Thursday, June 21, 2001

Major Growth in European Digital Content Distribution Market

In a report released today, Aberdeen Group, a leading IT market analysis and positioning services firm, and Van Dusseldorp & Partners (VDP), a European Internet consultancy, state that the two-year lag in total market size separating the European and North American Digital Content Distribution (DCD) markets will significantly decrease by 2005. Aberdeen and VDP project the European market will grow from $351 million in 2000 to $1.86 billion in 2005, a compound annual growth rate (CAGR) of 39.6%, while the North American market will grow from $1.01 billion in 2000 to $3.43 billion in 2005, a CAGR of 27.6%. Aberdeen and VDP project the worldwide DCD market will grow from $1.63 billion in 2000 to $7.31 billion in 2005.

"The dominance of North American suppliers in the DCD market will shift dramatically over the next four years," said Michael Hoch, senior analyst at Aberdeen Group. "New innovators will arise to address the technical and service requirements that are unique to specific nations or regions. Europe, in particular, faces significant challenges in terms of privacy, content localization, and content ownership within the content distribution framework. While not unique to Europe, these challenges will force suppliers operating in Europe to learn, innovate, and advance faster than companies operating in more isolated geographic regions. The question is whether suppliers realize what they're learning and then turn those lessons into a competitive edge in Europe and other parts of the world."

The report, Digital Content Distribution: New Media, New Challenges, provides an assessment of the state of streaming media, the technical limitations involved in delivering dynamic content, and the current and potential applications for content delivery technologies and services. The report also presents market size and growth forecasts for the global market in aggregate and for the North American, European, Pacific Rim, and "rest of world" individually; provides insight into the future direction of this marketplace; and profiles major and emerging North American and European suppliers.

"The European DCD market closely mirrors the North American market, but operates at a different stage of development," says Matthijs Leendertse, Senior Research Analyst at Van Dusseldorp & Partners. "There are certain unique features to the European marketplace, including the powerful influence of public European television broadcasters over content creation and distribution and the dominant position of the incumbent telecommunication carriers that have slowed the adoption of DCD technologies and services through 2000, but that will also push DCD forward quickly in the coming four years."