing the nature of entertainment programming and associated business models."
Honkworm and Gemini will conduct several follow-up studies related to this segment over the next 6 months. About Gemini Consulting
Gemini Consulting is the independent, wholly-owned, management consulting subsidiary of the Cap Gemini Group. With 40,000 people working across Europe, the Americas and the Far East, Cap Gemini is a global leader in information technology services. By combining management consulting and IT services, the Cap Gemini Group is uniquely positioned to help clients exploit the opportunities created by the emergence of the network economy. About Honkworm International
Honkworm is an industry leader in the creation of original on line programming. The company has produced several popular series such as "Fishbar," "Siliconites," and "Fatman," all of which have garnered an international cult following among web users as well as the endorsement of traditional media companies like MTV and Fox TV. Honkworm licenses shows and characters to web sites looking to attract new and repeat visitors, as well as to traditional media companies that are seeking unique and fresh content. With waning interest in banner ads, advertisers are looking to Honkworm's model of licensing flexible programming content - where message, commerce and entertainment can become one in order to grab a generation of web users who only click on what they really want to watch.
Honkworm has licensed content to clients including Budweiser, Snap.com, Yahoo, Macromedia, MTV Networks, Fox Television, Nike, Excite, Lucent, Gibson Greetings, Playboy, and RealNetworks. The company is located at 210 3rd Avenue South, Suite 3A, Seattle, Washington 98104. Telephone is (206) 748-7730 and email is: info@honkworm.com Honkworm is located on the Internet at: www.honkworm.com.
CONTACT: M Booth & Associates for Gemini Consulting | Kurt Rossler, 212/481-7000 x143; kurtr@mbooth.com | Mark Schroeder, 212/481-7000 x145; marks@mbooth.com | or | for Honkworm International | Kat Spellman / Pamela Grieff | 206/860-2838 / 206/860-0676; press@honkworm.com
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