To: BillyG who wrote (35998 ) 9/16/1998 5:42:00 PM From: John Rieman Respond to of 50808
Entertainment spending to double by 2007.........................dailynews.yahoo.com Wednesday September 16 4:49 PM EDT Entertainment Industry To Double By 2007 -- Kagan CARMEL, Calif. (Reuters) - The U.S. entertainment and communications industries should grow at nearly twice the rate of the economy over the next nine years as cutting-edge digital technologies feed the American appetite for new products, an industry trade group said. Consumers and advertisers will spend about $793 billion by 2007 in the two areas as compared to $365 billion last year, Carmel-based Paul Kagan Associates Inc., a widely respected industry tracking firm, said in a report. The average U.S. household will spend $4,211 annually on entertainment and communications by 2007, up 121 percent from $1,902 last year, Kagan said. ''Market demand has led to competition and convergence, the buzz words for the 21st Century. They are the matches that have set the media on fire,'' firm Chairman Paul Kagan said. Convergence refers to the merging of digital media like computers and the Internet with analog modes of entertainment delivery like television and telephones. TV and telephony are rapidly turning to digital signals and as a result, TVs, computers, cell phones and other devices are delivering similar information or providing the same information that can be used with several different products. Kagan reports that media and entertainment revenues in the United States grew at a rate of 9.1 percent annually between 1992 and 1997, or more than twice the rate of inflation. Using that growth level as a backdrop, Kagan expects consumer spending on entertainment to exceed $460 billion from 1997's $191.6 billion, a 10-year compound annual growth of 9.2 percent. Media advertising spending will nearly double to $333 billion from 1997's $173 billion for compounded yearly growth of 6.8 percent. The Internet will see the greatest growth with a 26.3 percent compounded annual growth rate. Kagan expects spending on Internet access, retailing, Web telephony and advertising to jump to $63 billion from about $6 billion last year. Spending on wireless telecommunications should grow at 12.8 percent annually, and cable and satellite TV is expected to turn in the third greatest growth rate at 10.4 percent a year.