The music industry in Europe has had a traumatic time, losing more than 31% of its revenue in the past five years to piracy. Given the increasing digitalization of content in the music, video, gaming, and newspaper industries, our recently published Forrester Research Online Paid Content Forecast, 2012 To 2017 (EU-7) maps content’s evolution from an audience, payer, and revenue perspective for each of these categories and for each of seven European countries. Here are some high-level results for the four categories:
Music.With more than 35% of music revenues in Europe coming from digital, spending on physical music will soon be overtaken by its digital counterpart. Although digital music use in Europe still lags behind the US (where digital revenues exceeded physical revenues for the first time in 2012), Forrester found that more than 50% of online Europeans already listen to online music regularly.
Video.Video is the fastest-growing digital content category; we forecast that more than 90% of the online population will regularly watch online video by 2017. Online video audience penetrations will rise significantly as video on demand, pay per view, and catchup TV become mainstream. And with pay-TV penetrations in the EU-7 nations considerably lower than in the US, there’s more scope for paid online video to grow.
Digital news.The online audience for digital news is large and stable, with more than 70% of online Europeans regularly reading online news. However, our analysis shows that the abundance of free news websites makes it hard for newspapers to attract or upsell paid-for digital subscribers, despite the increasing number of tablet owners.
Gaming.Online gaming is even more interesting; it competes with the accessibility and choice that free-to-play games from apps offer, driven by the strong growth of smartphones and tablets in Europe. Based on recent data from the Forrester Research Mobile Application Spending Forecast, 2012 To 2017 (EU-7), we predict that the number of mobile gamers will overtake the number of online gamers by 2013. With the imminent launch of the Wii U, it is still too early to say if this analysis further reinforces the stereotypical notion that serious gamers will more likely be attracted to console games, while casual gamers take the remainder of the games market. But there is no doubt that casual gamers are a large and important part of the gaming landscape.