Mobile Web Traffic Doubles in 2010

Consumer expenditure on entertainment content is expected to have reached close to $320bn (£201bn) worldwide last year, with online and mobile media segments experiencing the largest percentage growth.

Research carried out by Futuresource Consulting indicates that consumer expenditure on online entertainment grew by around 23 per cent, while expenditure on mobile media grew by more than 15 per cent, far outstripping gains made by packaged media, theatrical, cable, satellite and IPTV, albeit from a lower base. Moving forward, the rise of digital content delivery through mobile and online will continue to drive revenues, with 2009-2014 CAGR (Compound Annual Growth Rate) forecast at 16 per cent and 24 per cent respectively.

In recent years, much of the success in mobile has been driven by the growth in smartphones, with the market generating around 280m unit sales in 2010 – an increase of 56 per cent – translating to a total installed base of almost 580m. Smartphone form factors are continuingly being optimised for multimedia use, particularly for viewing video, using apps and browsing the internet. As a result, in the last year, mobile internet traffic has doubled globally, with growth in tablets expected to contribute to further growth.

“The launch of Apples App Store in 2008 created a new mobile content revenue stream, reinvigorating the mobile content industry,” notes David Sidebottom, digital media consultant at  Futuresource Consulting. “A number of other mobile apps services have launched, creating opportunities, particularly for handset vendors, operators, OS suppliers, content holders, publishers, developers and advertising companies.

“Over 10bn apps were downloaded in 2010, and more than 50 per cent of those were via the Apple App Store – with a total retail value of over $4bn, even though 85 per cent of downloaded apps are free. Moving forward to 2014, nearly 35bn  apps, worth $17bn, will be downloaded by consumers.

Sidebottom adds that streaming media activity has been rising significantly in recent months, with consumers more likely to stream content than download it. YouTube, catch up TV and embedded flash/HTML video have been central to driving streaming activity and traffic. Improvements in broadband performance, advances in video compression technology and, more importantly, the availability of compelling services, have led to a significant continued rise in streaming media activity. This growth is not exclusive to video: streaming audio has become a mainstream activity through online radio and personalised streamed music services such as Spotify and, whilst streamed social gaming services are extremely popular.

Futuresource will be hosting its annual Futuresource Entertainment Summit in London on 16 and 17 June. Topics will include the rise of digital content delivery and the business opportunities presented by new home entertainment technologies, platforms and delivery systems. There’s more information about the event here.